Why won’t the GNWT accept binding arbitration?

Union members protest outside the NWT legislature in March 2018
Union members protest outside the NWT legislature in March 2018. Ollie Williams/Cabin Radio

The Union of Northern Workers is offering binding arbitration. The territorial government will not accept. For some NWT residents, that decision is hard to understand.

Across social media and in messages to Cabin Radio, residents have questioned why the territory – faced with a strike after years of fruitless negotiations – would not accept a solution whereby a third party makes decisions both sides must accept.

Every time Cabin Radio has put that question to the territorial government, the response is the same: “We are following the process.”

What does that mean, and why is the GNWT insistent on not accepting binding arbitration?



On this page, we’ll try to explain as best we can, with help from several sources in key positions on both sides.

If you can’t read all of this, scroll to the bottom for the short answer. (But the long answer is worth reading, we promise.)

Sources asked for anonymity as they were not authorized to comment at a sensitive time in negotiations. Note that we’ve written this in a slightly different tone to our usual reporting – we’re trying to make this as easy to follow as we can.

What is ‘the process’ anyway?

When the territorial government refers to “the process,” it means the Public Service Act.



This piece of NWT legislation governs what happens during collective bargaining, and what happens when collective bargaining breaks down.

It’s a long, dry document, not easily understood. But it’s also the legal framework for these negotiations, which both parties have been following to this point.

When the Union of Northern Workers has talked about being “in a legal position to strike” in the past, the union was referring to the criteria set out in the Public Service Act.

The sections of the act that matter most in this situation are Section 41 and Section 42, which govern collective agreements and strikes.

So, what is “the process” that the Public Service Act sets out?

In short, it works like this:

  • Bargaining begins
  • Parties either reach agreement, or don’t
  • Once one party gets tired of not agreeing, it can request a mediator
  • Mediator acceptable to both parties is appointed (if they can’t agree, Supreme Court appoints one)
  • Mediation takes place
  • Mediator makes recommendations
  • Parties accept or reject recommendations

And here’s the first problem. That’s where it ends. The next step? Strike.

There is no guidance in the act about what to do if mediation fails, other than a section about how strike action should be handled and when it becomes legal.



As far as the territorial government is concerned, things are still in mediation: the last safe haven before the great, black abyss where the instructions run out.

As far as the union is concerned, mediation is failing (although it has allowed that last-ditch talks this weekend could work) and it is standing on the other side of the abyss, preparing to strike.

The union is offering to fill the abyss with binding arbitration – but that brings up a new problem.

Binding arbitration is not A Thing…

So far, as we’ve seen, both sides have followed “the process.”

But if both sides are committed to that process (and the union has often cited the agreed process as a reason for its actions, for example why it doesn’t share more information about bargaining) then there can’t be any binding arbitration – because it isn’t there. It is not a thing.

Nowhere in the Public Service Act is any allowance made for the sides to go to binding arbitration. The phrase “binding arbitration” does not occur anywhere in the document.

“OK,” I can hear you cry, “but rules were made to be broken. So what, it’s not in the document. Why can’t we just go ahead and do it anyway?”

Well, I’m glad you asked. There may be two possible reasons. (Remember, the territorial government hasn’t come out and said any of this explicitly. We’re just exploring the background.)



… but it used to be A Thing!

Firstly, guess what: binding arbitration was a part of this whole process, until everyone agreed to take it out of the process back in 1996.

Before then, all collective bargaining disputes under the equivalent of this legislation were sent to binding arbitration as a final step. There was no allowance made for strike action.

Unions tend not to like agreements which don’t let people go on strike so, in 1996, the NWT’s MLAs changed the law.

Out went binding arbitration, and in came the possibility of strike action (with some rules attached to it).

“The union indicated that it was OK with them to take out arbitration,” said Roy Erasmus, who was then the Yellowknife North MLA, on February 21, 1996.

“They indicated that process was too slow and the arbitrators were reluctant to make hard decisions,” he added. “They also indicated that they had been trying to get the right to strike for years.”

When the decision was made to make those changes, the NWT’s finances were in a pretty terrible state.

Within months of the right to strike becoming law, more than $100 million in spending cuts was approved, including a $13 million cut to the territorial government’s payroll which also meant more than 250 layoffs.



The union did not exercise its newly implemented right to strike.

(These figures come from the 1996 edition of the Canadian Annual Review of Politics and Public Affairs.)

What does this mean today?

One of our sources characterized this as follows: the modern-day Union of Northern Workers is asking the territorial government to use a solution – binding arbitration – that both parties earlier (two-decades-ago earlier) agreed to remove as an option in the process.

At the same time, the source added, the union is threatening a strike – a tool added into the process in exchange for removing binding arbitration.

That’s one point of view. It brings us to what may be the main problem for the territorial government: that arbitration could, in the GNWT’s eyes, set a dangerous precedent.

If you agree to binding arbitration even though it was taken out of the process, then – as Premier Bob McLeod put it on Wednesday – why have the process at all?

In the eyes of two of our sources for this document (one on each side of collective bargaining), agreeing to binding arbitration now is potentially dangerous for both sides as it means all bets are off for future collective bargaining.

If you step outside the process this time, you or the other guys could be the ones demanding to step outside the process next time, or the time after, and then the process is broken.



Both sides may find it harder to negotiate in good faith, as the other side could choose to pursue some alternative remedy that isn’t written down anywhere – which means no rules. In negotiations as complex as this, that has the potential to be a worrying and unpredictable added complication, and it could last for decades if a precedent is set.

But arbitration is still common sense, right?

Despite all of that, the territorial government still faces two hard truths.

The first is that binding arbitration remains the best plan on the table as far as many residents are concerned, and it’s unlikely all of them will be persuaded by arguments about legal process or precedents. On the face of it, binding arbitration has compelling merit to many people.

The second is that “the process” is running out. If mediation this weekend fails, the only option in the legislation is more mediation, on repeat, until either everyone agrees or there’s a strike. Which means if the two sides are too far apart to agree, there is only one outcome on the list.

Does that mean we need to rewrite the process?

It’s too early to say, the premier told us this week.

The short answer

So, in short, the territorial government may be rejecting binding arbitration because:

  • there is no legal mechanism for it in the legislation;
  • arbitration was specifically dropped from that legislation in the past, with the union’s agreement, to make way for the right to strike; and
  • to start doing things not set out in law now would set an uncomfortable precedent for the future.

Note again that this is a best guess, as the territorial government – when we have asked about binding arbitration in the past – has never gone into this level of detail.



Asked for a response to being served strike notice by the union, the territory gave Cabin Radio a short statement.

“The GNWT’s focus remains on this weekend’s mediation and we will be attending committed to concluding a new collective agreement,” the statement read.

“At the same time, due to the union’s decision to serve notice to strike, all GNWT departments and agencies are initiating their job action contingency plans in preparation for strike action should no deal be achieved.”

It’s likely that MLAs will more directly tackle some or all of these issues during a debate about binding arbitration which is scheduled to take place in the legislature on Friday. We’ll bring the outcome of that debate to you when we can.