Federal Post
Bill C-39: Ottawa Moves to Reshape Federal Collective Bargaining and Labour Dispute Resolution
Date: September 22, 2026
On September 18, 2026, the Federal government introduced Bill C-39, the Building Canada Strong Act, which proposes, in part, three significant changes to federal labour and employment laws under the Canada Labour Code. If enacted, these changes are intended, to: (1) modernize collective bargaining processes and increase supports to conclude negotiations at the bargaining table, (2) clarify the circumstances under which the Minister of Jobs and Families (formerly known as the Minister of Labour (Minister)) can intervene in labour disputes, and (3) strengthen worker protections.
Bill C-39 is at First Reading; we will continue to monitor updates on Bill C-39 as they become available. However, federally regulated employers with bargaining or contracting decisions on the horizon should consider whether the proposals could affect their timelines, strategy, any planned amendments to collective agreement provisions or any transaction and retendering plans.
Part 3 of Bill C-39 proposes amendments to Part I (Industrial Relations) and Part III of the Canada Labour Code (Code) and the Wage Earner Protection Act, along with other non-legislative measures.
Earlier Intervention in High-Risk Bargaining Relationships
The first overarching theme of proposed changes to Part I of the Code is to focus the collective bargaining process with a stated goal to prevent labour disruptions. To achieve this, Bill C-39 would introduce earlier federal involvement in bargaining relationships meeting the proposed high-risk criteria.
This would require parties in high-risk bargaining relationships to engage in collective bargaining as early as six months before their collective agreement expires, with the support of federal mediators.
High-risk relationships are those where the last bargaining cycle ended in a work stoppage or imposed arbitration, or in situations where more than five years have passed since the last collective agreement was reached.
New Mediation and Dispute-Resolution Tools
Bill C-39 also introduces new mediation and dispute-resolution tools, including:
- Post-dispute remediation obligations: requiring parties to engage in relationship-building work with the Federal Mediation and Conciliation Service (FMCS) within six months of reaching a collective agreement.
- Extending the conciliation period: providing parties with additional time to reach negotiated agreements by extending the statutory conciliation period from 60 days to 90 days.
- Special mediator role: allowing the Minister to appoint a special mediator to assist parties during the extended conciliation and to make a public report to the Minister.
- Expanding geographic certification: allowing a trade union, the Minister, or the Canada Industrial Relations Board (CIRB) to initiate a geographic certification process for two or more federal employers in the same industry and geographic area (expanding this mechanism beyond the longshoring industry).
- Expediting grievance arbitration: requiring all collective agreements to contain grievance resolution mechanisms, as well as establishing that future regulations may establish expedited grievance arbitration processes.
- Support for first collective agreement negotiations and binding arbitration: Requiring parties negotiating a first collective agreement to work with the FMCS throughout negotiations and allowing either party to apply to the CIRB for a binding resolution if an agreement is not reached after nine months.
- Deemed Successorship: expanding the scope of the deemed successorship provisions for contract services and those instances where a new contractor who succeeds a previous contractor will assume the trade union relationship.
- Funding the Canadian Industrial Relations Board: bolstering CIRB capacity to address growing caseloads and backlogs, reducing delays and helping ensure complaints are adjudicated in a timely, credible, and effective manner.
A Narrower Framework for Ministerial Intervention
The second theme of the legislation is to clarify and define what steps the Minister may use to address labour disruptions with significant national impacts.
Section 107 of the Code currently permits the Minister to direct the CIRB “to do such things as the Minister deems necessary” to maintain or secure industrial peace and promote conditions favourable to the settlement of industrial disputes. Bill C-39 would replace that broad language with a more defined framework.
Under the proposed framework, the Minister could consider exercising the revised authority after:
- a special mediator has been appointed and completed their mandate
- the special mediator has submitted a public report to the Minister
- the Minister has considered that report
- the Minister has formed the opinion that a strike or lockout would have a significant national impact
Where the conditions under the new framework are met and a work stoppage has commenced, the Minister will now be limited to direct the CIRB to: (a) order the resumption of services, (b) extend the terms of an existing collective agreement on an interim basis, or (c) establish a binding dispute-resolution mechanism.
Proposed Special Mediator Process
In exercising their authority, the Minister will need to rely on the report of the special mediator outlining the issues in dispute, the parties’ positions, the parties’ participation in the process and the likelihood of reaching a negotiated settlement within a reasonable period.
This report would contain the special mediator’s view and recommendations, and if a collective agreement is not reached, the report would be made public five days after the report is provided to the Minister.
Similarly, if a tentative agreement is reached as part of the special mediator process and is subsequently rejected, the special mediator’s report would also be made public.
At the same time as the special mediator process, the proposed changes provide for a national impact assessment by Employment and Social Development Canada to determine if a labour disruption would have significant impacts beyond the bargaining parties. This will also likely be important to the exercise of the Minister’s authority under the revised section 107.
The new special mediator process is not designed to affect the timing of right to strike or lockout, but it is designed to occur before a work stoppage can legally begin.
Limitations on Statutory Rights
If enacted in its current form, the proposed amendments to section 107 would appear to narrow and structure the circumstances in which the Minister may direct the CIRB to intervene in a labour dispute:
- The Minister would no longer have the ability to direct the CIRB to take action before a labour dispute occurs, even where both a special mediator’s report and the new national impact assessment indicate that intervention may be necessary. Given the time required for a ministerial direction and any resulting CIRB hearing, this may require a work stoppage to continue for some period before relief is available.
- The Minister would no longer have the general authority to direct the CIRB to take measures necessary to promote conditions favourable to the settlement of disputes or differences, or to secure industrial peace. That authority is not currently limited in its use to managing or ending an existing labour dispute.
The Minister would be unable to direct the CIRB to take action if the Minister did not appoint a special mediator within the first 75 days of conciliation.
While a special mediator may be of assistance to the parties, they have been given a defined period to work with the parties, they have no ability to extend the strike or lockout timeline to encourage resolution and the publication of their report will likely arise with only days left to a labour dispute.
Additional Worker Protections
In addition to the changes to the Code, the legislation proposes:
- Worker Protections & Enforcement: Legislative and non-legislative measures including a crackdown on worker misclassification and wage theft, enhanced workplace safety measures, union representation protection in contract retendering, and updates to the Wage Earner Protection Program.
- Clarification on Paid Medical Leave: Confirming that paid medical leave under the Code is a minimum statutory entitlement, not an additional benefit that can be stacked on top of other workplace benefits.
As mentioned above, Bill C-39 remains at First Reading. We will continue to monitor its progress, including the proposed expansion of deemed successorship beyond airport contract-service arrangements, and provide updates as further details become available.
For guidance on how we can help prepare for these proposed significant changes, please reach out to Simon Mortimer, Andrew Movrin, or your regular Hicks Morley lawyer.
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