If the state of Florida were a province in Canada, on the one hand, people might find it easier to travel to warmer climes when winter really hits snowy and cold part of Canada. On the other hand, they might find Canada too expensive to travel for long-term winter escapes. But that’s not my topic today. I’m more interested in an article in The Globe and Mail discussing the quandry facing health care providers in that state, caught as they are between opposing vaccine mandates. What if this conflict existed in Canada?
VACCINES MANDATES: FLORIDA LAW AND FEDERAL CMS EMERGENCY DECLARATION
Last November, the Florida House of Representatives and Senate enacted legislation prohibiting private sector employers from requiring vaccines unless they included five specific exemptions (see here). The law affects hospitals and other health care facilities. Florida also bans vaccine mandates in the public sector completely.
In relation to mandates in the private sector the Governor’s website states,
In Florida, effective immediately:
✓ Private Employer COVID-19 vaccine mandates are prohibited.
‣ Employees can choose from numerous exemptions, including but not limited to, health or religious concerns; pregnancy or anticipated future pregnancy; and past recovery from COVID-19.
‣ Employees can choose to opt for periodic testing or PPE as an exemption.
‣ Employers must cover the costs of testing and PPE exemptions for employees.
✓ Employers who violate these employee health protections will be fined.
‣ Small businesses (99 employees or less) will face $10,000 per employee violation.
‣ Medium and big businesses will face $50,000 per employee violation.
Florida has been serious about investigating and charging businesses and governments that require employees show proof of vaccination (see, for example, the lengthy and diverse list from last October here).
However, the Biden administration through the Centers for Medicare and Medicaid Services has also implemented a vaccine requirement (“the CMS requirement”) that applies to health care facilities receiving Medicare and Medicaid. This requirement takes the form of an Emergency Declaration issued by the Centers for Medicare & Medicaid Services (“CMS”). It states it pre-empts state laws.
The Supreme Court of the United States recently stayed injunctions against implementing the rule. (See Reuters report of decision here.) The requirements permits two exemptions, medical and religious. Failure to implement the requirement could imperil federal funding.
Clearly, healthcare facilities are caught in the classic web between laws of two jurisdictions, of which they cannot comply with one without disobeying the other. As the president and CEO of the Florida Hospital Association states,
“You can’t be in compliance with both based upon the breadth of exemptions that exist within the state law,” she said. “So, hospitals are working very closely with their staff, first of all, to encourage them to get vaccinated, but then to identify where there are exemptions that fit within the Medicare rule. Where we become potentially at odds with the state requirement is if an employee fails to fit.” (quoted here)
Or, as the report in The Globe and Mail puts it,
Violate the state ban, and an employer could be fined up to US$50,000 a violation.
Violate the federal mandate, and a hospital could jeopardize millions in critical funding.
In short, a classic scenario for a Canadian paramountcy claim. How would it be resolved in Canada?
A BRIEF PRIMER ON PARAMOUNTCY DOCTRINE
Although federal and provincial legislatures in Canada usually stay in their lanes under sections 91 and 92 of the Constitution Act, 1867, from time to time they stray into the area allocated to the other. When that happens, “[t]he tendency has been to allow these overlaps to occur as long as each level of government properly pursues objectives that fall within its jurisdiction” (Alberta (Attorney General) v. Moloney (“Moloney“), Gascon J., writing for the majority, para. 16).
But also from time to time, a conflict between the enactments arises. Federal paramountcy is among the approaches to addressing conflicts: “When there is a genuine ‘inconsistency’ between [intra vires] federal and [intra vires] provincial legislation, that is, when ‘the operational effects of provincial legislation are incompatible with federal legislation’, the federal law prevails” (Moloney, Gascon J., para. 16). The trick is determining whether there is actually a conflict.
A conflict is said to arise in one of two situations, which form the two branches of the paramountcy test: (1) there is an operational conflict because it is impossible to comply with both laws, or (2) although it is possible to comply with both laws, the operation of the provincial law frustrates the purpose of the federal enactment. (Moloney, Gascon J., para. 18)
However, there is not necessarily a conflict when the provincial law is more restrictive than the federal enactment: Gascon J. cites Rothmans, Benson & Hedges Inc. v. Saskatchewan (“Rothmans“) and Quebec (Attorney General) v. Canadian Owners and Pilots Association (“COPA”) as examples.
Even so, “The application of a more restrictive provincial law may, however, frustrate the federal purpose if the federal law, instead of being merely permissive, provides for a positive entitlement” (Moloney, Gascon J., para. 26).
There is a second way in which paramountcy arises: “the effect of the provincial law may frustrate the purpose of the federal law, even though it does ‘not entail a direct violation of the federal law’s provisions’” (Moloney, Gascon J., para. 19, citing Bank of Montreal v. Hall (“Bank of Montreal“)). More restrictive provincial laws, while not constituting an actual conflict, might frustrate a federal purpose.
More recently, Wagner CJ explained,
Under both branches of paramountcy, the burden of proof rests on the party alleging the conflict. This burden is not an easy one to satisfy, as the doctrine of paramountcy is to be applied with restraint. Conflict must be defined narrowly so that each level of government may act as freely as possible within its respective sphere of constitutional authority. “[H]armonious interpretations of federal and provincial legislation should be favoured over an interpretation that results in incompatibility . . . [i]n the absence of ‘very clear’ statutory language to the contrary” …. “It is presumed that Parliament intends its laws to co-exist with provincial laws” …. [T]he application of the doctrine of paramountcy should also give due weight to the principle of co-operative federalism. This principle allows for interplay and overlap between federal and provincial legislation. While co-operative federalism does not impose limits on the otherwise valid exercise of legislative power, it does mean that courts should avoid an expansive interpretation of the purpose of federal legislation which will bring it into conflict with provincial legislation. (Orphan Well Association v. Grant Thornton Ltd. (“Orphan Well“), Wagner CJ, writing for the majority, paras. 65-66)
The principle of “restraint” led to avoidance of a finding of conflict in Saskatchewan (Attorney General) v Lemare Lake Logging (“Lemare Lake Logging“):
While the principle of cooperative federalism cannot be seen as imposing limits on the otherwise valid exercise of legislative competence, it may be invoked to “facilitate interlocking federal and provincial legislative schemes and to avoid unnecessary constraints on provincial legislative action”: …. In line with this principle, absent clear evidence that Parliament intended a broader statutory purpose, courts should avoid an expansive interpretation of the purpose of federal legislation which will bring it into conflict with provincial legislation.(Lemare Lake Logging, Abella and Gascon JJ., for the majority, para. 23)
Paramountcy cases are best thought of as a puzzle: do the two enactments intertwine and if so, how?
A VERY FEW EXAMPLES OF HOW PARAMOUNTCY APPLIES
A 1973 case illustrates the difficulty that might arise for an individual subject to apparently conflicting provisions. In Ross v. Registrar of Motor Vehicles (“Ross“), Ross had been convicted of impaired driving, as a result of which provisions of both the Criminal Code and the Ontario Highway Traffic Act (“HTA“) came into play. The Provincial Court judge prohibited him from driving for six months except to allow him to go to and from work and to drive for work. The provincial Registrar of Motor Vehicles was not to suspend his licence. This was inconsistent with section 21 of the HTA, which provided for mandatory suspension of varying lengths, depending on the circumstances.
The Criminal Code provided for restrictions on the time and place a person convicted of relevant offence may drive. The judge’s order “considered not only that the prohibition may be limited as to time and place, but also that the person to whom the order is directed should enjoy the right to drive at specified time and place, irrespective of provincial legislation concerning the suspension of driving privileges” (Ross, Pigeon J., p.12).
[i]f such an order is made in respect of a period of time during which a provincial licence suspension is in effect, there is, strictly speaking, no repugnancy. Both legislations can fully operate simultaneously. It is true that this means that as long as the provincial licence suspension is in effect, the person concerned gets no benefit from the indulgence granted under the federal legislation. (Ross, Pigeon J., p.12)
It is not insignificant in this decision that the judge’s order that the licence not be suspended was, in the majority’s view, without jurisdiction.
Two judges disagreed with this analysis, and their conclusions would have helped Ross. They found that the judge had the jurisdiction to make the order and that the applicable provisions of the Criminal Code and the HTA were in conflict; therefore, the provincial legislation was inoperative and Ross would have been able to continue to drive for purposes of his employment.
(Assuming that the judge had jurisdiction to apply the sentence, Ross might well have benefitted from the majority interpretation in Moloney some 40 years later, since the provincial provision prevented his being able to take advantage of the judge’s sentence: see below.) [A personal note: I confess I always thought Ross got a raw deal.]
In the 1982 decision of Multiple Access Ltd. v. McCutcheon (“Multiple Access“), the Supreme Court of Canada explored the relationship between provisions under the Canada Corporations Act (“CCA“) and provisions under the Ontario Securities Act.
Shareholders of a federally incorporated company brought an action against directors or officers of the company under the Securities Act, alleging the directors had engaged in insider trading. (Specifically, the defendants knew that the company, unbeknownst to the public, had made an offer to purchase television and radio assets from another company and had bought stock in their own company. They benefitted from the increase in the value of the stock.) The directors maintained that the provisions under the Securities Act were inoperative under the doctrine of paramountcy because they duplicated provisions under the federal legislation.
Writing for the majority, Dickson J. found that the two sets of provisions regarding insider trading could co-exist. Having first held that the federal provisions were intra vires and valid under the double aspect doctrine, despite seemingly overlapping the Ontario provisions, he also found the Ontario provisions valid even when applying to federally incorporated companies. This overlapping led to the following question: “Does mere duplication constitute ‘the conflict’ required by the paramountcy doctrine in order to render a provincial statutory provision inoperative?” (Multiple Access, Dickson J., p.186)
Justice Dickson applied a test he considered the more “modern” test for determining the answer (that is, more modern than “mere duplication”), one that would “leav[e] to the provinces ample legislative room”. The older test meant simple duplication would result in the provincial provisions being inoperative. Under the newer and preferable test,
there is no true repugnancy in the case of merely duplicative provisions since it does not matter which statute is applied; the legislative purpose of Parliament will be fulfilled regardless of which statute is invoked by a remedy-seeker; application of the provincial law does not displace the legislative purpose of Parliament. (Multiple Access, Dickson J., p. 190)
Indeed, duplication in this sense is “‘the ultimate in harmony’” (citation omitted). In this case, the courts could address any concerns arising from efforts to benefit from both the federal and provincial enactments by preventing double recovery or refusing the authorization required under the Ontario legislation.
In Multiple Access, individuals can obey both enactments simply by effectively doing the same thing (in this case, not engaging in insider trading) and the provincial provisions do not impair the functioning of the federal provisions. On the contrary, the courts and commentators optimistically saw this overlap as an example of co-operative federalism.
- Paramountcy Applies
Moloney provides an example of where the doctrine of paramountcy led to provincial provisions being declared inoperative to the extent they were in conflict with federal law. It involved the federal Bankruptcy and Insolvency Act (“BIA“) and the Alberta Traffic Safety Act (“TSA“).
An individual injured in a motor vehicle accident obtained judgement against the uninsured driver of the vehicle, Moloney. Under its insurance scheme, the province compensated the injured person and sought recovery from Moloney. But Moloney declared bankruptcy and was eventually discharged from bankruptcy; as a result, he was released from his debts. As permitted under the TSA, the province suspended his licence until he paid the compensation owing to the province.
Moloney argued that he should not have to pay because the relevant provisions of the BIA and TSA were in conflict. The purpose of the relevant BIA provision (s.178) — the discharge of debts — is the financial rehabilitation of the debtor. The relevant provision of the TSA (s.102 coupled with s.103, which provides that suspension stops when the driver makes payment) is, in Gascon J.’s words, “a debt collection mechanism”. Justice Gascon explains, “Since the parties conceded that the judgment debt in this appeal is a claim provable in bankruptcy, I would add that the purpose and effect of s. 102, in the context of this appeal, are to suspend a debtor’s driving privileges until payment of a provable claim” (Moloney, Gascon J., para. 47).
In Moloney, Côté J., concurring in the result, held that there was not an operational conflict because the bankrupt could pay the debt or not drive. Justice Gascon rejected this view:
In a case like this one, the test for operational conflict cannot be limited to asking whether the respondent can comply with both laws by renouncing the protection afforded to him or her under the federal law or the privilege he or she is otherwise entitled to under the provincial law. In that regard, the debtor’s response to the suspension of his or her driving privileges is not determinative. In analyzing the operational conflict at issue in this case, we cannot disregard the fact that whether the debtor pays or not, the province, as a creditor, is still compelling payment of a provable claim that has been released, which is in direct contradiction with s. 178(2) of the BIA.” (Moloney, Gascon J., para. 60)
One law consequently provides for the release of all claims provable in bankruptcy and prohibits creditors from enforcing them, while the other disregards this release and allows for the use of a debt enforcement mechanism on such a claim by precisely excluding a discharge in bankruptcy. This is a true incompatibility. Both laws cannot operate concurrently …, “apply concurrently” … or “operate side by side without conflict” …. The facts of this appeal indeed show an actual conflict in operation of the two provisions. This is a case where the provincial law says “yes” (“Alberta can enforce this provable claim”), while the federal law says “no” (“Alberta cannot enforce this provable claim”). (Moloney, Gascon J., para. 63, citations omitted)
Justice Gascon also makes it clear that the province cannot avoid the result by simply not applying its provision and thus avoiding a finding of conflict or that it frustrates the federal purpose. Paramountcy deals with the consequence of a finding of conflict or frustration, not a method of avoidance of a finding. (Moloney, Gascon J., para. 70)
From that perspective, “[i]t is impossible for the province to apply s. 102 without contravening s. 178(2) and, as a result, for the respondent to simultaneously be liable to pay the judgment debt under the provincial scheme and be released from that same claim pursuant to s. 178(2)”. Indeed, the provincial statute creates a new class of exempted debts. (Moloney, Gascon J., para. 75).
The provincial provision also frustrated the purpose under the BIA. If Moloney had to compensate the province before being able to drive (he was a truck driver), he would not be able to achieve financial rehabilitation (his debt to the province was by far his largest debt). Parliament could have identified judgment debts arising from motor vehicle accidents as exempt debts that survived bankruptcy, but it didn’t: “It is beyond the province’s constitutional authority to interfere with Parliament’s discretion in that regard” (Moloney, Gascon J., para. 79).
APPLYING PARAMOUNTCY TO THE PROVINCE OF FLORIDA
So, if Florida were a province of Canada, how would its requirements relating to vaccination mandates in the private sector fare given the CMS requirement?
The two laws are these: Florida prohibits private sector employers, encompassing health care operators, from imposing vaccine mandates on their employees unless they exempt employees on a broad range of grounds. (See the Florida law for private employers here.) It states that employers must allow employees satisfying the exemptions to opt out.The federal government requires that employers impose a vaccine mandate on employees of health care facilities with two exemptions allowed, medical and religious belief.
(A number of health care facilities in Florida have actually imposed mandates and in certain facilities a high number of employees are vaccinated, although this isn’t the case elsewhere: see here, for example).
Following Canadian paramountcy analysis, the first issue to be addressed is the constitutionality of the enactments. The Supreme Court of the United States did uphold the CMS rule on January 13, 2022. I’m not aware the Florida requirement has been tested for constitutionality. For the purposes of this analysis, I am assuming that both enactments are intra vires.
(I do note, though, that this might not be the case if a Canadian provincial legislature and the federal Parliament enacted similar rules.) For the American context, see the scope of federal and state authority in relation to vaccine requirements as described by the Congressional Research Service here.
Assuming that both the province of Florida’s and the federal government’s requirements are intra vires, do they pose a conflict? Do the two enactments mean that an employer (healthcare facility) cannot follow one without breaching the other? And/or does the Florida requirement frustrate the purpose of the federal requirement?
Under the federal order hospitals are required to implement a vaccine mandate with limited exemptions. Under the Florida rule hospitals are not allowed to implement a vaccine mandate unless they grant a longer list of exemptions.
Is there an operational conflict? Keeping in mind Wagner CJ’s injunction to exercise restraint, it does appear there is a conflict. This isn’t a case in which the provincial (Florida’s) law is more restrictive, since it gives a wider scope of voluntary action to employers. But implicit in that “voluntary action” is that employers are not expected to impose mandates. (Compare this to the complete ban on public employers imposing mandates in Florida.) They themselves believe they cannot impose mandates. The law states “Private Employer COVID-19 vaccine mandates are prohibited”, but it indirectly permits them if they permit the exemptions designed to protect the health of employees.
Where does that leave us? The conflict, apart from the significant element of intent, comes down to the exemptions. A reminder that the Florida exemptions, which are not exhaustive, are the following: health or religious concerns; pregnancy or anticipated future pregnancy; past recovery from COVID-19; opting for periodic testing or PPE (which employers must pay for). Although it seems private employers can impose mandates, if they do so, they must allow all these exemptions. Given their scope, if enough employees take advantage of these exemptions, it would be fair to say that there isn’t actually a mandate. And that is the intention of the law, to circumscribe a private employer mandate to such an extent that it makes it useless and too difficult to implement.
The CMS rule is clear: it requires vaccine mandates and allows only limited exemptions. It does not allow for some of the options under the Florida law. And a read of the CMS rule as it applies, for example, to hospitals, shows it would be unrealistic for a hospital to conform to both the Florida and federal rules.
The purposes of the Florida rule and the CMS rule are inconsistent. They are far from the “ultimate in harmony”. And the Florida law’s impact ensures that “the legislative purpose of Parliament will [not] be fulfilled regardless of which statute is invoked by a remedy-seeker”. The “application of the [Florida] law does  displace the legislative purpose of Parliament”,contrary to Dickson J.’s assessment of the provisions in Multiple Access. Thus under paramountcy, the Florida enactment would be inoperative.
Even if the Florida law survives the first test, it fails the second. Even abiding by Abella and Gascon JJ.’s caution not to interpret the federal law too broadly, the purpose of the federal rule is to increase vaccinations in the health care sector; it expects employers to impose mandates for all employees except those narrowly exempted. The purpose of the Florida law is to increase personal choice and limit requirements. The Florida law therefore frustrates the purpose of the federal rule. Again, under paramountcy doctrine, the Florida law would be inoperative.
Finally, let’s suppose a healthcare employee in Florida seeks an exemption not contemplated by the CMS rule. Contrary to Ross, the employee’s benefit is under the Florida (“provincial”) law, not under the CMS rule and therefore would not overcome the ramification of the paramountcy doctrine.