The Attorney General of Canada successfully appealed a judgment from the Federal Court of Appeal. The Federal Court of Appeal allowed the appeal from the decision affirming a tribunal’s decision that Service Canada had not abused its authority when it advertised to fill a position that respondent claimed was not a new position and ought not to have been advertised.

Administrative law – Decisions of administrative tribunals – Public Service Staffing Tribunal – Employee classification – Abuse of public authority – Labour law – Government – Employees – Employment law – Appointment – Judicial review – Compliance with legislation – Standard of review – Reasonableness simpliciter

Canada v. Kane, [2012] S.C.J. No. 64, 2012 SCC 64, Supreme Court of Canada, November 23, 2012, McLachlin C.J. and LeBel, Abella, Rothstein, Cromwell, Moldaver and Karakatsanis JJ.

The respondent, Mr. Kane, was employed by Service Canada in a managerial position classified at the PM -05 level. As part of a re-organization, the structure for the work unit was changed and the position of Regional Manager was created at the PM -06 level. Service Canada internally advertised the new position. Mr. Kane applied for the position but failed a mandatory examination.

Mr. Kane subsequently filed a complaint with the Public Services Staffing Tribunal alleging an abuse of authority contrary to the Public Service Employment Act (“PSEA”). More particularly, he argued that: (1) the PM -06 position was not a new position, but a reclassification of the old PM -05 position he formerly held, (2) it was the practice in Newfoundland to internally fill reclassified positions by appointment and, therefore, (3) advertising the position constituted an abuse of authority.

The Tribunal found that Mr. Kane had not established abuse of authority and dismissed his claim. The Federal Court affirmed this decision. The Federal Court of Appeal (“FCA”) allowed the appeal and sent the case back to the Tribunal for reconsideration.

The FCA was of the view that the newness of the PM -06 position was the “principal justification” given by the employer for choosing an advertised process. If Mr. Kane could establish there was “no rational basis” for the employer’s assumption that the PM -06 was new, he might have been successful in demonstrating that the decision to use an advertised process was arbitrary and therefore an abuse of authority. The FCA held that the Tribunal, by failing to consider this point, effectively excluded from the scope of the term “abuse of authority” decisions that are based on facts that have no rational support. The FCA found this unreasonable.

The Supreme Court of Canada set aside the FCA’s judgment for four main reasons.

First, and most fundamentally, the gravamen of the complaint was that the choice of an advertised appointment process constituted an abuse of authority. The Tribunal acknowledged this argument but held that there is nothing in either the PSEA or the Public Service Employment Regulation requiring a deputy head to utilize a particular selection process (notwithstanding the position is new or reclassified).

Second, the majority assessed the decision of the Tribunal against a claim that Mr. Kane did not make. Mr. Kane never tried to establish that the newness of the position was the “principal justification” for the employer’s decision. Rather, he assumed that if he could establish that the PM-06 position was reclassified, he would be entitled to a non-advertised process.

Third, the decision to send the case back to the Tribunal was based on the majority’s reading of the record to the effect that the newness of the PM -06 position was the “principal justification” for the employer’s decision. However, the Tribunal made no finding as to what the employer’s “principal justification” may have been. The Supreme Court found that the FCA erred by effectively undertaking its own assessment of the record and attributing to the employer a “principal justification” for its decision that the Tribunal did not find, which was inappropriate on a judicial review.

Fourth, there was no realistic possibility that the Tribunal could find an irrational finding of fact in this case. At the very least, any reasonable reading of the record shows that whether this position was new or reclassified could be the subject of reasonable disagreement by reasonable people.

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