The Alberta government's Bill 9 will come back into effect after the province's top court on Friday overturned an injunction that had blocked the legislation.

In a 2-1 decision, the Court of Appeal of Alberta allowed the government's appeal of the July 30 ruling from Court of Queen's Bench Justice Eric Macklin, which granted the injunction to the Alberta Union of Provincial Employees.

"In the short term, the elected legislators must be allowed to legislate except in the clearest of cases," Justices Jack Watson and Frans Slatter wrote in the majority decision.

"In this situation, the government has not purported to take away the right to binding arbitration, or a right to a wage increase in the third year of the collective agreements, but has merely deferred the arbitration for a few months.

"It is not sufficiently clear that Bill 9 is unconstitutional as to justify an injunction on its implementation."

The judges wrote that the only harm they could see from Bill 9 was a four-month delay in the the start of arbitration.

Bill 9 — or the Public Sector Wage Arbitration Deferral Act — puts a halt to wage arbitration talks for three collective agreements affecting 65,000 AUPE members who work for Alberta Health Services or the provincial government. The bill puts the process on hold until the end of October.

With the injunction, AUPE's arbitration hearings were able to resume in August.

Finance Minister Travis Toews called the decision "a win" for Alberta taxpayers. He reiterated the government's position that the bill simply delayed arbitration talks until the government could get a better handle on Alberta's finances.

"We're pleased that the court upheld our position and those hearings will take place after that date [in October]," he said.

Asked what happens next, Toews said the government will then have decisions to make.

"This government will look at all of its options relative to going forward with the public sector," he said. "We just at this point in time need to ensure that we have all options on the table so that we can make the best decisions, the most responsible decisions, on behalf of Albertans."

Finance Minister Travis Toews said the Court of Appeal decision is a win for Alberta taxpayers. (Travis McEwan/CBC )

AUPE president Guy Smith said the union is disappointed with the decision and noted the Court of Appeal's ruling was not unanimous.

Justice Marina Paperny wrote in her dissent that she would have dismissed the appeal.

Smith said the union was able to complete the arbitration hearings in August, while the injunction was still in effect. The executive will review the Court of Appeal ruling to see if there are any grounds for seeking leave to appeal to the Supreme Court of Canada.

AUPE and other unions have filed a separate challenge on the constitutionality of Bill 9. The date for that trial hasn't been set.

In a report released Tuesday, the MacKinnon panel on Alberta's finances, chaired by former Saskatchewan finance minister Janice MacKinnon, recommended the government legislate public sector wages.

Smith said that means the union will soon have larger issues to tackle.

"Our members know that there are much more significant challenges laying ahead and we're preparing for those," Smith said. "And it will be through the strength of our membership that we overcome those challenges."

Late last year, AUPE members agreed to a three-year contract with wage freezes in the first two years, with the understanding that wage talks would be reopened in the final year.

The agreement also guaranteed the workers job security until March 30, 2020.