COURT FILE NO.: 74010/04

DATE: 20060202

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

GREER, MACDONALD E. AND LAX JJ.

B E T W E E N:

BENJAMIN BLASDELL,

Applicant

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ONTARIO LABOUR RELATIONS BOARD, UNITED FOOD AND COMMERCIAL UNION A.F.L.-C.I.O.-C.L.C., LOCAL 1000A,

Respondents

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LOBLAWS SUPERMARKETS LIMITED,

Intervenor

Allan Rouben, Counsel for the Applicant

Leonard Marvy, Counsel for the Respondent Board

Paul Cavalluzzo and Miriam London, Counsel for the Respondent Union

Morton G. Mitchnick and Jennifer Fantini, Counsel for the Intervenor Loblaws

HEARD at Newmarket: December 12, 2005

REASONS FOR DECISION

Greer J.

1The Applicant, Benjamin Blasdell, (the “Applicant”) seeks judicial review of a decision of the Ontario Labour Relations Board (the “Board”) dated December 8, 2003, and a subsequent reconsideration of that decision by the Board on November 1, 2004 (collectively, the “Decision”).

2The primary issue in this Application is whether the Board erred in denying the Applicant’s claim that his Union, the Respondent, United Food and Commercial Workers Local 1000A (the “Union” or “Local 1000A”) breached its duty of fair representation pursuant to s. 74 of the Labour Relations Act, 1995, S.O.1995, c.1, Sched. A. (the “Act”). Section 74 of the Act reads as follows:

74. A trade union or council of trade unions, so long as it continues to be entitled to represent employees in a bargaining unit, shall not act in a manner that is arbitrary, discriminatory or in bad faith in the representation of any of the employees in the unit, whether or not members of the trade union or of any constituent union of the council of trade unions, as the case may be.

3The Applicant is a member of the Union and an employee of the Intervenor, Loblaws Supermarkets Limited (“Loblaws”), a company carrying on business in the retail food industry. The Board is an Ontario administrative tribunal, responsible for administering various Acts in Ontario governing labour matters. The matter came on before the Board when the Applicant filed a Complaint, asserting an Unfair Labour Practice under Section 96 of the Act, specifically that the Union had breached its duty of fair representation as set out in Section 74 of the Act. The Complaint was dismissed and upon reconsideration by the Board, it was dismissed again.

4The Complaint arose out of the Union being approached around December 2002, by Loblaws, when it notified the Union that it intended to fight an expected threat from Wal-Mart, which intended to open a number of superstores in Canada. Loblaws intended to respond to this by significantly restructuring its operations and by closing down many existing Loblaws stores. It was, however, prepared to open new megastores under a different banner and it would fight any attempt at unionizing the employees of those stores. Loblaws says that under the new banner of “Real Canadian Superstores”, these new stores would have at least 35% of the store dedicated to department store type merchandise. Loblaws apparently planned on opening up 40 of these stores within the next three years, and emphasized that such investment was critical to maintain its competitive position.

5In the alternative, Loblaws was prepared to negotiate with the Union to make certain amendments to the existing Collective Agreement, which would include bargaining unit coverage for all employees of the new stores and job security for employees of existing stores.

6Loblaws says it insisted on certain pre-conditions before it would agree to negotiate with the Union. These conditions included the fact that the negotiations were to be kept confidential; the mid-term amendments would not be subject to ratification by the membership; and any terms and conditions of employment for the new stores would have to be competitive with Wal-Mart, said by Loblaws, to be a fiercely anti-union enterprise.

7Loblaws and the Union negotiated mid-term amendments to their Collective Agreement, and this was unanimously ratified by a group of primarily elected division officers. The Union then agreed to the amendments, which were mainly 5 in number, including guaranteed employment for all full-time employees on the full-time payroll as of January 1, 2003, even if the employee transferred to another store. Job security was also looked after. Bumping rights were guaranteed, early retirement incentives were offered and Loblaws agreed to make a financial contribution to the education fund for union members.

The Complaints by the Applicant

8The Applicant opposed these amendments to the Collective Agreement and filed his Complaint, alleging a breach of the duty of fair representation by the Union, on the following basis:

(a) the Union did not properly consult its membership;

(b) the agreed-to amendments had the potential to result in systemic discrimination against women employees;

(c) the Union should not have agreed to Loblaws’ requirement that negotiations remain confidential and the amendments not be subject to ratification by the membership;

(d) the Union did not hold a ratification vote of the mid-term amendments pursuant to s. 44 of the Act which he claimed requires ratification of collective agreements; and

(e) the contribution by Loblaws to the union’s education fund was an illegal financial contribution from an employer contrary to s. 70 of the Act.

9The first decision of the Board dated December 8, 2003, is lengthy. It describes the background to the negotiations between Loblaws and the Union including the business atmosphere of food retailers on that time; Loblaws’ plans to meet WalMart’s entry into the marketplace; Loblaws’ preliminary discussions with the Union; the Union’s response; the Applicant’s opposition and, ultimately the negotiation and agreement to a “new appendix” to the Collective Agreement that would apply to supercentres at new sites.

10It is to be noted that all of the divisional officers, who examined the proposal on behalf of the Union, met on June 17 and 18, 2003, and voted thereafter by secret ballot vote, unanimously giving Local 1000A the mandate to conclude the mid-term agreement. In addition, Union stewards were invited to a meeting to take place on July 3, 4 and 7, 2003, with most of them supporting the amendments. The agreement to amend the collective agreement was signed on July 11, 2003. Meetings were arranged by the Union for its members after that date.

11In its Decision, the Board carefully examined all issues raised by the Applicant, and dealt with the issue of 26 other Union members supporting the Applicant’s position. The Board rejected all the Applicant’s arguments. In paragraph 103, the Board says:

The real issue here is not that employees were denied the opportunity to be consulted. The issue is that the applicant and other employees dislike the deal and desire the opportunity to demonstrate that a majority of employees are also opposed. The remedy for such employees is at the ballot box, at the appropriate time, not in an application under section 74 of the Act.

The Board then found in paragraph 105 of its Decision, that, “… nothing would have compelled Local 1000A to change the amendment agreement so long as it did not otherwise act arbitrarily, with discrimination or in bad faith in coming to that decision.” The Board was satisfied that nothing would have changed, even if consultation had occurred. It concluded in paragraph 107 that, even if a breach could be established, “…no meaningful remedy could flow to the applicant.” In closing, it stated that one thing is clear, namely, that “…the trade union took the route which is most likely to protect its members’ jobs.”

12The Applicant filed a request for reconsideration of that Decision of the Board. Part of that request was based on what the Applicant said was new information, which appeared in a newspaper article. Another part was based on what the Applicant said was the Board not providing “adequate” reasons for its decision. The Applicant also complained about the Board not considering the gender issue he had raised. The Board, on p. 5 of it second decision says that much of the request for reconsideration related to “alleged procedural defects”, stating that the only part of the request for reconsideration, which addresses the merits of the issue was that dealing with the gender discrimination issue.

13The Union did not support the Applicant in his request for reconsideration, and asked that the request be dismissed. The Board, despite the Union’s opposition to it, did reconsider the matter, which was based on “a whole new set of facts and arguments” relating to the gender issue, and heard the Applicant’s submissions in that regard. The issue was thoroughly canvassed by the Board and was dismissed by it, as was the Applicant’s s. 70 complaint and the issue of the education payment to the Union, which the Union had not complained about.

14The Board dismissed all points raised by the Applicant for reconsideration, stating that the request for reconsideration, “…is simply an attempt to re-argue the case, and as such is not appropriate.”

The Standard of Review

15It is the position of the Applicant that the standard of review of the Board’s decision is that of correctness. It agrees that the Board must apply the pragmatic and functional analysis test in determining the standard to be applied. It says that this is the appropriate standard in light of the privative clause, the expertise of the tribunal relative to that of the reviewing court on the issue in question, the purpose of the legislation and the provision in particular, and finally the nature of the question and whether it is law, fact or mixed law and fact.

16It is the position of the Applicant that the privative clauses in the Act do not meet the standard of full privative clauses, stating that although they are strong, they are “partial” clauses. The Applicant says that these clauses do not warrant the highest level of deference. We disagree with the Applicant in this regard.

17The Applicant says that in this instance, the Board had no reason to consider either policy or use the remedies, which are unique to the Board. The Applicant says that the Board heard no evidence under oath and did not make any determinations as to credibility. Therefore, the Applicant says that the Board has no specific powers of interpretation of statute that are greater than those of the Courts, nor are there any special technicalities or scientific analysis unique to the Board, that would call for a greater degree of deference. Such factors call for a less deferential standard of review, says the Applicant. The Applicant also says that the issue of one general application and does not require any special expertise in the administration of the Act.

18The Union, on the other hand, asserts that the standard of review that applies to the Board’s decision is that of patent unreasonableness, set out in Voice Construction v. Construction & General Workers’ Society, Local 92 (2004), 238 D.L.R. (4^th ) 217 (S.C.C.) as follows at p. 224:

A decision of a specialized tribunal empowered by a policy-laden statute, where the nature of the question falls squarely within its relative expertise and where the decision is protected by a full privative clause, demonstrates circumstances calling for the patent unreasonableness standard.

19The Union says that in general, the Board’s decisions are protected from judicial review, by a strong privative clause and a finality clause found in ss. 114(1) and 116 of the Act. The Union says that the Board has historically been accorded a high degree of deference with respect to its decisions. It says that the strong privative clause in the Act, which is policy-laden, relates to the purpose of the legislation and the provision in particular. The nature of the question to be decided can be one of fact, law or mixed fact and law.

20The Union says that the issue of the duty of fair representation and the complaint made falls squarely within the Board’s jurisdiction. It notes that the Supreme Court of Canada has repeatedly recognized that labour relations boards are highly specialized tribunals whose decisions are particularly worthy of curial deference. See: Canadian Broadcasting Corp. v. Canada Labour Relations Board, 1995 148 (SCC), [1995] 1 S.C.R. 157.

21Loblaws also takes the position that the standard of review is that of patent unreasonableness, relying on the recent decision of our Court of Appeal in Lakeport Beverages, a Division of Lakeport Brewing Corp. v. Teamsters Local Union 938, 2005 29339 (Ont. C.A.) at pp. 5-8 thereof, which is now the standard for arbitrators. Loblaws, too, relies on the reasoning in Voice Construction, supra, that where considerable deference is directed, the test of patent unreasonableness applies.

22We adopt the reasoning as set out in Voice Construction, supra, and Lakeport, supra, on the issue of the standard of review, and find it to be one of patent unreasonableness in the case before us.

Analysis and Conclusions

23The Union submits that the Board was not patently unreasonable in reaching the conclusion it came to in both its Decision and in its reconsideration. We agree with the Union in this regard. The Board was called upon to read two Sections of the Act together, namely Section 44(1) and Section 58(4). Section 44(1) states:

A proposed collective agreement that is entered into or memorandum of settlement that is concluded on or after the day on which this Section comes into force has no effect unless it is ratified as described in subsection (3).

Section 58(5) states:

Nothing in this Section prevents the revision by mutual consent of the parties at any time of the provision of a collective agreement other than a provision relating to its terms of operation.

The Board found that the continuation of Section 58(5), unaltered, in the Act when Section 44(1) was enacted, did not require that employees ratify “mid-term” agreements.

24The Board properly pointed out that the Union members, including the Applicant, could vote at the ballot box when the Collective Agreement, governing the Union and Loblaws, comes up for reconsideration. The Union members were not ignored in the process and we accept that the consultation with the division officers of the Union was reasonable and the Union took into account potential opposition by members to the changes before reaching an agreement with Loblaws.

25Loblaws says that at the end of the day, the Board had to decide whether the Union’s response to the demands made in these special circumstances was appropriate. Loblaws says that the Board’s reasoning in this matter accords with accepted principles of statutory interpretation. We agree that the Board looked at s. 44(1) of the Act as a part of the statute as a whole. Further, as noted by Loblaws, given the duty imposed on the Union by s. 74 of the Act, the Union is obligated to consider and weigh the competing interest of all employees in the unit it represents. The Board’s approach, in considering all of the facts before it, cannot be said to be in any way unreasonable. Loblaws even concedes that the Union achieved significant protections for its members in the mid-term agreement it reached, including the $450,000 payment to the Union over three years to fund education and training initiatives.

26In our view, the Applicant simply tried to re-argue the issues before us, which had been before the Board on the two occasions. It was not sufficient for the Applicant to rely on statements made in a newspaper article, to say that there was new information, which was necessary for the Board to look at on a reconsideration of the issues. Even the argument it re-raised on the reconsideration, regarding gender issues and how women may (our emphasis) be treated if employed in the new reconstituted stores was not substantiated by clear facts. Finally, the Applicant’s s. 70 arguments of allegations of employer interference with the Union, in providing money for educational purposes, were found by the Board to be misconceived. The Board’s decision made in this regard cannot be said to be patently unreasonable.

27The Board was entitled to come to the decision it did, both in the first instance and on the reconsideration. The Board held that the facts as alleged could not support the conclusion that the Union breached its duty of fair representation to the Applicant under s. 74 of the Act. There was nothing arbitrary or discriminatory in its decision, nor was it made in bad faith. The decision is well-reasoned, thoughtfully crafted and balanced in its overall analysis of the claims by the Applicant.

28The Union acted reasonably and fairly in negotiating the mid-term amendments to the Collective Agreement, given the competition Loblaws was facing from Wal-Mart, and given the business climate of the day. See: Canadian Merchant Service Guild v. Gagnon, 1984 18 (SCC), [1984] 1 S.C.R. 509, where the Court noted that the Union’s representation must be fair, genuine and mot merely apparent, undertaken with integrity and competition, without serious or major negligence, and without hostility towards the employee. We can see nothing in the Board’s decision or in the Union’s representation of its members, which shows that the Union failed in this regard.

29The Union, as is noted in John Daniell, [1987] O.L.R.B. Rep. July 990, is not required to implement the views of a majority of employees, as though they were its principals. As the Board found on p. 23 of its Decision, the Union took the “route which is most likely to protects its members’ jobs.” The fact that the Applicant and approximately 26 other members vocally disapproved of the steps the Union took, does not make the Union’s decision either unfair or arbitrary. In our view, there is no evidence that the Union acted in bad faith in its dealings with Loblaws and in the mid-term agreement they reached respecting the Collective Agreement.

30The Board, in our view, made no reviewable error. The Board’s interpretation and application of s. 44 of the Act, as added to the Act in 1995, is not patently unreasonable. The Act allows a collective agreement to be revised or amended at any time during the duration of the agreement and it is no longer necessary for all Union members to vote on such changes. The Board rejected the Applicant’s argument that at some point, amendments to the collective agreement become so substantial as to constitute a new collective agreement requiring ratification, and made no error in this regard.

31We agree that the Board’s approach was also consistent with its prior decisions, confirming that parties to a collective agreement should be encouraged to respond to changing circumstances, such as those, which were taking place in the retail food industry and the rise of the superstores, box stores and megastores. Loblaws was responding to those changes and the Union recognized this and did its best to protect its members. See also: Great Atlantic and Pacific Tea Company Limited, [1986] O.L.R.B. Rep. April 485, at p. 499.

32The Board took no part in the arguments raised by the Union and Loblaws. It simply relied on the facta and on the arguments, which were raised by both of those entities in their presentations to the Court.

33The Application is therefore dismissed for the reasons set out herein.

34With respect to the issue of Costs, the Union says that this exercise has been a very costly one for the Union, and it therefore seeks nominal Costs of $1,000 under these circumstances. The Union was at a pre-hearing conference with the Applicant, had to prepare and attend at both the hearing and the reconsideration before the Board and was before us the better part of a full day. Loblaws is seeking its Costs thrown away. The Board seeks no Costs. Under the circumstances of this case, we are of the view that the Union is entitled to the $1,000 in nominal Costs, which it seeks. These shall be payable forthwith by the Applicant. Loblaws, on the other hand, was an Intervenor in the case. While we are aware that it has incurred substantial costs in the proceeding, as a whole, we are of the view that it must bear its own Costs in the circumstances. Orders to go accordingly.

Greer J.

Macdonald E. J.

Lax J.

Released: February 2, 2006

COURT FILE NO.: 74010/04

DATE: 20060202

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

GREER, MACDONALD E. and lax jj.

B E T W E E N:

BENJAMIN BLASDELL

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ONTARIO LABOUR RELATIONS BOARD, UNITED FOOD AND COMMERCIAL UNION A.F.L.-C.I.O.-C.L.C., LOCAL 1000A

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