Bazzo v. Essar Steel Algoma, 2016 HRTO 583

HUMAN RIGHTS TRIBUNAL OF ONTARIO

B E T W E E N:

Mark Bazzo Applicant

-and-

Essar Steel Algoma Inc. Respondent

-and-

United Steelworkers of America Intervenor

A N D B E T W E E N:

Steve Linklater Applicant

-and-

Essar Steel Algoma Inc. Respondent

A N D B E T W E E N:

Luke Woodcock Applicant

-and-

Essar Steel Algoma Inc. Respondent

INTERIM DECISION

Adjudicator: Bruce Best Date: May 3, 2016 Citation: 2016 HRTO 583 Indexed as: Bazzo v. Essar Steel Algoma

WRITTEN SUBMISSIONS

Mark Bazzo, Steve Linklater, and Mark Woodcock, Applicants Mark Molinaro, Representative

Essar Steel Algoma Inc., Respondent Michael Hines, Counsel

Introduction

1This decision addresses procedural issues that arise in light of proceedings under the Companies' Creditors Arrangement Act, R.S.C. 1985, c.C-36 (“CCAA”) respecting the respondent, and the applicants’ request for the Tribunal to defer consideration of the Applications following the issuance of an order of the Superior Court lifting a stay of proceedings against the respondent. The applicants in the above Applications are all represented by the vice-president of their union local, United Steelworkers Local 2251.

2Proceedings against the respondent were stayed pursuant to an order of Newbould J. issued under the CCAA on November 9, 2015. On the basis of that order, the respondent did not file a Response in Mr. Bazzo’s Application, HRTO File No. 2015-22808-I (the “Bazzo Application”). Mr. Bazzo, through his representative, took the position that the Superior Court had no jurisdiction under the CCAA to stay an application before the HRTO, and urged the HRTO to proceed with the matter despite the CCAA stay.

3The Tribunal sought submissions from the respondent with respect to the current status of the stay, which originally expired on March 15, 2016. Counsel for the respondent in the Bazzo Application provided a further order of Newbould J. dated February 26, 2016 which extended the stay to June 17, 2016.

4Mr Bazzo’s representative provided the Tribunal with a copy of another order of Newbould J., dated March 14, 2016 (the “Grievance Claims Procedure Order”), which appears to have lifted the stay with respect to a number of proceedings, including certain grievances, matters before the Ontario Labour Relations Board (“OLRB”), and applications before the Human Rights Tribunal of Ontario (“HRTO”). The Grievance Claims Procedure Order further sets out a timeline and procedure for the resolution of these proceedings. The HRTO sought further submissions from the respondent with respect to the applicability of this order to the Applications.

5No submissions were provided by the respondent. However, the applicants’ representative contacted the HRTO again, this time asking that the HRTO stop all activity in all three of the Applications until after August 31, 2016. As noted below, this is the date by which the Grievance Claims Procedure Order required all matters subject to the order to be settled or determined.

Interaction of CCAA and HRTO Proceedings

6The superior court has jurisdiction under the CCAA to stay proceedings against a debtor company which involve a claim for a monetary remedy. All three of the above Applications are seeking a monetary remedy against the respondent, and as such appear to fall within the scope of the CCAA.

7The Applications also appear to be covered by the definitions of “Grievance Claims” and “Schedule “A” Grievances” as set out in paragraph 2(n), 2(x), and Schedule “A” of the Grievance Claims Procedure Order, which further provides, at paragraph 3, 17, and 32:

3. THIS COURT ORDERS that, subject to the terms of this Grievance Claims Procedure Order and further order of this Court, all Grievance Claims shall be settled or determined by no later than August 31, 2016.

4. Unless otherwise agreed in writing by the Applicants and the USW, Schedule “A” Grievances shall be determined in accordance with the usual procedures contemplated by the Collective Agreements or the practice of the administrative board or tribunal having jurisdiction in respective thereof, as applicable.

5. THIS COURT HEREBY REQUESTS the aid and recognition of any court, tribunal, arbitrator, and regulatory or administrative body having jurisdiction in Canada or in the United States or any other jurisdiction to give effect to this Grievance Claims Procedure Order and to assist the Applicants, the Monitor and their respective agents in carrying out the terms of this Grievance Claims Procedure Order, including the US. Bankruptcy Court. All courts, tribunals, arbitrators, regulatory and administrative bodies are hereby respectfully requested to make such orders and to provide such assistance to the Applicants and the Monitor, as an officer of this Court, as may be necessary or desirable to give effect to this Grievance Claims Procedure Order or to assist the Applicants and the Monitor and their respective agents in carrying out the terms of this Grievance Claims Procedure Order.

8In Essar Steel Algoma Inc. (Re), 2016 ONSC 1802 (“Re Essar”), a decision issued at the same time as the Grievance Claims Procedure Order, Newbould J. addressed arguments from United Steelworkers Local 2251 that the court had no jurisdiction under the CCAA to stay grievance proceedings. Relying on the recent Supreme Court decision 407 ETR Concession Co. v. Canada (Superintendent of Bankruptcy), 2015 SCC 52, at paras 24-25, Justice Newbould held that there was a conflict between the provisions of the CCAA and the Ontario Labour Relations Act, RSO 1990, c L.2 (“LRA”), that under the doctrine of federal paramountcy the provisions of the LRA were inoperative to the extent they conflicted with the CCAA, and as such he had jurisdiction to stay the grievance proceedings. He further noted that even if there was no direct conflict between the federal and provincial statute, the doctrine of paramountcy would still apply, as complying with the provincial statute would have the effect of frustrating the purpose of the federal statute.

9The parties have not made submissions on whether the above rationale would similarly apply to proceedings before the HRTO (though I note that the Tribunal has recognized that it is bound by orders under the CCAA staying proceedings. See James v. Target Canada, 2015 HRTO 429). It is, however, not necessary for me to determine that question in order to determine the appropriate procedure in these Applications.

10The Tribunal has recognized that the purpose of the CCAA is to permit the establishment of a protocol and the effective management of claims against an insolvent party, and that it is appropriate for the Tribunal to co-operate with such proceedings. See Rijal v. Distinctive Designs Furniture, 2009 HRTO 297 at paras 14-16, and Johnson v. Yorkview Lifecare, 2009 HRTO 1338 at para 13.

11I agree that it is appropriate in the circumstances of these Applications for the HRTO to give effect to and to assist the parties to carry out the terms of the Grievance Claims Procedure Order, regardless of whether or not the superior court has jurisdiction to require the HRTO to do so. As such, the Tribunal will continue to process the Applications in accordance with its usual practices and procedures.

12The Tribunal’s practices and procedures include that an application may not be finally disposed of without affording the parties an opportunity to make oral submissions: Human Rights Code, R.S.O. 1990 c.H.19, as amended, s.43(2)1. However, based on the Tribunal’s current scheduling timelines, hearings may not be scheduled prior to the August 31, 2016 deadline set out in para 3 of the Grievance Claims Procedure Order.

13In order to assist the parties in carrying out the terms of the Grievance Claims Procedure Order, the Tribunal therefore directs as follows:

Application 2015-22024-I

14The Tribunal issued a Case Assessment Direction (“CAD”) in Application 2015-22024-I on March 10, 2016, directing a preliminary hearing be held to determine whether that Application should be dismissed for delay or because the substance of the Application had been appropriately dealt with in a related grievance proceeding. It does not appear that either the applicant or the respondent in that matter advised the Tribunal of the CCAA proceedings or the existence of a stay. The Grievance Claims Procedure Order lifting the stay was issued 4 days after the CAD was issued.

15The Tribunal will make best efforts to schedule the preliminary hearing conference call referred to in the March 10, 2016 CAD to be held no later than July 1, 2016. If Application 2015-22024-I is not dismissed or otherwise finally determined at the preliminary hearing, the adjudicator hearing the matter may make further directions as appropriate to assist the parties in complying with the Grievance Claims Procedure Order.

Applications 2015-22808-I

16Given its position that the proceedings were stayed pursuant to the November 9, 2105 CCAA order, the respondent has not filed a Response in 2015-22808-I.

17In light of the Grievance Claims Procedure Order, the Tribunal directs the respondent to file its Response to 2015-22808-I within 14 days of the date of this Interim Decision. If the applicant wishes to file a Reply, he shall do so within 7 days of being delivered the Response.

18The Tribunal shall make best efforts to schedule a one-day hearing for Application 2015-22808-I, for a date prior to August 15, 2016. The hearing may be held by conference call.

Application 2016-23233-I

19The respondent has also not filed a Response in 2015-23233-I.

20In light of the Grievance Claims Procedure Order, the Tribunal directs the respondent to file its Response to 2016-23233-I within 14 days of the date of this Interim Decision. If the applicant wishes to file a Reply, he shall do so within 7 days of being delivered the Response.

21The applicant in 2015-23233-I indicated that the facts of his Application were also part of a grievance that was still in progress; however, he did not provide a copy of the grievance with his Application. As this grievance would also presumably be covered by the Grievance Claims Procedure Order, the Applicant is directed to provide a copy of the grievance, and the parties are directed to advise the Tribunal in their Response or Reply, as appropriate, of the status of the grievance and whether it is already being addressed in the procedures set out in the Grievance Claims Procedure Order.

22The Tribunal shall make best efforts to schedule a one-day hearing for Application 2015-23233-I, for a date prior to August 15, 2016. The hearing may be held by conference call.

General

23The Tribunal may make other orders or directions as appropriate in these Applications to assist the parties in complying with any orders issued in the CCAA proceedings.

24Nothing in this Interim Decision prevents the parties from engaging in settlement discussions or resolving the matters outside the Tribunal process.

25This Interim Decision shall also be delivered by email to counsel for the monitor, counsel for the respondent, and counsel for the unions, at the addresses set out in paragraphs 27-31 of the Grievance Claims Procedure Order.

26I am not seized.