STANDING COMMITTEE ON INDUSTRY

COMITÉ PERMANENT DE L'INDUSTRIE

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, March 11, 1999

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[English]

The Chair (Ms. Susan Whelan (Essex, Lib.)): I'm going to call the meeting to order, pursuant to an order of reference of the House dated Tuesday, November 3, 1998: consideration of Bill C-54, an act to support and promote electronic commerce by protecting personal information that is collected, used, or disclosed in certain circumstances, by providing for the use of electronic means to communicate or record information or transactions, and by amending the Canada Evidence Act, the Statutory Instruments Act, and the Statute Revision Act.

[Translation]

Ms. Lalonde.

Ms. Francine Lalonde (Mercier, BQ): I would like to raise a point of order.

This morning, you told me that Mr. Frémont who, in my opinion, had been invited to appear, had been contacted for the sole purpose of setting a date for a broader panel. However, I contacted Mr. Frémont and he told me that he had indeed been invited to appear Thursday morning. He even received confirmation for this appearance, and I have a copy of the notification here.

Madam Chair, I spoke with some of my colleagues and they said that they had never seen such a situation, namely, where someone had had their appearance confirmed and they were then told: “Don't come. We will try to schedule another date.” I would really like to know what occurred between the time that we received the first notice on Tuesday, at 5:05 p.m., and the second notice, on Wednesday at 8:37 a.m.. Confirmation for this appearance was made on March 9.

Madam Chair, whatever the case may be, I would really like either you or someone to write to Mr. Frémont in order to apologize because it seems to me that we shouldn't treat witnesses in this manner. I want us to make every effort to hear this witness, whether by himself or with others.

[English]

The Chair: Madame Lalonde, as I explained earlier today, with all due respect, Mr. Frémont was not confirmed for this morning. He was invited and tentatively scheduled for this morning. The agenda that went out went out inadvertently, because you see only one name and no others. He was to be part of a panel of three. If there was a confirmation, it was done, as well, inadvertently.

The clerk has spoken to Mr. Frémont. He's very willing to come next week. She spoke with him since the meeting this morning. She spoke with him earlier this afternoon. He doesn't seem to have a problem with it.

I did not confirm Mr. Frémont for this morning, so I apologize to you. I don't even know what that is you're showing me. I didn't send that out.

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[Translation]

Ms. Francine Lalonde: We have a serious problem here in the committee. When the clerk confirms something, that means that the confirmation is official. You can't get any more official than that.

I would like this document to be photocopied and distributed.

[English]

The Chair: The clerk has just explained and she explained to Mr. Frémont. It's a confirmation notice that inadvertently went out. As you can see, it shouldn't have happened. There were supposed to be three witnesses. There was only one who was able to confirm for this morning, so we delayed the meeting. I explained it quite clearly this morning, Madame Lalonde.

[Translation]

Ms. Francine Lalonde: But you...

[English]

The Chair: With all due respect, we've also cancelled other meetings in the past. We cancelled the meeting for the day of the budget, when two witnesses had been confirmed for two weeks. This happens from time to time at committee. It's not something out of the ordinary. It's not something new. It happens.

Mr. Frémont was advised when he was invited that there were three witnesses who were to appear at the same time.

I'm not going to discuss it any more. We have witnesses waiting. If you want to delay the second group, that's fine, keep talking.

[Translation]

Ms. Francine Lalonde: It is not at all my intention to delay the appearance of the witnesses here this afternoon. I do, however, want the committee to conduct itself properly with the witnesses.

[English]

The Chair: We do things the way we should, Madame Lalonde, with all due respect to you. The clerk does what she can. She has an assistant. Sometimes things happen that shouldn't happen.

[Translation]

Ms. Francine Lalonde: She did this yesterday.

[English]

The Chair: Pardon me?

[Translation]

Ms. Francine Lalonde: I'm not blaming her, but I see that confirmation was in fact made.

[English]

The Chair: The clerk has explained several times that Mr. Frémont is willing to come one day next week. We're working out times and dates. We've offered different times and dates to all of our witnesses.

That being said, I'm very pleased to welcome our witnesses here this afternoon. We have the Canadian Life and Health Insurance Association. We're very pleased to have Mr. Mark Daniels, the president; Mr. Jean-Pierre Bernier, the vice-president and general counsel; and Mr. Charles Black, senior adviser, insurance operations. We are very pleased to have the three of you before us.

Everyone should have received in their office a detailed brief in advance of today. I believe, Mr. Daniels, that you now have an opening statement to go along with that brief.

Mr. Mark Daniels (President, Canadian Life and Health Insurance Association Inc.): Thank you, Madam Chair. It's a pleasure to have this opportunity to contribute to the deliberations of the Standing Committee on Industry regarding Bill C-54.

I'd like to begin by saying a word or two about my colleagues who are seated with me at the table.

Charles Black is the CLHIA's senior adviser on insurance operations. Mr. Black is an actuary who has been deeply involved with privacy issues in the life and health industry for many years. For example, Mr. Black was one of the industry representatives who participated in the development of the CSA model privacy code.

Jean-Pierre Bernier is the CLHIA's general counsel. Mr. Bernier's lengthy experience in legal matters affecting our industry has given him considerable expertise in the area of privacy, including a familiarity with Quebec's privacy legislation.

All of this, Madam Chair, is to say that I'm here essentially as a water carrier for my two colleagues, who are much more versed than I in the details of the legislation.

Over the years this committee has played an important role in the development of public policy impacting the Canadian economy and society in general. Our own industry has testified before this committee on a number of significant issues over recent years. In this context, your recent invitation was very much welcomed as an opportunity to provide constructive contributions to the committee as you seek to develop your report to Parliament on this sensitive, complex, and vitally important piece of legislation.

With your permission, Madam Chair, I want to just say a few introductory comments and then turn to Mr. Black, who will provide the committee with the industry's views and recommendations pertaining to Bill C-54. Then Mr. Bernier will conclude with some remarks following. Our comments will closely parallel the submission that has been distributed to the committee.

At the outset, I want to note that our submission and our comments relate solely to the privacy aspects of Bill C-54. Moreover, they are confined primarily to Bill C-54 as it was tabled in October. We are aware that the parliamentary secretary recently put forward 25 government amendments. We will endeavour to address a few of these amendments in our remarks this afternoon.

By way of background, the Canadian Life and Health Insurance Association represents 84 life and health insurance companies, accounting for about 90% of the life and health insurance in force across Canada. The industry serves more than 20 million Canadians and another 10 million people internationally.

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For over 100 years, Canada's life and health insurers have been handling the personal information of Canadians. The very nature of the insurance product requires that a large portion of the information exchanged between companies and their clients is personal in nature. And protecting its confidentiality has been long recognized by the industry as an absolutely necessary condition for maintaining access to such information.

Indeed, our industry would not have survived if it were not able to have the trust placed in it by Canadians. Correspondingly, Madam Chair, life and health insurers have taken a leadership role in developing standards and practices for the proper stewardship of personal information.

In 1980 we adopted right to privacy guidelines, which represented, as far as I know, the first privacy code to be adopted by any industry group in Canada. The industry continues to update those guidelines, most recently in 1993, and a further fine-tuning of them will have to take place over the months ahead to reflect any new requirements resulting from Bill C-54.

In light of the industry's international business, the CLHIA, along with its U.S. counterparts, urged the Canadian and U.S. governments to adopt the privacy protection principles established by the OECD. And the principles were adopted by Canada in 1984.

In 1991 the industry included a provision in its consumer code of ethics, which requires members “to respect the privacy of individuals by using personal information only for the purposes authorized and not revealing it to any unauthorized person”. A commitment to this provision, by the way, is one of the requirements of membership in the CLHIA.

At present we are working closely with the federal finance department with respect to the MacKay task force and the possible development of privacy regulations under the Insurance Companies Act. The committee should also be aware that several life and health insurance industry representatives have actively participated along with governments, labour and consumer groups in the development of the CSA model code for the protection of personal information. This comprehensive and multi-sectoral code represents a significant step forward in the protection of personal information in Canada, as indicated by the fact that it has been used as the basis for part 1 of Bill C-54.

A key strength of the CSA model privacy code is its balance between improved privacy protection and promotion of efficient commerce. While Bill C-54 is built on the sound principles of privacy protection contained in the CSA model code, we are concerned that the legislation contains several practical deficiencies. Most notably, Bill C-54 lacks the balance established in the CSA model privacy code.

In this context, Madam Chair, our submission to the committee makes a number of recommendations, which we believe will improve the workability of the legislation. I'd now like to ask Mr. Black to address some of our specific recommendations regarding Bill C-54.

The Chair: Mr. Black.

Mr. Charles Black (Senior Adviser, Insurance Operations, Canadian Life and Health Insurance Association Inc.): Thank you, Madam Chair and members of the committee.

Perhaps it would be reassuring to state up front that I don't intend to plow through the detailed comments in our submission. But I would like to provide in the next few minutes a brief background or context for the comments that are made in chapter 3 of the written submission.

As outlined in appendix C, life and health insurers operate on a national basis and deal with a very large number of Canadians. Indeed, Canadian insurers are also very active internationally. Life and health insurers' operations involve very personal situations: financial planning for a potential death, the processing of a disability claim, reimbursing the costs of prescription drugs and other health care expenses and so on. These operations are transaction oriented, involving thousands of transactions each working day. These transactions are very varied in nature, as are the insurers' needs for personal information.

For example, under a personal life insurance policy, particularly one for a large amount, detailed information may be collected when the individual applies for insurance, may be used to assess the applicant's eligibility, and then the file may be relatively dormant for several decades until death occurs. In contrast, under many group insurance or employee benefit plans, the insurer collects virtually no personal information, not even the individual's name or address, until a claim actually occurs for the cost of a prescription drug, for example. At that time, sufficient information obviously must be collected and used to process the claim.

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As Mr. Daniels has indicated, insurers have recognized for many years that the confidentiality of personal information must be protected, and have undertaken extensive steps to do so. We believe that in general those efforts have worked well. That conclusion was shared by the federal Task Force on the Future of the Canadian Financial Services Sector, which examined this aspect in considerable detail.

Later in our discussion, if time permits, I would be pleased to share some experience from our consumer assistance centre.

We realize that rapid advances in technology, the implementation of the European directive, and other factors make it desirable to develop broader systems to protect personal information, such as the CSA model code, in which we have participated actively, or this proposed legislation.

As indicated in the submission, we've reviewed the proposed legislation on the basis of the industry's experience and on the basis of several criteria that have emerged from that experience. I certainly want to emphasize that we support the objectives of the legislation and most strongly endorse the use of the CSA model code as the basis for it. The principles in this code form an excellent foundation for flexible and effective privacy legislation, protecting the privacy of individuals throughout the private sector.

As indicated in chapter 3, however, we are concerned about several practical aspects of this bill and believe efforts must and can be made to improve those aspects. For example, many provisions of the bill are very difficult to interpret, including most significantly the application and the implementation provisions. In our view, this lack of clarity seriously hampers an understanding of the legislation and will complicate its implementation and its administration.

As indicated, the operations of life and health insurers are national in scope, and many common day-to-day transactions involve both intraprovincial and interprovincial or international collection, use, and disclosure of personal information. Thus, one of our primary concerns is that we believe the need to coordinate or harmonize this legislation with any such legislation at the provincial or territorial level is paramount to avoid unproductive duplication and confusion for consumers, for organizations, and for regulators alike.

Based on our current understanding, we believe that the current provisions of Bill C-54 that strive for harmonization would be largely ineffective for organizations such as life and health insurers, which operate on a national basis. In our view, further efforts are clearly needed in this area.

In general, life and health insurers collect, use, and disclose personal information with the consent of the individual and also provide the individual with access to his or her information. Those principles, I might mention, are key items in our industry guidelines. There are some situations, however, where such procedures are inappropriate. Some such situations are recognized in proposed sections 7 and 9 of the proposed legislation, but these provisions are inadequate, in our view, and do not achieve the required balance among individual, collective, and organizational needs.

Several examples are outlined in the written submission. In the interests of time, I will comment only on one: the deterrence and detection of fraudulent and deceptive practices. The impact of such practices on insurance and indeed on other financial services can be extremely damaging, and efforts to minimize them are essential.

On this point, the recent report of the federal Task Force on the Future of the Canadian Financial Services Sector comments in its paper entitled “Empowering Consumers” as follows:

Consumer fraud is a problem for financial institutions, and they must be in a position to protect themselves from it, as this also benefits other consumers.

As indicated in the submission, fraudulent and deceptive practices can arise from several sources, including a very small minority of consumers themselves, service providers, and other parties that are not directly involved with the contract. We do not believe efforts to control such practices need to be in conflict with efforts to protect personal information, but we are seriously concerned that the current provisions of Bill C-54 would have that impact.

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Our submission also contains a number of other comments and recommendations for improvements in the proposed legislation, which we trust will receive careful consideration. I emphasize again that we believe such improvements can be made and they are necessary to achieve the objectives of this bill. They include effective and comprehensive protection of personal information, and the promotion of efficient commercial activities.

The association certainly stands ready to work with your committee and other parties in this regard, if that would be helpful.

Thank you.

Now I would ask my colleague, Jean-Pierre Bernier, to continue our comments.

[Translation]

Mr. Jean-Pierre Bernier (Vice-President and General Counsel, Canadian Life and Health Insurance Association): Madam Chair, the CLHIA thanks the committee for this opportunity to express its views on Bill C-54. Our opinion is based on our experience in protecting personal information and on our analysis of this bill to date.

The CLHIA fully supports the privacy principles put forward in this bill, which are based on the CSA code. Nevertheless, we do feel that the bill, in its present form, contains some major shortcomings in practical terms. We must eliminate these shortcomings in order to achieve a balance between the following two goals: to provide adequate protection of personal information and to promote good practices in marketing goods and services to Canadians, including electronic marketing. Thank you for your attention.

[English]

The Chair: Thank you very much, Mr. Bernier.

We will now go to questions. Mr. Lowther, do you have any questions?

Mr. Eric Lowther (Calgary Centre, Ref.): Yes, I have one question for Mr. Black. I am interested in his comments regarding his concerns about the efforts to detect and defer fraud.

Your document talks about a situation in a Montreal suburb where apparently somebody was putting forward false claims and claiming the same thing from a number of different insurers, etc. We don't need to go too much into this particular case unless you feel it's necessary, but I was wondering, because it doesn't really conclude here, how you think this particular piece of legislation would have helped address this kind of situation. If it had been in place, would it have made a difference? Are there changes needed that would have helped in this kind of scenario, or is it not even related? I'd just like some insights there.

Mr. Charles Black: This legislation is very directly related, particularly the provisions under clause 7 of Bill C-54. We address this issue on page 15 of our text. Some of these provisions are difficult to interpret, but paragraph 7(1)(b), particularly if it's corrected as we recommend, would allow the collection of information without the individual's consent in certain situations that we interpret to include efforts to detect and deter fraud and deceptive practices. In many cases we would be operating with the individual's consent, but if that consent must be obtained at the time of the investigation, it could obviously frustrate the purpose.

However, there is no similar provision in subclause 7(2) or subclause 7(3) with regard to the use or disclosure of information without the individual's consent. We are very concerned, for example, that although the insurer might be able to collect the information, no one else would be prepared to disclose it without the individual's consent. There are also situations where the insurer itself must disclose that information. I believe the example you cited involved the cooperative efforts of 24 insurance companies and three government agencies. So we believe amendments are needed to the bill to provide more flexibility and balance in this area.

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Subclause 7(2) also refers back to the use of information collected under paragraph 7(1)(b). I apologize for getting into such detail, but that reference then limits the use to information that is collected without the individual's consent, and in many cases the information used would have been collected previously.

I would emphasize a comment I made earlier that the suspected perpetrator of the practices may not be the individual. It may well be a health care provider, a dentist, a doctor, a hospital or a physician in Florida, for example, who is overcharging exorbitantly on out-of-Canada travel insurance.

Mr. Eric Lowther: So if the provisions you're suggesting on page 15 had been in place, these 24 insurers and three government agencies could have more openly shared information to more quickly come to a conclusion that fraud was taking place, and could have caught it sooner. Is that the bottom line here?

Mr. Charles Black: In the example that happened, of course, this legislation was not in place. Quebec's privacy legislation was in place and provided a reasonable amount of flexibility that did not inhibit this investigation. Our own industry guidelines provide that information can be collected, used and disclosed only with the consent of the individual, except where inappropriate. They specifically refer to fraud and deceptive practice investigations. It's one of those situations where it's inappropriate.

So that investigation was within the confines of our industry guidelines. We believe it was conducted in a reasonable way.

Mr. Eric Lowther: So you were not hindered in any way with the current structure prior to this legislation coming forward?

Mr. Charles Black: That's correct. But we would be under—

Mr. Eric Lowther: But you would be under the proposed legislation unless these changes were made.

Mr. Charles Black: Right.

Mr. Eric Lowther: Thank you, that's what I needed to get.

The Chair: Thank you very much, Mr. Lowther.

Mr. Lastewka.

Mr. Walt Lastewka (St. Catharines, Lib.): Thank you, Madam Chair.

There was a request in your report about the grandfathering of information collected to date, and I didn't hear it today. Do you have a concern about having to update records in order to allow privacy items to be obtained by consent?

Mr. Charles Black: We have some concern because of the volume of information of this nature and the fact, as I alluded to briefly in my comments, that much of this information could be decades old. The consent language used at that time certainly would not have anticipated the concerns that are present in 1999, and to administratively go back to contact all those policyholders, the insurer has no authority to require consent.

Insurance contracts generally cannot be cancelled, and the insurance company cannot insist on any modification. If a claim is being filed, of course, they can put appropriate language on the claim form.

But the time required to contact existing customers is fairly extensive, and we believe there needs to be some flexibility in this area that would permit informing those customers and assuming, if they don't express serious concerns, consent would be implied.

Mr. Walt Lastewka: But don't you communicate with your clients in your ongoing business and say “These are the agreements you have and we suggest you make some changes”, and so forth? Don't you think you could at the same time upgrade your privacy...what you have on that client?

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Mr. Charles Black: We could certainly provide information at that time. Typically there is an annual communication with the individual policyholder. It would take some time to gear up and develop the necessary material to do that. Then it would take, with a little lead time, probably 15 months to run through the cycle. In other cases, as I indicated with group insurance, the insurance company doesn't even know the name or address of the individual.

Mr. Walt Lastewka: So what I'm hearing from you—and I would think our commissioner would be reasonable and understand—is that it would take some time to get the proper consent, but at the next billing, when that client is reviewing his or her insurance, consent could be given by that individual on the gathered materials.

Mr. Charles Black: Certainly information could be provided. As I indicated, the insurer has no right to insist on consent and would still be bound to administer the contract.

Mr. Walt Lastewka: Have you had a chance to go through all the amendments that were brought forward?

Mr. Charles Black: Very briefly.

Mr. Walt Lastewka: During the course of reviewing the amendments, did you see any problems?

Mr. Charles Black: One that at least requires further study is the amendment to paragraph 7(1)(b), which does two things. First of all, it makes the correction that is referred to in our submission, where we felt it was necessary to refer to the individual's consent rather than collection from the individual. The second part of that, however, tightens the language very materially and refers to a breach or a suspected breach of a law of Canada or a province. We're not sure whether that would include an investigation for potential fraud. If it would, the reference to the laws of Canada or a province would not provide the necessary flexibility if we were investigating a doctor or a hospital in Florida, for example.

Mr. Walt Lastewka: I think I heard you say earlier your members in Quebec apply the Quebec law.

Mr. Charles Black: Very much.

Mr. Walt Lastewka: Have you had any difficulties?

Mr. Charles Black: I wouldn't characterize them as difficulties. Perhaps Mr. Bernier would like to comment. But my understanding is that there are—

Mr. Walt Lastewka: Areas of improvement or...?

Mr. Charles Black: —areas of interpretation. We are working with the commissioner there to understand and make our member companies aware of their requirements.

Jean-Pierre.

Mr. Jean-Pierre Bernier: When the Quebec privacy legislation came into force, the major problem we faced was a question of interpretation, because it was not specifically tailored to insurance. We had to adjust to the new laws and regulations pertaining to the protection of personal information.

We received many questions from our member companies throughout Canada that do business in the province of Quebec about the meaning of certain aspects of the legislation and what they could and couldn't do. We collected questions from the members and set up two working groups of lawyers—one group of francophone lawyers in Quebec and one group of anglophone lawyers in Ontario—to answer the same questions. We came up with common answers.

Before publishing our answers, we worked with the Quebec privacy commissioner and his staff on the answers we were providing to our members. Following several meetings we had with the staff of la Commission d'accès à l'information, we had to make some changes to our answers. That resulted in a little guide that we call “Guide 68” in relation to Bill 68 in Quebec. It's still in application today without problems.

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Mr. Walt Lastewka: Is it being used outside of Quebec?

Mr. Jean-Pierre Bernier: The principles protecting personal information that were developed in Quebec are used by an increasing number of life companies outside Quebec, Canada-wide, nationwide.

Mr. Walt Lastewka: Thank you, Madam Chair.

The Chair: Thank you, Mr. Lastewka.

[Translation]

Ms. Lalonde, do you have any questions?

Ms. Francine Lalonde: Yes. Thank you for your presentation and your very detailed brief.

I will pursue Mr. Lastewka's line of questioning and begin by saying that Quebeckers expected federal legislation based on this experience instead of creating, even if based on the principles of the CSA code, a completely different bill. Your opinion of the bill is extremely practical and useful, although severe.

I would first of all suggest to my colleagues—I hope that everyone had time to do this—to take a look at Appendix B. You have asked some very concrete questions. This is helpful to me because I have said, on several occasions, that in Quebec we already have legislation in effect. Perhaps I shouldn't have said that, but there is legislation only in Quebec. Some companies won't know which legislation to apply under certain circumstances or they're going to have to apply both laws. I pointed out that this created a major problem, as you do as well. You asked what will happen if the other provinces adopt different laws that are more or less similar to the one in Quebec, and you explained in very practical terms the need for coordination.

I would ask you to comment on your recommendation because, just beforehand, you pointed out on page 12:

Such layering of a regulation leads to uncertainty and confusion among consumers, as well as to non-productive duplication and administrative costs for organizations and regulatory agencies. It is extremely undesirable.

Your recommendation reads as follows:

The CLHIA respectfully suggests that the committee recommend that, before proceeding with this legislation,...

This was in response to the task force.

...the federal government undertake further consultations with provincial governments and with private sector organizations to develop a more satisfactory approach...

Could you elaborate on this recommendation and perhaps give us some examples?

[English]

Mr. Charles Black: Thank you, Madame Lalonde. I think you have captured the concern we have in this area very well.

The principles in the schedule of Bill C-54 are virtually identical to the principles underlying the Quebec privacy legislation, and indeed the principles underlying our own industry guidelines for quite some years. I think the principles are comparable; at that level, we frankly do not regard this legislation as being materially different from the Quebec legislation. As they say, however, the devil is often in the details, in the practical implementation, in the interpretation, and in dealing with regulators in this area, we believe.

We believe there are also potential problems. One is referred to in appendix B, with regard to the Manitoba legislation on health information, even though we think it clearly does not apply to insurers. There's legislation being developed in Alberta. Alberta's recent throne speech indicated that the government there would be bringing forward legislation for health information.

So there's a lot of activity in this area, and we feel the possibility of multiple, overlapping, duplicative legislation is extremely severe and must be addressed. Certainly, we believe the objectives of the various jurisdictions are comparable in protecting personal information. We would like to think further consultations would lead to an agreement to work together on this.

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We also refer there to the use of sectoral codes, which are not developed in the legislation. For example, as has been mentioned, we did adapt our industry guidelines in 1993, certainly in anticipation of some of the provisions in the Quebec legislation. We believe a code could be developed for our industry that would meet the requirements of both the Quebec and the proposed federal legislation. We feel that, with oversight by the respective authorities, if that sectoral code was somehow accepted as meeting the needs, then companies could operate under that single code rather than under two or three or five or twelve different pieces of legislation. That's one of the avenues that obviously would need more work, but we think it has potential to address this issue.

[Translation]

The Chair: Mr. Bernier.

Mr. Jean-Pierre Bernier: Even for sectors that come under Quebec's jurisdiction, the multitude of regulations and laws on the protection of personal information is a source of great concern.

Moreover, last year, Quebec created a financial services office under Bill 188, which dealt with the marketing of financial goods and services. At the outset, the bill gave the Bureau des services financiers du Québec the same type of power to create regulations on the protection of personal information as was given to the Commission d'accès à l'information. The president of the Commission, Mr. Comeau, strongly opposed this potential to create numerous regulations in order to protect personal information. Just before Bill 188 was adopted, Minister Landry, who was responsible for the legislation, withdrew the regulatory power that the government of Quebec had wanted to give to the Bureau des services financiers.

The Chair: Thank you, Ms. Lalonde. Ms. Jennings, the floor is yours.

Ms. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.): I would like to thank the witnesses for their presentation. I have a few questions for you.

First of all, you talked about the need for coordination and harmonization of all legislation that would eventually be adopted by the provincial governments in this area. You spoke about coordinating provincial laws that may be adopted within a three-year period with the federal Act which, we are presuming, will be adopted, perhaps with some amendments, and will come into force eventually.

I really appreciated the fact that Mr. Bernier pointed out that there can be some overlap between various regulations even within the same province. It's always a challenge to ensure that, first of all, there is no infringement and that, second, everything is properly harmonized.

On another issue, do you think that there should be protection for an employee who has reasonable grounds to believe that his or her employer is breaking the law? Let's say that the bill is adopted. Should it contain provisions to protect this employee against any retaliation from his or her employer should this employee decide to file a complaint with the Commissioner? Here I am not referring to complaints that the Commissioner may deem to be frivolous, futile, vexatious or made in bad faith.

Do you think that we should provide such protection, protection that is, moreover, found in several human rights statutes? Here I'm thinking about an alleged victim of sexual harassment or discrimination committed by the employer.

Mr. Jean-Pierre Bernier: Yes, indeed. The problem with Bill C-54 is that, if I remember correctly, the employees who will be affected will be those who work for businesses that come under federal jurisdiction. Bank employees, for instance. There is no uncertainty about the application of personal information protection principles for bank employees.

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However, the employees of insurance companies are wondering about this. It is very difficult to say whether or not the provisions of Bill C-54 will apply to insurance company employees, regardless of whether or not the company is incorporated federally or provincially. The Canadian Constitution does not designate insurance companies as federal businesses.

Ms. Marlene Jennings: But in the course of your transactions, you use personal information. If this information is transmitted between provinces in the course of a business transaction, I presume that the provisions of this bill will apply to that transaction.

I will now ask a second question which will give you the opportunity to answer my first one. I don't know whether the Quebec law provides for that type of protection. Do you know? Can you refresh my memory?

Mr. Jean-Pierre Bernier: I was just going to answer your first question by addressing your second one.

Ms. Marlene Jennings: Fine, go ahead.

Mr. Jean-Pierre Bernier: The employees of insurance companies, whether they fall under federal or provincial charters, who work in Quebec are covered and protected by the Quebec law of privacy protection. To come back to the idea of harmonization, these employees are protected in Quebec, which is still the only province to have privacy protection legislation. It therefore goes without saying that employee protection should be extended to every other Canadian jurisdiction.

Ms. Marlene Jennings: You mean that in Quebec, under Bill 68, an employee who complains to the Access to Information Commissioner because his employer is breaking the law is protected from possible repercussions by his employer?

Mr. Jean-Pierre Bernier: Yes.

Ms. Marlene Jennings: Can you point out the relevant section?

Mr. Jean-Pierre Bernier: Unfortunately, I did not bring my copy of Bill C-68.

Ms. Marlene Jennings: I have a copy in my office. I asked the question in case you had brought it. I don't recall any such provisions.

Do you really think it's good to have what is called

[English]

a whistle-blower protection?

[Translation]

Mr. Jean-Pierre Bernier: Yes. If we made exceptions for employees from one sector or another, for employees of non-profit organizations and for others, the bill would have very little impact.

Ms. Marlene Jennings: No, I was talking about a plaintiff who denounced his employer for breaking the law, not necessarily by revealing information about the employee, but by doing so after a third party had collected or transmitted personal information in order to commit fraud. Does the law protect the employee who complains to the Commissioner and who is then subject to repercussions by his employer, like being fired or not being promoted to a position for which he is qualified? That's the kind of protection I'm talking about.

Mr. Jean-Pierre Bernier: Yes, the law covers that type of situation. A private law firm in Montreal studied some 4,000 complaints since Bill C-68 was passed in Quebec. Since I'm not familiar with Quebec statistics, I can't really say how many complaints came from employees. All I can say is that employees and employers in Quebec are covered by Bill 68.

Ms. Marlene Jennings: I'm not sure you've answered my question. I'll look at my copy of the bill at my office this evening. Thank you.

The Chair: Thank you, Ms. Jennings.

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[English]

Mr. Lowther, did you have any more questions?

Mr. Eric Lowther: No.

[Translation]

The Chair: Ms. Lalonde.

Ms. Francine Lalonde: I'll refer to the same page. You say:

Subsection 27(2)(d) provides for an exemption from the application of this Part where there is substantially similar legislation at the provincial level. However, this exemption is limited to "the collection, use or disclosure of personal information that occurs within that province" and, thus, would not be operative for a transaction that involves interprovincial or international components.

In the opinion of your association, this approach is completely inefficient for organizations like yours. This is why you say governments will have to work together. Tell us a little more about this and the kinds of problems you have to deal with. In Quebec, for instance, companies will be subject to two laws at the same time. Which one will apply?

Mr. Jean-Pierre Bernier: I do not have an answer. I could not give an answer to my members based on the provisions of Bill C-54. We have identified problems that would arise from the application of Bill C-54 in business transactions transcending in one way or another the jurisdiction of a single province. We make thousands of business transactions like that each day, and each transaction varies. You were given many examples in Appendix B. I cannot answer the questions that we asked ourselves on the application of Bill C-54.

[English]

The Chair: Mr. Black, do you wish to comment?

Mr. Charles Black: If I may, Madam Chair, I'd just like to comment on that.

At least in Quebec we have one piece of legislation that appears to be comprehensive. One of our concerns about this bill is that it does not appear to apply to certain key sectors, such as the area that Madame Jennings raised—or part of her question did—with regard to employer or employee information. In other provinces, we can certainly see being subject to substantially more than two laws. For example, if the Province of Alberta implements provisions protecting the privacy of employer-employee information under its employment standards legislation, we could see that it could impact on our business because much of our business is in the group insurance or employee benefits area. We could see health information protection legislation in Alberta. It's certainly on the road. And there are revisions to the Insurance Act in Alberta that have privacy provisions in them.

As Mr. Bernier points out, it's not just one law per jurisdiction, there could be several. In our view, this is a very serious administrative problem.

The Chair: Mr. Daniels.

Mr. Mark Daniels: As you can see, I just want to add parenthetically that throughout this whole submission of ours, what we've tried to do is not get at the principles of the law—we're trying to operate with them already—but deal with a practical overlay. There are a lot of practical problems that we can see coming out here that are going to make it potentially difficult to continue with business, at least as we have practised it. Obviously changes will be made to accommodate whatever the law is, but there may not be enough flexibility in here to allow us to work with the necessary authorities, Madam Chair.

The Chair: Mr. Dubé, you had a question.

[Translation]

Mr. Antoine Dubé (Lévis-et-Chutes-de-la-Chaudière, BQ): You say that additional consultations would be useful because there are still some problems.

Some witnesses have told us that this bill was trying to encompass too many things, namely seeking to promote electronic trade and, at the same time, get into the field of protecting personal information that is not necessarily electronic. You work in the field of insurance, where many transactions are made by electronic means. What do you think of the position of those who would prefer to have two separate acts?

• 1625

Since I have the floor, I would like to ask one more little question. Some witnesses are concerned that the Cabinet can by order, without even consulting the Parliament, change the legal aspects of the law. What do you think of that?

Mr. Jean-Pierre Bernier: There is a constitutional question here. Although I am not a constitutional expert, I have taken some courses in the field. In my opinion, the question of protection of personal information is one of provincial jurisdiction, under the heading property and civil rights. Thus it would be very difficult to imagine the federal government passing a bill focussing only on the protection of personal information.

We know that the federal government has jurisdiction over electronic trade, as it does over banks. In grouping together rules on the protection of personal information within a field of activity where its authority is not disputed, the federal government is more likely to get involved in this field. I believe that this is why the issues of electronic trade and protection of personal information have been grouped together. I'm giving you a personal opinion. As I said, I'm not an expert in constitutional law.

[English]

The Chair: Thank you very much, Mr. Dubé.

Mr. Lastewka.

Mr. Walt Lastewka: Yes, I just have one question after Mr. Daniels' intervention there.

I want to take this to a very simplistic area, based on your comments. The privacy bill basically says that if you're collecting information from an individual, you have the consent of that individual. If you're going to use that information for anything other than what it was intended, you have an obligation to go back to the individual.

You talked about the section on the investigative portion, and I understand that there is need for some clarification there. But taking it down to the very simplistic matters, what are your difficulties? You had mentioned a number of technical problems and a number of other areas, Mr. Daniels, but isn't that the essence of the bill? It seems we're making more of it than those simplistic points.

Mr. Charles Black: Mr. Lastewka, I tend to agree with you. It should be a simple matter. We believe improvements can be made to facilitate the infrequent situations in which it's necessary to use, disclose and collect information. Another example that we cite is a situation in which a certain action is required by law. As currently drafted, the bill permits disclosure of information without the individual's consent where required by law, but there is nothing comparable for the collection or use that would be any processing within the organization, including, as we understand it, transferring information from the operating area to the legal department within the organization.

One of the areas that is of great concern is the whole issue of money laundering. There are requirements in the law to take certain action with regard to financial transactions in order to try to minimize the possibility of money laundering. Those requirements are legal requirements, and to comply with them may require the collection of certain information. It may require the use, the processing of certain information, and it certainly requires the disclosure of certain information.

In our view, the exceptions in clause 7 are just incomplete. There are three separate lists, and there's no parallelism between the three lists. I think they are relatively simple changes.

• 1630

Mr. Mark Daniels: Madam Chair, that is indeed exactly the answer. As I said in my opening remarks, as the specialists in our organization and industry sat down and looked at this, we weren't grumping about the principles of the bill. On the contrary, we've tried to live with them. What we've tried to do in this rather exhaustive, if not exhausting, submission is give you examples of situations in which, in our view, it's not going to work when we have to deal with the stuff on a day-to-day basis. That's what we're trying to get at here. It's not an attempt to undermine the bill. On the contrary, it is an attempt to make it work in a practical context, the one we have to operate in.

Mr. Walt Lastewka: Thank you, Madam Chair.

The Chair: Thank you, Mr. Lastewka.

I just have two questions. I'm not sure if you've seen the press release dated October 1, 1998, that accompanied the bill, but it very clearly states:

Where and whenever a province adopts legislation that is substantially similar, the organizations covered will be exempted from the application of federal law. As Quebec's existing privacy law is essentially similar to the proposed Personal Information Protection and Electronic Documents Act, Quebec will be exempted from its application.

We seem to be splitting a lot of hairs over Quebec versus federal jurisdiction or federal legislation. There seems to be a lot of confusion that you're raising. I look at your examples towards the end of your brief, in appendix B. The reality is that you're a large organization with companies all across Canada. You uphold the higher standard. What's the problem?

Mr. Charles Black: Madam Chair, I think the basic problem is this: we have reviewed that press release in great detail, we have reviewed the provisions in the bill in great detail, and we cannot interpret the provisions in the bill to tally with the press release, frankly. We feel the—

The Chair: But if you uphold the higher standard, Mr. Black, what's the problem? You're already upholding the standard in Quebec right now.

Mr. Charles Black: As I mentioned earlier, I do not see a problem in coming up with a single code that would meet the needs of the Quebec legislation and the needs of this legislation, but there is duplication in administration. There is confusion for the consumer to know who to turn to. The consumer may not know whether this transaction involves interprovincial or international components. From the consumer's viewpoint, he or she may be dealing with the insurance agent three blocks away while not realizing that the information or disability claim is processed in a regional claims office in Ottawa.

The Chair: Surely you're not suggesting the onus should be on the consumer to decipher that.

Mr. Charles Black: I'm not suggesting that, but the consumer needs to know that.

The Chair: Well, I'm assuming agents will inform consumers of that when they ask those consumers for their consent. I've filled out many application forms for insurance, particularly for health insurance, and I know that I very clearly have to give my consent already for certain types of medical information and tests. I don't understand the basis or the premise of many of your concerns.

Mr. Charles Black: The advice that would have to be given to the consumer is that he or she could approach the Commission d'accès à l'information in Quebec or the federal privacy commissioner in Ottawa.

Mr. Mark Daniels: That's just one example, but as far as we can tell, it's—

Mr. Charles Black: I know you haven't had a lot of opportunity to review this extensive submission—

The Chair: No, I have read parts of your submission, and I find we're splitting hairs over suggested wording changes in some cases.

Mr. Charles Black: I would draw your attention to example 16 in appendix B, It is a drug claim, which is a very simple transaction. It's the claim for a drug prescription for a child. Both the father and the mother have drug plans. In the example presented here, one of those plans is in Alberta, but it could be anywhere else in the country.

For that plan, the processing is done totally within the province. Assuming that there is an exemption under paragraph 27(2)(d) for legislation in Alberta, on that plan it would be the Alberta legislation that would apply. Under the other plan—and I emphasize that this is a very common situation—the other parent is covered under a plan that happens to be administered by Maritime Life in Halifax—and I'm sorry, I didn't mention the name of the company, but Maritime Life is based in Halifax—so that would be interprovincial. As we interpret it, in that case, it's the same drug, it's the same claim. Presumably, if there's anything involving the doctor or the pharmacist, that would be under the Personal Health Information Protection Act in Alberta, whereas the insurance aspect might be under the Insurance Act or the Employment Standards Act. This is where the confusion arises.

• 1635

The Chair: Again, it takes me back to the basic premise of this bill. If you ask for a consumer's consent at the beginning of the process, at the beginning of the application, before you sign that person up, before you agree to cover him or her, before you agree to insure, I don't see the problem. You have consent to use the information.

Mr. Charles Black: It's not just the insurer; it's the druggist, it's the doctor, it's the employer potentially. It could be the union that's affected by this. The consumer may not know where a problem arises in terms of the protection of the information.

Mr. Mark Daniels: Madam Chair, I see what you're driving at. I guess what we're trying to say, with all due respect, is that it ain't that simple. It doesn't work that way.

We have a huge compliance problem in this business of ours, in insurance. On the market side, we're operating under thirteen different regulatory authorities. We're not governed by one set of laws, we're governed by a huge number of sets of laws. In this particular case, at this juncture and as the law appears, we're simply saying we've done our best to say there are some issues out here that look like they're going to create problems, yes, for the companies, but also for our customers. We're trying to say it's not just you as you sign up your application, it's a whole bunch of parties to the transaction, and we've given you as many examples as we can think of.

I have to leave this committee with the assurance that we're not trying to trivialize this stuff. We have to work with it. We're simply saying that from a commercial point of view you have some issues here, and they don't look to us as if they're settled on the surface. But I repeat that it is not an objection to the principle of the bill. It's very important to make that clear.

The Chair: Mr. Lastewka, do you have a comment?

Mr. Walt Lastewka: I want to thank the witnesses for what they've said on this item, and I realize there are going to be some growing pains. I want to assure you that we take your advice very strongly. Also, after hearing so many of the privacy commissioners from province to province across the country, and from our own privacy commissioner, there'll be some sorting out. I use the example of one of the commissioners saying that even if it's reported to a particular office and it's under the federal law, they do talk to each other and they do sort it out and share that across the country.

So I appreciate your comments and I know there are going to be some growing pains, but that's how things are when there's new legislation. I notice our commissioner here also, but those are items that will be sorted out as we implement it. That's why it's so key on the education side across the country.

The Chair: Thank you, Mr. Lastewka.

Mr. Daniels, I was not trying to trivialize your brief, your comments, or your concerns by any means. I do think there are a number of areas that will work well in this bill. There are also a number of areas that we're trying to improve as a committee. That's our job. We're looking for specifics, and we appreciate the specific examples that you've provided in your brief.

We've heard from both sides of the coin on this one. We've heard people tell us that it's not tough enough, and we've heard others tell us that it's too tough. You have to remember that as a committee we've heard from many witnesses, and we've heard the opposite. So when I ask these questions, I'm asking them on behalf of other things that we've heard, in order to ensure that we're consistent in what we're hearing.

I thank all of you for being with us today.

We're now going to move on to our second group of witnesses.

• 1639

• 1643

The Chair: I'll reconvene the meeting. Can have order, please? Is everyone ready?

I'm very pleased to welcome our next group of witnesses, from the Confédération des syndicats nationaux. We have Michel Lessard, the treasurer and a member of the executive committee; and Madame Anne Pineau, a lawyer and member of the legal department.

I believe you have an opening statement that you'd like to make, but I don't know if Mr. Lessard or—

[Translation]

Mr. Michel Lessard (Treasury and Executive Board Member, Confederation of National Trade Unions): Thank you, Madam Chair. I would first like to thank you for inviting us to this committee. Let me give you a brief introduction to our organization.

We are a Quebec trade union organization with some 2,300 unions and over 250,000 members. Our members are working in all activity sectors in Quebec society, at both the private and public levels. The CNTU also represents a large number of wage earners covered by federal jurisdiction, especially in communications and transportation.

The CNTU has always had a keen interest in the question of respect for privacy and protection of personal information, and as such participates in the 5-year reviews of the Freedom of Information Act and in the protection of personal information in the public sector applicable to Quebec government departments and public agencies.

In 1997, with two other Quebec trade union organizations, we also took part in preparing a brief which was submitted concerning identification cards. In the brief, we expressed quite strong opposition to the introduction of compulsory identifiers. Historically we have also supported and welcomed the adoption in Quebec of a law protecting personal information in the private sector. Finally, with more specific reference to what concerns us today, we applaud the initiative taken by the federal government.

• 1645

However, we think there are significant weaknesses in Bill C-54 that concern the confusion regarding its application, the lack of useful remedies and the subdelegation of legislative authority, all of which lead us to urge the government to redraft its bill.

Our remarks—and Ms. Pineau will be making our main points—are limited to Part 1 of the bill. Ms. Pineau will identify the weaknesses and the corrective action we suggest to make Bill C-54 acceptable to everyone.

Ms. Anne Pineau (Legal Counsel and member of the Legal Section, Confederation of National Trade Unions): Thank you. One of the main problems of the bill is its application, as many previous witnesses have mentioned.

Clause 4(1)(a) states that the bill shall apply to information collected, used or disclosed in the course of commercial activities. The federal government plans to use in this way its authority to regulate trade and commerce. That means that any use of personal information in a commercial context will be subject to the federal law.

That causes us a problem, because in Quebec, we have an Act at the moment that governs commercial activities, and thus the collection, use and disclosure of information in the context of commercial activities. So there is a potential conflict here. The provincial legislation in effect in Quebec, which covers in general the use of personal information, would be replaced by the federal legislation, when the information is used in the course of commercial activities.

The first problem is this: what is a commercial activity? It is defined in the bill. Moreover, there could be two systems in place for a single Quebec company, depending on whether the information is used in the course of commercial activities or otherwise.

Clause 4(1)(b) deals with transborder flows of information. It refers to information collected, used or disclosed interprovincially or internationally. In this case, leaving aside commercial activities, using the information outside the province or the country would mean that the matter came under federal jurisdiction.

Here again, there could be a problem involving two systems, depending on whether or not the information is used outside the province. The same company could be subject in part to the provincial legislation and in part to the federal legislation, when information is transferred outside the province. It will be no easy matter for ordinary people to know where the information has gone. Might it have been transferred outside the country, and if so, which legislation applies?

Clause 4(1)(c) deals with employees of federal works, undertakings or businesses. In this case, the federal government would intervene to the extent that personal information was used, collected or disclosed in connection with employees of a federal work, undertaking or business.

I would like to point out the current position of the Access to Information Commission, which is that even employees of federal undertakings are covered by provincial legislation in the area of personal information. There is a court case underway at the moment. The matter is before the appeal court, but it does not really deal with the constitutional issue for the following reason.

In the Air Canada case, the Commission held that the provincial legislation applied to Air Canada for its employees, and the Superior Court overturned the Commission's decision, because the collective agreement included a provision that stated that the grievance arbitrator, not the Access to Information Commission, had jurisdiction. However, the court did not call into question Quebec's jurisdiction to have the employees of federal undertakings come under its provincial legislation, given that the provincial privacy Act does not cover labour relations or working conditions. It is a general law, which is applied generally to all citizens of Quebec. It is designed to provide general privacy protection for the people of Quebec.

• 1650

So, there are three problems regarding application, to which could be added the exemption authority set out in clause 27(2)(d). This clause states that the Governor in Council could decide, if he were satisfied that substantially similar provincial legislation applies to an organization or to an activity, to exempt the organization, activity or class of activities from the application of the federal legislation.

The principle of exemption is interesting in itself. I'm sure you realize that. The problem for us lies with the exemption technique. If a similar or superior provincial statute applies, why provide for an exemption by activity or by organization? In our view, if a similar provincial Act exists, the provincial legislation should apply to all organizations and to all activities.

Moreover, the exemption and authority is also defective for us in another very important way—namely, it is discretionary. That means that the Governor in Council may order the exemption, but is not obliged to do so. We think the exemption must flow from the legislation. The act itself must state that when a similar or superior provincial Act is applicable, that is the legislation that is in fact applied. We believe that would simplify the application considerably. In addition, it would enable us to maintain in place provincial legislation when the objective—which is the protection of personal information—has been met.

We have other problems with the schedule to Bill C-54. The heart of the legislation, the provisions regarding the protection of personal information and the related mechanics are set out in the schedule, in the CSA Code. Despite all the virtues the CSA Code may have as a self-regulatory code, it leaves much to be desired in legislative terms. Imagine a piece of legislation that uses the following terminology: “should be specified”; “should be able”; “an individual should be informed in some cases, for example”; “shall make a reasonable effort”; “the organization should try to reach a consensus”. In other words, much of the code is in the conditional and does not impose an obligation. If there were any ambiguity about that, clause 5(2) of the bill clearly removes it. It states that the word “should”, when used in Schedule 1, indicates a recommendation and does not impose an obligation.

As a result, the bill loses a great deal of its appeal. In our view it is clear that the legislation itself must contain these provisions, and that they must be worded as obligations, not recommendations, advice or invitations.

Moreover, we fail to see how we could force someone to comply with something a legislation describes as a recommendation. We have trouble imagining that.

Finally, clause 27(2)(b) allows the Governor in Council to amend Schedule 1 to reflect recent revisions to the CSA Code. We have a problem with that as well. It is very important that any discussion regarding the protection of personal information be carried out within Parliament or within a committee such as this one, to ensure that there is a public debate and to prevent amendments from being made to the heart of the legislation through a discretionary decision on the part of the Governor in Council.

We also have a major problem regarding remedies. In Quebec, the Access to Information Commission rules on disputes that may arise out of the Privacy Act, in both the public and private sectors. In our view, Bill C-54 does not really offer a genuine remedy. We think it is very difficult to imagine that people will go to the Federal Court spontaneously for a ruling on an issue involving access to an employee's file or to credit information. I seriously doubt that people will go to the Federal Court with problems of this type.

• 1655

It is important to have an administrative tribunal for people, a friendly place, where people can represent themselves or, in a pinch, have legal representation. The tribunal also has to be a specialized one. That's important for us. The Federal Court has no expertise in the protection of personal information.

So for us, it is very important to have recourse, but not in the Federal Court. The ideal thing would be to have the Privacy Commissioner, but we know that the federal Privacy Commissioner does not intend to take on this responsibility. Apparently for him, it is difficult to reconcile the promotion of an Act and the adjudication of rights under this Act. Thus at the very least we recommend the establishment of a specialized tribunal under Bill C-54.

As for the rest, the brief sets out various aspects, section by section. Some we feel are quite important, for example, when there is no indication available, before building up a file on someone, it must be proven that there is a serious, legitimate reason for doing so. This idea is not found in the bill, but we feel it is quite important.

I will close by saying that for us, it is important to put standards in the Act, to re-enact them in legislative form, to provide an accessible administrative tribunal, and to state in the Act that when an equivalent or superior provincial Act exists, the provincial one will apply in all cases.

Finally, the federal Act could prove to be necessary for provinces with no privacy protection legislation, but as for Quebec, we really feel that the provincial Act should be applied in all its dimensions.

[English]

The Chair: Thank you very much, Madame Pineau.

We'll now go to questions. Mr. Lowther.

Mr. Eric Lowther: Thank you, Madam Chair, and thank you to the witnesses. I see your brief was only provided in French, which is probably a good thing because it gives me some empathy for Madame Lalonde and Mr. Dubé when they only get it in English, although a steady diet of it would leave me out in the cold.

I appreciate what you had to say. I had a couple of questions. Is your organization strictly in Quebec?

[Translation]

Mr. Michel Lessard: No. It has a national charter, in Canadian terms. It occupies the Canadian territory, but it is primarily in Quebec, of course. It is a Quebec labour organization. There are unions in New Brunswick and Ontario, among others.

[English]

Mr. Eric Lowther: You have made some comments, and the previous witnesses as well, that I wondered about. If we have the privacy laws in various provinces and we also have this federal privacy law, when organizations like yours or the previous witnesses' do business in all these different jurisdictions—I was thinking of Madame Pineau's comments—what takes precedence in your mind? Do the federal laws form the baseline that we don't go below, and if provinces go beyond it, that becomes the primary thing?

I'm just thinking, if I was trying to manage a national entity and had to step through all these various hoops of various privacy acts and try to make sure I hadn't crossed the line somewhere.... It must be a tough job.

• 1700

I wasn't sure where you're coming from, or what your proposal was, particularly Madame Pineau. We have the provincial legislation and we have this federal legislation before us. Which is the baseline, and then do you go beyond that provincially? Is that what you're sort of suggesting? Can you bring some clarification there for me?

[Translation]

Ms. Anne Pineau: All we are doing is taking paragraph 27(2)(d) of Bill C-54, which already exists. That is where it says in 27(2)(d), concerning the Governor in Council:

(2) The Governor in Council may, by order,

(d) if satisfied that legislation of a province that is substantially similar to this Part applies to an organization, a class of organizations, an activity or class of activities, exempt the organization, activity or class...

He may exempt the organization or activity from the application of the federal Act. That's what paragraph 27(2)(d) says. We would like to see this paragraph 27(2)(d) remain, but be improved. When a similar provincial law exists, we would like it to apply to all the organizations and activities to which it is applicable. Either it is applicable or it is not. If it is applicable to an organization or activity, the provincial law should apply.

Paragraph 27(2)(d) should also be improved by saying that the Act, and not the Governor in Council, must state that the provincial law is applicable. Under 27(2)(d), the Governor in Council is the one with the discretion to decide whether an organization, activity or class of activities can be made exempt from the application of the federal law, giving precedence to the provincial one. I do not know whether this answers your question, but that is what we want.

[English]

Mr. Eric Lowther: Another question I have relates to this particular legislation. You're involved with a union—I understand that to be the case—and employee relations type of activity. Do you feel this legislation is going to make grievance procedures more difficult, less difficult, or have no effect?

[Translation]

Ms. Anne Pineau: Right now, the application of the provincial law in the private sector does not raise any difficulties in the application of a grievance. The application of Quebec's Bill C-68 has made it easier for an employee to get access to his record and correct it, but this applies to all other citizens of Quebec, in any other field of activity. The value of this law is that it allows anyone to control the information concerning himself or herself, and to make sure that the information is not used willy-willy.

Concerning labour relations, at the present time, apart from the Air Canada decision, the Act does not raise any difficulty inasmuch as, even where a collective agreement contained provisions for access to employment files, the Commission d'accès à l'information has always deemed that this would not cause it to lose any jurisdiction, and in any case, it could give effect to the agreement and to the Act if the content of the Act was superior to the agreement. So there is really no difficulty at the practical level.

[English]

The Chair: Thank you, Mr. Lowther.

Mr. Bellemare.

[Translation]

Mr. Eugène Bellemare (Carleton—Gloucester, Lib.): I would like to ask Michel Lessard a question on the compulsory identification card first. I do not know whether that is Mr. Lessard's policy or the CNTU's, but did you actually say that you were against a compulsory identification card...

Mr. Michel Lessard: [Editor's note: Inaudible]

Mr. Eugène Bellemare: Yes? Are you serious?

Mr. Michel Lessard: Yes.

Mr. Eugène Bellemare: In the case of a health card—

Mr. Michel Lessard: That's not an identification card.

Mr. Eugène Bellemare: If a health card is not an identification card, what is it?

Mr. Michel Lessard: It's not an identification card under the Act. It's a card used for the health care system. The health insurance card is not deemed to be an identification card, no more than a driver's licence is.

Mr. Eugène Bellemare: A driver's licence is not an identification card?

Mr. Michel Lessard: Not at all.

Mr. Eugène Bellemare: Goodness gracious! We certainly live in two different worlds, you and I.

• 1705

Mr. Michel Lessard: Legally speaking, it's not an identification card.

Mr. Eugène Bellemare: In your mind, is a passport an identification card?

Mr. Michel Lessard: Legally? I don't know.

Mr. Eugène Bellemare: Do you think that people should walk around with their passport on them?

Mr. Michel Lessard: No, because not everyone has a passport. You have the opportunity to travel, but ordinary working people...

Mr. Eugène Bellemare: Do you have a passport?

Mr. Michel Lessard: Yes, I do.

Mr. Eugène Bellemare: And is it a Canadian passport?

Mr. Michel Lessard: Pardon me?

Mr. Eugène Bellemare: I imagine it's a Canadian passport.

Mr. Michel Lessard: Yes.

Mr. Eugène Bellemare: Is your photo and other information on the passport?

Mr. Michel Lessard: Yes, of course.

Mr. Eugène Bellemare: Are you opposed to that?

Mr. Michel Lessard: We are not against that, but we are against compulsory identification cards in Quebec, cards which everyone would have to carry for particular needs. Compulsory identification cards don't exist in Canada or Quebec.

Mr. Eugène Bellemare: Truckers in Quebec and Ontario...

Mr. Michel Lessard: I'm not a legal expert, but I know that neither Canada nor Quebec require identification cards.

Mr. Eugène Bellemare: Truckers in Canada, in each province, have identification cards and are union members. The cards stipulate, for example, that they can drive 18-wheelers.

Mr. Michel Lessard: Is your credit card also an identification card? A little while ago, when I came in, they asked me for identification. I showed my credit card.

Mr. Eugène Bellemare: Right. You have given me a bit of an insight into your attitude concerning personal information and you have shown the extent to which you would like to see a free-for-all in this country...

[English]

Mr. Walt Lastewka: Madam Chair, the translator can't translate two conversations at once, or if they can they shouldn't be here, they should be raising money somewhere else. I can't hear both conversations.

The Chair: We'll ask the parties to please calm down.

Monsieur Bellemare.

[Translation]

Mr. Eugène Bellemare: Ms. Pineau, you talked about the problems of a person who, as a customer, would like to know where the information concerning him or her has gone. I suppose you meant that the person would like to know whether it had gone outside Quebec. Is that right?

Ms. Anne Pineau: Yes.

Mr. Eugène Bellemare: Earlier on we received representatives from the insurance companies. If someone is insured in Montreal and agrees to give personal information—let's say health insurance or dental insurance—he gives all kinds of information and agrees to its being used. In the case of dental insurance, why would he raise the question if all of a sudden the company insuring him is purchased or moves? We have often seen companies from Quebec move to Ontario. Why would the question be raised? It's still the same company insuring him. Where is the problem?

Ms. Anne Pineau: The problem will arise when he wishes to have access to his file, which is now in Toronto. He will be told, "This information has been sent outside the province. So it's no longer the Quebec privacy legislation, but the federal law, that applies in your case. Please call the Federal Court to get access to your file." That's where the problem lies.

At the present time in Quebec, section 17 of the Act indicates that when a company transfers personal information outside the province, it must make sure that the information is treated in the same way as under Quebec legislation, and that the company will guarantee confidentiality. The third party receiving or processing the information will undertake to apply provisions equivalent to those of the Quebec Act. I would like to finish, if you don't mind.

Mr. Eugène Bellemare: Yes, but you're taking up all my time.

Ms. Anne Pineau: Paragraph 4(1)(b) indicates that it will apply to personal information sent to another province where the scope of the federal law covers all the information to the extent that it is being sent from one province to another.

Mr. Eugène Bellemare: In Quebec, let's say the same customer is insured with a company, for example, Sun Life, which was headquartered in Quebec, but is now in Ontario. He has insurance with this company because he has looked into it and feels that he's getting a better deal. Who protects a person like this?

• 1710

Ms. Anne Pineau: It depends what you do with the information. I would invite you to read paragraph 4(1)(b):

4. (1) This part applies to every organization in respect of personal information that:

(b) the organization collects, uses or discloses interprovincially or internationally;

In Quebec, companies subject to the provincial law have full jurisdiction over information concerning them on their territory, until the insurance file is sent for employees in Ontario or New Brunswick, or until the pay file is sent out. From that time onward...

Mr. Eugène Bellemare: If this person sees that the company has gone to Ontario or another province, he or she will probably count on the fact that the other province has a law protecting personal information.

Ms. Anne Pineau: They don't want to prevent...

Mr. Eugène Bellemare: Do you think that Ontario should have a privacy Act because Quebec has one?

Ms. Anne Pineau: No, but Ontario should pass one.

Mr. Eugène Bellemare: Should Ontario have a law?

Ms. Anne Pineau: I think so.

Mr. Eugène Bellemare: Okay. If the eight other provinces do not have a law, is the federal government not entitled to pass one to protect the consumer?

Ms. Anne Pineau: We aren't saying otherwise. Wherever the Quebec law can apply, it should. That's all we are saying.

Mr. Michel Lessard: There is no overlapping jurisdiction.

Mr. Eugène Bellemare: But there's no conflict right now. We are not in the process of creating one.

Mr. Michel Lessard: You will get one.

Mr. Eugène Bellemare: You said that the Federal Court had no expertise in the field of private information. That's not so, madam. Since 1983, the Federal Court has looked at a number of cases pertaining to private information. Didn't you know that?

Ms. Anne Pineau: When you talk about expertise, you are talking about people who are really in the thick of things, who know the ins and outs and who work with these things everyday. In Quebec, we also have a court that hears appeals on the decisions made by the Information Access Commission. A number of requests have been made to do away with this appeal level, because even though the Quebec court judges have been hearing such cases for 10 years, they are not experts in the field. They do not come from this background and they do not have hands-on experience with personal information.

Mr. Eugène Bellemare: In Quebec, in Montreal, you have a Federal Court.

[English]

The Chair: Mr. Bellemare, thank you.

Madame Lalonde.

[Translation]

Ms. Francine Lalonde: I would like to do as he does, Madam Chair, in order to have more time. Thank you for the brief, it is very well done, straightforward and easy to read.

Mr. Eugène Bellemare: [Editor's note: Inaudible]

Mr. Antoine Dubé: That doesn't make it worse.

Ms. Francine Lalonde: I didn't hear.

Mr. Antoine Dubé: You said that it was a sovereignist brief.

[English]

The Chair: I would really appreciate it if everyone would try to stick to the questions, with all due respect. We're going to run out of time very quickly. This meeting is done at 5.30 p.m.

[Translation]

Ms. Francine Lalonde: I will continue on the subject of Mr. Bellemare's comments. It's curious, but the Quebec law was passed by the government of Daniel Johnson, who had just been elected leader of the Liberal Party. He was a federalist and there was unanimity over this law. There was a debate. I would like you to talk about it. In Quebec, a good number of people were caught up in it for a considerable time. There was first the law and then the revision, with Bill 451.

Basically some work was already done and there was a type of acceptance. Previously we heard the insurance companies. I was surprised to see how they had adapted. They said that the principles of the law were different from their previous practices, but they had adapted. They are now concerned because they will have to adapt again, and feel that the federal law is confusing.

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Basically you are saying that we should continue in Quebec. We have started something. It does not yet apply everywhere. There is still some work to be done. It's like any other law in the field of health and employment security. It takes time before it can be applied. So you are saying that we must continue and that Bill C-68 must be applicable to all companies. That's essentially what you are saying. You do not enter too much into the constitutional debate, but you say that it must apply to all businesses within Quebec.

You quoted section 17. Section 17 requires people who are operating businesses in Quebec and communicating information outside to protect this information. This is similar to the principle found in the European Union directive and is some European laws where an obligation is created.

The Chair: Mr. Lessard.

Mr. Michel Lessard: I would say that essentially, Ms. Lalonde is quite right. In Quebec, there is a phenomenon that we observe, independently of political allegiances and party interests. When there are fundamental interests of citizens in a democratic society, it is easy to achieve consensus. Thus consensus was easy to achieve on that, because it's fundamental. It's the primacy of an individual's entitlement to his private life. Whether you are trade unionist, federalist, independentist, blue, red or yellow, you have an interest in it because we're all citizens. Mr. Bellemare, I don't necessarily want to have access to your personal information, but it seems that you too...

Mr. Eugène Bellemare: [Editor's Note: Inaudible]

Mr. Michel Lessard: Probably. I don't know, but I imagine you also have a right to that. You're talking about Ontario. Of course they must have legislation also and they'll realize this under the pressure coming from their fellow citizens. There has to be one. When there's one covering the whole picture, it's the one that applies.

We're not creating any kind of confusion because otherwise the citizens, whose rights must be paramount, will be injured. You'll have total ambiguity. We're talking about judges. In the area of labour relations, we know all about that. More and more Superior Court judges, when they have to make a decision, say that they're not specialists in labour law and that we should go back and see a labour tribunal. So you have to have an administrative tribunal that has exclusive jurisdiction over the matter, which wouldn't prevent the others having jurisdiction in the matters of common law crime or things of that nature.

The Chair: Ms. Lalonde, your last question, if you don't mind.

Ms. Francine Lalonde: It will be a thank you. I could put a little question on the files. If Bill C-54 were implemented, it would be a lot more complicated for someone to get access to their file outside of Quebec. It would create different rights, especially when it would also depend on the kind of business concern. Is that a worry for you?

Ms. Anne Pineau: The problem stems from the fact that, in our view, there are loopholes in Bill C-54. It's not specified that personal information must be collected only for legitimate and serious reasons. There's no definition of consent. Nothing is really provided in the way of the Commissioner's auditing powers except if there's a suspicion or reasonable reasons to believe that there's an offence. We don't find the recourse appropriate. You don't have a primacy of law.

In short, there's a series of distinctions in the Quebec legislation that mean that we'd prefer the provincial law to apply. Besides, it's very important, in our view, that the citizen know in advance what legislation applies to be able to know what rights he has, where he must consult and which regime applies to him.

[English]

The Chair: Thank you, Madame Lalonde.

Madame Jennings.

[Translation]

Ms. Marlene Jennings: Thank you, Ms. Pineau and Mr. Lessard. I have two questions for you.

First, I'd like to make sure I fully understand your suggestion for an amendment to 27(2)(d).

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In cases where the federal government determines that a provincial piece of legislation is essentially similar, you'd like that legislation to apply in that province no matter what the activity, the category of activity or the organization.

Ms. Anne Pineau: Paragraph 27(2)(d) says that when similar provincial legislation applies...

Ms. Marlene Jennings: Yes, I know. I wanted to know what kind of amendment you're suggesting.

Ms. Anne Pineau: We suggest that it not be the federal government who decides. We want that written into the Act. At the outset, when you define the scope of the Act, it says that the present legislation does not apply to... We'd want the legislation to say that where similar provincial legislation exists, it is applicable to any and all organizations. That has to be set out in the legislation; we can't leave it up to the Governor in Council to decide whether the legislation is similar or not and then leave it up to the courts who, ultimately, will decide whether the legislation is similar or not.

Ms. Marlene Jennings: I hadn't understood that at all. Thank you very much for your explanation.

My second question has to do with Quebec's Bill 68. In that legislation, is there any provision protecting a whistle blower from reprisals by an employer violating Bill 68? If that's the case, that's fine. If it's not the case, do you think that could be an improvement that should be made both to Bill 68 and Bill C-54? As members of a union organization, you deal with employers every day and you deal with thousands of grievances. So you know what kind of reprisals some employers use. Do you think it would be useful to write that kind of protection into both Bill 68 and Bill C-54?

Ms. Anne Pineau: Bill 68 has no provisions on layoffs, transfers, suspension or reprisals for having exercised a right under the present Act. There's a series of texts that do have such provisions such as the Act respecting labour standards and the Labour Code, but they don't show up in Bill 68. On the other hand, in Bill 68, in clause 9 it specifies that an organization or an enterprise can't refuse to acquiesce to a request for goods or services or a request concerning a job for the simple reason that someone refuses to provide information unless that information is necessary. But it doesn't have that power. For example, the Commission d'accès à l'information can't order the reintegration of anyone who was a victim of reprisals.

Quite honestly, in union circles, we haven't had that kind of problems. Our unionized employees, quite regularly, under the legislation concerning the private or public sectors, put in request for access or amendments to their files. We haven't heard of anyone being the victim of reprisals.

Ms. Marlene Jennings: I'm not talking about an employee who discovers a practice concerning his own private information. For example, I'm talking about someone working in an insurance company and collecting privileged information who transmits that privileged information to other organizations and who comes under Bill 68. There's no doubt that it's Bill 68. The employee working for that insurance company discovers, one day, that his employer is systematically violating certain provisions of Bill 68 and exposes the delinquent practice his employer's engaging in to the Information Commissioner. At that point, the employer fires him or suspends him for any other reason on earth except the real one.

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However, you are union people and you know there's a strong case that the employee was fired because he blew the whistle on his employer who was violating a provincial statute. As union people, do you think that adding a provision protecting employees in such cases would be an improvement to Bill C-68 and Bill C-54?

Mr. Michel Lessard: Yes, because it's always a good thing to give more protection to the workers. There are some who are unionized and others who are not. Someone who can count on a union organization to defend his interests on a day-to-day basis is in a far better position to uphold his rights than any non-unionized worker. You can't go against motherhood and apple pie. We have an interest in protecting those who might be penalized because they're blowing the whistle on an employer who's breaking the law.

Ms. Marlene Jennings: Thank you very much.

[English]

The Chair: Thank you very much, Madame Jennings.

I want to thank our witnesses for being with us this afternoon. We've run out of time. We appreciate your comments, your brief, and your participating in questions and discussions.

The meeting is now adjourned.