GSB#1479/02

IN THE MATTER OF AN ARBITRATION

Under

THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT

Before

THE GRIEVANCE SETTLEMENT BOARD

BETWEEN

Professional Engineers, Government of Ontario (Policy Grievance & Lysiak)

Grievor

• and -

The Crown in Right of Ontario (Ministry of Municipal Affairs and Housing)

Employer

BEFORE

Marilyn A. Nairn

Vice-Chair

FOR THE UNION

Larry Robbins Labour Consultant

FOR THE EMPLOYER

David Strang Counsel Management Board Secretariat

HEARING

May 27 & 28, 2003.

AWARD

Further to an interim award issued on February 11, 2003 these matters reconvened. That interim award had concluded that the employer was subject to the reasonable efforts obligation set out in paragraph 1 of Appendix "A" to the collective agreement between the Professional Engineers, Government of Ontario ("PEGO") and the Crown (the "employer"). Five members of PEGO were employed across the province in positions related to social housing. Three members of PEGO received surplus notices and remedies are being sought on behalf of two of those individuals. These engineers were employed at the Ministry of Municipal Affairs and Housing, performing work for the benefit of the former Ontario Housing Corporation. Mr. Lysiak was employed by the Ministry as a Mechanical/Electrical Engineer for the Ontario Housing Corporation Support Branch. Mr. Levesque was employed as a Mechanical Engineer in the Ministry's Toronto Regional Office. They received surplus notices on June 27, 2002.

The grievances arose from the employer's decision to divest itself of social housing functions and to transfer those functions to municipalities and regional local governments across Ontario. The PEGO members were not offered employment with a new employer and the union asserts that the employer failed in its obligation to make reasonable efforts to ensure continuing employment. The relevant provision of the collective agreement provides:

APPENDIX A: EMPLOYMENT STABILITY

The Government of Ontario is aware that its restructuring initiatives over the next three years could have a significant effect on employees, some of whom have served for a lengthy period. Accordingly, the Employer undertakes the following:

1. The Employer will make reasonable efforts to ensure that, where there is a disposition or any other transfer of bargaining unit functions or jobs to the private or broader public sector, employees in the bargaining unit are offered positions with the new employer on terms and conditions that are as close as possible to the then existing terms and conditions of employment of the employees in the bargaining unit, and, where less than the full complement of employees is offered positions, to ensure that offers are made on the basis of seniority.

The employer filed two volumes of documents concerning its reasonable efforts to which the union did not object. The divestment of social housing functions did not take place pursuant to a request for proposal or tender process. The transfer occurred by operation of law pursuant to the provisions of the Social Housing Reform Act, 2000, S.O. 2000, c.27, which statute was enacted in December, 2000. The statute was drafted specifically to deal with the magnitude of issues arising from the complex transfer, from the Ontario Housing Corporation and the Crown, (including as represented by the Minister of Municipal Affairs and the Minister of Housing) to various local authorities, of the real estate and other assets and the liabilities and other responsibilities associated with providing and maintaining social housing. Section 34(1) of the legislation provides authority to the Lieutenant Governor in Council to make "transfer orders" "transferring employees...of a local housing authority" to a new employer, referred to in the legislation as a "service manager". There were forty-seven service managers created as a result of the overall provincial transfer of social housing functions. Approximately thirty percent of the total volume of the social housing portfolio devolved to the City of Toronto as the largest service manager.

The Social Housing Services Corporation ("SHSC") was also created by regulation under the Social Housing Reform Act, 2000 as a non-share capital corporation. Its role is to provide centralized services to the service managers. That regulation was printed in the Ontario Gazette on February 9, 2002.

Ms. Lisa Alfieri testified on behalf of the employer. Ms. Alfieri was the Labour Relations/Human Resources Specialist assigned to deal with the reasonable efforts obligation for the Central Ontario and Metropolitan Toronto Regions. She also had responsibility for Head Office functions which included the OHC Support Branch where Mr. Lysiak was employed. Overall Ms. Alfieri was responsible for approximately 45 Ministry employees affected by the transfer of social housing functions. These included members of OPSEU and AMAPCEO as well as the small percentage of PEGO members. Five regions in the province had a Labour Relations/Human Resources Specialist assigned to deal with the reasonable efforts obligation. Both grievors fell within Ms. Alfieri's areas of responsibility.

Ms. Alfieri was hired in the summer of 2000 and began meeting with service managers in the fall of 2000. The government made its announcement about the transfer of social housing in October 2000 and the legislation passed in December 2000. The Area Transition Team included Ms. Alfieri and three others. The team began meeting with each service manager, during which Ms. Alfieri outlined her role, the Ministry's obligations in respect of the reasonable efforts commitment, and what she was looking for in a joint local transfer plan ("JLTP") with respect to the transition of employees and job offers. A JLTP was required by the legislation to be signed by both parties in order to effect the transfer of social housing. The plan was to demonstrate the service manager's capacity to receive and conduct the business. The reasonable efforts component was a part of the plan, as were other human resource issues. Ms. Alfieri provided copies of all collective agreements, related benefit information and materials, pension requirements, and job descriptions of all affected employees, including PEGO members, to the various service managers. She outlined what would constitute a good offer and what the employer was looking for. This information was disclosed during the planning stages in the hope that the service managers would have a better understanding of the functions performed at the Ministry and the skills available.

Once the service managers had identified how they planned to organize and operate the transferred business and had created organizational charts, Ms. Alfieri received those organizational charts and any job descriptions for planned positions in order to attempt to match them to any job description of the affected employees, including the PEGO members. Some organizations, particularly the City of Toronto, had pre-existing structures and were seeking to absorb the work into those operations. Information was sought from managers regarding job duties and a review of Ministry job descriptions was conducted to ensure that they accurately and adequately reflected the work being performed by affected employees.

It is fair to say that of the job offers received that reflected work performed by Ministry employees, few, if any reflected terms and conditions of employment outlined by the criteria in paragraph 1 of Appendix A. That provision exists in similar, if not identical terms in the OPSEU and AMAPCEO collective agreements. Offers were limited in different ways, for example, in their recognition of seniority, level of wages, and requirements for interviews and/or probationary periods. If there was no match of job functions, the team continued to meet with service managers and Ms. Alfieri outlined the experience and qualifications of the persons affected and attempted to persuade the service managers to make use of that experience.

Throughout this process, Ms. Alfieri offered different ideas and incentives in an attempt to enhance offers or the feasibility of making offers to employees, including sharing of personnel with other service managers or creating part-time opportunities. In that transfers were staggered she offered that the Ministry would provide secondments of Ministry personnel to service managers until the business transferred in order that the service manager could gain the benefit of their experience, arguing that the longer the service managers waited to use that experience, the less likely it was to be available. Whether attempting to pursue job offers or seeking to enhance offers made, the employer offered financial incentives in amounts equal to enhanced severance payments. Amounts were identified to the service managers reflecting the entitlements of the affected employees.

In each case where no job offers were made there was a careful review of job descriptions and specifications to ensure that there was sufficient staff capacity for the service manager to perform the business. In addition the Area Transition Team sought agreement from service managers to continue negotiations regarding job offers up to the point of the transfer of the business in order not to prematurely foreclose the opportunity for negotiations. The transition teams tried to meet with each service manager approximately once a month. The City of Toronto delayed a number of their meetings with the team for reasons to do with its workload.

At a MERC meeting on April 27, 2001 PEGO was provided with an update of the reasonable efforts process and was asked to provide feedback with respect to the protocol for the reasonable efforts job offer process. Mr. Lysiak was the union's representative on that committee. No evidence about any feedback was tendered. Other than that the parties are agreed that PEGO was not consulted about the reasonable efforts process or advised of its progress. Ms. Alfieri had no direct role in meeting with PEGO. She was asked for updates which she believed were being passed on to union representatives on a regular basis.

Reference was made by the employer to other transition activities or programs in addition to its reasonable efforts activity. Although that included certain transition supports such as a hotline for employees to call with questions regarding the business change, that activity is separate and apart from the reasonable efforts obligation under paragraph 1 of Appendix A of the collective agreement.

Very early in the process, Ms. Alfieri was told by service managers that there was not enough engineering work to justify the creation of a full-time engineering position. Alternatively she was told that the service manager had existing maintenance and/or technical staff who could absorb any additional work normally performed by PEGO members, or that the service manager typically contracted out engineering work on an as-needed basis. There was nothing the employer could do to dissuade the smaller service managers from this view, regardless of incentives. They were simply not interested. The only two areas in the province where there was any real prospect of work for engineers were with the City of Toronto or the SHSC.

It was anticipated that many of the functions being performed by the OHC Support Branch where Mr. Lysiak was employed would be phased out. Any employees remaining in the Support Branch as of December 31, 2001 were going to be surplused. The employer was aware of the possibility that certain residual functions might be transferred to the SHSC. It however had not yet been created, never mind identified its needs. Two employees were transferred in the hope that they could be later matched to a SHSC job. One was an AMAPCEO member. The other was Mr. Lysiak. Given the possibility of an opportunity for further negotiations, Mr. Lysiak was transferred to the Social Housing Branch of the Ministry. Mr. Lysiak received notice of that change in reporting structure by letter dated December 18, 2001.

It is perhaps clearer to then review the Ministry's efforts with each of the City of Toronto (the "City") and the SHSC.

In May 2001 the JLTP for the City was completed. The introduction to that plan makes it clear that the City was not welcoming the responsibility for additional social housing functions and that it felt that insufficient funds were available to meet the program needs. The City's initial and continuing position regarding recruitment was that its hiring policies must take precedence for both bargaining unit and non-bargaining unit positions. While it acknowledged that the Ministry had a reasonable efforts obligation it asserted its obligations under its own collective agreements and policies.

As of May 2001 the City provided what was referred to as a "functional" organizational chart. The actual transfer was not due to occur until May 2002. As of May 2001 it had not yet created position descriptions although it had determined the number of anticipated staff and the broad areas of function. In response to receiving the City's JLTP, Ms. Alfieri wrote to the Project Manager representing the City on May 18, 2001 reiterating the Ministry's position that it intended to pursue job offers for its employees and that it appeared that 19 positions were being created by the City as a result of the transfer of social housing. The parties met on May 23, 2001. Ms. Alfieri's goal was to pursue job offers for the 19 identified positions. The City's position at that time and throughout was that it intended to use its internal posting provisions to fill both union and non-union positions.

At various meetings the Ministry representatives requested job descriptions and other documents to review the City's plans. They requested and did meet with the City's human resources staff in order to better understand the City's policies and collective agreement obligations. As of June 2001 the Ministry had not received any job offers from the City. A Memorandum of Understanding was signed by the City and the Ministry on June 25, 2001 wherein the parties agreed to continue the reasonable efforts negotiations until June 30, 2002. It references and includes the Ministry's obligation to affected employees, including PEGO members. It does little else other than to cite the parties' respective goals. The Ministry's goal was to obtain job offers for its employees. It is apparent that the City's goal was to staff the additional work pursuant to its internal, existing obligations.

A proposed agenda created by Ms. Alfieri and dated September 25, 2001 sets out the difficulties the Ministry was having in achieving any success in its reasonable efforts negotiations with the City and outlines suggested negotiating strategies for attempting to achieve job offers. The City cancelled meetings scheduled for both September and October.

In mid-October 2001 the Ministry received a copy of a job specification for the Social Housing Consultant position. The City simultaneously proceeded with its internal posting process in order to fill the vacancies. It represented 8 of the proposed 19 available positions at the City. It also agreed to meet with the Ministry to discuss a protocol were the positions not all filled internally.

The parties met again on October 23, 2001. In order to attempt to obtain job offers the Ministry again offered the possibility of using enhanced severance. The Ministry argued that the position matched its existing Housing Administrator position (an AMAPCEO position) and that the City could make good use of the skills of the Ministry's employees. The City noted that due to the municipal amalgamation and resulting harmonization issues, it would take longer before it could respond to the Ministry, reasserting its position that its internal process was to proceed first. That process included a second tier in which applicants from the City's "special purpose bodies" were considered. The City maintained its position that job offers would not be made until an external posting process had been conducted.

Eventually the Ministry was able to persuade the City to consider Ministry employees at the same stage as employees from "special purpose bodies", effectively treating Ministry candidates as second tier City employees for purposes of job competition. At no time was the City prepared to make job offers directly to Ministry employees regardless of skills or job description. The posting process for the Social Housing Consultant position was conducted in November 2001. The Ministry again made offers of enhanced severance during that process. The same process occurred in respect of the position of Supervisor, Training and Community Liaison and a Financial Systems Analyst position.

During this period the Ministry continued to pursue meetings with the City. The next meeting was January 22, 2002. The City was still evaluating its needs with respect to technical services. There had been no suggestion that the City was contemplating any kind of engineering position.

By February 2002 the technical position had been identified to the extent of describing it as a Human Resources position, to manage staff and oversee Requests for Proposals ("RFPs"). In April 2002 that position was identified as "Asset Management Consultant, Social Housing". Ms. Alfieri had the position description reviewed. Mr. Horn, Technical Services Manager, Metro Regional Office, responded on April 22, 2002 advising that he did not believe the job to be subject to reasonable efforts as it did not reflect any existing Ministry position. Some of the duties were outside the scope of regional technical staff and it included significant other duties such as managerial/supervisory duties and project management services. However he described it as a "good opportunity" and recommended that the position be brought to the attention of technical staff when it was to be posted. Ms. Alfieri testified that in her view reasonable efforts was not separate from the total effort to provide opportunities to qualified staff where openings were thought relevant to their backgrounds. On April 22, 2002 she recommended to Mr. Johnson, her supervisor, that when the City's posting was ready, it should be shared with "the techies". Ms. Alfieri moved to a different position on May 18, 2002 and left her role on the Area Transition Team.

On May 22, 2002, the Ministry was notified of the posting. On May 24, 2002 Mr. Johnson asked Mr. Horn if he could say that the Asset Management Consultant position more accurately reflected the Ministry's Maintenance/Construction Inspector's position (an OPSEU position) than any other position at Housing. He specifically identified engineering. Ms. Alfieri testified that Mr. Horn concluded that the job was closer to the Maintenance/Construction Inspector's job. However a review of Mr. Horn's response to Mr. Johnson does not specifically draw that conclusion. Mr. Horn's response was "I don't have a simple answer". He reviewed different tasks and noted that the engineering qualification had been removed from the job specification but drew no conclusion. He summarized that the City job encompassed an "exceptionally broad ranging job scope".

On May 22, 2002 a memo from Mr. Horn had been sent to those members of his staff who would fall within a description of technical staff, advising them of the opportunity to apply for the Asset Management Consultant position. Although a draft position description had included a reference to a professional engineering qualification, the final position description did not. However Mr. Horn saw fit to include Mr. Levesque as a recipient of that memo. Mr. Lysiak was not sent that memo as he was not employed by that office. OPSEU was also advised of the opportunity. PEGO was not. Mr. Lysiak did not otherwise learn of the opportunity.

The Ministry began discussions with the SHSC in or around March 2002. Prior to that time some planning was done based on anticipated movement of residual functions and trying to match those with existing Ministry job specifications. Ms. Alfieri and her team approached the negotiations with the SHSC as with the service managers. She provided the SHSC with copies of relevant documentation including job descriptions of affected Ministry employees. Unlike the City, the SHSC was more open to the idea of considering Ministry personnel. At a meeting on March 11, 2002 Ms. Alfieri was able to confirm the agreement of the SHSC's spokesperson (subject to Board approval) to look at all vulnerable Ministry staff, reasonable efforts obligation or not, prior to proceeding to any competitive process to fill positions. She also received an organizational chart and five proposed job descriptions. Ms. Alfieri had those job descriptions reviewed in comparison to Ministry work being performed by affected employees.

Most of those job descriptions did not reflect a job being performed by Ministry employees. As a result no job match was found except for a Board Administrator position. However the Ministry identified six employees who performed various identified duties of the Financial Analyst position, including Mr. Lysiak who had been engaged in bulk natural gas purchasing. Ms. Alfieri was also told that of those employees it appeared that Mr. Lysiak was the only employee who was subject to a reasonable efforts obligation.

In response to her inquires as to whether or not the job descriptions accurately reflected the manner in which SHSC intended to perform the duties and specifically whether its job descriptions properly captured those duties, Ms. Alfieri received three revised job descriptions from the SHSC in May 2002, including the Financial Analyst job description. She asked Mr. Farley, a Director, to further review the position descriptions in order to determine whether anyone performed any of the functions described even if not included in that person's Ministry job description. She was looking for any overlap in function. She also requested that if more than one person performed a function to identify who performed the greater percentage. He responded and identified that no single individual performed all the duties outlined in the Financial Analyst job specification. He referred to five of the six persons identified earlier. He commented on Mr. Lysiak's role in bulk gas purchasing. He noted that two other employees had no accounting or budgeting skills and that a number of the identified functions were not being performed by any of these employees. The employer concluded that the bulk purchasing component of the Financial Analyst position was a small component of the job and that the core work of the job related to financial analysis of program delivery, insurance analysis, financial management systems and the like, areas in which Mr. Lysiak was believed to have no experience or expertise.

In late May 2002 Mr. Johnson communicated with an OPSEU representative regarding the Board Administrator position and the Financial Analyst position. OPSEU took the position that both positions represented opportunities rather than offers. The Board Administrator position was matched to an existing Ministry position but the terms of the offer limited any recognition of seniority or service and it was not a permanent position. OPSEU treated the Financial Analyst opening as an opportunity rather than a job offer because various duties of the position overlapped with functions found in different existing Ministry positions and because it too was not a permanent placement. OPSEU suggested that the Financial Analyst position be posted on the Ministry's e-cruiter system.

On June 3, 2002 Mr. Johnson communicated with the SHSC to advise them of OPSEU's position that it would be fairer to post the Financial Analyst position on the e-cruiter in order that anyone who was interested could apply. He further requested that the SHSC not staff the position pending the opportunity to post it and determine if there was any response to the opportunity. Mr. Johnson asked the SHSC to confirm that it was not interested in taking advantage of financial incentives. Mr. Lysiak did not receive notice of the position through the e-cruiter system. PEGO was not informed of the opportunity. Although Mr. Johnson apparently made further inquiries to the SHSC regarding the posting of the Financial Analyst position on June 13, 2002, there was no evidence as to any response to that inquiry.

Within a few weeks of the effective transfer to the SHSC, the SHSC was obliged to hire a full-time employee responsible for bulk gas purchasing and to embark upon a tender process for a new gas broker and to review the program and identify opportunities for improved service and cost-recovery. This reflects work that Mr. Lysiak had performed. However the opportunity came after the transfer of the business and only as a result of losing brokerage services which had been provided by a subsidiary of Enron. The collapse of the brokerage services was unexpected and was unknown prior to or at the time of the transfer of the business.

The union recognized that the employer has more ability to procure job offers for affected employees where the transfer arises through a tender or RFP process. However the union argued that the employer failed to make sufficient efforts to have the City buy-in to the reasonable efforts obligation, that it failed to make appropriate use of financial incentives, that it should have gone beyond enhanced severance amounts. It suggested that the interests of the PEGO members were not given adequate attention as they comprised only a small portion of the employees affected and that the employer failed to make sufficient efforts to have the new employers create engineering positions. The union argued that there was a need for a gas purchaser at the SHSC and that the employer failed to use the Financial Analyst position description as an opening to find a job for a PEGO member. Nor was Mr. Lysiak advised of the Financial Analyst position. Similarly with respect to the Asset Management Consultant position, the union argued that managers were advised of the position with the understanding that employees would be told, yet Mr. Lysiak was not. The union also argued that the reasonable efforts obligation went beyond the date of the transfer of the business.

The employer posed the question as, on a balance of probabilities was there something that the employer ought reasonably to have done that would have generated a job offer for a PEGO member?

The employer argued that it attempted to achieve significant concessions by negotiating as a group for all employees in the three affected bargaining units. The union did not suggest that it was inappropriate for the employer to have a joint team. It argued that within that team, one needed to make efforts specific to the members of this bargaining unit. The employer argued that this case was not about trying to improve a job. It argued that this was a case where the employer did not achieve job offers because engineering jobs did not exist in the new employing entities. The employer argued that the offer of financial incentives did not motivate the new employers to create a job. It was not receiving job offers to which it could assign a PEGO member. The employer argued that it could not dictate how the new employers were to conduct business. The employer noted that the appropriate level of financial incentives was in the order of 'avoided costs', in this case, enhanced severance amounts. The employer noted that if Mr. Lysiak's function at the time of the transfers was bulk gas purchasing that would remove the municipalities from the equation as they were not performing that function.

The employer argued that the reasonable efforts obligation ends at the time of transfer because other entitlements flow from what remains once those efforts have concluded. The employer acknowledged that there may be an argument that it should pursue changes should it become aware of them prior to the transfer but noted the need for finality and fairness to those who have made decisions based on then current information as to their options.

The approach to determining whether or not the employer has met the reasonable efforts obligation has been reiterated in a number of decisions. It is an objective test. It does not mean "all efforts" or "efforts to the point of undue hardship". It is not "every effort". Efforts which could not reasonably be expected to advance the objects contemplated by paragraph 1 are not 'reasonable efforts' that the employer is obliged to make. What is reasonable will depend on all of the circumstances of each case.

The cases I was referred to involving transfers arising from a Request for Proposal or tender process are of assistance only in respect of their general principles. That form of transfer obviously provides significantly greater control to the employer to ensure that employees enjoy considerable employment security notwithstanding the transfer. So, in the Ministry of Transportation v. OPSEU case (Kaplan, June 9, 1997), when the employer reviewed the bids and gave no credit for a commitment to hire employees, failed to fully utilize savings on enhanced severance costs, and restricted itself from attempting to negotiate with the successful bidder, it was found to have failed to make reasonable efforts.

In the absence of such a process the reasonable efforts obligation remains significant and proactive. However, results will also very much depend on the interests and position of the transferee.

In the Ministry of Consumer and Commercial Relations v. OPSEU case (Roberts, May 26, 1998) it was determined that the employer fell short of its reasonable efforts obligations in that it failed to pursue negotiations regarding seniority protection. The employer accepted the Alcohol & Gaming Control Commission's position that seniority would only be recognized for vacation and benefits and did not attempt to pursue it further. Thus the scope of the negotiations was found wanting. As well, the degree of effort in the negotiations was also found lacking as it related to seniority and attempts to achieve 100% salary. No financial incentives had been offered and the Vice-Chair noted that both entities were creatures of the Crown. The case stands for the proposition that the employer has an obligation to continue to attempt to bargain even in the face of obstacles.

In terms of competing positions of the Ministry and the new employers this case more closely resembles the circumstances in the Ministry of Community and Social Services V. OPSEU case (Brown, August 4, 1998). As the Vice-Chair there noted, "other than regulatory instruments, persuasion and financial incentives are the only mechanisms available to the Ministry" (page 14). That decision notes that reasonable efforts do not guarantee that equally favourable results will be achieved for all employees.

I start from the premise that the employer had no ability to direct a new employer as to how to conduct its business. These were arms-length transfers and, apart from satisfying the requirement that they be able to perform the business, there were few if any staffing restrictions on how that was to be accomplished. The union suggested that the Minister could have withheld approval of the JLTP if the new employer failed to provide job offers or otherwise reflect employment security for the affected employees. Although the Minister has the authority to set criteria for a JLTP, under the legislation the Minister's recourse if that plan fails to meet the criteria is to find a replacement service manager. Certainly as it related to the City of Toronto, the downloading of social housing was not something sought or desired by the City. Nor was the Minister likely to be able to find a replacement service manager should the City not meet certain criteria imposed by the Minister. In the result it was unlikely that the Minister was in any position to impose obligations on the City absent further legislative intervention. While the legislation provided for the making of transfer orders in relation to employees of the Ontario Housing Corporation affected by the transfers, no such provision exists in the legislation to deal with affected Ministry employees.

In this case the employer put a team in place to deal with transition issues. That included Human Resources/Labour Relations Specialists whose responsibly it was to focus on the employer's reasonable efforts obligation. The employer provided the new employers with information concerning the affected positions and the terms and conditions of that employment. It acted to obtain organizational charts of the new employers; to examine them and to obtain job specifications for the positions represented in the organizational charts. It examined those job specifications and fully reviewed the job functions involved in order to attempt to ensure that they reflected a capacity on the part of the new employer to perform the business and to fulfill the duties contemplated. Throughout the process, whether seeking to obtain job offers or to enhance offers, it offered incentives, including part-time and/or shared service options, financial incentives, and secondment opportunities. It did not limit its opportunity to negotiate prematurely and transferred two employees, including one of the grievors, in the hope that subsequent negotiations would produce a favourable outcome. Even assuming that enhanced severance payments did not represent the avoided costs, on the evidence, there is nothing to suggest that the employer should have offered greater financial incentives. The new employers were not interested.

There was little the employer could do in response to the smaller service managers who, not surprisingly in the circumstances, were simply unable and unwilling to even consider the creation of an engineering position. It did focus its efforts where it thought there was some likelihood of success. In its negotiations with the City the employer was faced with solid resistance to any prospect of job offers. It was not interested in incentives. It was concerned about ensuring that its internal obligations and policies were met. The employer did manage to negotiate the opportunity for Ministry employees to be considered as second-tier internal candidates. While not evidencing a high degree of success, the employer made dogged efforts to attempt to secure offers or opportunities for affected employees, including PEGO members.

Of relevance to PEGO members was the City's position of Asset Management Consultant, Social Housing. Notwithstanding Ms. Alfieri's recommendation that the technical staff be notified of the opportunity, and Mr. Horn's memo directed to specific employees, including Mr. Levesque, Mr. Johnson did not notify PEGO or Mr. Lysiak of that opportunity, although OPSEU was notified.

In negotiations with the SHSC Ms. Alfieri pursued the same course as with the service managers and was again dogged in her efforts to attempt to match the job offers to the work of affected employees and to offer incentives.

Of interest to PEGO members was the Financial Analyst position. The employer argued that the job reflected functions and qualifications other than engineering. It represented a wide combination of functions. The union acknowledged that it was difficult to discern the bulk purchasing component of the job from reading the job specification. However the employer did elicit that information. The employer was aware of six employees, including Mr. Lysiak, who performed some of the functions described by the position.

Mr. Johnson saw fit to share the job offer with OPSEU and understood that OPSEU treated the position as an opportunity in that it did not match with an existing Ministry job description. The employer advanced OPSEU's suggestion to the SHSC that the position not be filled pending its posting on the Ministry e-cruiter system. He also advised OPSEU that if anyone from the bargaining unit decided to apply, he anticipated further discussions between the Ministry and SHSC at that time. He did not communicate with PEGO concerning this opportunity.

I am not persuaded that the employer's reasonable efforts obligation continued after the transfer date so as to require it to respond to the hiring of a full-time gas purchaser a few weeks later. There is a need for finality and one would be hard-pressed to describe under what authority the employer would have been able to affect the operation of an arms-length entity once it had transferred that operation. However the employer did suggest there would be further discussions with the SHSC should affected employees respond to the Financial Analyst posting. That interest does not appear to have been communicated to the SHSC. These events occurred on the eve of the transfer and I have no evidence as to any outcome.

The employer posed the question as, was there something it ought reasonably to have done that would have generated a job offer for a PEGO member. It may be that the likelihood of generating a job offer for a PEGO member for either the Asset Management Consultant position or the Financial Analyst position was slim. At the City there was to be a competitive process and it was not interested in utilizing financial incentives. Yet the employer saw fit to notify at least one PEGO member of the opportunity at the City and to notify OPSEU. The employer also saw fit to consult with OPSEU regarding the posting of the SHSC Financial Analyst position. Other employees appear to have been no more particularly qualified for the Financial Analyst position than Mr. Lysiak. The employer was aware that at least one PEGO member had skills and experience reflected in the position description, was also aware that of those with relevant experience, his position was the only one likely to be surplused, and was unaware of whether other more qualified Ministry employees might respond. There was no evidence from which to draw a conclusion that Mr. Lysiak ought not to have had the opportunity to review and respond to this opportunity.

Whether or not the employer has an obligation to consult with the union per se (compare Ministry of Transportation v. OPSEU (Gray, May 8, 1997) and Ministry of Community and Social Services v. OPSEU (Kaplan, June 2, 1997) ) it did engage a process wherein it contacted OPSEU for input on jobs that it knew could affect its members and, more to the point, in the case of both positions relevant to PEGO, advised OPSEU of opportunities that might be of interest to its members. It did not do the same for PEGO although it was aware of affected PEGO members who might be similarly interested. The employer treated that advice to OPSEU as part of its reasonable efforts obligation. In the circumstances I find that the employer failed in its reasonable efforts obligation and violated the terms of paragraph 1 of Appendix A of the collective agreement with PEGO by failing to similarly provide that advice to PEGO.

This matter is remitted to the parties on the issue of remedy. I will remain seized should the parties be unable to finally resolve this matter.

Dated at Toronto, Ontario this 10th day of July, 2003.