GSB# 2017-1839

UNION# 2017-0228-0025

IN THE MATTER OF AN ARBITRATION

Under

THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT

Before

THE GRIEVANCE SETTLEMENT BOARD

BETWEEN

Ontario Public Service Employees Union (Crawford)

Union

• and -

The Crown in Right of Ontario (Ministry of Health and Long-Term Care)

Employer

BEFORE

Nimal Dissanayake

Arbitrator

FOR THE UNION

Maria Luisa Vitti Ontario Public Service Employees Union Grievance Officer

FOR THE EMPLOYER

Joohyung Lee Treasury Board Secretariat Legal Services Branch Counsel

HEARING

December 4, 2018

DECISION

1A grievance dated September 14, 2017 filed by Ms. Stacey Crawford (“grievor”) was scheduled before me for mediation-arbitration pursuant to article 22.16 of the collective agreement. The parties jointly requested that I should proceed directly to arbitration because they were agreed that there is no possibility of a mediated settlement.

2The facts were agreed upon. The grievor worked for the employer as an Ambulance Communications Officer. She went on sick leave on January 20, 2015 and was on long term income protection benefits for approximately two years. On July 20, 2017, the insurance carrier Manulife terminated her LTIP benefits on the grounds that she no longer met the definition of “disability”. Consequently the employer also ceased making premiums on her behalf for pension, health benefits and extended health and dental benefits. She responded by filing the instant grievance, alleging a violation of article 42.3.1. of the collective agreement.

3Subsequently the grievor filed a civil law suit against Manulife on her own, without any involvement of the union, and with a lawyer retained by her, challenging Manulife’s denial of disability benefits. On September 18, 2018 the grievor’s action was settled by the execution of Minutes of Settlement (“MOS”). For the present purposes it is sufficient to note that under the MOS, Manulife paid a lump sum payment to the grievor, in consideration of the grievor agreeing to the dismissal/discontinuance of her action and her agreement to a full and final release.

4Article 42.3.1 of the collective agreement reads:

The Employer will continue to make pension contributions and premium payments for the Dental Plan and for Supplementary Health and Hospital on behalf of the employee, at no cost to the employee, while the employee receives or is qualified to receive L.T.I.P. benefits under the plan, unless the employee is supplementing a Workplace Safety and Insurance award.

5Ms. Vitti for the union pointed out that under article 42.3.1 the employer is obligated to continue making pension contributions and premium payments “while the employee receives … LTIP benefits under the plan”. She submitted that the lump sum payment made by Manulife to the grievor under the MOS represents the LTIP payments to the grievor for the years 2017 and 2018 and continuing into the future until March 2025, when the lump sum amount runs out. Based on that calculation, the grievor in effect is in receipt of LTIP benefits until March 2025. Therefore, the employer’s obligation under article 42.3.1 continues until March 2025.

6Counsel for the employer submitted that to trigger the employer’s obligation under article 42.3.1 the employee must be in receipt of LTIP benefits. The MOS did not provide for the reinstatement of the grievor’s LTIP benefits, which Manulife had terminated in July 2017. It agreed to pay a lump sum in order to resolve a law suit. There is nothing in the MOS to the effect that the lump sum represents LTIP payments to the grievor. In the absence of any language or evidence, it is not possible to assume that the money represents LTIP payments to the grievor for specific periods.

7Counsel pointed out that the MOS has language indicating that Manulife, while making a monetary payment to settle the civil action, did not change its position that the grievor was not entitled to LTIP benefits beyond July 20, 2017. He relied on the following provision in the MOS:

IT IS UNDERSTOOD AND AGREED that the payment of the funds is not and shall not be construed as an admission by the Release of any liability whatsoever arising out of the said Policy and such liability is expressly denied.

8In reply, the union pointed out that in the MOS it is provided that the money paid is taxable and Manulife has agreed to issue a T4A to the grievor indicating specific taxable benefit amounts for years 2017 and 2018. She submitted that this is an indication that the payments were intended to represent LTIP payments for those years.

9Having considered the submissions of the respective parties, I conclude that the grievance must fail. In Re Ottawa-Carleton Regional Municipality, (2000) 2000 CanLII 50135 (ON LA), 88 L.A.C. (4^th) 7 (Burkett) the collective agreement provided for the continuance of a number of benefits by the employer when a disabled employee “is receiving L.T.D. benefits”. Like here, the grievor commenced a civil action against the insurance carrier when her disability benefits were terminated. The action was settled. In the Minutes of Settlement, the insurance carrier agreed to pay to the employee a lump sum of $ 90,000, “In consideration of past and future disability benefits of

$1,056.30 per month”. The employee agreed to a release and dismissal of her action.

10Arbitrator Burkett noted that having been denied LTD coverage the employee “was forced to file suit against Confederation Life to seek redress”. At p. 9, he wrote:

The result of that suit was not to reinstate on-going LTD coverage as it applies to employees within the bargaining unit but, by way of the Memorandum of Settlement, to provide her with a lump sum payment of $ 90,000. The union’s position is that the settlement recognizes and compensates Ms. Jacques for her continuing disability and accordingly the lump sum payment, which constitutes the present value of a stream of future LTD payments, must be considered an LTD payment of a type that triggers benefit coverage under Article 17.3(iv). The union position has a certain attraction to it. However, it is not a position that can be sustained on the application of the facts to the language of Article 17.3(iv).

The simple answer is that Ms. Jacques is not in receipt of a continuing stream of LTD benefits as is contemplated under Article 17.3(iv) as the precondition to benefit coverage. Rather, she is in receipt of a single lump sum payment provided to her under the terms of settlement to her suit against the carrier; a settlement that at one and the same time provides for the lump sum payment and terminates the only legal avenue available to her to seek reinstatement of her entitlement to LTD benefits.

11In the present case there is no evidence and no indication in the MOS that the lump sum payment represents the amount representing the grievor’s entitlement to LTIP benefits. Unlike in Re Ottawa-Carleton (supra), there is no language at all linking disability payments to the lump sum payment. Thus the facts here are even weaker than in that case. Even if I accept that the lump sum amount was calculated taking into consideration the LTIP benefit amounts the grievor would have been entitled to if she had met the definition of “disabled”, that still would not trigger article 42.3.1. In Re Ottawa Carleton (supra) the MOS explicitly provided that the lump sum payment was in consideration of the employee’s past and present monthly disability benefits. Yet, it was held that “is receiving LTD benefits” contemplates a continuing stream of LTD benefits and that a lump sum payment does not meet that pre-condition. The same reasoning applies to the language in article 42.3.1 “While the employee receives … LTIP benefits”. Those words also contemplate a series of benefit payments over a period of time. A one-time lump sum payment does not meet that precondition to trigger the obligation under article 32.3.1. It is critical that, like in Re Ottawa Carleton, the MOS does not contemplate a reinstatement of the grievor’s LTIP benefits. To the contrary, the “no admission of liability” clause indicates the opposite.

12For the foregoing reasons, I find that there is no violation of the collective agreement, and the grievance is dismissed.