New prohibition on use of replacement workers coming to federally regulated workplaces

22 May 2025 5 min read

At a glance

Bill C-58 amends the Canada Labour Code to expand the prohibition on the use of replacement workers during legal strikes and lockouts in federally regulated workplaces,
The bill removes the requirement for unions to prove that replacement workers are used to undermine union representation, broadly restricting employers from using most replacement workers during strikes and lockouts.
The new law is expected to become effective June 20, 2025.

Bill C-58, An Act to amend the Canada Labour Code and the Industrial Relations Board Regulations (Bill C-58), received Royal Assent on June 20, 2024. Bill C-58 implemented various amendments to the Canada Labour Code and Canada Industrial Relations Board Regulations, 2012 (the Regulations) to expand the scope of the prohibition on employers’ use of replacement workers during legal strikes and lockouts.

Both the Canada Labour Code and the Regulations apply to federally regulated workplaces in Canada, which include banks, telecommunications companies, and airlines. They do not apply to provincially regulated workplaces, which are instead governed by provincial employment and labour laws.

Expanded prohibition on use of replacement workers

The Canada Labour Code prohibits an employer from employing replacement workers during legal strikes and lockouts for the ;demonstrated purpose of undermining a trade union’s representational capacity rather than the pursuit of legitimate bargaining objectives…'. Put simply, this means that employers are currently permitted to use replacement workers during a legal strike or lockout if doing so is not for improper or illegal purposes, such as to rid the workplace of union representation, as opposed to pursuing a legitimate economic goal or bargaining objective.

In contrast, Bill C-58 will remove the requirement for a union to prove that an employer employed replacement workers during a legal strike or lockout for the 'demonstrated purpose of undermining a trade union’s representational capacity rather than the pursuit of legitimate bargaining objectives…' for the employer’s use of said workers to be prohibited. Instead, starting June 20, 2025, the Canada Labour Code will prohibit an employer from employing the following persons during a legal strike or lockout:

Any employee or any person who performs management functions or who is employed in a confidential capacity in matters related to industrial relations if that employee or person is hired after the day on which notice to bargain collectively is given.
Any contractor, other than a dependent contractor, or any employee of another employer.
Any employee whose normal workplace is a workplace other than that at which the strike or lockout is taking place or who was transferred to the workplace at which the strike or lockout is taking place after the day on which notice to bargain collectively is given.
Any volunteer, student, or member of the public.
A bargaining unit employee during a legal strike or lockout intended to involve the cessation of work of all employees in said bargaining unit, subject to certain exceptions.

In effect, Bill C-58 will restrict employers’ use of most replacement workers during most legal strikes and lockouts.

Exceptions to prohibition on use of replacement workers

Despite these restrictions, Bill C-58 will permit employers to use the services of any person as a replacement worker if:

The services are used solely to deal with a situation that presents or could reasonably be expected to present, an imminent or serious:

threat to the life, health, or safety of any person;
threat of destruction of, or serious damage to, the employer’s property or premises; or
threat of serious environmental damage affecting the employer’s property or premises.

The use of the services is necessary in order to deal with the situation because the employer, or person acting on behalf of an employer, is unable to do so by any other means, such as by using the services of a person who is not referred to in the enumerated prohibitions set out in the previous section of this update.
In the case of the services of a person referred to in the enumerated prohibitions set out in the previous section of this update (except for a bargaining unit employee during a legal strike or lockout intended to involve the cessation of work of all employees in said bargaining unit), the employer, or person acting on behalf on an employer, gave the employees in the bargaining unit on strike or locked out the opportunity to perform the necessary work before using the services of said person(s).

Sanctions for the illegal use of replacement workers

Bill C-58 will result in new penalties for employers who illegally use replacement workers during a legal strike or lockout. For instance, an employer who illegally uses replacement workers is guilty of an offence and liable on summary conviction to a fine not exceeding CAD100,000 for each day the offence is committed or continued.

Bill C-58 will also permit the Governor in Council to make regulations, which may include establishing an administrative monetary penalties scheme to promote compliance with the provisions governing the use of replacement workers. As yet, no regulations have been made.

Changes to the maintenance of activities process

During a lockout or strike, the Canada Labour Code requires that an employer, union, and employees in a bargaining unit continue the supply of services, operations of facilities, or production of goods to the extent necessary to prevent an immediate and serious danger to the safety or health of the public. This provision is referred to as the 'maintenance of activities' requirement.

Once Bill C-58 is in force, the maintenance of activities process under the Canada Labour Code will change to, among other things, encourage employers and trade unions to reach earlier agreements respecting activities to be maintained in the event of a legal strike or lockout. As a result of Bill C-58, starting June 20, 2025, an employer and trade union will have to enter into an agreement no later than 15 days after the day on which notice to bargain collectively has been given with respect to compliance with maintenance of activities. That agreement will have to set out:

The supply of services, operation of facilities, or production of goods that they consider necessary to continue in the event of a strike of a lockout.
The manner and extent to which the employer, the trade union, and the employees in the bargaining unit, must continue that supply, operation, and production, including the approximate number of those employees that, in the opinion of the employer and the trade union, would be required for that purpose.

Immediately after entering into a maintenance of services agreement, an employer and trade union must file a copy with the Minister of Labour and the Canada Industrial Relations Board. Once the agreement is filed, it will have the same effect as an order of the Board.

If an employer and trade union conclude that it is not necessary to continue any supply of services, operation of facilities, or production of goods to comply with the maintenance of activities requirement, then they will have to set out this conclusion in the above-noted maintenance of services agreement.

Coming into force

Bill C-58 is not yet in force. Until and unless Bill C-58 comes into force, the current provisions of the Canada Labour Code and its regulations continue to apply. Bill C-58 is expected to come into force on June 20, 2025.