GSB# 2003-0417

UNION# 2003-0604-0001

IN THE MATTER OF AN ARBITRATION

Under

THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT

Before

THE GRIEVANCE SETTLEMENT BOARD

BETWEEN

Ontario Public Service Employees Union (Smith)

Grievor

• and -

The Crown in Right of Ontario (Ministry of Transportation)

Employer

BEFORE

Loretta Mikus

Vice-Chair

FOR THE UNION

Tim Hannigan Ryder Wright Blair & Doyle Barristers and Solicitors

FOR THE EMPLOYER

John Smith Senior Counsel Management Board Secretariat

HEARING

March 29, 2004.

Decision

The grievor, Shane Smith, has grieved that the Employer has violated Article 20 of the collective agreement, which deals extensively with employment security. At the first day of hearing the Employer raised two preliminary objections to my jurisdiction. It took the position that the matter is not arbitrable because the Union and grievor are bound by Minutes of Settlement which specifically resolved the grievor’s employment status. Under those Minutes the grievor waived his rights under Article 20 and cannot rely on them now. Additionally, the Union specifically agreed that no grievances would be filed in respect of employees affected by the Minutes and cannot forward a grievance in these circumstances. The Employer relied on the following cases; OPSEU and Ministry of Transportation (1999) GSB # 0320/98 (Mikus) and OPSEU and Ministry of Transportation GSB # 2445/02 (r. Brown).

The facts giving rise to the grievance are essentially in agreement.

The Minutes of Settlement and Release referred to above arose from the Employer’s decision to outsource some of its work, specifically its road maintenance work in the Sudbury area. The Minutes speak for themselves:

Minutes of Settlement and Release

WHEREAS the parties wish to resolve on a without prejudice and precedent basis any and all differences as follows:

1. The Ministry will be permitted to close its call for tenders/RFPs, evaluate, announce the preferred bidder, award and proceed with implementation with regard to the outsourcing of all work in RFPs referred to by numbers 98-7 to 98-22 and their associated addendums.

2. OPSEU will withdraw immediately all grievances (individual, group or policy) arising out of the outsourcing of the work contracted for in the RFPs and their associated addendums and agrees not to file any future grievances (individual, group or policy) in relation thereto.

3. OPSEU hereby releases the Ministry from all liability with regard to all actions, past, present or future relating to the outsourcing of the work contracted for in the RFPs and agrees not to bring any grievances or other action relating to those past, present or future actions

4. In consideration of the above, the parties agree to the following process with regard to the outsourcing of the work referred to in these RFPs.

(a) The Ministry will identify the employees who will be affected by the relevant RFPs.

(b) The Ministry will then remove the following categories of employees from the relevant RFPs:

(i) Those employees eligible to pension bridge as of December 31, 1998.

(j) Those employees who are in receipt of LTIP or WCB as of the date the RFP is advertised

(c) The remaining employees will be provided the opportunity to select in writing within 5 working days of receiving notice of the election option not to be included in the applicable RFP. In default of election (within the five day window) the employee will be deemed to be included in the RFP.

(d) Employees who elect not to be included in the RFP will be declared surplus. The date of the surplus notice will be at the sole discretion of the Ministry. Upon receipt of the surplus notice, the affected employee will exit the OPS immediately. Upon exiting the OPS, these employees will receive only the benefits set out below:

(i) pay-in-lieu of notice in accordance with Article 20.2; and

(ii) (a) the greater of separation allowance in accordance with Article 20.3, or

(b) enhanced severance in accordance with paragraph 4 of Appendix 9; and

(iii) termination payments in accordance with Article 53 or 78.

5. The employees who elect not to be included in the RFPs will not be eligible for any other benefits or rights under the collective agreement. Notwithstanding the generality of the foregoing, these employees have no other rights under Article 20.

6. Employees who are eligible to pension bridge as of December 31, 1998, will receive the benefits of paragraph 2 or 3 of Appendix 9 whichever paragraph is applicable.

7. Employees who are in receipt of LTIP of WCB as of the date the RFP is advertised will be issued a notice of surplus. Immediately upon receipt of the surplus notice, these employees must exit the OPS. Upon exiting the OPS, these employees will get the same benefits provided to those employees who elected to opt out of the RFP.

8. For employees who elect to be included in the RFPs:

a) The parties agree that these RFP’s (98-7 to 98-22) will contain the mandatory language set out in Schedule “A”.

b) The jobs offered pursuant to the RFP’s will not specify duration.

9. The parties agree that there will be no rated criteria or HRIF or negotiations in relation thereto.

10. The parties agree that the provisions of paragraph 8 meet the Ministry’s obligations under Appendix 9 in relation to those employees who remain attached to the RFP.

11. The parties agree that Robert Gavin will be removed from the Temporary Modular Bridge tender and will be provided the same benefits as employees who elect to opt out of the RFP, on the same terms and conditions.

12. The parties also acknowledge that the Ministry may outsource work by means of managed outsourcing contracts, and Quality and Standards outsourcing contracts. If the Ministry, at its sole discretion, were to choose to use these means of outsourcing, the parties agree that the employees who are affected by such outsourcing, will be dealt with in the manner outlined in paragraphs 4 to 7 of these Minutes of Settlement and Release.

13. The parties agree that the Ministry will have no other obligations in relation to Appendix 9 with regard to the outsourcing referred to in paragraph 12.

14. The provision of these Minutes of Settlement and Release apply to those outsourcings which are announced prior to December 31, 1998.

15..The parties agree that these Minutes of Settlement and Release constitute the entire agreement between them and supersede any and all written agreements or undertakings between them in connection with or incidental to the outsourcing referred to in these Minutes of Settlement and Release.

16. The parties agree that Vice-Chair Loretta Mikus will remain seized with regard to any issues concerning its application, interpretation or any alleged breach of its terms.

Dated November 13, 1998.

The grievor received a letter dated November 24, 1998 that described the two options available to him as a result of the previous settlement. That letter set out the conditions of each option as follows; if the grievor decided to have his position listed in the RFP, the Ministry would include in the RFP a requirement for an offer of employment equal to at least 85% of his salary, recognition of his service for purposes of vacation and benefit entitlements, recognition of his seniority for purposes of layoff and promotions and a waiver of any probationary period and, if the grievor elected this option, the letter advised him he would give up his rights under Article 20 or Appendix 9 and would only be eligible for termination pay pursuant to article 53 or 78. The second option outlined in the letter explained that his position would be declared surplus on the date the contract commenced and he would exit the OPS. Upon exiting he would receive pay-in-lieu as per Article 20.2, the greater of the Article 20.3 separation allowance or enhanced severance under Appendix 9, paragraph 4, termination payment under Article 53 or 78 and the right to apply to restricted competitions until December 1, 2001.

The letter further advised the grievor that these would be his only entitlements under the collective agreement if he were to select this option and set out the sum of money he would be paid in the circumstances. The grievor was also advised to read over Appendix 9 and Article 20 and to speak to his Union representative before making up his mind.

The grievor opted for the latter and removed his name from the RFP. On January 22, 1999 he was sent a letter from the Human Resources Coordinator confirming his election and advising him his position had been removed from the RFP.

On May 3, 1999, the grievor was advised that the Maintenance Contract 98-21 had been awarded and he would be surplussed as of May 28, 1999.

Unfortunately for the grievor, before he could be surplussed, he suffered a heart attack. He was off on short-term sick leave for 6 months followed by two years of LTIP benefits. After the change of definition to “any occupation” the grievor was denied further benefits. He appealed unsuccessfully and in January of 2003 the Employer was informed that he was ready to return to work. To this point in time the parties agree that the grievor had made his election to be surplussed and waived his seniority rights under Article 20. The Union conceded that the Employer had no additional obligations to the grievor and the grievor had no remaining claims against the Employer.

The problem arose when the Employer advised the grievor by letter dated January 31, 2003, that he was entitled to pre-notice of layoff under Article 20 and that, under Article 42.10, he had the following options; pay in lieu of notice or work during the notice period and look for a position to exercise your recall rights. The grievor was informed that he could broaden his geographic parameters if he was prepared to relocate. The grievor elected to remain on staff and a letter confirming that agreement was sent to him on February 7, 2003. During this time discussions had taken place about a new position and the grievor was advised that an alternative job was available in Kenora. The grievor’s evidence would have been that he accepted the offer, told his family about the move and began discussions with real estate agents about relocating.

However, before he could do that, he was advised in a letter dated February 27, 2003 that because of the Minutes of Settlement and Release signed in 1998, his only rights flowed from that document, not the collective agreement. He was therefore entitled to pay in lieu of notice for 6 months, legislated severance under Article 53 and the separation allowance under Article 20 or the enhanced severance under Appendix 9.

As stated previously, the parties are agreed that, absent the offer in the letter of January 31, 2003, the grievor had no remaining rights to employment. He elected to remove his job from the RFP and instead chose to receive pay in lieu of a possible job offer. Mr. Smith, counsel for the Employer, took the position that the grievor’s election on 1998 determines his entitlement to the provisions of the collective agreement. However, that is not the issue before me.

The Union’s argument is not based on a repudiation of the Minutes of Settlement and Release or on an alleged breach of those Minutes. Its argument is based on the equitable doctrine of estoppel. Mr. Hannigan, counsel for the Union, took the position that the actions of the Employer on and after January of 2003 gave rise to an estoppel The doctrine requires that, where a party, by words or conduct, makes a promise or an assurance to another party that affects the legal relationship between them and the other party acts on it, the one who gave the promise or assurance cannot revert to the previous legal relationship. In this case, the grievor was promised a job in Kenora, took steps towards making that move by alerting his family about the move and speaking to real estate agents. It would be inequitable to rescind that offer. It relied on the Ontario Division Court decision of Ontario Public Service Employees Union v. Ministry of Community and Social Services 1995 CanLII 10660 (ON CTGD), [1995] O.J. No. 3869 for the authority of a Board of Arbitration to determine whether the doctrine of estoppel applies in the case before it.

The Employer submitted that it had simply made a mistake in offering the grievor the options set out in the letter of January, 2003 and it had a right to correct that mistake.

DECISION

The only issue before me is whether the Employer, by its conduct, is estopped from relying on its strict rights under the collective agreement. If the Union argument fails, the parties are agreed that the grievor has no Article 20 rights and the grievance must be dismissed.

There is no doubt that the grievor waived his rights to a job when he elected to remove his position from the RFP in 1998. But for his heart attack, he would have exited the OPS on the date set out in his confirmation letter of May 3, 1999. The terms of the Minutes of Settlement and Release could not be clearer. Not only did the Union agree to its present terms but also undertook to file no further grievances in respect of the RFPs mentioned in the Minutes.

There is no dispute that the letter of January 31, 2003 offering the grievor the option to work out his notice and exercise his bumping rights was sent in error. He had no such rights at the time. Did the offers in that letter trigger a new set of rights? I think not. It was not intended to alter the legal relationship between the grievor and the Employer. It cannot be conferred in these circumstances that was the Employer’s intention. The 1998 Minutes of Settlement and Release expressly resolved all matters relating to this and other RFPs and expressly prohibited the Union from filing any grievances in the future related to those RFPs. The letter of January 31, 2003 was a mistake. The Employer is entitled to rectify that mistake. Additionally, there is no evidence that the grievor acted on the offer of employment. The offer was rescinded within a month of it having been sent and the grievor had taken no steps to indicate he had relied on the Employer’s promise to his detriment. I have no doubt that, when the grievor was advised that the job in Kenora was not available to him, he was greatly disappointed. Nevertheless, that disappointment cannot transform a mistake on the Employer’s part to a legal obligation that otherwise does not exist.

For these reasons the grievance is dismissed.

Dated this 2nd day of April, 2004.