The federal government has introduced Bill C-39, the Building Canada Strong Act, a wide-ranging piece of legislation that includes significant proposed changes to labour relations, worker protections, enforcement, and workplace compliance in federally regulated industries.
While much of the public discussion around Bill C-39 has focused on infrastructure and major project approvals, the employment law implications are substantial.
The proposed changes would affect employers in federally regulated sectors such as banking, telecommunications, rail, ports, air transportation, marine transportation, and other industries governed by the Canada Labour Code.
For employers, the central message is clear: if Bill C-39 is enacted, federal labour law could become more interventionist, more compliance-focused, and more structured around early dispute resolution.
Earlier Intervention in Collective Bargaining
One of the most significant proposed changes concerns collective bargaining.
The government says the bill is intended to reduce the likelihood that difficult bargaining relationships escalate into strikes or lockouts by requiring earlier engagement and providing more opportunities for mediation and dispute resolution.
Under the proposed framework, certain higher-risk bargaining relationships would be required to begin negotiations six months before the expiry of a collective agreement, rather than relying on the existing framework that permits bargaining to begin as early as four months before expiry.
This would apply in situations where the previous bargaining cycle ended in a work stoppage or imposed arbitration, or where more than five years have passed since the last collective agreement was reached.
For employers, that could mean less flexibility around timing and a greater expectation that bargaining risks be identified and managed earlier.
Conciliation Period Could Increase to 90 Days
Bill C-39 would also extend the current 60-day conciliation period to 90 days.
The objective is to provide more time for parties to reach a negotiated settlement before a legal strike or lockout becomes available.
For employers, this may create additional opportunities to resolve disputes without a work stoppage, but it could also prolong bargaining and increase the importance of early strategy, documentation, and preparation.
New Special Mediator Process
The proposed legislation would create a new Special Mediator process for difficult disputes.
A Special Mediator could be appointed no later than day 75 of the conciliation period and would have a 21-day mandate to help the parties narrow outstanding issues and pursue a negotiated agreement.
If the dispute remains unresolved, the mediator would prepare a report addressing the outstanding issues, the parties’ positions, their participation in the process, and the likelihood of settlement. In certain circumstances, that report could become public.
For employers, this introduces another level of scrutiny and potential transparency into difficult bargaining relationships.
Government Intervention in Nationally Significant Disputes
Bill C-39 would also clarify the circumstances in which the federal government could intervene in labour disputes with significant national consequences.
The proposed framework would require:
- Appointment and completion of a Special Mediator process
- A public report from the mediator
- Consideration of that report by the Minister
- A determination that the strike or lockout would have a significant adverse national impact
Only after those conditions are met, and once a work stoppage has begun, could the Minister direct the Canada Industrial Relations Board to take measures such as ordering a resumption of operations, extending a collective agreement on an interim basis, or establishing a binding dispute-resolution process.
This proposal attempts to preserve the right to strike while creating a more structured process for exceptional disputes.
First Collective Agreements Would Receive More Support
Bill C-39 also proposes additional support for newly unionized workplaces.
The Federal Mediation and Conciliation Service would be required to begin working with the parties after a union certification order is issued.
If a first collective agreement has not been reached after nine months of bargaining, either party could apply to the Canada Industrial Relations Board for a binding dispute-resolution process.
For employers dealing with a newly certified bargaining unit, this could significantly affect bargaining timelines and strategy.
Stronger Enforcement and More Inspectors
The government has also announced a major enforcement expansion.
It plans to add 100 new federal health and safety officers, which it says would increase inspection capacity by approximately 70 per cent. It also plans to add 26 new staff to the Canada Industrial Relations Board to address complaint backlogs.
For federally regulated employers, this means compliance may receive substantially more scrutiny.
Workplace health and safety policies, documentation, reporting systems, investigations, and training should therefore be treated as active compliance issues, not simply administrative requirements.
Worker Misclassification and Wage Theft
Another important focus is worker misclassification.
The federal government has stated that it intends to increase enforcement against employers who improperly classify employees as independent contractors, with particular attention to the trucking industry.
Misclassification can affect wages, vacation pay, overtime, leave entitlements, termination rights, and other statutory protections.
Federally regulated employers that rely heavily on contractors should review those relationships carefully and ensure that the legal reality of the relationship matches the label used in the contract.
Successor Rights in Contract Retendering
The bill would also extend successor rights in certain contract retendering situations in airports and the air transportation sector.
The proposed changes would preserve union representation and collective agreement rights where work moves from one contractor to another.
For employers bidding on federally regulated contracts, this could affect labour costs, workforce planning, and due diligence.
Paid Medical Leave
Bill C-39 would also clarify the relationship between statutory paid medical leave and employer-provided or collectively bargained leave.
The government says the amendments would confirm that the federal paid medical leave regime is a minimum floor, not an additional benefit that must be stacked on top of an equivalent or greater employer-provided entitlement.
For employers, this could provide greater certainty where existing benefit plans already meet or exceed the statutory minimum.
Why This Matters for Employers
Bill C-39 is notable because it does not focus on a single area of workplace law.
It combines:
- Collective bargaining reform
- Greater mediation and dispute-resolution involvement
- Enhanced labour board capacity
- Expanded health and safety enforcement
- Increased scrutiny of worker classification
- Successor rights
- Paid leave clarification
- Stronger compliance infrastructure
If enacted, these changes could materially affect how federally regulated employers manage labour relations, staffing models, workplace safety, contractor relationships, and dispute resolution.
What Employers Should Be Doing Now
The bill has only been introduced and may change during the parliamentary process.
However, federally regulated employers should not wait until the last minute to assess potential exposure.
Now is a good time to review:
- Collective bargaining timelines and labour relations strategy
- Employment and contractor classification practices
- Workplace health and safety policies
- Complaint and investigation procedures
- Existing collective agreements
- Paid leave policies
- Contract retendering arrangements
- Documentation and compliance systems
Employers should also monitor the bill as it moves through Parliament, because amendments may alter the final obligations.
Final Thoughts
Bill C-39 represents one of the most significant proposed changes to the federal labour framework in years.
For employers, the key themes are earlier intervention, more enforcement, greater scrutiny, and a stronger expectation that workplace risks be addressed before they become disputes.
The legislation is not yet law, but federally regulated employers should begin considering how these proposals could affect their workplace.
Minken Employment Lawyers (Est. 1990) Can Help
Minken Employment Lawyers (Est. 1990) regularly advises employers and employees on Canada Labour Code compliance, collective bargaining, labour relations, workplace investigations, health and safety obligations, employment contracts, worker classification, and workplace risk management.
If you are an employer or an executive employee, we can help.
Contact Minken Employment Lawyers (Est. 1990) today for a confidential consultation at 905-477-7011 or contact@minken.com to connect with our team.
“Your Workplace is Our Business” ™
Sign up for our Newsletter to learn about new Employment Law legislation and Court decisions impacting your workplace.
Copyrighted. Not to be copied or reproduced without express permission of Minken Employment Lawyers (Est. 1990) ©
Please note that this article is for informational purposes only and does not constitute legal advice or opinion.
Related Topics
- A 2026 Reminder for Federally Regulated Employers: Graduated Termination Notice Rules Are Already in Effect
- Ontario Expands Labour Mobility: New “Deemed Certification” Regulations to Take Effect January 1, 2026
- Ontario Introduces Bill 30: What Employers Need to Know About the Working for Workers Seven Act, 2025