Bill 148 'substantially interfered' with right to collective bargaining
The Supreme Court of Nova Scotia has ruled that the province’s public‑sector wage restraint law is unconstitutional, striking down Bill 148, the Public Services Sustainability Act, for violating unions’ constitutional right to meaningful collective bargaining.
In a decision released to the parties on Friday, Justice Ann Smith found that the 2015 law, introduced by former Liberal premier Stephen McNeil’s government, “substantially interfered” with the applicant unions’ Charter right to a process of good‑faith collective bargaining. The Act imposed multi‑year wage caps and eliminated long‑service retirement awards as part of a broader bid to rein in public‑sector spending and balance the provincial budget.
“The government has failed to demonstrate that Bill 148 amounted to a reasonable limit on that right,” Smith wrote, according to CBC News.
The ruling is a major victory for several unions, including the Nova Scotia Government and General Employees Union (NSGEU), CUPE Nova Scotia, the Nova Scotia Nurses’ Union, the Nova Scotia Teachers Union and Unifor, which jointly challenged the law.
NSGEU president Sandra Mullen described the outcome as “a long‑fought battle” and “a victory for workers’ rights in this province,” speaking to reporters at Province House after the ruling was released.
Delay to declaration of invalidity
Although Smith declared the law unconstitutional, she agreed to suspend the declaration of invalidity for 12 months. The delay is intended to allow Premier Tim Houston’s Progressive Conservative government and affected unions to negotiate how the ruling should be implemented, including the impact on existing collective agreements and compensation foregone under the legislation.
“The court notes that the fiscal implications of an immediate declaration of invalidity would likely be considerable. The current government should be given time to consider these implications,” Smith wrote.
If no agreement is reached within a year, the matter can return to Smith, who has retained jurisdiction to determine an appropriate remedy.
Finance Minister John Lohr told reporters he had not yet read the full decision and said officials would need time to review it. He declined to say whether the government plans to appeal, leaving open the possibility of further legal action even as unions press for the province to accept the ruling and move directly into negotiations.
Bill 148 set wage pattern
Bill 148 set a wage pattern for much of the provincial public sector consisting of a two‑year wage freeze, followed by across‑the‑board increases of 1%, 1.5% and 0.5% over a four‑year period. It also removed the public service award, a lump‑sum payment at retirement based on years of service for eligible employees.
In her reasons, Smith concluded that by taking wages off the bargaining table, the Act “materially undermined the ability of the Applicant Unions to effectively bargain for their members.” She found that the removal of long‑service awards, combined with wage caps, had “a hugely negative impact on the bargaining power of the Applicant Unions” and disturbed the balance of power between unions and government.
“Bill 148 removed the Applicant Unions’ leverage on monetary items and thereby upset the balance of power between the parties and negated the ability of the Unions to engage in meaningful bargaining,” the decision states.
The ruling lands in the same week the Houston government tabled its 2026‑27 budget, which includes more than $300 million in cuts to jobs and grants, alongside nearly $528 million earmarked for restructuring costs such as workforce adjustments, contract negotiations and government restructuring.
It is not yet clear how much any eventual remedy for Bill 148 could cost or whether the province will tap that restructuring fund to offset potential back pay or restored benefits.
‘Major victory’ for workers
Labour groups that fought Bill 148 for more than a decade are calling the ruling a landmark victory.
The case was brought by several major unions, including the Nova Scotia Government and General Employees Union (NSGEU), CUPE Nova Scotia, the Nova Scotia Nurses’ Union, the Nova Scotia Teachers Union and Unifor.
NSGEU president Sandra Mullen described the outcome as “a long‑fought battle” and “a victory for workers’ rights in this province,” speaking to reporters at Province House.
CUPE Nova Scotia president Alan Linkletter said workers “lost out on wages and benefits that should rightfully be theirs because of Bill 148,” and accused the Houston government of putting “more taxpayer money into undermining our Charter rights” despite having campaigned in 2021 on repealing the law.
The Nova Scotia Federation of Labour called the judgment “a major victory for workers” and urged Houston to rule out any appeal. Federation president Melissa Marsman and other labour leaders said Bill 148 was “a stain on the history of workers’ rights in Nova Scotia” and argued the government should now focus on making amends to those affected.
Unifor – which represents more than 3,500 workers covered by the legislation – also welcomed the decision. “Bill 148 was anti‑worker legislation, plain and simple,” Unifor national president Lana Payne said, adding that the court had confirmed the union’s long‑held view that the Act undermined free and fair collective bargaining.
