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New ‘Supply and Confidence Agreement’ in Canada

Written by
Mathews Dinsdale, Canada’s only national labour and employment law firm.
The governing Liberal Party in Canada has concluded a ‘Supply and Confidence Agreement’ with the New Democratic Party in exchange for commitments on some policy issues. What are the implications of these commitments for federal employers?


On 22 March 2022, Canadian Prime Minister Justin Trudeau announced an agreement between the Liberal Party and the New Democratic Party (NDP), titled ‘Delivering for Canadians Now, A Supply and Confidence Agreement ‘(the ‘Agreement’). As part of the Agreement, the NDP has committed to supporting the Liberal Government on confidence and budgetary matters in exchange for the Liberals advancing key policy issues that are of a ‘shared interest’ between the parties. If maintained, the Agreement would keep the Liberal Party in power until at least June 2025.

The Agreement includes two notable reforms to the Canada Labour Code that, if implemented, will impact federal employers.

Paid sick leave

First, the Liberals have agreed to prioritise the implementation of a ten-day paid sick leave regime for federally regulated workers, which is to be implemented ‘as soon as possible in 2022’. Implementing ten days of paid sick leave was a promise made by both the Liberals and NDP in the 2021 federal election.

Ban on replacement workers

Second, the Liberals have agreed to introduce ‘legislation by the end of 2023 to prohibit the use of replacement workers…when a union employer in a federally regulated industry has locked out employees or is in a strike.’

Amending the Canada Labour Code to ban replacement workers has been a longstanding objective of the NDP. The Liberals previously opposed such a ban, but their 2021 election platform included a ban on replacement workers in the event of an employer lockout.  The Agreement suggests that the Liberals will go further than their 2021 platform by applying a ban on replacement workers in the case of both lockouts and strikes. Notably, the last comprehensive review of Part 1 of the Canada Labour Code, the 1996 Report of Arbitrator Andrew Sims entitled Seeking a Balance, recommended against such legislation.

The Liberals’ commitment to banning replacement workers in the federal sector is very general and leaves much to be determined. In particular, it is unclear how the term ‘replacement worker’ will be defined and what work will be prohibited. Will the ban only apply to prohibit employers from hiring off the street during a strike/lockout, or will it also prohibit managers and other current non-union employees from performing bargaining unit work during a strike/lockout? Will the ban go so far as to prohibit members of the bargaining unit who choose to cross the picket line from returning to work during the strike or lockout? The NDP can be expected to demand the broadest possible ban on replacement workers.


Finally, it should be noted that the Agreement has kept the door open to the identification of any other shared priorities between the Liberals and NDP, so additional reforms may be forthcoming that will impact federal employers.

The author gratefully acknowledges the assistance of Christian Rocca, an Articling Student in the firm’s Toronto office.

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John D. R. Craig
Partner - Canada
Mathews Dinsdale