Executive Summary: Key Legal and Evidentiary Issues

• Scope of an arbitrator’s jurisdiction to apply or be constrained by the “Immunity Provision” in s. 9-10.1 of The Saskatchewan Employment Act when reviewing discipline and termination decisions tied to a COVID-19 vaccination-or-testing policy.
• Proper timing of judicial review of a preliminary arbitration award, including whether a court should intervene before the arbitration on the merits has concluded (doctrine of prematurity and “exceptional circumstances”).
• Interaction between labour arbitration powers to substitute “just and reasonable” penalties under the collective agreement and SEA s. 6-49(4), and statutory immunity designed to shield employers from proceedings where they acted in good faith and were not grossly negligent.
• Evidentiary significance of the parties’ agreement to bifurcate the arbitration (preliminary jurisdictional objection first, merits later) and the limited record focused on Nutrien’s good faith compliance efforts with the Emergency Regulations.
• Risk that the arbitrator’s interpretation of s. 9-10.1, if wrong and left uncorrected until after a merits award, would render the merits hearing unnecessary or require it to be redone, thereby wasting resources and undermining efficiency.
• Treatment of prior authorities on interlocutory judicial review of arbitral decisions (including Sabo, USask Faculty, SaskPower, Halifax, Laval and Mzite) and how they frame “exceptional” cases where early court intervention is justified.

Factual background and workplace policy

Nutrien Ltd. operates a potash mine near Rocanville, Saskatchewan, where the United Steelworkers, Local 7916 is the certified bargaining agent for production employees. The employer is subject to statutory and contractual duties to take reasonably practicable steps to ensure the health and safety of workers, including under The Saskatchewan Employment Act (SEA), The Mines Regulations, 2018, and its collective agreement with the Union. In March 2020, COVID-19 was declared a global pandemic, followed by a provincial state of emergency in Saskatchewan. Nutrien continued operating as an allowable service and adopted multiple measures to reduce the risk of an outbreak in its mine. In September 2021, Nutrien notified employees that, effective October 18, 2021, they would be required either to provide proof of vaccination or to undergo regular testing for COVID-19. On October 1, 2021, The Employers’ COVID-19 Emergency Regulations came into force, authorizing private sector employers to require workers to choose between vaccination and rapid antigen testing as a disease control measure. Shortly after, Nutrien issued an October 13, 2021 memorandum specifying enforcement consequences: first non-compliance would attract a three-day unpaid suspension (absent extenuating circumstances), and continued non-compliance on return would result in termination of employment. The vaccination-or-test policy took effect on October 18, 2021. Three unionized employees refused to disclose their vaccination status or provide negative test results that day. Consistent with the policy, Nutrien imposed three-day unpaid suspensions and directed that, on their return, they would be expected to supply proof of vaccination or a negative rapid test. A dispute resolution meeting followed on October 20, 2021, at which the Union objected to the disciplinary approach and suggested alternatives, such as placing the employees on unpaid leave, but the matter was not resolved. When the employees returned after their suspensions still without proof of vaccination or a negative test, Nutrien terminated their employment. On October 27, 2021, the Union filed separate grievances for each worker, challenging both the suspensions and the dismissals.

Statutory immunity provision and labour remedial powers

At all relevant times, Nutrien and the Union were bound by a collective agreement (June 1, 2018 to May 31, 2023) containing a remedial clause authorizing an arbitrator to reinstate a discharged or disciplined employee and to substitute any other penalty that is fair and reasonable in the circumstances. This mirrored SEA s. 6-49(4), which similarly permits an arbitrator or board to substitute “any other penalty for the termination or discipline of an employee that the arbitrator or arbitration board considers just and reasonable in the circumstances” where no specific contractual penalty exists for the infraction. On January 21, 2022, after the grievances were filed but with retroactive effect, the Legislature enacted SEA s. 9-10.1, sometimes referred to by the parties as the “Immunity Provision.” It provides that, subject to regulations, “no action or proceeding lies or shall be commenced or maintained” against an employer in respect of any act or omission if the employer acted or made a “good faith effort” to act in accordance with the Public Employers’ or Employers’ COVID-19 Emergency Regulations and its conduct does not amount to gross negligence. The section is expressly retroactive to causes of action arising before, on, or after its coming into force, and it deems already-commenced actions or proceedings caught by it to have been dismissed, without costs. It further states that no compensation or other remedy is available for the extinguishment or termination of rights under this immunity and extends the protection, with necessary modification, to those vicariously liable for the acts or omissions of another person.

The bifurcated arbitration and preliminary objection

When the grievances proceeded to arbitration, Nutrien raised a preliminary jurisdictional objection based on s. 9-10.1. It argued that, provided the evidence showed it acted or made a good faith effort to act in accordance with the Emergency Regulations and was not grossly negligent, the Immunity Provision barred the grievances, such that no arbitration “proceeding” could be “maintained” and the arbitrator lacked jurisdiction to substitute penalties for the suspensions and terminations. By agreement, the parties bifurcated the arbitration: the arbitrator would first decide Nutrien’s jurisdictional objection; only if the objection failed would there be a subsequent hearing on the “merits,” meaning whether, in all circumstances, different discipline or reinstatement should be ordered under the collective agreement and SEA. For the preliminary objection, Nutrien led affidavit evidence (with Union cross-examination rights), while the Union called no evidence. Nutrien maintained that its evidence, uncontradicted on the record, established good faith efforts to comply with the Emergency Regulations and the absence of gross negligence, thus satisfying s. 9-10.1’s factual preconditions. It also contended that allowing the grievances to proceed to a full merits hearing despite the Immunity Provision would defeat the Legislature’s objective of giving employers peace of mind and legal protection when they implemented vaccination-or-testing policies during the pandemic. The Union countered that s. 9-10.1 did not displace an arbitrator’s long-standing remedial authority to substitute lesser penalties for unjust discipline, and that the provision should not be construed to extinguish fundamental collective agreement rights, including the right to grieve and arbitrate allegations of unjust discipline. In the alternative, the Union suggested that, because the factual and legal questions were intertwined, the arbitrator should defer determination of the immunity issue to his decision on the merits.

The arbitrator’s preliminary objection award

In his Preliminary Objection Award, the arbitrator accepted that the Emergency Regulations were designed to prevent non-compliant employees from being physically present in the workplace. However, he interpreted s. 9-10.1 as a liability-shielding measure that did not explicitly or impliedly address or bar grievances contesting discipline imposed under an employer’s vaccination-or-testing policy. Adopting the reasoning of another Saskatchewan arbitrator in Saskatchewan Power Corporation v International Brotherhood of Electrical Workers, Local 2067, he concluded that the Immunity Provision’s language was not sufficiently specific and clear to extinguish or override fundamental collective agreement rights, particularly the right to pursue a grievance to arbitration alleging unjust discipline. On that interpretation, questions of whether Nutrien acted or made a good faith effort to act in accordance with the Emergency Regulations, or whether it had been grossly negligent, were not determinative of his jurisdiction. He therefore held that s. 9-10.1 did not preclude him from hearing the grievances on the merits and did not deprive him of his power to substitute penalties he considered just and reasonable; the grievances would proceed to a full merits hearing.

The chambers judge’s decision on prematurity

Nutrien applied to the Court of King’s Bench for judicial review of the Preliminary Objection Award, seeking to have it quashed and to obtain a declaration that the grievances were statute-barred by s. 9-10.1. The Union, while having fully argued the merits of the judicial review, urged the court to dismiss the application as premature, on the basis that arbitrations should ordinarily run their full course before courts intervene. The chambers judge agreed with the Union and disposed of the matter solely on prematurity grounds. He offered four main reasons for declining to hear the judicial review at that stage. First, he saw little efficiency or utility in deciding the judicial review before the merits arbitration, noting that the arbitrator had yet to decide the underlying suspensions and terminations and that the preliminary issue could become moot if the grievances were ultimately dismissed on the merits. Second, he emphasized the general principle that judicial review of interim or interlocutory arbitral decisions should usually await a final award, to avoid multiple judicial review proceedings arising out of the same grievance. Third, he found helpful and applicable earlier Saskatchewan authority (USask Faculty), which had declined to review an arbitrator’s assertion of jurisdiction mid-stream. Fourth, he distinguished the Sabo decision, where a preliminary jurisdictional determination was reviewed, on the basis that Sabo involved a final, binary choice between competing statutes. On that analysis, the judge dismissed Nutrien’s judicial review application “without prejudice,” directing that it could renew the application after the arbitrator had decided the merits of the grievances, and he awarded the Union fixed taxable costs of $3,000 for the chambers proceeding.

The Court of Appeal’s analysis of prematurity and exceptional circumstances

Nutrien appealed, arguing that the chambers judge misunderstood and misapplied the law of prematurity, particularly in light of the Supreme Court’s guidance in Halifax and Laval, and later appellate guidance in SaskPower and Mzite. On appeal, Nutrien accepted that the judge had discretion to refuse to hear an application directed at a non-final arbitral decision, but maintained that the discretion had been exercised on demonstrably incorrect premises. The Court of Appeal began by situating the dispute within the broader principles of administrative law. The prematurity doctrine is one of several discretionary grounds for refusing judicial review; it aims to prevent parties from delaying administrative processes by seeking court intervention on issues that may ultimately prove moot once the tribunal renders a final decision. Courts are to exercise restraint and generally avoid reviewing preliminary or interlocutory decisions, particularly on evidentiary or procedural matters, absent “exceptional circumstances.” At the same time, appellate jurisprudence recognizes that early judicial review can sometimes be appropriate—such as where there is an obvious lack of jurisdiction, where a clearly baseless proceeding would entail a long and wasteful hearing, or where failing to intervene risks harm that cannot be corrected later (for example, disclosure of confidential or privileged material that, once revealed, cannot be “unrevealed”). The Saskatchewan Court of Appeal in SaskPower had distilled a non-exhaustive list of factors to guide this discretion, including hardship or prejudice, waste of resources, delay, fragmentation of proceedings, the strength of the case, and statutory context, all to be assessed flexibly and contextually.

Errors identified in the chambers decision

Against that framework, the Court of Appeal held that the chambers judge made two palpable and overriding errors in assessing prematurity. First, it concluded that the judge either implicitly assumed that the arbitrator had left open the possibility of revisiting the interpretation of s. 9-10.1 at the merits stage, or else wrongly treated the finality of the Preliminary Objection Award on that issue as legally irrelevant. The arbitrator’s award made clear that he had fully and finally interpreted the Immunity Provision and determined that it did not bar the grievances; he did not merely assert jurisdiction provisionally or reserve judgment on how s. 9-10.1 might apply once a fuller evidentiary record was developed. The Court of Appeal contrasted this case with USask Faculty, where the arbitrator had simply concluded he had authority to hear the grievance while explicitly preserving discretion on the ultimate merits and liability questions. Here, by comparison, the arbitrator definitively held that s. 9-10.1 did not extinguish his remedial jurisdiction, regardless of any showing of good faith or lack of gross negligence by the employer. Second, the Court of Appeal found that the judge failed to grapple with a critical consequence of the arbitrator’s interpretation: on that view of s. 9-10.1, the factual preconditions in the statute (good faith effort to comply with the Regulations and absence of gross negligence) would play no role in the merits hearing. Because the arbitrator regarded those elements as irrelevant to his jurisdiction, he had no reason to make final findings of fact on those issues later. If Nutrien’s contrary interpretation of s. 9-10.1 were ultimately accepted on judicial review, the arbitration could proceed through a full merits hearing without ever resolving the questions on which the statutory immunity turns, resulting in an award that might need to be set aside and redone. The chambers judge, in focusing on the possibility of multiple judicial reviews and the efficiencies of waiting for a final arbitral award, looked only at the risk of fragmented court proceedings and not at the equally serious risk of wasted arbitral effort and duplication if the preliminary award’s interpretation of the Immunity Provision proved incorrect.

Exceptional circumstances justifying immediate judicial review

The Court of Appeal then explained why, corrected for those errors, this was one of the exceptional cases in which judicial review of a preliminary arbitral decision should proceed before the merits hearing. It noted that the arbitrator unquestionably had jurisdiction to interpret s. 9-10.1 in the first instance; this was not a case of a tribunal purporting to exercise powers obviously beyond its statutory remit. However, the arbitrator had conclusively determined that the Immunity Provision did not limit his authority to hear and remedy the grievances, and he had done so in a discrete, bifurcated preliminary phase that the parties had deliberately separated from the merits for reasons of efficiency. Drawing on the reasoning in Mzite, the Court observed that the decision under review was substantive (a binding interpretation of a law of general application) rather than a mere procedural management ruling; that its resolution was of significant value to the parties and potentially to other employers, unions and workers facing similar COVID-19 related disputes; that deciding the statutory interpretation now could avoid the cost and delay of a full merits hearing that might ultimately prove unnecessary or require duplication; that no better evidentiary record on the s. 9-10.1 issue was expected at a later stage; and that the arbitrator had finally answered the question of whether the grievances could proceed. The Court also attached appropriate weight to the parties’ original agreement to bifurcate the arbitration. They had jointly sought a preliminary, stand-alone determination on the applicability of s. 9-10.1 to avoid the burden of a full merits hearing if the grievances were in fact barred. That rationale did not evaporate simply because the arbitrator’s decision on the preliminary objection favoured the Union. Taken together, the risk that the arbitration could proceed on an incorrect legal footing without ever resolving the key statutory preconditions, the final character of the arbitral interpretation of s. 9-10.1, the bifurcated structure, and the broader importance of the Immunity Provision’s meaning persuaded the Court of Appeal that this was an exceptional case where deferring judicial review would not provide an adequate or efficient remedy.

Outcome of the appeal and overall result

In the result, the Court of Appeal held that the chambers judge’s palpable errors were overriding and required intervention. It allowed Nutrien’s appeal from the chambers decision and set aside the finding that the judicial review application was premature. In accordance with the parties’ agreement on remedy should the appeal succeed, the Court remitted the matter to the same judge of the Court of King’s Bench to complete the judicial review of the Preliminary Objection Award on its merits. Because the judge had already received full submissions on the substance of the judicial review, it left it to him to decide whether any further hearing was necessary. The Court of Appeal granted Nutrien its taxable costs of the appeal, while expressly reserving the issue of costs in the Court of King’s Bench to be decided in the course of determining the judicial review. Across the arbitral, chambers, and appellate stages covered by the decisions, there is no final damages award or quantified monetary remedy on the underlying employee grievances, and the only specified figure is the $3,000 in fixed chambers-level costs originally awarded to the Union, which may be revisited when the judicial review is finally decided; accordingly, while Nutrien is the successful party on appeal, the total monetary amount ultimately ordered in its favour cannot be determined on the basis of the available decisions.