Digest of Benefit Entitlement Principles Chapter 8 - Section 4

8.4.0 Stoppage of work

The stoppage of work concept is of major importance. There must be a stoppage of work for the labour dispute provisions to apply (Digest 8.1.3).

It is important to be aware that, virtually from day to day, the application of the labour dispute provisions will depend on the development of the stoppage of work, and whether it occurred on one or several specific days. This is very much a "day" concept, particularly when there are irregular stoppages of work, for example, during sporadic strikes and rotating walkouts.

The issue is whether a business or a given place of employment are continuing normal day to day operations, despite the presence of a labour dispute. This may be difficult to determine when, for example, there is a work-to-rule, a partial slowdown, or when essential services are being well maintained.

Everything depends on what is meant by stoppage of work. It may be that a stoppage of work takes place once the work that the employer offers and wishes to have performed is not carried out or completed because some of the employees have stopped working. But it is much less obvious that there is a stoppage of work when only one or several employees within a large group of workers withdraw their services.

8.4.1 Stoppage of work defined

Since the act does not define "stoppage of work" (EI Regulation 53), the term should be given its ordinary meaning. It should not be confused with labour dispute, of which it is only one outcome (Digest 8.2.1 and Digest 8.2.2).

A stoppage of work within the context of a labour dispute cannot be defined in terms of the work of individual employees, but rather by referring in general to what constitutes the normal operations of a business (Digest 8.4.2). The latter include not only production departments, but also office work, maintenance services, and others.

A stoppage of work refers to a breakdown in the normal operations of a firm or to a change in the usual delivery of services, as a result of a reduction in operations and in the number of employees. The fact that activities continue elsewhere will be of no consequence as it is the activities at the premises where the claimant worked that are relevant (CUB 15424).

A stoppage of work does not refer only to a strike or lock-out (CUB 80535). It may also be used to refer to production slowdowns, concerted refusals of work, mass absenteeism, walkouts, suspensions, dismissals and shutdowns.
Even lay-offs resulting from the dispute may be deemed to cause a stoppage of work or help make a partial stoppage of work more widespread. Other examples include suspension of the night shift or a refusal to work normal overtime.

Not resuming work after a general lay-off or at the beginning of the active season could also be a sign of a stoppage of work, if it is established that activities would normally have resumed at a given time. The delay in resuming the normal activities at a specific moment may be seen as a stoppage of the normal activity (EI Act 36; Digest 8.4.3 and Digest 8.5.2).

To conclude, the existence of a stoppage of work depends on the impact of the labour dispute upon the normal operations of the business (Digest 8.11.1). If the dispute has a marked effect on these operations, then there is a stoppage of work. There is no requirement that this stoppage of work be generalized throughout the firm (CUB 21211). The stoppage may even be confined to a certain number of employees, or to a single operation, so long as it has some significant impact in terms of a slowdown or change of normal operations carried out by this more limited group of employees (Digest 8.4.2).

Clearly, a walkout that has only a negligible impact on the operation of a group does not meet this definition of stoppage of work. However, it would be very difficult for claimants who willingly participate in this partial strike to prove they are unable to find suitable work. Such situations may arise, for example, during the period preceding a generalized stoppage of work.

8.4.2 Scope of work stoppage

The existence of a labour dispute does not necessarily imply a sudden halt to all operations of a business, without prior signs. There may be several measures and events related to negotiations and the willingness of the parties to reach a concrete agreement.

Nowhere in the act is there any standard that measures a stoppage of work or its scope to determine if it fits the definition. The approach generally adopted has been that there be an appreciable reduction in the normal operations of a business before reaching any conclusion that a stoppage of work exists within the terms of the labour dispute provisions.

Reference has often been made to the business as a whole in order to measure this reduction in operations; however, at other times this has been confined only to employees on strike, to a single department or service within a firm, or to employees of a single bargaining unit (FCA A-340-79, CUB 12992A). A dispute between the employer and a specific group of workers can disrupt the activities of this group and yet not significantly affect the operations of the business as a whole. This does not mean that there is no stoppage of work. Rather, a total stoppage of work or a marked reduction in work in any major department of a firm constitutes a stoppage of work, no matter whether this involves production or support services, such as administration or maintenance. This may be the case even if a single activity within a department is interrupted, or if other operations of the business continue more or less normally, despite the stoppage of work.

Depending on whether or not the dispute and stoppage of work have repercussions on the entire firm or only on specific operations, the reduction in operations attributable to the dispute can be measured against the entire firm, or only those operations affected by the labour dispute.

Among the many indicators that can individually reflect a business's level of operations, there are two main ones that have been established and used historically to determine whether a stoppage of work has occurred. First is the production of goods and services in terms of both quality and quantity. Even if, from a quantitative standpoint, a near-normal production level is maintained, there is still a stoppage of work if there is an appreciable decline in quality (CUB 69099C).

The number of employees still at work is the second determining factor. Although it is not the sole and absolute test, it generally corresponds to the level of production. The level of income of the business, however, is not an element to be considered.

There is clearly a significant reduction in the normal activity where the production of goods or services has completely ceased or where there are no longer any employees at work. However, how does one judge the situation where the presence of a dispute influences the drop in production or in the number of employees at work, but there is not yet a total interruption. What must be determined is when exactly the reduction in the normal activities that corresponds to a stoppage of work, occurred.

Similarly, it must later be determined whether there is a termination in the stoppage of work. What must be considered in either case, is the level of employees at work and the level of the production of goods and services of a business or a group of workers, and not what their normal level would be, had there not been a labour dispute and a stoppage of work.

The regulations that define what constitutes the termination of the stoppage of work should be used to resolve the question of when the stoppage of work occurs and continues. The stoppage of work ends, according to the regulation, when the number of employees at work and the activities in respect of the production of goods and services represent at least 85% of their normal level (Digest 8.11.1). If this minimum of 85% is not attained in one or the other case, the stoppage of work continues to exist.

When determining the start of the stoppage of work, the reverse of the 85% rule (i.e., a reduction of more than 15% of the work force or activities), is one factor that can be used. This factor, however, should not be systematically applied. There must be flexibility in its application, as, in any given situation, there are indicators which reveal an appreciable stoppage of work, such as a significant reduction in the production of goods or services or in the number of employees at work, as compared to the normal situation.

There may be occasions, however, whether, due to exceptional or temporary measures that, in spite of the dispute, the employer maintains or resumes a normal level in terms of the number of employees at work or in the activities related to the production of goods or services. What must then be determined is what the actual situation would have been without these exceptional or temporary measures. It may be concluded that a stoppage of work occurred in the case where, in the absence of such, there would have been a significant reduction in the number of employees or in the activities related to the production of goods or services, when compared to the normal situation.

8.4.3 Cause-and-effect relationship between labour dispute and stoppage of work

The word "attributable" inserted between "stoppage of work" and "labour dispute" (EI Act 36(1)) in the act was added to establish a cause-and-effect relationship between a labour dispute and a stoppage of work. The labour dispute provisions specifically contemplate a stoppage of work as a direct result of a labour dispute.

In addition to the fact that a stoppage of work cannot exist without its cause (FCA A-354-79, CUB 5193B; FCA A-512-88, CUB 12992A), this relationship must also exist at the claimant's actual place of employment. A stoppage of work due to a dispute at another place of employment does not meet this condition unless that dispute has also resulted in a dispute at the claimant's own place of employment (CUB 20493 and CUB 16592).

When there is a generalized dispute at several places of employment, for example, in the construction industry or in public transit, the stoppage of work must be distinctly established for each place of employment. The stoppages may occur at different dates depending on the actual situation at each of these places. The fact that it is one and the same dispute does not change that.

When a stoppage of work arises during a labour dispute, the cause-and-effect relationship is a logical deduction unless some other explanation for the situation can be proven. In the case of an employer who indicates they will temporarily close the business if such a cause-and-effect relation is established, this clearly supports that the stoppage of work was a direct result of a labour dispute.

This relationship is all the more obvious when the stoppage of work takes the form of a strike or lockout; by its very nature, this type of event is directly linked to the existence of a labour dispute. The fact that a lockout was declared the day before the employer shut down operations, only to reopen two days later with a reduced labour force, does not change this relationship. Other forms of stoppages of work are also attributable to a labour dispute where the stoppage results from earlier negotiations; however, the lack of negotiations is not a crucial factor.

The link between the stoppage of work and the dispute need not be direct, so long as the stoppage of work can be said to be an event related to the dispute or that, had there been no dispute, the stoppage of work would not have occurred. The latter is true even when the stoppage of work is provoked by others, and not by the employees or the employer.

Without formally denying the existence of a labour dispute, some have linked work stoppages to causes unrelated to the dispute: the economic situation, the impending move of the business, overproduction, seasonal market fluctuations, weather and even natural disasters. As is always the case, the relevant facts must be examined in reaching a decision; there is no issue with claims where it is established that, had there been no dispute, the firm would still have shut down (Digest 8.11.3 and Digest 8.11.4). But it is important to keep in mind that in many disputes not everyone plays by the rules. With action and reaction, demand and resistance, threat and counter-threat, it is always appropriate to ask where reality actually begins, and on what objective and undisputed facts conclusions can be based (CUB 21211). The mere fact that an employer takes advantage of a stoppage of work to prepare to move operations or to make renovations is not conclusive.

Some may claim that the stoppage of work was caused by lay-offs resulting from a shortage of work. It is important to go beyond the events themselves, and clarify whether the shortage of work resulted from the labour dispute, or if lay-offs would have taken place regardless. When rumours of a strike result in fewer orders and thus provoke numerous lay-offs, the resulting stoppage of work is deemed to be attributable to the dispute.
Generalized absenteeism under the pretext of illness is sometimes used as a strategy during a labour dispute. Similarly, the claim that a stoppage of work was provoked by acts of vandalism is of no help where the sabotage is attributable to the dispute.

When there are two causes for the stoppage of work, the issue then is whether the dispute is the principal cause. Generally a subsequent event will not change the cause-and-effect relationship between the dispute and the original cause of the stoppage of work, unless the dispute becomes of secondary importance. This subsequent event then becomes the principal cause of the stoppage of work; examples include fires or natural disasters. Even if it is established that the original cause of the stoppage of work had nothing to do with the dispute, the fact that, because of a dispute, there is a delay in the return to work following a period of lay-off or at the beginning of the season, constitutes a stoppage of work attributable to the dispute (Digest 8.4.1 and Digest 8.5.2; CUB 80780).

[April 2019]