GSB # 263/98

OPSEU # 98U021

IN THE MATTER OF AN ARBITRATION

Under

THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT

Before

THE GRIEVANCE SETTLEMENT BOARD

BETWEEN

Ontario Public Service Employees Union

(Union Grievance)

Grievor

• and -

The Crown in Right of Ontario

(Ontario Clean Water Agency)

Employer

BEFORE Randi Hammer Abramsky Vice Chair

FOR THE Ed Holmes

GRIEVOR Counsel Ryder, Wright, Blair & Doyle Barristers & Barristers

FOR THE Robert Little

EMPLOYER Counsel Hicks, Morley, Hamilton, Stewart, Storie Barristers & Solicitors

HEARING July 22, 23, 1999 May 24, 2000

AWARD

There are six individual grievances and one Union grievance in this matter, each alleging that the Employer, the Ontario Clean Water Agency (OCWA), improperly denied the grievors benefits under Article 20 of the collective agreement. Specifically, it is alleged that OCWA improperly denied the grievors pay in lieu of notice under Article 20.2.1.

The relevant provisions of Article 20, Employment Stability, state as follows:

20.2 NOTICE AND PAY IN LIEU

20.2.1

An employee identified as surplus shall receive six (6) months notice of lay-off or, with mutual consent, an employee may resign and receive equivalent pay in lieu of notice. Pay in lieu of notice for the balance of the notice period shall only be granted where the Employer determines that operational requirements permit an employee’s exit from the workplace prior to the expiration of six (6) months notice.

20.2.2

The notice period will begin when the employee receives official written notice. Copies of all such notices hall be provided to the Management Board Secretariat and to the Union.

FACTS

OCWA, which is part of the Ministry of Environment, operates water treatment and sewage treatment plants under contract with various municipalities which own the treatment plants. OCWA competes with private sector companies to provide these services to the municipalities.

For a number of years OCWA provided water and sewage treatment services for the Municipality of Haldimand-Norfolk. In March 1997, the Municipality put out a tender for bids for sewage service, beginning January 1, 1998. In late July, the Engineering Committee selected a competitor, Professional Services Group (PSG), as the likely winner, although a number of conditions set out in the Request for Proposals had not yet been fulfilled by PSG. According to Rick Connell, Operations Manager at the Simcoe-Nanicoke facility, OCWA was hopeful it could retain the contract and began a serious lobbying effort to sway the Haldimand-Norfolk Council to overturn the initial selection of PSG. However, in September or October 1997, the Council, by a one-vote margin, awarded the contract to PSG. Even after this, OCWA remained hopeful that PSG would not be able to provide a sufficient operational plan, but on December 11, 1997, OCWA was informed that PSG had a sufficient number of qualified employees, including OCWA employees, to operate the plants, effective January 1, 1998.

On December 31, 1997, management met with all of the affected OCWA employees to inform them officially that OCWA had lost the contract with Haldimand-Norfolk and that they would be declared surplus, effective the same date, with a layoff date of July 1, 1998. Each employee was given a surplus letter and a letter from Mona Kronberg, Vice-President Human Resources, the purpose of which was to provide “a summary of the entitlements and options available to you in accordance with Article 20 of the collective agreement.” For each grievor, the letter stated that “[a]t the time of your notice, there is no vacancy available within 40 km to which you may be matched pursuant to Article 20.5.” The letter went on to state, in part, as follows:

However, the following options remain available to you:

1. As a surplus employee you shall receive six (6) months notice of lay-off or, with mutual consent, you may resign and receive equivalent pay in lieu of notice. Pay in lieu for the balance of the notice period shall only be granted where the Employer determines that operational requirements permit an employee’s exit from the workplace prior to the expiration of the six (6) month notice. If approved, you will receive payment for the balance of your notice period, pus the greater of enhanced severance pay (paragraph 4 of Appendix 9*) or separation allowance (Art. 20.3.1 or Art. 20.3.2)- and termination pay (Article 53). In addition, if this option is approved by the Employer, you will forfeit all rights under the collective agreement, except for the right to apply to restricted competitions for a period extending twenty-four (24) months after the lay-off date of July 1, 1998. Please note that it is OCWA’s position that you will work the six month notice period or until operational requirements dictate. (emphasis added) e

Employees were also informed, in the letter, of their right, pursuant to Article 20.4, to displace an employee within 40 kilometres, or failing a match, “you may request to displace an employee outside of forty (40) kilometres of your present headquarters (there are no relocation expenses paid for an employee accepting a displacement beyond forty (40) kilometres).” It was also noted that “if displacement is offered and rejected, you will continue to have redeployment rights under Article 20.5 until your lay-off date.”

Employees were not told at the December 31, 1997 meeting what their displacement opportunity would be since, for some, it might change due to decisions made by more senior employees, voluntary exits and so forth. Instead, employees were informed in the letter that “you will be advised no later than January 7, 1998 at 4:30 p.m. if there is an opportunity to displace another employee.” Employees were advised that they could contact their “supervisor or Human Resources Advisor, Jim Macdonald, if you have any questions about this letter or your personal situation.”

Earlier, in either late November or early December, each employee met with Labour Relations Advisor Monty Seli to review potential displacements. For all of the grievors, except the most senior one, the potential displacements identified were not within 40 kilometres and were a significant distance away, requiring relocation in most cases.

At the December 31, 1997 meeting, employees were told that if they wished to continue with OCWA they were to report on January 2, 1998 at the Nanicoke facility, a water treatment plant, until further notice, and that there would be no pay in lieu of notice. One of the grievors, John Topp, asked what “operational requirements” required them to work the notice period since there was no work available at the sewage plants. He was told by Sharon Gray, Vice-President, Central Area, that there were operational requirements related to their regular jobs at Nanicoke, that it was not painting or cleaning jobs or make-work projects, that there would be meaningful work relevant to their position. The meeting, by all accounts, was an emotional one.

Operations Manager Rick Connell explained that Nanicoke was the central hub and the only facility left in the Haldimand-Norfolk area and it was decided that it would be best for the surplus employees, fourteen in all, to report there, where they would be given meaningful, temporary work until it could be determined “who would bump who”. Nanicoke would be “used as a temporary location for bodies to go to.” Only eight employees reported to Nanicoke. Some did maintenance work such as cleaning wet wells and equipment, one job shadowed, one cleaned up files, one did manual work, one took care of compliance records. It was Connell’s view that employees were not offered pay in lieu “because each of the most senior employees, the grievors, had positions to go to; because of their experience and knowledge they were valuable employees. The idea was to keep experienced personnel.” On cross-examination, he stated that the work at Nanicoke was not “make work” but “work that had to be done.” When asked if this work could have been done by regular Nanicoke staff, he responded “sure.” He also acknowledged that Nanicoke itself had, at the same time, surplused two employees out of a total complement (for a three-shift operation) of eight employees.

For the employees who reported to Nanicoke on January 2, 1998, the work available for them, except for one employee, ceased at the end of January. Mr. Connell made that decision is mid to late January. The work for the remaining employee ended in mid-February. All of these employees were given pay in lieu of notice for the remainder of the six month notice period.

All of the grievors accepted jobs with PSG. Although, in the view of the grievors, their acceptance was contingent upon PSG actually having jobs for them on January 1, the documentary evidence clearly establishes PSG made firm offers of employment effective January 1, 1998 which were then accepted by the grievors, individually, on either December 10 or December 11, 1997. Except for one of the grievors who informed OCWA management of his acceptance of the PSG job offer, the grievors’ acceptance of the PSG jobs was not conveyed to OCWA until they resigned immediately after the December 31, 1997 meeting. All of the grievors commenced working for PSG on or about January 1, 1998. None of the grievors, except for Topp, testified that they requested pay in lieu at the December 31 meeting or thereafter. The Employer disputed that Topp had asked management about this. All of the grievors received termination pay under Article 53, severance pay and enhanced severance pay. The only benefit in dispute is pay in lieu of notice under Article 20.2.1.

The issue of pay in lieu had been raised by the Union with OCWA prior to December 31, 1997. On November 28, 1997, Sandra Harper, Job Security Officer with OPSEU, wrote to Mr. Seli, and in that letter raised, among other things, “OCWA’s decision to withhold mutual consent for pay-in-lieu.” In pertinent part, the letter states as follows:

I would appreciate detailed information on OCWA’s decision to withhold mutual consent for pay-in-lieu. OCWA’s definition of “operational requirements” as it applies with respect to Article 20.2.1 would be appreciated. Particularly in light of the fact that the individuals’ workplaces will no longer be operated by OCWA effective 31 December 1997, and that all workplaces within a 40 km radius have undergone recent downsizing themselves.

OCWA did not respond to this letter, although the issue of pay in lieu was discussed at the Employee Relations Committee. At that meeting, the Employer explained that it needed the employees, it had work for them to do and the Union disagreed since the plants would no longer be operated by OCWA and there were layoffs in the neighboring plants.

According to Labour Relations Advisor Seli, OCWA did not “predetermine” its operational requirements in advance of the surplus notice and could not until it knew what senior employees would do regarding displacement. He acknowledged, on cross-examination, that as of January 1, 1998, there were no operational requirements for the grievors at the plants now operated by PSG. He confirmed that at the same time the surplus employees were being told to report to Nanicoke, two Nanicoke employees were being laid off.

ARGUMENTS OF THE PARTIES

The Union contends that the Employer’s decision that “operational requirements” did not permit the grievors’ exit from the workplace prior to the expiration of the six months notice was unreasonable and cannot be allowed to stand. It submits that the evidence was clear that the Employer did not have work for the grievors at “the workplace” as of January 1, 1998 and it did not need them at Nanicoke.

The Union argues that Article 20.2.1 gives employees the right to six months notice of layoff or, with mutual consent, pay in lieu of that notice. It asserts that the Employer’s consent cannot be unreasonably withheld and that consent must be given if operational requirements permit the employee’s early exit from the workplace. The Union submits that this provision places a positive obligation on the Employer to consider if operational requirements permit early exit of an individual employee. Instead, it contends that the Employer applied a blanket, rigid policy to require all surplus employees to work their notice period and that there was no genuine exercise of discretion. In support of its position, the Union cites to Re Elesie and the Crown in Right of Ontario (Ministry of Health) (1980), 1980 CanLII 4088 (ON LA), 27 L.A.C. (2d) 283 (Swinton); OPSEU (Kuyntjes) and Ministry of Transportation and Communications (1985), GSB No. 513/84 (Verity)

The Union further submits that the onus is on the employer to establish that “operating requirements” precluded the early exit of the grievors and that real proof is required, not just the employer’s claim of operating needs. In support, the Union relies on Re Intercraft Industries of Canada, Ltd. and United Brotherhood of Carpenters and Joiners of America, Local 2679 (1985), 1985 CanLII 5325 (ON LA), 22 L.A.C. (3d) 281 (Solomatenko); Re Government of Nova Scotia and Nova Scotia Government Employees Association (1983), 1983 CanLII 4830 (NS LA), 11 L.A.C. (3d) 181 (Christie). It submits that the Employer failed to meet its onus.

The Union also contends that the grievors were not required to accept the displacement opportunities offered by the Employer and that if an employee declines the displacement, he or she is still entitled to receive all contractual benefits, including pay in lieu. It submits that the “workplace” under Article 20.2.1 is personal to the employee and in this case, the grievor’s “workplace” ceased to exist as of January 1, 1998. It argues that the Employer could have given notice in July but chose not to. Instead, it gave notice on December 31, 1997 and must give six months notice to the grievors or the equivalent pay in lieu.

The Employer initially contends that the Board has no jurisdiction to review its decision to withhold consent for pay in lieu. It argues that just as an employee may withhold his consent, so may the Employer and neither decision is reviewable by a board of arbitration. To rule otherwise, it submits, would potentially force “consent” and effectively read the word out of the collective agreement. It argues that the second sentence of Article 20.2.1 does not change the requirement of “consent”.

If the decision is reviewable, however, the Employer urges the Board to adopt a “good faith” standard, rather than a “reasonableness” standard, and to defer to the Employer’s determination of operational requirements as long as it had a bona fide reason for the decision. It submits that as long as the determination that it had work for the employees to do was not arbitrary, discriminatory or in bad faith, the determination should not be second-guessed by the Board. In support of its contention, the Employer cites to Re Artubus Club and Food & Service Workers of Canada (1986), 1986 CanLII 6753 (BC LA), 24 L.A.C. (3d) 241 (MacIntyre); Royal Canadian Mint and Public Service Alliance of Canada (St. Vincent Grievance)[1997] C.L.A.D. No. 436; Re Government of Nova Scotia and Nova Scotia Government Employees Association, supra. The Employer asserts that the “good faith” standard is appropriate since the Employer should not lightly be required to pay six months pay for no work when there is work required to be done.

On the facts, the Employer contends that it determined, in good faith, that it had legitimate temporary work for the surplus employees to perform at Nanicoke and then useful work with the Employer through displacement. It submits that it had “operational requirements” for the grievors during the notice period and that it appropriately withheld its consent for pay in lieu. In the Employer’s submission, Article 20.2.1 provides for pay in lieu only where the Employer determines that there is no meaningful work for the employee during the notice period; an employee need not sit useless during the notice period and may request pay in lieu. The Employer, however, it submits, may withhold its consent if it has work for the employee. In this case, it argues, the grievors were senior, experienced, valuable employees and the Employer had work for them to do.

The Employer submits that the words “the workplace” in Article 20.2.1 is not personal to the employee and that as long as there is meaningful work anywhere, the Employer is entitled to withhold its consent to pay in lieu. It assert that where the parties wanted to refer to the employee’s own workplace, they used the term “work location”. In support of its contention, the Employer cites to Re C.W. Carry Ltd. and United Steelworkers of America, Local 5575 (1994), 1994 CanLII 18661 (AB GAA), 42 L.A.C. (4th) 237 (Power).

The Employer also points out that the grievors never requested pay in lieu, which is a prerequisite. No one asked for it and instead, they resigned immediately after the December 31, 1997 meeting. Under these circumstances, the Employer argues that the Union cannot assert that a more thorough, individual assessment was required. By failing to ask, the grievors deprived the Employer of that opportunity.

The Employer further asserts that the grievors were not available to work as of January 1, 1998 and that Article 20.1.1 contemplates that the surplus employee be available to work. Yet, it submits, at the time notice of layoff was officially issued on December 31, 1997, all of the grievors had already effectively resigned from OCWA. It contends that even though the resignations had not been communicated they were still effective, citing Re Anchor Cap and Closure Corporation of Canada, Ltd. and United Electrical, Radio & Machine Workers of America, Local 512 (1949)(Finkelman). As a result, the Employer contends that no monetary remedy should flow should a violation be found since the grievors were not available for work.

DECISION

1. Is the Employer’s Decision Reviewable?

Based upon the language of Article 20.2 as a whole, I conclude that the employer’s determination that operational requirements do not permit an employee’s early exit from the workplace, and thus its decision to withhold “consent”, is subject to limited review by the Board. Article 20.2.1 states as follows:

An employee identified as surplus shall receive six (6) months notice of lay-off or, with mutual consent, an employee may resign and receive equivalent pay in lieu of notice. Pay in lieu of notice for the balance of the notice period shall only be granted where the Employer determines that operational requirements permit an employee’s exit from the workplace prior to the expiration of six (6) months notice.

This provision gives a surplus employee the right to six months notice of layoff, or, with mutual consent, pay in lieu of notice. That this is a “right” of the employee is clear from the use of the mandatory words “shall receive.” In this case, the grievors’ right to six months notice of layoff, or with mutual consent, pay in lieu of notice, began on December 31, 1997, the date they were officially notified of the layoff.

The Employer asserts, however, that the use of the word “consent” means that the determination of operational requirements is within the sole discretion of the Employer and is not reviewable. The board, in its view, cannot force “consent”, and to do so would essentially read the word out of the agreement.

If the first sentence of Article 20.2.1 stood alone, the question of arbitral review of the Employer’s “consent” might, arguably, be more questionable. But the first sentence does not stand alone. The next sentence states: “Pay in lieu of notice for the balance of the notice period shall only be granted where the Employer determines that operational requirements permit an employee’s exit from the workplace prior to the expiration of six (6) months notice.” The second sentence, in essence, defines consent. It clarifies that pay in lieu (i.e., consent for pay in lieu) shall only be granted where the Employer determines that operational requirements permit an employees exit from the workplace prior to the expiration of the notice period. For this reason, the word “consent” in the first sentence of Article 20.2.1 does not vest unlimited discretion in the Employer and does not remove the decision from arbitral review.

In so ruling, I note that several other provisions in Article 20 provide for “mutual consent” such as 20.5.2 (redeployment beyond 40 km in the ministry) and 20.5.4 (redeployment beyond 40 km in any ministry). These provisions pertain to important redeployment rights and the withholding of consent by the employer would clearly be subject to review.

The fact that it is the Employer who determines whether “operational requirements” permit the early exit of an employee also does not remove the determination from arbitral review. In Re Elsie and the Crown in Right of Ontario (Ministry of Health), 1980 CanLII 4088 (ON LA), 27 L.A.C. (2d) 283, then Vice-Chair Swinton concluded that a provision which stated that “[a] Deputy Minister or his designee may grant an employee leave-of-absence with pay … upon special or compassionate grounds” was subject to arbitral review. She stated at p. 285: “While the wording appears to confer a broad discretion upon the employer in deciding whether to grant special or compassionate leave, it is well established that such discretion must be exercised reasonably and non-discriminatorily.” Accord, Re Young and the Crown in Right of Ontario (Ministry of Community and Social Services)(1979), 1979 CanLII 3955 (ON LA), 24 L.A.C. (2d) 145 (Vice-Chair Swinton), quoted in OPSEU (Kuyntjes) and Ministry of Transportation and Communications (1985), GSB No. 513/84 (Verity). The Vice-Chair in Young, supra, in deciding that the employer’s decision not to grant an employee “special or compassionate leave” was reviewable, stated as follows at pp.147-148:

The grievor is arguing that she has been unreasonably denied leave of absence under art. 29.1. While that article is framed in a way which appears to give management an unlimited discretion in the granting or denial of leaves of absence, in fact that discretion must be exercised in a non-discriminatory and reasonable manner…

An arbitration board, in subsequently assessing what the employer has done in reaching its decision, then plays a restricted role. It must decide whether the employer has acted reasonably and without discrimination and has turned its mind to the merits of the particular request. If satisfied that these criteria have been met, the board must deny the grievance, even if it disagrees with the result reached by the employer or if it might have reached a decision other than that reached by the employer. The board’s concern is the reasonableness of the decision, not its correctness in the board’s view. Such an approach is the proper one to adopt in situations such as leave of absence cases, where the collective agreement gives the employer a broad discretion and where the board has less familiarity than has the employer with the needs of the work place.

I conclude that this limited standard of review is equally applicable to review of the Employer’s determination of “operational requirements” under Article 20.2.1. Further, upon review of the cases cited by the Employer, I find very little practical difference between this standard and the standard set out in Re Artubus Club and Food & Service Workers of Canada, supra and Re Royal Canadian Mint and Public Service Alliance of Canada (St. Vincent Grievance), supra.

In Re Artubus Club, a senior employee grieved that she was entitled to be placed exclusively on the day shift pursuant to a provision which read: “ Subject to the operating needs of the business, management will consider senior employees with respect to assignment of shifts and hours.” The board, at p. 247, found that the employer “supported those [operating] ‘needs’ by its evidence and argument that the shift rotation provided a consistent level of experience and familiarity with the work of the two shifts.” It then stated that the rotation was “not vital to the continued existence of the employer’s business” but “that cannot be the definition of ‘needs.” It concluded at p. 248:

So long as we are satisfied that the employer’s decision was based on a bona fide business reason, we do not think it is for this board to impose its own view about the wisdom of that reason…. [I]n the present case, the evidence satisfies us that the new manager made his decision on a ‘business needs’ basis….

In Re Royal Canadian Mint, supra, a similar issue arose. In that case, the employer had determined that “operational requirements” required the grievors to work the evening or midnight shift. The board held that “[o]n balance the evidence satisfies us that the Mint is justified in thinking that there is a benefit to having the set-up operators rotate through the day shift…as evenly and equitably as possible.” It stated at pp. 40-41:

We do not think “operational requirements” should be construed narrowly. A fair and reasonable construction of those words include requirements that are consistent with the optimal level and functioning of the Mint’s operations, as reasonably and fairly determined by the Mint itself. “Operational requirements permit” when the Mint, acting reasonably and with regard to its legitimate business interests, so determines that they do.

In each case, the board of arbitration reviewed management’s determination to ensure that it acted “reasonably and with regard to its legitimate business interests.” That it acted “reasonably and without discrimination and has turned its mind to the merits of the particular request.” That it made its decision on a bona fide “business needs” basis. In each case, the board reviewed the evidence presented to ensure that the employer’s assessment of its business needs was bona fide and reasonable, not whether it was wise or correct.

Further, the Employer is correct that management is in the best position to determine operational requirements. As Vice-Chair Swinton stated in Young, supra,”the board has less familiarity than has the employer with the needs of the work place.” Likewise, as the board held in Re Government of Nova Scotia and Nova Scotia Government Employees Association, supra at p. 91, in reviewing the employer’s decision that “operational requirements” did not permit an employee from taking a special leave without pay:

An arbitrator should give very considerable weight to management’s assessment of whether or not operational requirements permit special leave because management is in by far the best position to make that assessment, but in the end the collective agreement requires the arbitrator, not management, to decide the matter.

Further, in my view, under Article 20.2.1, the norm is that employees will work the notice period. As long as there is meaningful work for an employee to do, the Employer may require the employee to work the notice period. But where there is no meaningful work and operational requirements permit an employee’s early exit from the workplace prior to the end of the notice period, the employee may resign and receive equivalent pay in lieu of notice.

2. The Determination of Operational Requirements

The onus of establishing that “operational requirements” do not permit an employee’s exit from the workplace prior to the expiration of the six months notice is on the employer. As stated in Re Government of Nova Scotia, supra at p. 91, “it would not make sense to require the union or the employee to prove affirmatively that operational requirements did permit special leave because it is the employer that has full access to information on operational requirements….” Accord, Re Intercraft Industries of Canada, Ltd. and United Brotherhood of Carpenters and Joiners of America, Local 2679, supra. The same is true here. Only the Employer has full knowledge of and access to its operational requirements.

There is no dispute that the Employer did not have “operational requirements” for the grievors at the plants at which they worked beyond December 31, 1997. Instead, the Employer asserted that it had operational requirements for the grievors on two bases. First, it had meaningful temporary work at Nanicoke until it could be determined which employees would exercise their displacement rights. Second, all of the grievors, because of their seniority, had displacement opportunities and thus had work with OCWA, although not in the Haldimand-Norfolk area. Neither of these contentions can be accepted.

Under the Employer’s approach, “the workplace” under Article 20.2.1 is OCWA as a whole. As long as the employee has a displacement opportunity with OCWA, “operational requirements” do not permit the early exit of the employee. That contention is not supportable for two reasons.

First, the Employer’s argument improperly ties an employee’s displacement rights under Article 20.4 with the employee’s right to notice of layoff under Article 20.2. The two rights are separate and distinct. Under Article 20.4, an employee who has received notice of layoff and who has not been assigned to a vacant position under Article 20.5 (which is what occurred with the grievors) has the right to displace an employee identified in the manner set out in that article. But he or she also has the right to decline the displacement. An employee who declines a displacement opportunity still has the right to six months notice of layoff, or pay in lieu. The right to notice, or, the more limited right to pay in lieu, is not contingent on having or not having a displacement opportunity. Having a displacement opportunity does not mean that the Employer’s “operational requirements” do not permit the employee’s early exit. If that were true, senior employees with displacement opportunities, no matter how far away or undesirable, would be deprived of their right to six months notice of layoff or pay in lieu.

Second, the argument improperly equates “the workplace” under Article 20.2.1 with the Employer’s entire operation. Instead, the words “the workplace” refer to the workplace of the employee identified as surplus. Even though it uses the word “the” rather than “his” or “her” before the word “workplace”, the workplace” is personal to the employee. Employees, under Article 20.1.2, are identified for layoff on a seniority basis “in an administrative district or unit, institution or other such work area…” Employees performing identical work in other locations may not be laid off. In this case, the grievors were laid off from the Regional Municipality of Haldimand-Norfolk. Other employees, due to the loss of other contracts, were laid off from the Corporation of the Town of New Tecumseth and the Regional Municipality of Waterloo. Each constitutes a unit from which the employees were laid off. It is that “workplace” which must be reviewed to determine if operational requirements permit the exit of a surplus employee during the notice period.

The words “prior to the expiration of six months notice” confirm that “the workplace” is particularized to the surplus employee since the notice period starts when “the employee receives official written notice.” (emphasis added) Thus, the notice period is personal to the employee and so is “the workplace” from which the employee is surplused. I find that the parties did not always use the words “word location” to refer to an individual employee’s personal “workplace”. Accordingly, the determination that must be made by the Employer under Article 20.2.1 is whether operational requirements at “the workplace” of the surplus employee permit the employee’s early exit. The words “the workplace” refer to the workplace from which the employee is being surplussed, in this case, the Regional Municipality of Haldimand-Norfolk.

The evidence showed that the plant at Nanicoke is part of the Regional Municipality of Haldimand Norfolk unit. The Employer asserts that it had meaningful temporary work for the grievors at Nanicoke and thus had “operational requirements” that did not permit their early exit. Under the facts of this case, however, I cannot conclude that there was meaningful work for the grievors at Nanicoke. The evidence showed that Nanicoke, a water treatment plant, was a small operation consisting of approximately eight employees. It was, at the time, undergoing a reduction in force of two employees. Clearly, on the balance of probabilities, it did not have need for fourteen more employees, some of whom were not licensed for such a facility, even on a temporary basis. As Mr. Connell acknowledged on cross-examination, all of the work performed by the surplus employees who reported to work at Nanicoke could have been done by regular Nanicoke staff. As a result, the conclusion is inescapable that the work assigned was “make work” for them. Since all of the work could have been performed by regular staff, there was no bona fide “operational need” for them at Nanicoke.

Based on the evidence presented, there was no legitimate, bona fide business need for the grievors at Nanicoke. Nor could the Employer properly rely on the fact that the grievors had displacement opportunities. I conclude that the Employer’s determination that “operational requirements” did not permit the grievors’ early exit from the workplace is not supported by the evidence and that, accordingly, the Employer did not act reasonably and with regard to its legitimate business interests when it withheld its consent for pay in lieu.

3. Other Arguments

The Employer argues that the grievors made no request for pay in lieu and thus cannot complain that “consent” was withheld, or that an individual assessment was not made. It submits that a request for pay in lieu must be made before the benefit may be received.

While the Employer’s contention may be correct in general, under the specific facts of this case the absence of a request by the grievors cannot be held against them. This is because the Employer, in its December 31, 1997 letter to each grievor, stated that “it is OCWA’s position that you will work the six month notice period…” In light of this clear statement, there was no reason for the grievors to make a request, nor would such an expectation be reasonable. The answer had already been provided.

I also cannot accept the Employer’s contention that the grievors resigned as of December 10 or 11 and that the resignation was simply not communicated. Although I agree that acceptance of another job offer is conduct which is inconsistent with remaining in OCWA’s employ, the grievors new employment did not take effect immediately. They all continued to work for the Employer until December 31, 1997. Nor did the Employer treat the grievors as having resigned, even in relation to the grievor who informed the Employer that he had done so. Further, all of the grievors received termination and severance pay, benefits to which employees who resign prior to notice of layoff are not entitled.

Finally, I do not agree with the Union’s argument that the Employer’s decision-making process is fundamentally flawed by adherence to a blanket, rigid policy rather than individual determinations. Unlike requests for special leave which must be evaluated on the merits of the individual request, the Employer may determine its “operational requirements” on a group basis. The Employer, however, must turn its mind to the “operational requirements” at the workplace of the surplus employees.

4. Remedy

I conclude that the appropriate remedy is to pay the grievors six months pay in lieu, plus interest. The Employer claims that no remedy is available because the grievors were not available to work for OCWA during the notice period and all had jobs the very next day and suffered no monetary loss.

Under the common law, the purpose of notice is to provide employees with sufficient time to secure alternative employment and any earnings received from alternative employment are offset against monies paid during the notice period. I am sensitive to the view that awarding the grievors six months pay in lieu may be a perceived as a “windfall” since they all had jobs with PSG the very next day. But what is at issue here is contractual entitlements under a collective agreement, not the common law. Article 20.2.1 provides a surplus employee with the right to six months notice of layoff, or, with mutual consent, pay in lieu of notice. This is a contractual entitlement which the Employer did not provide to the grievors.

Further, the parties could have, but did not, provide for repayment of pay in lieu if the surplus employee obtained another job during the notice period and thus was no longer available to work the notice period. The only provision regarding repayment of pay in lieu is Article 20.2.4 which states, in pertinent part, as follows:

20.2.4 Where an employee accepts pay in lieu of notice and is reappointed to a position in the Ontario Public Service prior to the originally projected lay-off date, the employee will repay to the ministry a sum of money equal to the amount paid for the period between the date of re-appointment and the original projected lay-off date. …

Only where an employee is reappointed to the Ontario public service during the notice period is there a repayment obligation. There is no similar requirement to repay if an employee obtains a job in the private sector. The parties clearly turned their minds to this issue and imposed a repayment obligation only when the surplus employee obtains a job in the public service.

In light of this, the fact that the grievors were not available to work for OCWA as of January 1, 1998 is not relevant. Under Article 20.2.1, the grievors were entitled to six months notice of layoff or, with mutual consent, pay in lieu of notice if operational requirements permit the employee’s exit from the workplace prior to the expiration of the notice period. The grievors were provided notice on the last day possible and the evidence shows that there were no bona fide operational requirements for the grievors in the Haldimand-Norfolk area during the notice period. Accordingly, they were entitled to six months pay in lieu.

CONCLUSION

1. The grievance is allowed.

2. The grievors are to be paid six months pay in lieu at the applicable rate for their position, plus interest.

3. I shall remain seized.

Dated at Toronto, Ontario this 7th day of July, 2000.