Executive Summary: Key Legal and Evidentiary Issues

• Section 236 of the Federal Public Sector Labour Relations Act (FPSLRA) bars civil actions for grievable workplace disputes, ousting the Federal Court's jurisdiction over most claims

• Residual jurisdiction exists only in exceptional cases where the grievance process is demonstrably "corrupt" or "incapable of providing effective redress"

• Plaintiffs failed to establish that IOGC's internal grievance mechanisms were ineffective, as evidence showed affiants either did not use the process or their experiences did not demonstrate systemic failure

• Report evidence, including the TLS Report and expert opinion, was admissible only for contextualizing facts, not for proving the truth of its contents regarding grievance inefficacy

• Fear of retaliation or unfamiliarity with available recourse does not constitute an exceptional circumstance warranting the Court's residual jurisdiction

• Claims predating the FPSLRA (April 1, 2005) still require deference to the grievance regime under the predecessor Public Service Staff Relations Act (PSSRA)

Background and nature of the claim

Yvette Zentner and Letitia Wells, both Aboriginal women who worked at Indian Oil and Gas Canada (IOGC), brought a proposed class action in systemic negligence against the Attorney General of Canada. The proposed class encompassed all current and former Aboriginal employees and contractors at IOGC from November 1, 1987, to the present, excluding persons employed as executives, managers, and deputy heads. The precise size of the class was unknown, but the Plaintiffs surmised from the AGC's evidence that there were 85 potential class members. The Plaintiffs alleged that IOGC's Executive Division owed a duty of care to have reasonable policies and procedures in place and to take reasonable steps to prevent bullying, discrimination, harassment, and intimidation, and to ensure that class members had equal opportunities to advance as non-Aboriginal employees.

The representative plaintiffs' experiences

Ms. Zentner was employed by IOGC from 1997 until 2024. She worked as a Land Administration Clerk between 1998 and 2000; as a Land Administrator from 2000 to 2003; as a Contracts Administrator from 2003 to 2005; as a Contracts Analyst from 2005 to 2023; and as Supervisor of Sub-Surface Contracts from 2023 to 2024. Over the course of her employment, she filed three harassment complaints, all after 2015, and one of them resulted in a favourable decision for Ms. Zentner and the issuance of a letter of reprimand against the harassing employee. She also made two staffing complaints: one to the Public Service Commission, and the other to the Federal Public Sector Labour Relations and Employment Board. Ms. Wells was employed by IOGC in casual appointments as a Junior Land Administrator in 2015, 2016, 2017, and 2018. On July 9, 2018, Ms. Wells became a part-time term employee in the position of Land Administrator, with her employment extended until March 30, 2020. She alleged sexual harassment by IOGC's former Executive Director, as well as a senior manager and a divisional director, and further alleged harassment and physical assault by a supervisor. Ms. Wells did not file grievances with IOGC respecting these complaints.

The statutory framework governing federal public service grievances

The Attorney General argued that section 236 of the FPSLRA clearly and unambiguously provides that the grievance rights afforded to federal public service employees under the Act are "in lieu of any right of action" relating to grievable matters. The statutory bar applies regardless of whether an employee utilized the grievance process or not. For claims arising before April 1, 2005, disputes were governed by the predecessor legislation, the Public Service Staff Relations Act, and since April 1, 2005, these matters have been governed by the FPSLRA.

The jurisdictional challenge

The Court determined that the essential character of the allegations in this case related to IOGC's inability to provide a safe and harassment-free workplace, which constitutes grievable matters under subsection 91(1)(b) of the PSSRA and subsection 208(1) of the FPSLRA. The statutory bar applies to all "employees" as defined in the legislation. There was no question that Ms. Zentner was an "employee" within the meaning of the applicable legislation. Ms. Wells was casually employed between 2015 and 2018 and was therefore excluded from the meaning of "employee" by virtue of the definition. From July 2018 onward, however, she fell squarely within the definition of "employee" under the FPSLRA.

The question of residual jurisdiction

Canadian courts have recognized that residual jurisdiction may be exercised over exceptional cases where the grievance process is "corrupt" or "incapable of providing effective redress." The Plaintiffs bore the burden of presenting compelling evidence demonstrating systemic deficiencies in the internal recourse mechanisms. They relied on the TLS Report—an organizational review of IOGC conducted by TLS Enterprises and published on December 10, 2021—which documented that IOGC employees believed there was a lack of clarity on which process applied in which situation, and that interviewees believed IOGC management did not take allegations of racist and discriminatory comments seriously. However, the Court found this evidence insufficient: the report was comprised of an aggregation of individual employee perspectives rather than factual evidence; it predated the 2022 update to IOGC's grievance procedure; and its conclusion that there was "no recourse" after a final level grievance decision was simply incorrect, as judicial review of such decisions remained available.

Evidence regarding use of the grievance process

The Court noted that an employee who chooses not to follow the grievance procedure cannot challenge the adequacy of the process they have not used. Ms. Wells, Ms. Handel, and Ms. Daniels did not pursue grievances under the process available, making it impossible to assess the process's effectiveness based on their experiences. Cross-examination revealed that both representative plaintiffs were aware of available recourse mechanisms. Ms. Zentner acknowledged filing complaints through various channels, and when asked whether she was familiar with IOGC's harassment and staffing complaints process, she stated she was "familiar to what I had to research for myself." Ms. Wells admitted she was informed about the complaint process at the Centre for Integrity but chose not to file complaints because she "felt it was a dead end." The Court emphasized that fear of reprisal or retaliation is not a sufficient basis for the Court to exercise residual jurisdiction.

The two-step grievance process and CEO involvement

The Plaintiffs argued that IOGC's two-step grievance procedure in place between 2018 and 2022, which made the CEO's evaluation the final and unavoidable step in the process, rendered it ineffective—particularly given Ms. Wells' allegations of sexual harassment by the CEO from September 2018 to 2019. The Court rejected this argument, finding that section 64 of the Public Service Labour Relations Regulations provides that an individual grievance process must consist of "a maximum of three levels," and the two-step process complied with this provision. Moreover, the 2018 IOGC Grievance Procedure required the waiver of any level in the procedure where the adjudicator at that level was the subject of a discrimination or sexual harassment complaint, and in such circumstances, the Deputy Minister of Indigenous Services Canada was authorized to perform the relevant functions.

Admissibility and weight of report evidence

The Court admitted both the TLS Report and Dr. Bombay's expert report for the limited purpose of contextualizing the facts pleaded and providing "some basis in fact" for the certification criteria. However, these reports could not be relied upon for the truth of their contents because information in reports is usually not collected in a manner suitable for civil litigation—it is not given under oath or affirmation, and there is no opportunity for cross-examination. The Court specifically rejected the Plaintiffs' arguments that there were no hearsay issues with the TLS Report, and that the TLS Report itself or the implementation of its recommendations constituted an admission of systemic negligence by IOGC.

Ruling and outcome

Justice McVeigh granted the Defendant's motion to strike the Fourth Amended Statement of Claim without leave to amend and dismissed the Plaintiffs' motion for certification. The Court concluded it was plain and obvious that the Federal Court lacked jurisdiction over the claim. The statutory bar at section 236 of the FPSLRA applied to claims arising after April 1, 2005, and the Plaintiffs failed to demonstrate that the circumstances warranted exercise of residual jurisdiction over pre-2005 claims under the PSSRA. The Court stated this was "not a decision that I reach easily" and acknowledged the "heartbreaking stories of the women involved in this action, the hardships that they describe, and the obstacles that they must overcome in their effort to seek justice," while applauding "the strength of the women for choosing to come forward and not stay silent." The Court emphasized that the outcome "should not be understood to reflect the credibility of these women or the significance of their concerns, but only the constraints of the legal framework in which this Court must operate." No costs were awarded, as prescribed by Rule 334.39(1). No specific monetary amount was determined, as the claim was struck before proceeding to the merits.