What happens when related unionized/non-unionized companies have a beef with the union? R.W. Tomlinson Limited v. LIUNA Local 527, 2025 ONCA 861
Dan Wilband
Here’s a significant new Ontario Court of Appeal decision that labour lawyers and HR professionals should know about.
A unionized construction company and two non-union sister companies all got hit by strike picketing. They later sued together, seeking damages in tort. The union objected to the court’s jurisdiction, saying the whole dispute fell under the exclusive labour arbitration regime. The motion judge agreed and dismissed everything, leaving the non-union companies with nowhere to go since arbitrators can’t hear claims from parties who never signed the collective agreement.
This created what Chief Justice Tulloch called a “jurisdictional dead end.” The non-union companies had legitimate claims but no forum to pursue them in.
The Court of Appeal introduced a nuanced approach. Instead of dismissing the claims from the non-parties outright, it said courts should temporarily stay them while the arbitration proceeds. This respects the arbitration process that the unionized parties agreed to, while preserving access to justice for everyone else.
Today, companies increasingly operate through multiple corporate entities, with shared facilities and management. When labour disputes spill across those boundaries, an approach is needed that doesn’t create artificial barriers to resolving the whole mess efficiently.
The court was clearly troubled by the timing: the company waited 18 months after settling the strike, then launched litigation just as new contract negotiations were starting. Using related corporate entities to pressure the union through parallel lawsuits is exactly what this framework is designed to prevent.
The takeaway: If you’re dealing with labour disputes that affect multiple entities in a corporate group, understand that arbitration requirements will be enforced, but courts won’t leave the non-parties stranded without a forum. Expect temporary stays that let the arbitration process work first, with court proceedings to follow if needed.
This nuanced policy balances competing principles, respecting negotiated dispute resolution while maintaining access to justice for everyone.