A Newfoundland and Labrador scaffolding company has obtained a temporary pause on a $477,198.28 union arbitration award after a judge found that enforcing the entire award before judicial review would threaten the business’s survival.
The September 8, 2026 ruling in Industrial Scaffolding Inc. v. United Brotherhood of Carpenters and Joiners of America, Local 579, 2026 NLSC 110 does not overturn the arbitrator’s findings or decide whether the company’s challenge will succeed. Justice Irene S. Muzychka of the Supreme Court of Newfoundland and Labrador, General Division, stayed the arbitrator’s decision pending review.
The dispute concerns the company’s use of non-union workers for residential scaffolding work. The union opposed the stay, arguing that it was entitled to the benefit of its award and that the employer had not established an irreversible financial injury.
What the arbitrator decided
The company had signed a voluntary recognition agreement in May 2013, agreeing to be bound by the applicable collective agreement between the Construction Labour Relations Association and the union. Industrial Scaffolding disputes the extent to which that arrangement covered residential construction.
The arbitrator allowed the union’s grievance. She found that the collective agreement applied to residential scaffolding, that the company had violated it by employing non-union members, and that it had failed to remit required union dues and follow dispatch and hiring procedures. The award required the company to pay the union $477,198.28 for August 2023 through August 2025.
Industrial Scaffolding sought judicial review, challenging the interpretation of the agreement and the scope of its recognition of the union. It also contested the retroactive damages calculation and alleged procedural unfairness because the arbitrator refused to postpone the hearing when four intended witnesses unexpectedly became unavailable.
Those are the employer’s grounds of challenge, not findings that the arbitrator made legal errors. The stay hearing concerned whether enforcement should wait while the court considered them.
A serious issue was only the first step
Muzychka applied the three-part test from the Supreme Court of Canada’s RJR MacDonald decision: whether there was a serious issue to be tried, whether refusing a stay would cause irreparable harm, and which side would face greater harm from granting or refusing the temporary relief.
The first threshold was low. The judge was not to conduct a detailed merits assessment before the full evidence was available. The union conceded that some of the company’s arguments were neither frivolous nor vexatious, although it disputed that every part of the award was genuinely in issue.
Muzychka found that the company had established a serious issue. That conclusion allowed the stay analysis to continue; it did not establish that the company was likely to win its judicial review.
Equipment and receivables were not available cash
The central issue was whether paying the award immediately could cause harm that a later successful review could not repair. Irreparable harm concerns the nature of the injury, not simply the amount of money involved.
The union questioned the adequacy of the financial evidence and pointed to the company’s substantial assets and shareholder equity. It suggested selling assets or making monthly payments. It also noted that there was no claim the union would be unable to return the money if the award were eventually overturned.
The court examined financial statements, overdue invoices, secured borrowing and ongoing liabilities. Much of the company’s asset value was tied up in equipment and receivables rather than cash. A significant portion of the receivables related to an ongoing mechanic’s lien claim.
Muzychka found that the company had no cash reserves to pay the award. Selling equipment could impair its ability to operate and risk loans being called. The company said its existing debt payments, payroll, tax remittances and leases also prevented it from making monthly payments toward the award.
The evidence had limits. The judge could not determine how much the company could borrow, and initially described business failure as an uncertain but more-than-speculative possibility. After considering the financial records and continuing obligations, she concluded that enforcement of the entire award would cause irreparable harm in the form of business failure.
A later repayment by the union would not remedy the loss of the business. The ruling is a finding about the risk from enforcement before review, not a finding that the company had already closed or become bankrupt.
Why the whole decision was stayed
The union argued that at least $121,034.95 should remain enforceable, describing that amount as unpaid health and welfare, pension and other remittances the employer had admitted owing for unionized employees.
The company disputed that the amount could be accurately calculated in light of its review arguments. Without the entire record, Muzychka said she could not determine an appropriate amount for a partial stay.
Balancing the competing harm, the judge favoured preserving the company’s operations while the review proceeded. Her reasons recorded that the judicial review hearing was scheduled for February 18, 2027, a date she considered sufficiently prompt. That was the schedule stated in the September decision, not a finding about any later hearing or outcome.
The arbitrator’s decision was stayed pending review, not cancelled. Litigation costs were left in the cause, to follow the outcome of the underlying proceeding; the reasons fixed no dollar amount. The legality of the arbitrator’s decision and the company’s ultimate liability remain undecided by this stay ruling.
