McMaster University v. McMaster University Academic Librarians’ Association, 2014 ONSC 2114
DIVISIONAL COURT FILE NO.: DC-216/13
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
THEN, MacKENZIE, McEWEN JJ.
BETWEEN:
McMASTER UNIVERSITY Applicant
– and –
McMASTER UNIVERSITY ACADEMIC LIBRARIANS’ ASSOCIATION Respondent
George Avraam, Jordan Kirkness, for the Applicant
David Wright, Christopher Bryden, for the Respondent
HEARD AT TORONTO: November 22, 2013
Overview
1The parties to this judicial review do not agree whether their collectively bargained agreement requires the applicant, McMaster University (“McMaster”), to consider the work undertaken by some employees on behalf of the McMaster University Academic Librarians’ Association (the “Association”) as part of their “professional service and professional activity” responsibilities for the purpose of management decisions on merit pay. A grievance arbitrator interpreted the collective agreement as requiring McMaster to do so. McMaster seeks to quash that award.
2McMaster submits that the award is unreasonable because it confers a financial benefit on Association members in the absence of clear language in the collective agreement; it places McMaster in an unavoidable conflict of interest and; it exposes McMaster to claims of anti-union conduct if they fail to award merit pay to an employee who has been active in the Association. The Association submits that none of these grounds are sufficient to show that the arbitrator’s award was unreasonable.
3It is common ground that the decision of a labour arbitrator in interpreting a collective agreement is to be afforded a considerable degree of deference by the reviewing court; the applicant nevertheless, submits that the decision of the arbitrator is unreasonable while the respondent submits that it is reasonable. We agree with the respondent.
Background
4The parties’ collective agreement went into effect in 2011 and provides that employees will create Annual Activity Reports that address, among other things, each employee’s “professional service and professional activity” during that year. Article 3 of the agreement, defines “professional service and professional activity” both collectively and individually as follows:
“professional service and professional activity” refer to employees’ contributions to the Library, the University and the Profession over and above the responsibilities set out in their Position Responsibility Statement. In evaluating professional service and professional activity emphasis is placed on: (a) the level of the employee’s personal contribution to the specific service or activity; and, (b) the value of the service or activity to the librarian’s professional advancement, the Library and the broader library and research community.
“professional service” includes active membership on, or chairing, committees, professional association boards or committees, task forces or projects over and above the responsibilities set out in their Position Responsibility Statement.
“professional activity” includes research and publication (writing, editing, refereeing or reviewing books, articles, or reports); grant preparation; participation at conferences (contribution through presentations to professional or scholarly associations/meetings); conference management (planning, organizing or conducting professional programs, workshops, seminars or conferences); teaching (over and above the teaching or instruction responsibilities set out in their Position Responsibility Statement); and, consulting for external organizations.
It is notable that the definition does not explicitly anticipate consideration of employee work on behalf of the Association (“Association work”), such as assisting with an Association member’s grievance or engaging in the negotiations with management.
5The collective agreement specifies that employees discuss their Annual Activity Reports with their supervisor and this may result in changes. Eventually, the supervisors create their own written performance evaluation for each employee and uses it, along with the Annual Activity Report, to determine a recommended performance rating for the employee. The Report, performance evaluation and recommended performance rating are then forwarded to top management where the employee’s performance rating and merit pay, if any, is ultimately determined. This process must involve consideration of employees’ professional service and professional activity, in addition to their position related responsibilities. The normal distribution of librarian responsibilities between these two categories is 25% to the former and 75% to the latter.
6The question of whether employees’ Association work would be considered as part of their professional service and professional activity was uncertain after the collective agreement was entered into in 2011. By September 2011, McMaster confirmed that Association work would not be considered. This decision was grieved by an Association member and the grievance eventually proceeded to an arbitration hearing in Hamilton on March 28, 2013.
7The grievance arbitrator’s task was to determine the intention of the parties on this issue. By award dated April 3, 2013, the arbitrator determined that the agreement required McMaster to consider employees’ Association work in their assessments of those employees’ professional service and professional activity. This conclusion was grounded in key terms of the collective agreement:
- The preamble/purpose clause which the arbitrator held acknowledged the “critical role the Association can and must play in achieving academic and professional ‘excellence.’ Therefore, service to the Association in furtherance of these goals must be equated with service on behalf of the Library and the University.”
- The definitions of professional service and professional activity which are “broad and inclusive.”
- Articles 5.02 and 5.03(c) which provide for paid release time for Association activities, including mutual recognition of the value of these activities.
- Article 24.01 which requires consideration to be given to “employee’s multi-faceted work as a whole” in evaluating employees’ performance.
- Article 24.02(b) which further recognizes librarians’ professional responsibility to pursue self-directed professional service, with the constraint that it be in the interest of the Library and the broader library and research community.
Issue
8The sole issue on this judicial review is whether the arbitrator’s interpretation of the collective agreement is reasonable.
Standard of review
9The parties agree that reasonableness is the standard of review for an arbitrator’s interpretation of a collective agreement: Imperial Oil Ltd. v. Communications, Energy and Paperworkers Union of Canada, Local 900, 2009 ONCA 420, 96 O.R. (3d) 668, at paras. 26, 28. In respect of their interpretation of collective agreements, labour arbitrators are entitled to a high degree of deference by the reviewing court; and an arbitrator’s decision will only be set aside as unreasonable if the result is not within the range of possible, acceptable outcomes defensible on the facts and the law: Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, at paras. 47 and 68; Lakeport Brewing Corp. v. Teamsters Local Union 938, at paras. 20-33.
10We are also guided in our assessment of the reasonableness of the award by the approach taken by the unanimous Supreme Court in Law Society of New Brunswick v. Ryan, 2003 SCC 20, [2003] 1 SCR 247, where at paras 55-56 Iacobucci J. stated:
A decision will be unreasonable only if there is no line of analysis within the given reasons that could reasonably lead the tribunal from the evidence before it to the conclusion at which it arrived. If any of the reasons that are sufficient to support the conclusion are tenable in the sense that they can stand up to a somewhat probing examination, then the decision will not be unreasonable and a reviewing court must not interfere (see Southam, at para. 56). This means that a decision may satisfy the reasonableness standard if it is supported by a tenable explanation even if this explanation is not one that the reviewing court finds compelling (see Southam, at para.79).
This does not mean that every element of the reasoning given must independently pass a test for reasonableness. The question is rather whether the reasons, taken as a whole, are tenable as support for the decision. At all times, a court applying a standard of reasonableness must assess the basic adequacy of a reasoned decision remembering that the issue under review does not compel one specific result. Moreover, a reviewing court should not seize on one or more mistakes or elements of the decision which do not affect the decision as a whole.
Positions of the parties
11McMaster argues that the collective agreement reflects the parties’ intention that employees’ be compensated only for specific types of Association work. These activities are explicitly listed in Article 5.03 and can be quantifiably determined, i.e. pay can be calculated by simply adding up the time spent doing the activity, for instance the time spent attending a relevant meeting between the Association and the University. The arbitrator erred in ordering that McMaster must qualitatively assess employees’ Association work in order to confer a financial benefit on certain employees that have devoted service time to the Association. It is a principle of collective agreement interpretation that clear language is required to confer a financial benefit and none exists in the agreement.
12McMaster also argues that the award places it in an unavoidable conflict of interest with the Association. It violates the principle of “managerial exclusion” because loyal managers cannot provide an objective, qualitative evaluation of employees’ work for the Association. Those managers are in an inherently adversarial relationship with the Association. Further, compliance with the award may expose McMaster to claims of anti-union conduct if merit pay is not given to an employee that engages in Association work.
13The Association argues that the arbitrator properly understood the interpretive task was based solely on the language of the collective agreement read as a whole. The agreement’s relevant provisions had to be analyzed in concert and the arbitrator did so reasonably. The arbitrator’s interpretation does not automatically confer a financial benefit. Rather, it provides information that top management will weigh in determining an employee’s performance rating and merit pay, if any is warranted.
14The Association also argues that McMaster is not placed in a conflict of interest because evaluating employees’ performance is a classic management function. Moreover, the “managerial exclusion” principle has no application outside the determination of which persons fall inside or outside of a bargaining unit. Finally, if the arbitrator’s interpretation is reasonable, the courts cannot quash it simply because it might expose McMaster to claims of anti-union conduct. It would be a logical absurdity with far reaching consequences in labour law to deny enforcement of a collective agreement’s terms for this reason.
Analysis
Monetary benefit
15McMaster submits that clear language is required in a collective agreement to confer a financial benefit. They cite the following cases as authority for this proposition: Canada Post Corp. and C.U.P.W. (Schlosser) (1993), 39 L.A.C. (4th) 6 (Bird), where an employee sought pay for time spent attending court to defend a speeding charge; Long Harbour Employers Assn. Inc. and Resource Development Trades Council of Newfoundland and Labrador (Grievance #41), Re, 2011 CarswellNfld 473; 112 C.L.A.S. 85 (Browne) at para. 32, where employees sought pay in the form of “board allowance” added to their wages; and Cardinal Transportation B.C. Inc. and C.U.P.E., Loc. 561 (1997), 62 L.A.C. (4th) 230 (Devine) where school bus drivers sought pay for statutory holidays when schools were closed. There are two significant points to be made about these authorities.
16First, in each of these cases the issue was whether the collective agreement directly, or automatically, conferred a financial benefit on a grieving employee. In this case, the arbitrator’s agreement does not directly confer a financial benefit but, rather, merely obliges McMaster to consider employees’ Association work as part of the decision on merit pay. It does not oblige management to order merit pay for any employee – management still retains discretion to decide whether merit pay will be given to an employee and, if so, in what amount. In other words, the merit pay is still contingent on an exercise of management’s discretion.
17Second, all the decisions cited above have a common thread in their reliance on Re Noranda Mines Ltd. (Babine Division) and U.S.W.A., Loc. 898, [1982] 1 W.L.A.C. 246 (Hope) for the “principle” asserted by McMaster. In Noranda Mines the arbitrator was interpreting a provision in the collective agreement that made it the employer’s responsibility to pay for the costs of the employee dental plan. The union argued this provision required the employer to ensure no deductible would be included in the plan, while the employer countered that it only made them responsible for paying the premiums, and that arranging for a dental plan with a deductible to be paid by employees did not violate the agreement.
18The arbitrator explained, at p. 266, that “[a] claim for monetary benefits is best advanced on the basis of a clear expression of intention and should not be left to inference” and noted that the minimum onus on employees asserting a monetary benefit in an interpretation grievance “is to provide persuasive evidence of that intention.” The arbitrator then qualified this proposition, at p. 267:
That is not to say that a union will be deprived of the fruits of its agreement simply because some aspect of the bargain is not expressly stated in the collective agreement itself. The union is entitled to all benefits that flow naturally from a consideration of the language used even though the benefit may not have been specifically contemplated by the employer. [Emphasis added]
19This qualification from Noranda Mines on the importance of clear language was reviewed in Re B.C. Transit and I.C.T.U., Loc. 1, unreported, April 14, 1987 (Larson), where it was characterized in the following way, at p. 9:
The probability that the obligation [allegedly conferring a monetary benefit] would have been undertaken except by express words is an important factor in persuading the board of that assertion. But the board should not be taken to have stated that a monetary obligation can only be undertaken by an employer by express words to that effect. [Emphasis in original]
20These decisions exhibit an important qualification on the notion that a monetary benefit should only be conferred where clear language exists in the collective agreement to that effect. This “principle” is not a hard and fast rule, but rather one signal of the parties’ intention that must be weighed in the context of the collective agreement as the whole and any extrinsic evidence that might be relevant in the circumstances.
21In our view, the interpretation of the arbitrator of the terms of the collective agreement does not confer a monetary benefit. Even if the interpretation does confer such a benefit we find that the arbitrator was entitled to engage in a contextual interpretation of the agreement as a whole and thereby to conclude that the union is entitled to the “benefits that flow naturally from consideration of the language used”. In our view, her interpretation is within the range of possible acceptable outcomes defensible on the facts and the law.
Conflict of interest, Anti-union conduct
22McMaster also argues that the award is unreasonable because it places managers in an unavoidable conflict of interest and exposes McMaster to claims of anti-union conduct. It is their position that the award violates the principle of “managerial exclusion” and it leads to an absurdity, since their managers owe their loyalty to McMaster and could not objectively and fairly evaluate employees’ Association work. Further, Article 8.02 of the collective agreement prohibits McMaster from discriminating against employees on the basis of their membership or activity in the Association. Thus, a decision not to give merit pay to an employee who engages in Association work could expose McMaster to a discrimination claim, regardless of the merits of that work.
23In our view these arguments are interesting but ultimately do no more than demonstrate that other reasonable interpretations of the collective agreement may exist. As the Supreme Court of Canada has recently reiterated in McLean v. British Columbia (Securities Commission), 2013 SCC 67, at para. 40:
[U]nder reasonableness review, [the courts] defer to any reasonable interpretation adopted by an administrative decision maker, even if other reasonable interpretations may exist. [Emphasis in original]
24McMaster argues that, in labour law, the concept of a “conflict of interest” underlies the managerial exclusion principle. The principle is applied in labour law to determine which employees must be excluded from a bargaining unit due to their exercise of managerial functions: see Labour Relations Act, 1995, S.O. 1995, c. 1, Sch. A, s. 1(3)(b). In our view, this principle has no application in these circumstances. The arbitrator’s interpretation of the collective agreement not does trigger the inclusion or exclusion of managerial employees from the bargaining unit. It simply requires McMaster to evaluate employees’ work. While evaluating employees’ Association work in performance reviews may cause some awkwardness given the existence of the bargaining relationship, it is far from an absurd outcome given that evaluating employees’ contributions to the overall harmony of the workplace is a classic management function.
25The arbitrator was alive to the potential that the result might create a “thorny issue when, or if, a person’s Association activity was viewed as disruptive to labour relations,” in that the value of such an employee’s professional service and professional activity could be “problematic to determine.” The arbitrator concluded, however, that the same problem might face McMaster in their evaluations of any other type of non-work related professional service and professional activity undertaken by employees. In essence, the arbitrator concluded that employees who devote some of their time to Association service contribute to the labour relations goals and ultimately to the goals of the university to foster academic excellence that underpin the collective agreement. Accordingly, they should enjoy the same potential benefits as those that devote themselves to other applicable non-work related professional service.
26McMaster cites Clean Harbors Canada Inc. v. C.E.P., Local 914 (35331) (2012), L.A.C. (4th) 276 at para. 24, a prior decision of the arbitrator in the case before us, for the proposition that an interpretation of a collective agreement that leads to an “absurdity” should be avoided. While this is undoubtedly true, not only does Clean Harbors (supra) have nothing in common factually with the instant case but also provides us with some comfort that the arbitrator in the instant case has sought to heed her own counsel.
27On this point, the Association cites Edmonton School District No. 7 v. Alberta Teachers’ Association, 2013 ABCA 155, where, at para. 30, the court upheld as reasonable an arbitral interpretation of a collective agreement that may have created administrative difficulties or impracticalities for management. These difficulties did not rise to the level of an “absurdity”:
ESD7’s fourth argument is that the Board’s interpretation creates absurd impracticalities and administrative difficulties which the Board ignored. We do not agree that the Board “closed its eyes” to the implications of its decision. It was aware that its decision may be awkward for school boards, but concluded that these operational problems did not overcome the clear terms requiring the employer to give 30 days’ notice to a temporary teacher whose contract is ended early.
While the decision is also not factually on point with this case, the court’s language nevertheless illustrates the common sense proposition that an interpretation of a collective agreement does not create an absurdity merely because it entails administrative difficulties or requires an employer to make an “awkward” decision.
28We conclude that the arbitrator’s interpretation does not create an absurdity, either through placing management in an inherent conflict of interest or by forcing them to make some awkward decisions.
29Neither does the arbitrator’s interpretation unreasonably expose McMaster to claims of anti-union conduct. McMaster raised two specific examples of situations that could lead to claims of anti-union conduct under Article 8.02 of the agreement. In the first situation, two employees involved in bargaining on behalf of the Association executive express different positions on an issue, one more favourable to the employer and the other less. Subsequently McMaster determines that the employee who expressed the more favourable position deserves merit pay while the other employee does not. In the second situation, an employee that is a member of the Association’s executive decides to advance a grievance that McMaster deems frivolous. Accordingly, the employee receives a lower performance rating based on McMaster’s negative evaluation of the merits of the grievance.
30These examples confuse the notion of prima facie discrimination with actual liability for discrimination. It is well established that, even where prima facie discriminatory conduct can be shown, an employer must also have acted out of “anti-union animus” to be liable for discrimination. Because it is often difficult to prove an employer’s motivations, anti-union animus will be a rebuttable presumption where an employer’s decision is prima facie discriminatory. Thus, in either example described above McMaster could rebut the claims of discrimination by bringing evidence showing legitimate business reasons for their decisions.
31McMaster cites the following cases as examples of employers being held liable for discriminatory conduct: Board of Commissioners of Police for Sault Ste. Marie (City) (1982), 3 L.A.C. (3d) 208; Soft Drink Workers Joint Local Executive Council v. Coca-Cola Bottling Ltd., 1997 CarswellOnt 3813; and Calgary Herald v. Graphic Communication Union, Local 34M (Press Operators, Platemakers, Mailers, Paperhandlers) (Bonus Grievance), [2002] A.G.A.A. No. 59. In each of these cases the employer either failed to show legitimate business reasons for the allegedly discriminatory conduct and/or the arbitrator found direct evidence of anti-union animus. McMaster referred to no authorities where the employer demonstrated legitimate business reasons for the allegedly discriminatory action and yet was found to have engaged in prohibited discrimination.
32We accept that disagreements and indeed, occasional claims of prima facie discrimination may arise with respect to individual evaluations under this collective agreement. In our view such claims may be defeated by McMaster’s proof of the legitimate reasons behind the decisions. For instance, McMaster could defensibly give less weight to the professional service and professional activity of an employee whose Association work evidences a consistently unreasonable and unproductive pattern of behaviour that actually worsens labour relations in the workplace. Proof of these reasons would likely be sufficient to defeat a discrimination grievance. The necessity of providing this proof, while no doubt frustrating to McMaster, is part and parcel of labour relations under a collective agreement. In our view, the mere prospect of claims of anti-union conduct does not render the arbitrator’s interpretation of the collective agreement unreasonable.
Conclusion
33For these reasons, the application for judicial review of the arbitrator’s order is dismissed. The arbitrator’s interpretation of the parties’ collective agreement was reasonable. The respondent shall have its costs fixed at $5,000.00, all inclusive, which is the amount agreed to by the parties at the conclusion of the hearing.
Then J.
MacKenzie J.
McEwen J.
Released: April 17, 2014
CITATION: McMaster University v. McMaster University Academic Librarians’ Association, 2014 ONSC 2114
DIVISIONAL COURT FILE NO.: DC-216/13
DATE: 20140417
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
THEN, MacKENZIE, McEWEN JJ.
BETWEEN:
McMASTER UNIVERSITY Applicant
– and –
McMASTER UNIVERSITY ACADEMIC LIBRARIANS’ ASSOCIATION Respondent
REASONS FOR JUDGMENT
Released: April 17, 2014