… rejects the Union’s demand that the Ford plant be made a closed union shop. However, all workers in the bargaining unit — whether or not they are actually union members — must contribute funding in the form of union dues to enable the Union to pay bargaining costs and administer the labour contract[1].Justice Rand recognized that not all employees should be required to join a union, however those that were excluded should not receive the wages and benefits negotiated in a collective agreement. Also at that time, unions had to queue at the front door of a plant to collect employee dues however the adoption of the Rand Formula changed all of that. It was now the company’s responsibility to deduct a certain amount of employees’ wages which was to be paid to the union in the form of dues.
It also set out rules for strikes. For example, before this decision, legal strikes could be violent and even illegal in some cases. The decision led to the adoption of financial penalties for workers and their Union whenever they took part in illegal work stoppages. For employees, these penalties could take the form of daily fines and loss of seniority; for the Union, the suspension of union dues[2].Judge Ivan Rand’s decision made history. It guaranteed a future for unions and the opportunity to make extraordinary advances. Financial security allowed them to set up programs to help employees enforce their rights. [1] https://www.thecanadianencyclopedia.ca/en/article/rand-formula [2] https://www.thecanadianencyclopedia.ca/en/article/rand-formula