CITATION: KAS Group of Companies v. Metro Waste Paper Recovery Inc., 2010 ONSC 7050

DIVISIONAL COURT FILE NO.: 611/09

DATE: 20101217

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

FERRIER, MOLLOY AND SACHS JJ.

BETWEEN:

THE K.A.S. GROUP OF COMPANIES INC.

Applicant

– and –

TEAMSTERS LOCAL UNION NO. 419, METRO WASTE PAPER RECOVERY INC., c.o.b. METRO MUNICIPAL RECYCLING SERVICES INC.

-and –

ONTARIO LABOUR RELATIONS BOARD

Respondents

Christopher M. Andree and R. Ross Wells, for the Applicant

James K. McDonald, for the Respondent, Teamsters Local Union No. 419

Leonard Marvy, for the Respondent, Ontario Labour Relations Board

HEARD at Toronto: December 17, 2010

SACHS J. (ORALLY)

[1] The K.A.S. Group of Companies Inc. (“KAS”) bring this application for judicial review of a decision of the Ontario Labour Relations Board (the “Board”) dated November 2, 2009. In its decision the Board held that KAS and the respondent Metro Waste Paper Recovery Inc., c.o.b. Metro Municipal Recycling Services Inc. (“Metro”) were related employers within the meaning of s.1(4) of the Ontario Labour Relations Act, 1995 (the “Act”).

[2] The parties agree that the applicable standard of review to this application is reasonableness. We concur.

[3] With respect to s.1(4) of the Act, we note that this Court has previously found that the standard of review applicable to the Board’s decision under s.1(4) is a highly deferential one. Specifically, in Greater Essex County District School Board v. International Brotherhood of Electrical Workers, Local 773 2007 741 (ON SCDC), [2007] O.J. No. 185 at para. 39, this Court held:

The significant discretion given to the Board by the Legislature in Section 1(4) reinforces the need for deference. It signals the Legislature’s decision that it is the Board who has the expertise to do the balancing required in making a decision under Section 1(4).

[4] In a twenty-four page decision, the Board weighed the evidence adduced by the parties, considered the parties’ position and analyzed the Board’s jurisprudence. It concluded that both Metro and KAS exercised control over employees and that it was not clear which was the “true” employer or whether there even was one “true” employer. The Board then considered the application of s.1(4), held that “this is the kind of circumstance which s.1(4) of the Act was designed to address” and determined that a related employer declaration should issue. As a result, the Union was certified to represent the employees in the bargaining unit it applied for and both KAS and Metro were named in the certificate as the employers of those employees.

[5] On this application for judicial review, KAS made two principle submissions. First, KAS argued that it was unreasonable for the Board to proceed with a s.1(4) analysis without having first concluded that it was impossible to decide as between KAS and Metro who was the “true” employer. In support of this argument, counsel pointed to paras. 102 and 103 of the Board’s Decision in which the Board stated that because it was difficult to find the “true” employer, it was therefore not necessary to make such a finding because of the application of s.1(4).

[6] Second, KAS submitted that the Board unreasonably exercised its discretion under s.1(4) of the Act in the absence of any identifiable labour relations mischief that s.1(4) was enacted to address.

[7] With respect to the first submission, it is important to remember that our job on a judicial review is to consider the reasons as a whole, not to parse a particular phrase in a particular paragraph. Read in context, it is clear that the Board considered all of the established criteria for determining which is the true employer. In doing so, it made extensive findings of fact, including findings of credibility, considered the relevant case law and ultimately concluded that KAS and Metro shared roughly equal power over the employees and made a number of decisions jointly. Neither one appeared to exercise greater power than the other and, thus, it was not clear which entity was the “true” employer. The Board, therefore, found it appropriate to consider whether the criteria for the operation of s.1(4) were met. We find nothing unreasonable about this approach, which is consistent with the legislative scheme.

[8] With respect to the second submission, we disagree that the Board exercised its discretion in the absence of any identifiable labour relations mischief.

[9] At paragraph 88 of Etobicoke Public Library [1988], OLRB Rep. September 935, the Board states:

“The principles and legislative objectives or purposes underlying section 1(4) identified by the Board in these and numerous other decisions may be conveniently summarized as follows: section 1(4) is designed

(a) to preserve or protect from artificial erosion the bargaining rights of the union,

(b) to create or preserve viable bargaining structures, and

(c) to ensure direct dealing between a bargaining agent and the entity with real economic power over the employees.

These principles and purposes have guided the Board in the exercise of its discretion. In our view, the appropriate question to be asked and answered therefore is whether there are any reasons, consistent with the purposes and legislative objectives underlying the statute to make the common employer declaration.” (cite omitted)

[10] In the case at bar, the Board identified three forms of labour relations mischief.

(i) It was unable to properly define and tie down the employment relationship.

(ii) Within the reality of this workplace, a single employer declaration would make it difficult for anyone to know who the true employer was.

(iii) Collective bargaining rights would be substantially undermined if only one employer was certified, because bargaining with either one of them alone would be enormously difficult, particularly since neither has the unfettered right to raise wages. (See paras. 116 and 117 of the Board’s decision adopting and applying the reasoning in PPG Canada Inc., [2009] OLRB Rep. Mar/April 256).

[11] In effect, to use the language of Etobicoke Public Library, resort to s.104 was appropriate in this case to protect bargaining rights, to create a viable bargaining structure and to ensure direct dealings between the union and the entities with real economic power.

[12] The Board’s Decision on both the issues raised by KAS was, in large measure, fact-driven and squarely within its expertise. The Board’s Decision was made within its exclusive jurisdiction and pursuant to legislative provisions that specifically rely upon the Board’s specialized expertise. Its reasons are rational and clear and the decision falls within the range of acceptable outcomes that are defensible in respect of the facts and the law.

[13] Accordingly, there is no basis for this Court to intervene and the application for judicial review is dismissed.

FERRIER J.

[14] I have endorsed the Application Record: “For oral reasons delivered this day, the application is dismissed. Re: OLRB, no costs. As between KAS and the union, costs to the union, on consent, fixed at $7,500.00”

SACHS J.

FERRIER J.

MOLLOY J.

Date of Reasons for Judgment: December 17, 2010

Date of Release: January 12, 2011

CITATION: KAS Group of Companies v. Metro Waste Paper Recovery Inc., 2010 ONSC 7050

DIVISIONAL COURT FILE NO.: 611/09

DATE: 20101217

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

FERRIER, MOLLOY AND SACHS JJ.

BETWEEN:

THE K.A.S. GROUP OF COMPANIES INC.

Applicant

– and –

TEAMSTERS LOCAL UNION NO. 419, METRO WASTE PAPER RECOVERY INC., c.o.b. METRO MUNICIPAL RECYCLING SERVICES INC.

-and –

ONTARIO LABOUR RELATIONS BOARD

Respondents

ORAL REASONS FOR JUDGMENT

SACHS J.

Date of Reasons for Judgment: December 17, 2010

Date of Release: January 12, 2011