GSB#2015-2664

UNION#2015-0999-0042

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)

Union

• and -

The Crown in Right of Ontario

(Ministry of Government and Consumer Services)

Employer

BEFORE

Nimal Dissanayake

Vice-Chair

FOR THE UNION

Susan Ursel, (Counsel)

Kristen Allen, (Counsel)’

Ursel Phillips Fellows Hopkinson

Barristers & Solicitors

FOR THE EMPLOYER

Paul Meier, (Counsel)

Cathy Phan, (Counsel)

Treasury Board Secretariat

Legal Services Branch

HEARING

May 11, 13; August 30 and September 1, 2016.

PRELIMINARY DECISION

1This decision relates to a motion advanced by the employer for bifurcation of the proceeding. Before turning to the legal submissions on the motion itself, it is necessary to briefly review the relevant background facts. The union grievance dated December 17, 2015 before the Board reads:

The Union grieves the Employer has violated the OPS Collective Agreement, including but not limited to Articles, 2, 3, 20, 32, 35, 36, 37, 39, 40, 63, 64, 65, 67, 68 UN 16, COR17, Appendix 11, Appendix 20, the OPS Benefits Booklet, and any other such Act, Regulation or grounds as the Union may advise in relation to the Employer’s announcement that its intention is to unilaterally cease/alter the coverage of post-retirement benefits effective January 1, 2017. Further, the Employer is estopped from any such action based on its past practices. Finally, the Employer has failed to provide any supporting documentation or demonstration of its announced unilateral changes.

SETTLEMENT DESIRED

Full redress including but not limited to:

1. An order to cease & desist.

2. An order to comply with the Collective Agreement and a declaration of the violation.

3. An order that the Employer is estopped from both making the announcement and carrying out any of its stated intentions.

4. An order that any individual detrimentally affected by the employer’s actions be properly compensated.

5. Any such other relief as the Union may advise.

2The grievance followed a letter of notice dated February 18, 2014 from the Assistant Deputy Minister, Employee Relations Division, HR Ontario, Ministry of Government Services, to the President of the Union. It reads:

Re: Post-Retirement Insured Benefits Changes – Eligibility Criteria and Premium Cost Sharing

I am writing to notify you that the Government intends to make changes to the post-retirement insured benefits (retiree benefits) applicable to certain persons who will receive a pension under the Public Service Pension Plan (PSPP) or the OPSEU Pension Plan. This would include changes to the retiree benefits eligibility requirements as well as the introduction of premium cost sharing effective January 1, 2017.

Currently, the government provides health, dental and $2000 in basic life insurance benefits to former employees in receipt of a pension under the PSPP or OPSEU Pension Plan based on at least 10 years of pension credit. Retiree benefits are not a provision of the Public Service Pension Plan or the OPSEU Pension Plan, nor are they a pension benefit.

The changes would require members who do not have 10 years pension credit in the pension plans by January 1, 2017, to meet the following two criteria in order to qualify for retiree benefits:

Have at least 20 years of pension credit; and

Retire to an immediate unreduced pension.

Further, any eligible member who has not commenced receipt of a pension before January 1, 2017, would be required to pay 50 per cent of the retiree benefits premium costs to participate in the benefit plan.

These changes to the retires benefits terms would apply to Ontario Public Service employees and eligible employees of other employers with membership in the PSPP or OPSEU pension plans, including former employees who are deferred pensioners, who are not in receipt of a pension before January 1, 2017.

OPS bargaining agents are being notified in advance of formal communication to employees on February 18, 2014. Communication material including an updated retiree benefits guide would be developed and distributed in the months leading up to January 1, 2017.

3Commencing in April 2014, representatives of the union and the employer met several times and discussed the announced changes. In the meantime, between April 2014 and January 2016, over 1300 individual grievances and group grievances were filed, in addition to the instant union grievance. The fundamental dispute between the parties is clear in the union grievance. The employer’s position is that Post Retirement Benefits (hereinafter “PRB”) are not a negotiated benefit forming part of the collective agreement, and that therefore, it is entitled to unilaterally change its terms. The union on the other hand asserts that the terms relating PRB may only be changed through negotiation with the union. While conceding that there is no explicit provision in the collective agreement extending PRB to retirees, particularly relying upon a historical link between the benefits for active employees negotiated in the collective agreement and the PRB extended to retirees, the union takes the position that PRB are implicitly incorporated in the collective agreement.

4Besides the “implicit incorporation” argument, however, the union also alleges that the employer’s proposed changes to PRB contravene a number of provisions of the collective agreement. It asserts that the employer violated article 1.1 by failing to recognize OPSEU as the exclusive bargaining agent for its members, that it violated article 2.1 by an unreasonable exercise of its management rights, and that the employer violated article 3.1 of the collective agreement and the Ontario Human Rights Code, by discriminating on the basis of the age. It is also alleged that the employer would be in violation of Appendix 11 to the collective agreement, which is a letter from the employer to the union, wherein it agrees that it does not intend to amend “the OPSEU Pension Plan or any related documents” during the term of the central collective agreement, and that any changes will be negotiated with the union. The union further claims that the employer is in breach of article UN16.2 (unified) and CR17.3 (corrections) by failing to comply with the obligation to cooperate with the union..

5When the Board convened, Ms. Ursel for the union, and Mr. Meier for the employer, made extensive opening statements setting out their respective positions on the various allegations. Ms. Ursel categorized the union’s allegations under 6 theories. They were described as follows:

(1) Orders-in-Council (hereinafter “OIC”) which extend PRB to retirees and Benefits Guides are “related documents to the pension plan”. Therefore, Appendix 11 prohibits the employer from amending those without negotiating with the union.

(2) PRB are a form of deferred compensation for bargaining unit employees, and are implicitly included in the collective agreement as part of their terms of employment. In other words, PRB are implicitly incorporated in the collective agreement through its obligations to active employees.

(3) Article 39.6 provides:

The Employer shall make available to employees an information booklet with periodic updates, when necessary, within a reasonable period of time following the signing of a new collective agreement or following major alterations to the Plans.

When article 39.6 is read in the context of the evidence of the history of PRB, it incorporates the benefits guide in the collective agreement by reference. Therefore, its content may not be changed unilaterally by the employer.

(4) While the announced changes appear to be neutral they are discriminatory on the basis of age in application. Therefore, it violates article 3 and the Human Rights Code.

(5) The unilateral action by the employer is an unreasonable exercise of its management rights under article 2, in that it infringes on the terms set out in Appendix 11 to the collective agreement.

(6) The employer has had a practice of negotiating for changes to PRB with the union. That constitutes a representation on which the union relied upon to its detriment. Therefore, the employer is estopped from asserting that it is entitled to unilaterally change PRB. It has also made similar representations directly to employees through the Benefits Guide.

6Counsel for the employer submitted that the Board should bifurcate the hearing. It should first hear and dispose of a motion he wished to put forward to the effect that the union has not made out a prima facie case for any of its allegations based on terms of the collective agreement. He would, therefore, be submitting that the Board should dismiss all of the “contractual claims” the union has asserted on the basis that it has not made out a prima facie case that any contractual right has been violated even based on the facts it has asserted. Once the motion is dealt with, the Board can proceed to hear and determine the remaining issues in the grievance. Ms. Allen, who made submissions for the union on the motion for bifurcation, took the position that all of the issues and allegations raised by the union in the grievance should be dealt with together with no bifurcation.

7On agreement, the union proceeded first with its submissions on the employer’s motion for bifurcation. She reviewed the six theories the union relies on, and the evidence it intends to call to substantiate them. She stated that evidence will cover a period of over 40 years, starting with the period prior to 1972 under the legislative scheme of the Public Service Act, when all terms and conditions of employment for members of the Civil Service Association of Ontario (predecessor of OPSEU), were under OIC’s. Then in 1972 the Crown Employees Collective Bargaining Act was enacted, extending to civil servants the right to collective bargaining. However, under that Act superannuation was made non-bargainable. The union witnesses, particularly Mr. Bob Hebdon (OPSEU Senior Research Officer 1968-72) and Mr. Andy Todd (OPSEU Chief Negotiator 1972-2002), would be testifying to the effect that at the time both parties understood that PRB are tied to pensions, and therefore non-bargainable. Ms. Allen submitted that the evidence will establish that PRB were dealt with through OIC’s, not because they were benefits extended gratuitously by the employer. Rather, OIC’s were used as a way of getting around the legislative provision which made PRB non-bargainable in collective bargaining.

8The first OIC to provide for PRB was in 1974. Ms. Allen submitted that evidence will establish that since then, for 40 years OIC’s have been issued from time to time amending the terms of PRB, and that all such changes were directly linked to terms negotiated with OPSEU for active employees. The parties understood that changes negotiated for active employees would result in corresponding changes in PRB for retirees. The OIC itself explicitly makes that link between benefits for active employees and PRB.

9Counsel stated that there will be evidence called to establish that in the 2008 round of collective bargaining the employer tabled a proposal to increase the eligibility requirement for PRB from 10 to 15 years. The union objected and made a counter proposal. Ultimately a collective agreement was concluded with no amendment to the eligibility requirement. Based on this evidence the union would be arguing that if the employer believed that PRB were gratuitous, it would have simply implemented the change it wanted. It would not have raised it at the bargaining table and backed off when the union objected.

10Ms. Allen further submitted that the union would be adducing evidence that the employer has made legal representations in various documents that PRB are negotiated. This includes statements set out in the Benefits Guide provided to employees.

[11] The union relied on the following authorities on the issue of bifurcation: Canadian Broadcasting Corp and C.U.P.E. (Broadcast Council) Source decision, [1991] 22 LAC (4th) 9 (Thorne); Ontario Liquor Board Employees’ Union v Ontario (Liquor Control Board) (East Grievance, [2005]¸2005 OGSB minicounsel 85, 142 LAC (4th) 442 (Dissanayake); Police Assn. of Nova Scotia v. Amherst (Town) (Hicks Grievance), [2011]¸Source decision, 207 LAC (4th) 89 (Richardson); Halifax Regional School Board and N.S.T.U. (Daye) [2002]¸Source decision, 116 LAC (4th) 412 (MacDonald); Cargill Foods, a Division of Cargill Ltd. v. United Food & Commercial Workers Union of Canada, Local 175 (Pizzorusso Grievance), [2009]¸185 LAC (4th) 167 (Marcotte).

12Counsel pointed out that the employer has conceded that even if its proposed no prima facie case motion is successful, the union’s claim based on Appendix 11, as well as its estoppel argument would survive, and would have to be litigated. In relation to Appendix 11, the union’s evidence through Mr. Todd would be to the effect that there were rumours circulating that the employer was planning changes to PRB. The union and the employer met and discussed the union’s concerns about the rumours. OIC’s relating to PRB and the Benefits Guides were explicitly discussed. Appendix 11 resulted from these discussions as a written commitment by the employer. She noted that in his opening statement, employer counsel stated that Mr. Kevin Wilson will be denying that any discussion about PRB took place, and would testify that he never understood that Appendix 11 had anything to do with PRB.

13Union counsel pointed out that in his opening statement employer counsel relied on negotiations and proposals that were exchanged during the 1989 collective bargaining just prior to the execution of Appendix 11. He also made references to the 2008 collective bargaining. Therefore, it is clear that the employer is also relying on extrinsic evidence. The union would be also relying on that extrinsic evidence, including evidence about the 2002 round of collective bargaining. Ms. Allen submitted that the Board, therefore, will have to hear extensive evidence relating to multiple past rounds of collective bargaining in dealing with the union’s claim based on Appendix 11. She submitted that in addition, the Board will hear extensive evidence about the link between OIC’s and the Benefits Guide to support the union’s position that OIC’s and Benefits Guides are “related documents to the Pension Plan”, which may not be changed without negotiating with the union under Appendix 11.

14Counsel pointed out that in determining the union’s estoppel argument, the Board would have to consider whether the elements of an estoppel are present. Citing Re SPAR Professional Allied and Technical Employees’ Assn v. McDonald, Dettwiller and Associates Inc., [2014] O.L.A.A. No. 274 (Shime), she submitted that the Board cannot determine whether OIC’s and Benefits Guides contained representations by the employer that PRB are negotiated benefits, by simply reading those documents. They should be read together with contextual evidence, including evidence as to what employees understood from statements in those documents. That evidence would be critical for the union to establish the representation, as well as detrimental reliance. She noted that employer counsel stated in his opening statement that no reasonable employee would understand the statements in the Guide as a representation by the employer that PRB are negotiated because active employees’ and pensioners’ entitlements are dealt with in separate sections. The union’s evidence will contradict that assertion.

15Counsel pointed out further that the employer has asserted that prior to the 2015 collective bargaining, the union had received notice of the changes to PRB, and yet it made no proposals relating to PRB. Counsel submitted that the union will be leading evidence to explain why it did not make proposals at the time.

16Based on the foregoing, union counsel submitted that there would be significant overlap between the evidence led in relation to the union’s contractual claims which would be subject to the proposed no prima facie case motion, and the claims the Board will have to adjudicate upon regardless of the outcome of the motion.

17Counsel pointed out that another claim the Board will be required to deal with, regardless of the outcome of the employer’s proposed no prima facie case motion, is the allegation of discrimination on the basis of age. In that regard, to understand the discriminatory impact of the proposed changes, the Board will hear from employees about the impact on their retirement and financial planning. Statistical evidence will be led show that the changes impact more negatively on older workers. Individual workers will testify that in order to preserve access to PRB they had to retire earlier than planned. This evidence also overlaps with the evidence on the estoppel issue. Therefore, there will be little to gain by bifurcation of the hearing.

18Counsel submitted that the union’s allegation that article 2, the management rights clause, was violated is not an independent claim. It is directly linked to its allegation that Appendix 11 and article 3 were contravened. Therefore, the same evidence will be relevant on both issues. That would be relevant also for estoppel. Therefore, it would make no sense to hear each of these claims separately.

19Counsel submitted that due to the commonality of evidence, the most efficient and expedious process is to hear all of the claims together. Hearing the no prima facie case motion on the contractual claims first, and then hearing the remaining claims one by one, as the employer suggests, would not be efficient. There would be the real risk that the Board will hear from the same witnesses multiple times. Potentially, Mr. Todd will have to be called three separate times, and Mr. Hebdon twice. Counsel urged the Board to also consider the fact that many of the individuals who would be testifying are retirees. Mr. Hebdon left back in 1992 and lives in Montreal. His evidence is important for the union.

20Counsel submitted that in adjudicating labour relations issues, fairness and promotion of harmonious labour relations should be paramount considerations. This dispute affects the whole bargaining unit. Thousands of civil servants have decided to retire prior to January 1, 2017 in order to preserve access to PRB. Therefore, fairness and harmonious labour relations would be achieved only by hearing all of the claims the union has asserted on their merits.

21Employer Submissions

The employer’s proposed no prima facie case motion is to the effect that all of the union’s contractual claims are unsubstantiated because there is nothing in the collective agreement to support any of the claims. The announced changes to PRB would not impact on any collective agreement rights. Therefore, the Board is without jurisdiction to hear them. The Board should dismiss those, and then proceed to hear the remaining claims properly before it.

22Counsel reviewed in detail the submission he would be making in the “no prima facie case” motion. He argued that the Board would be convinced by those submissions, and would dismiss the union’s contractual claims. As a result many days of evidence would be avoided. The Board can rule on the motion by simply interpreting the express provisions of the collective agreement, based on the plain and ordinary meaning of the language the parties have used.

23Counsel cited Palmer & Snyder, Collective Agreement Arbitration in Canada, (5th Ed) at 2.10, quoting from Massey-Harris, (1953), 4 L.A.C. 1579 at 1580 (Gale) as follows:

…We ascertain the meaning of what is written into [a] clause and to give effect to the intention of the signatories to the Agreement as so expressed. If, on its face, the clause is logical and is unambiguous, we are required to apply its language in the apparent sense in which it is used notwithstanding that the result may be obnoxious to one side or the other. In those circumstances it would be wrong for us to guess that some effect other than that indicated by the language therein contained was contemplated or to add words to accomplish a different result.

He also cited Brown & Beatty, Canadian Labour Arbitration at 4.2100 as follows:

4:2100 – The Object of Construction: Intention of the Parties

It has often been stated that the fundamental object in construing the terms of a collective agreement is to discover the intention of the parties who agreed to it.

As one arbitrator, quoting from Halsbury’s Laws of England, stated in an early award:

The object of all interpretation of a written instrument is to discover the intention of the author, the written declaration of whose mind it is always considered to be. Consequently, the construction must be as near to the minds and apparent intention of the parties as is possible, and as the law will permit.

And further:

But the intention must be gathered from the written instrument. The function of the Court is to ascertain what the parties meant by the words they have used; to declare the meaning of what is written in the instrument, not of what was intended to have been written; to give effect to the intention as expressed, the expressed meaning being, for the purpose of interpretation, equivalent to the intention.

A more recent articulation of the proper approach has been as follows:

The modern Canadian approach to interpreting agreements (including collective agreements) and legislation is encompassed by the modern principle of interpretation which, for collective agreement, is:

In the interpretation of collective agreements, their words must be read in their entire context, in their grammatical and ordinary sense, harmoniously with the scheme of the agreement, its object and the intention of the parties.

And, in determining the intention of the parties, the cardinal presumption is that the parties are assumed to have intended what they have said, and that the meaning of the collective agreement is to be sought in its express provisions.

(Foot-notes omitted)

24Employer counsel submitted that if on a plain reading the collective agreement can reasonably be interpreted to mean that the provisions the union relies on only apply to active employees, effect must be given to that intention of the parties. That expressed intention cannot be changed based on inferences derived from extrinsic evidence. He cited this Board’s decision in Re Metrolinx – Go Transit, 2010-2210 (Dissanayake) at para. 9, where it wrote:

Moreover, where there is no ambiguity in meaning, the language must be given effect to, regardless of the Board’s opinion on the fairness of the result. The initial obligation on the Board is to see if meaning could be given to the expressed language in article 2.1. If that is possible, it must be assumed that the parties intended what they have agreed to.

25Much of employer counsel’s submissions that followed were to the effect that the language in the various articles in the collective agreement the union relies on in support of its contractual claims, when given its plain and ordinary meaning, cannot be interpreted to mean that those provisions apply to anyone other than active employees. Counsel also proceeded to make submissions as to why each of the union’s proposed arguments of “implicit incorporation” are without any merit. He submitted that “the issue before the Board is one of interpretation of the collective agreement. The allegations based on the facts asserted by the union are irrelevant.” He cited the decisions in Re Couture, 2008-3329 (Dissanayake) and Re OPSEU and MGS 2010-0405 (Abramsky) as examples where the Board upheld motions of no prima facie case based on the express language in the collective agreement. I will not address in this decision, the merits of the employer’s proposed motion for dismissal of the union’s contractual claims for lack of a prima facie case. The issue presently before the Board is to determine the process. That is, whether to bifurcate as the employer suggests, or to hear all issues together in one hearing as the union submits.

26The employer’s book of authorities included the following decisions on the issue of bifurcation. Re Magee, 2006-1918 (Dissanayake); Re Stewart et al 1999/98 (Harris); Re Alcan Canada Products Ltd., (1974) Source decision, 5 L.A.C. (2d) 300 (Weatherill); Re Cherubini Metal Works Ltd., (2008) 172 L.A.C. (4th) 1 (Christie); Re Municipality of Metropolitan Toronto, (1991) 22 C.L.A.S. 3 (Hunter)

DECISION

27S. 48(1) of the Crown Employees Collective Bargaining Act provides that the Board “Shall determine its own practice and procedure, but shall give full opportunity to the parties to any proceeding to present their evidence and to make submissions”. In exercising this statutory power in relation to the issue of bifurcation, the Board is required to take into account practical considerations such as economy of time, resources and expenses. However, those considerations must be subject to the statutory obligation to give to the parties, the full opportunity to present their evidence and submissions. There has to be a balancing of considerations of savings and efficiency on the one hand, and fairness on the other hand.

28In Re East and L.C.B.O., (2005) 2005 OGSB minicounsel 85, 142 L.A.C. (4th) 442 (Dissanayake), the Board reviewed the case law, including the following statement by Vice-Chair Harris in Re Stewart (supra) at para.8:

In deciding whether to bifurcate proceedings the Board seeks to maximize efficiency in the hearing process. If the early resolution of an issue may be dispositive of the matters before it, then bifurcation is a useful procedural tool, provided there is no unfairness to any party in following such a procedure.

In Re East, the union claimed that the discharge of the grievor was void ab initio because the employer had contravened article 26.3 by meeting with the grievor without union representation. The union moved that the Board decide, as a preliminary matter, whether there had been a breach of article 26.3. The employer objected.

29The employer took the position that the meeting without union representation the union relies on was not “for the purpose of discussing a matter which may result in disciplinary action being taken against the employee” within the meaning of article 26.3. That meeting was not related to its investigation on the grievor’s conduct that led to his discharge, but was about an accommodation issue. The Employer submitted that it would have to lead evidence about its entire investigation to demonstrate that the meeting was not part of it. He submitted that in the circumstances bifurcation of the article 26.3 issue would not result in any efficiency, but would result in additional hearing time and duplication of evidence.

30The Board, citing prior decisions, confirmed that the rights conferred by article 26.3 are substantive and not procedural, and that where there is a breach of that provision the resulting remedy is a declaration that the discipline is void ab initio. At para. 13-15 it stated as follows in denying the union’s motion for bifurcation:

13 What is clear from the case law is that the decision to bifurcate depends in each case, upon the considerations of practicality, economy and efficiency and fairness. The decision must be made on the basis of the respective counsel’s submissions as to what positions it would take on the union representation issue. I agree with union counsel that article 26.3 is broader than the provision in Re City of Toronto. Counsel submitted that in the present case, it would not be necessary for the union to establish that the employer intended to discuss any disciplinary issues at the February 3rd meeting or that the employer actually took into account anything that occurred at that meeting in deciding to terminate the grievor. Nevertheless, counsel asserted also that the evidence will show that the February 3 meeting was a continuation of the employer’s investigation. He thus submitted that for the article 26.3 issue, it was “key” that in January 2005 the employer had commenced a disciplinary investigation of the grievor. He submitted that the evidence will be clear that “the purpose of the meeting was to discuss a matter which may lead to discipline and that in fact it did lead to discipline.” Counsel submitted that following the February 3rd meeting with no union representation, the employer convened a formal disciplinary meeting with union representation on February 23, 2005. The evidence will be that the employer directly relied upon and compared the statements the grievor had made on February 3rd with what was disclosed on the surveillance tapes in coming to the conclusion that the grievor had “lied”, which led to the decision to discharge the grievor.

14 Based on his opening statement and submissions on the motion to bifurcate, it is clear that the union was asserting that there was a direct link between the February 3rd meeting and the employer’s disciplinary investigation of the grievor, and further that the employer relied upon statements made by the grievor on February 3rd in determining that the grievor was guilty of misrepresentation, which in turn led to his discharge.

15 I have determined that given that position of the union, the employer is entitled to establish its contrary position that there was a total disconnect between the February 3rd meeting and the disciplinary process by demonstrating what the total investigation consisted of. While bifurcation would avoid dealing with certain issues such as the dispute as to the admissibility of the surveillance evidence, I have determined that in balancing the limited potential for gaining efficiency with the need for fairness, the overall considerations do not favour bifurcation in the particular circumstances of this case.

31In Re East (supra) I observed that in making the decision on bifurcation the Board has to rely on the opening statements of counsel. In Re Police Assn of Nova Scotia v. Amherst Town (supra) the Board alluded to the implications of having to rely on opening statements. At para 31-36 it wrote:

31 The principle of “speedy relief” does, however, support bifurcation in an appropriate case. Where a ruling on a preliminary objection would, if successful, avoid days if not weeks of evidence – or where the issues on the preliminary objection are separate and distinct from those that would have to be argued and considered on the merits – there is much to be said for bifurcation: see for e.g., Cherubini Metal Works Ltd. and USWA, local 4122 (2008) 172 LAC (4th) 1 (Christie) at pp. 28-29; Canadian Broadcasting Corp and CUPE (Broadcast Council) (1991) Source decision, 22 LAC (4th) 9 (Thorne) at p. 18.

32It may be said then that while there is a “general reluctance on the part of arbitrators to bifurcate hearings”. B.C.T. Local 446, supra at para. 35, the ultimate decision is dependent “upon fairness to the parties, and practicality and economy of time.” Toronto (City) and CUPE, Loc. 79 (2004) Source decision, 128 LAC (4th) 217 (Kirkwood) at p. 220 Canadian Broadcasting Corp, supra at p. 18; School District No. 27 Cariboo-Chilcotin) and Cariboo-Chilcotin Teachers’ Assn (1994) Source decision, 46 LAC (4th) 385 (Kinzie) at pp. 386-87.

33What then is the “best course of action” for an arbitrator when considering a motion to bifurcate a hearing? It is suggested by the authors in Gorsky, Evidence and Procedure in Canadian Labour Arbitration, Part III, section 7.2, pp. 7-4 to 7-6 that while the “early practice” of arbitrators was to hear both the preliminary objection and the merits in the same hearing, the “more-orthodox position” – one that was they say in place by 1970 and is now “the best course of action” – is for these matters to be bifurcated: see too Nova Scotia and NSGEU (CoatesI (1999) 82 lac (4th ) 218 (North) at pp. 220-21. In support of this proposition the text cites Re Hiram Walker & Sons Ltd and Distillery Workers, Local 61 [1973] OLAA No. 71 (Adams), where Arbitrator Adams suggested at para. 6 that requests for bifurcation should not be granted unless:

a. the party requesting the adjournment made this fact known to the other party before the hearing date to enable the other party the opportunity to refrain from having his witness in attendance;

b. the merits appear to be severable from the issue of arbitrability;

c. the delay will not seriously affect the availability of witnesses; and

d. no other serious prejudicial effect, uncompensable by money, will be experienced.

34The most problematic of these four conditions is the second: that the merits appear to be severable from the issue of arbitrability. The difficulty is that an arbitrator hearing a motion to bifurcate does not know what the evidence and issues on either the preliminary objection or the merits will be. Indeed, it often has little idea of the exact nature of the issues – or of the facts that are or will be material to those issues. Hence it can only rely on the submissions of counsel seeking bifurcation, but counsel with the best of good intentions may nevertheless be mistaken as to (a) what evidence will be necessary to establish their preliminary objection and (b) whether that evidence will overlap evidence that is material to the merits.

35The risk then is that bifurcation may be granted on the assumption that the evidence and issues on the preliminary objection are separate and distinct from the merits, only to discover either that (a) they are not severable, or (b) evidence from the merits side is in fact necessary to resolve the issues on the preliminary objection side. So, for example, and perhaps ironically, Arbitrator Adams in the Re Hiram Walker case granted the employer’s request for bifurcation based on counsel’s submissions that the four conditions had been established – only to discover upon hearing the evidence relevant to the preliminary objection that “with hindsight, the second criteria enumerated has not been met:” para. 7. In the result he found that the issues of arbitrability and the merits were intertwined, and a new hearing would have to be convened: See para.23.

At para 37, arbitrator Richardson proceeded to formulate the following criteria to be applied:

37 In the end the Board is of the view, having considered the authorities relied upon by the parties as well as their submissions, that bifurcation may be appropriate where:

a. the issues relating to the preliminary objection are clearly separate and distinct from the merits of the grievance;

b. a decision on the objection would be dispositive of the entire grievance (that is, would eliminate the need for a hearing on the merits); and

c. such a disposition would save significant amounts of time and resources that would otherwise be necessary to hear the matter on the merits.

32In Canadian Broadcasting Corp, (supra) at para. 25-26, arbitrator Thorne wrote:

25 If it were clear that the preliminary issue could be dealt with separately from the merits, this would be the very sort of case in which a preliminary determination should be made. It appears that the evidence on the merits will be extensive and that going into the merits may be stressful for the grievor and others. If the evidence on the preliminary question could be restricted to that issue and dealt with fairly expeditiously, the possibility that the preliminary issue might dispose of the whole matter would make it very desirable to deal with the preliminary issue first. Yet the procedural question must be dealt with on the basis of the allegations which are before me at this point. The union has taken the position that the application of art. 54 is intertwined with the merits of this case and that the union’s argument on the preliminary issue would necessarily involve going into aspects of the merits. It is also said that the evidence to be presented with respect to the interviews in question would involve consideration of some of the case against the grievor – to which he would be entitled to respond.

26 At the hearing I indicated that, at this stage of the proceeding, I must depend to a great extent to the allegations put forward by counsel. Since it appeared that the evidence on the preliminary matter would be bound up with the evidence on the merits, it seemed to me that the appropriate course was to permit the parties to call their evidence on both questions, leaving the preliminary issue as a matter to be argued at the conclusion of the case.

33In Re Halifax Regional School Board, (supra), the issue was the same as in Re Canadian Broadcasting Corp., namely whether the union’s claim that discipline imposed was void ab initio should be bifurcated and dealt with as a preliminary matter before hearing the merits. At para. 25-27, the Board summarized its reasons as follows:

25 Both parties agree that the principles to be applied in considering this issue emanate from the CBC case. These were applied in the Cariboo-Chilcotin case, supra, and there is criteria for consideration set forth in the Gorsky text, supra.

26 Based on a review of the material made available to me, I am of the impression that any determination of the bifurcation issue must address two considerations. First, will bifurcation strengthen the arbitral process without compromising its function of providing a final settlement in an expeditious manner. Secondly, if such is the case, do the circumstances lend themselves to proceeding in such manner. The criteria in this second step would include a consideration of the fairness to the parties, the severability of the preliminary issue from the merits, the effect on witness availability, and any overriding prejudice that might arise therefrom.

27 There appear to be two underlying reasons which make bifurcation desirable. First and foremost in my opinion is the possibility that a determination of the preliminary issue might dispose of the whole matter. This should be a real possibility, otherwise bifurcation will have served no purpose whatever. The second reason is the avoidance of a lengthy hearing which is likely to be arduous and stressful on the grievor and others, and likely to have a serious prejudicial effect on the relationship of the parties.

34In Re Cargill Foods (supra) arbitrator Marcotte reviewed authorities on the issue of bifurcation, including Re Canadian Broadcasting Corp and wrote at para. 222-23 as follows:

22 In applying the above approach to the matter of bifurcation before me. I first and foremost note the Employer’s allegation that a decision on the preliminary issue would not be dispositive of the grievance, firstly, in alleging that the Employer did not rely on the grievor’s statements made in the impugned meeting on April 8, 2009, and, secondly, if it is found that the discharge is void ab initio, it would not be appropriate to re-instate the grievor in all the circumstances RE TRW Canada Ltd., supra. That is, regardless of the decision in the preliminary issue, the merits of the grievance will have to be dealt with in this hearing. Thus, it would not be an efficient or economical use of time to bifurcate the hearing. Nor in my view would it be practical to bifurcate the hearing. Because the merits of the grievance will have to be dealt with, witnesses called to provide evidence on the preliminary issue, including the grievor and Mr. Kyle and, perhaps, others such as Mr. Do and Mr. Hogan, would be called a second time in dealing with the merits of the grievance. Not only is such a circumstance impractical, but it would be unnecessarily stressful on the witnesses to be called twice to testify at the hearing.

23 Based on the foregoing, I find it is not appropriate in the instant case to bifurcate the hearing for procedural purposes.

35In applying the principles relating to bifurcation that emerge from the authorities, I first note that the instant case is distinguishable from most of the authorities cited, in one significant respect. In those cases, the consideration was whether the decision on a preliminary issue to be bifurcated would be dispositive of, or render irrelevant, the merits of the grievance. In the instant case, the employer’s proposed no prima facie case motion is not a “preliminary” issue in that sense. The union has challenged the employer’s decision in a number of ways. Some are based on a claimed right to PRB under the provisions of the collective agreement – the “contractual claims”, as counsel called it. The employer has conceded that one such claim, based on Appendix 11 to the collective agreement would survive its no prima facie case motion. In addition the union has challenged the employer’s decision based on the equitable doctrine of estoppel and the prohibition of discrimination in the collective agreement and the Human Rights Code. It is agreed that the estoppel and discrimination allegations would also survive a decision upholding the employer’s motion. The employer’s attempt is to hive off some of the claims of the union and hear them first.

36If the Board follows the procedure proposed by the employer, that is decide the no prima facia case motion solely on an interpretation of the words in the collective agreement without hearing any evidence, the motion would likely be heard and decided very quickly. Then the Board could proceed to hear the union claims that survive the motion. There obviously could not be a duplication of evidence because no evidence would have been heard in disposing of the motion.

37However, the case law is consistent that any efficiencies that may be gained by bifurcation should not be pursued, where it results in unfairness or prejudice to any party. To quote Vice-chair Harris in Re Stewart (supra), “If the early resolution of an issue may be dispositive of the matters before it, then bifurcation is a useful procedural tool, provided there is no unfairness to any party in following such a procedure”. (Emphasis added). In Re Police Assn. of Nova Scotia v. Amherst Town (supra) at para. 32, the arbitrator wrote: “It may be said then that while there is a “general reluctance on the part of arbitrators to bifurcate hearings”, … the ultimate decision is dependent “upon fairness to the parties, the practicality and economy of time.” (Emphasis added). In Re East, (supra) at para. 15 the Board wrote: `While bifurcation would avoid dealing with certain issues such as the dispute as to the admissibility of the surveillance evidence, I have determined that in balancing the limited potential for gaining efficiency with the need for fairness, the overall considerations do not favour bifurcation in the particular circumstances of this case”. (Emphasis added). Similar observations are found also in Re Toronto (City) (2004) 128 L.A.C. (4th ) 217 (Kirkwood) at p. 220; Re Canadian Broadcasting Corp., (supra) at p. 18; and Re Cariboo-Chilcotin School District No. 27, (1994) 46 L.A.C. (4th ) 385 (Kinzie) at pp. 386-87.

38In the Board’s view, the bifurcation sought by the employer in the instant proceeding would not be fair to the union. It would indeed be a denial of the union’s right to fully present its case in support of the grievance. Brown & Beatty, Canadian Labour Arbitration, at 4:2100 states:

A more recent articulation of the proper approach has been as follows:

The modern Canadian approach to interpreting agreements (including collective agreements) and legislation is encompassed by the modern principle of interpretation which, for collective agreement, is:

In the interpretation of collective agreements, their words must be read in their entire context, in their grammatical and ordinary sense, harmoniously with the scheme of the agreement, its object and the intention of the parties.

At 4:2250 the authors state that “Where the context of the agreement or subject matter is sought to be established, extrinsic evidence may be received for that purpose”. At 4:2300 they go on:

In construing collective agreements, arbitrators look to the purpose of the particular provision in the collective agreement as an aid to determining the meaning intended by the parties. In this regard, they have recognized that collective agreements are not negotiated in a vacuum, but rather are settled in the context of general industrial relations practices, within a specific negotiating context and against a vast history of judicial and arbitral jurisprudence which will affect the parties expectations and understandings. In the result, arbitrators give effect to this general contextual climate by requiring clear statements to alter such general expectations. (Foot-notes omitted)

39In Simcoe Muskoka District Health Unit, (2009) 100 C.L.A.S. 140 (MacDowell) at para. 38, the arbitrator wrote:

… Where it is said that the words mean something different than what they seem to mean on the surface … then we think that it is legitimate to ask whether there is anything in the context (the other words in the agreement, the bargaining history, the past practice etc.) which indicates that this is what the parties “must have intended”, even if they have not said so explicitly. (Emphasis added).

40Thus, from the forgoing it is established that a party is entitled to lead extrinsic evidence to establish that a provision of a collective agreement means something different than what the literal words indicate even if the parties have not said so explicitly, and that extrinsic evidence may be received for that purpose. It would take reliable and compelling evidence to establish that provisions of a collective agreement mean something different than what the language indicates. However, whether extrinsic evidence meets that standard must be decided after the evidence is in. It would be unfair and not appropriate, to deny a party the opportunity to present its evidence.

41The jurisprudence is clear that a party to a collective agreement is entitled to attempt to establish that the words in a provision mean something different than what appears on a literal reading. As arbitrator MacDowell wrote in the excerpt from Simcoe Muskoka District Health Unit, (see para. 39 supra), even where parties have not said so explicitly, the context may indicate that “the words mean something different than what they seem to mean on the surface.” He states that the context includes the bargaining history. Brown & Beatty at 4:2250 (para. 38 supra) state that “where the context of the agreement or subject matter is sought to be established, extrinsic evidence may be received for that purpose”.

42The employer’s position is that in its proposed motion the Board should decide the union’s contractual claims solely based on the language of the collective agreement, without hearing any of the extrinsic evidence the union seeks to rely on. It seems to me, if that process is followed, the employer’s position would be unassailable. This is so because the union has conceded that there is no explicit language it can rely on. Its argument is that PRB are implicit in the agreement. The employer’s position in effect is that the union should not be allowed to make that argument. It is tantamount to saying that there can be no claim under a collective agreement in the absence of explicit language. In other words, a party cannot adduce extrinsic evidence to establish that words mean something different than what they seem to indicate on a plain reading. However, as the case law reviewed above indicates, that is not supported by the law. The union is entitled to adduce extrinsic evidence to support its position that even in the absence of explicit language, PRB is part of the collective agreement.

43Given that conclusion, the Board is convinced that there would be little, if any, efficiency to be gained by bifurcation of the instant proceeding. While employer counsel submitted that no extrinsic evidence should be received in relation to the union’s contractual claims (which submission has been rejected by the Board), he did not take the position that if the Board allows extrinsic evidence in hearing the motion, there would be no duplication of evidence. To the contrary in his opening statement, he repeatedly relied on extrinsic evidence in relation to both the union’s contractual claims, as well as the other claims not subject to his proposed no prima facie case motion.

44It is also clear that a decision in favour of the employer on the motion would not dispose of the whole grievance. The Board is of the view that issues raised in the various claims of the union are intertwined. Therefore, there will be significant overlap in the evidence. A procedural decision to bifurcate in the circumstances of this case would also be unfair and prejudicial to the union.

45Therefore, the Board denies the employer’s motion for bifurcation. All of the claims raised in the grievance will be heard in one proceeding. The Board remains seized, and the hearing will proceed on the dates scheduled.