GSB# 2002-1510
UNION# 2002-0999-0021
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 (Management Board Secretariat)
Employer
BEFORE
Richard Brown
Vice-Chair
FOR THE UNION
Richard Blair Ryder, Wright, Blair & Doyle Barristers and Solicitors
FOR THE EMPLOYER
Kelly Burke Senior Counsel Management Board Secretariat
WRITTEN SUBMISSIONS
May 31; June 4 & 7, 2004.
Decision
This is the fifth in a series of decisions dealing with statutory holiday pay for employees designated as essential and/or emergency workers during the 2002 strike. This decision deals exclusively with the issue of whether interest should be paid on monies owing.
The dispute over interest is complicated by the manner in which rates of pay applicable to the relevant dates are determined. The 1999-2001 collective agreement governed terms and conditions of employment for those designated to provide essential or emergency services during the strike. The rates of pay contained in that agreement were increased retroactively by the memorandum of settlement ending the work stoppage, and the retroactive increase came into effect before the holidays in question. I will deal first with interest on monies owing under the 1999-2001 agreement and then turn to interest on monies owing by virtue of the retroactive increase.
I
Insofar as the union claims interest on monies owing under the expired collective agreement, the matter is governed by article 22.18.1 of the agreement:
Where monetary compensation and/or damages are decided to be owing for a grievance, interest shall be payable as follows:
(a) for the period commencing thirty (30) days prior to the date the grievance was filed until the decision:
(1) interest shall be calculated at the quarterly prime rates, set by the Bank of Canada, averaged yearly for that period.
(2) interest will be paid on all amounts owing, except where compensation is payable for back pay or any other amount that accrues over time, interest shall be calculated on one half of the compensation.
(b) for the period from the date of the decision until the compensation and/or damages is paid, interest shall be payable on all amounts owing, payable at the prime rate set by the Bank of Canada, for the quarter before the decision.
Employer counsel contends the union is estopped from claiming interest because such a claim was first mentioned on the last day of hearing, May 12, 2004. According to this argument, the union’s initial silence “lulled” the employer into “a false sense of security”, and the later request for interest caught management by “surprise.” The response of union counsel is that the earlier absence of an explicit claim for interest did not amount to a representation that no such claim would be made if and when matters relating to remedy were eventually addressed. Counsel for the union also notes: “In any event, an estoppel requires reliance, both reasonable and detrimental. Here, there is neither.”
Detrimental reliance is an essential prerequisite to an estoppel. The only reliance mentioned by the employer is being lulled into a false sense of security. In my view, this sort of reliance is not sufficiently concrete or detrimental to warrant the invocation of an estoppel, so as to preclude the union from asserting the right to interest conferred by the collective agreement.
The employer is directed to pay interest in accordance with article 22.18.1 for monies owing under the 1999-2001 agreement. For the purpose of applying this article, the date of the decision is March 8, 2004.
II
Turning to interest on monies owing by virtue of the retroactive wage increase, I note the memorandum of settlement ending the work stoppage, dated May 2, 2002, states: “Retroactive adjustments shall be paid as soon as reasonably possible after ratification by both parties... .” Retroactive payments later were made in three instalments: (1) a first interim payment on August 1, 2002; (2) a second interim payment on September 12, 2002; and (3) a final payment on October 10, 2002. The foregoing facts are recited in OPSEU and Management Board Secretariat, decision dated March 25, 2004, GSB No. 2002-0610 (Petryshen), where this board held the retroactive payments had been made “as soon as reasonably possible.” Relying upon this decision, employer counsel argues interest on the retroactive-increase component of holiday pay should begin to accrue only after October 10, 2002. I agree.
For monies owing by virtue of the retro-active increase, the employer is directed: (1) for the period from October 10, 2002 to March 8, 2004, to pay interest in accordance with the formula in paragraph (a) of article 22.18.1; and (2) for the period from March 8, 2004 to the date payment is made, to pay interest in accordance with the formula in paragraph (b) of article 22.18.1.
Dated at Toronto this 10th day of June 2004.