Unionized Workers Not Entitled to Reasonable Notice Under the Civil Code of Québec

On January 27, 2006, the Supreme Court of Canada rendered two much-anticipated decisions confirming that unionized employees who are permanently dismissed for economic reasons are not entitled to receive reasonable notice prior to termination, or payment in lieu thereof, pursuant to the Civil Code of Québec ("Civil Code").

Following a decision to close their businesses for financial reasons, in 1999 and 1998 respectively, two Québec-based companies dismissed their unionized employees. In the first case, Isidore Garon Ltée. v. Syndicat du bois ouvré de la région de Québec Inc. (C.S.D.), the collective agreement provided that in the event of a layoff for six consecutive months or more, the employer’s obligation was to provide the employees with the notice of termination requirements contained in the Québec’s Act Respecting Labour Standards ("LSA"). The LSA requires employers to give employees notice of termination, or pay in lieu thereof, which varies between one to eight