Ontario Labour Relations Board
[1980] OLRB Rep. October 1373
2049-79-M Group of Employees, Applicant, v. Central Park Lodges of Canada and Service Employees Union, Local 210, Respondents.
BEFORE: R. O. MacDowell, Vice-Chairman and Board Members E. C. Went and C. A. Ballentine.
APPEARANCES: J. H. McGivney, Patricia Marion and Ruth A. Pentz for the applicant; John O'Donoghue for the respondent company; Ted Wohl and Tony Borg for the respondent union.
DECISION OF THE BOARD; October 9, 1980
I
1This is an application under section 95(2) of The Labour Relations Act made by a group of registered nursing assistants ("RNA's") employed by Central Park Lodges of Canada ("the employer") at its nursing home in Windsor. The first question which must be determined is whether the RNA's have the status to bring this application. Section 95(2) provides as follows:
"If, in the course of bargaining for a collective agreement or during the period of operation of a collective agreement, a question arises as to whether a person is an employee or as to whether a person is a guard, the question may be referred to the Board and the decision of the Board thereon is final and conclusive for all Purposes.”
2The history of the proceedings between these parties is somewhat complicated but the principal facts are not in dispute. The Service Employees International Union Local 210 ("the union") is the bargaining agent for three bargaining units of the employer's employees: a "service unit" and two "nursing units". Bargaining rights with respect to the nursing units are based upon two certificates issued by this Board certifying the union as the bargaining agent of all full-time and part-time registered and graduate nurses regularly employed by the employer. There is no collective agreement in respect of the nursing units. The employees in the service unit are covered by a collective agreement which runs from January 1st, 1979 until January 31st, 1981. In article 2 of that agreement, the employer recognizes the union as the sole and exclusive bargaining agent for all employees, save and except supervisors and persons above the rank of supervisor, professional nursing staff, physiotherapists, occupational therapists, office and clerical staff and students employed for the months of June to September. Prior to July of 1979, the nursing home did not employ any RNA's and accordingly, on January 1st, 1979, when the service unit agreement began to operate, the words "professional nursing staff' could only apply to the registered and graduate nurses for whom the union had been certified some months before. The outstanding certificates in respect of nurses, the composition of the employee complement at the time the agreement was signed, and the apparent congruence between the agreement and the nurses' certificates all suggest that the phrase "professional nursing staff' refers to the registered and graduate nurses who were subject to a separate certificate, and that all other employees (excluding physiotherapists, occupational therapists, office staff and students, but including RNA's) are covered by the service unit agreement.
3In the summer of 1979, the employer advised the union that, for budgetary reasons, it intended to replace all of the registered nurses by RNA's and that the RN's would be indefinitely laid off. This prompted the union to file a complaint under section 79 of The Labour Relations Act alleging that the registered nurses were being laid off because of their trade union activity. The union contended that the scheme to replace the RN's by RNA's, was designed to undermine the union's bargaining rights, and that the employer had failed to bargain in good faith contrary to section 14 of the Act. Each of the RNA's filed an individual intervention in this application and all of them were made parties. Patricia A. Marion appeared at the hearing on their behalf – although it should be noted that she was not accompanied by counsel.
4Counsel for the employer concedes that, at the hearing of the section 79 complaint, he submitted on behalf of the employer that the RNA's were employees within one or the other of the union's bargaining units. This submission was consistent with the outstanding agreement and certificates; moreover, an agreed statement of facts placed before the Board also suggests that such RNA's as the employer may have had from time to time, were employed in the service unit. The employer argued that since the newly hired employees would be represented by the union in any event, no anti-union inference should be drawn from its decision to replace registered nurses by RNA's. There was no suggestion that the RNA's would occupy managerial positions or constitute a new complement or "layer" of management. The registered nurses whom they were replacing had not been considered "managerial". The Board accepted and relied upon the employer's representations in coming to the conclusion that the employer's actions were not motivated by any anti-union animus. The Board reasoned that the employer would not undermine the union by substituting RNA's for registered nurses, and on that basis concluded that there was no basis for the union's charge of an unfair labour practice. The complaint was dismissed in a decision dated December 4th, 1979, [1979] OLRB Rep. Dec. 1145.
5There followed an exchange of correspondence between the solicitor who had been retained by the RNA's and the employer. The recently hired RNA's did not wish to be represented by the union or pay union dues and, in a letter dated January 9, 1980, their solicitor raised inter alia, the question of whether they were "employees" under The Labour Relations Act. Section l(3)(b) of The Labour Relations Act excludes from the definition of "employee" persons exercising managerial functions, but as we have already noted, prior to this letter the employer had not taken the position that the RNA's were members of management, and had, in fact, in the earlier section 79 proceedings, asserted that they were employees.
6On January 21st, 1980, the employer wrote to the Board seeking a determination of a number of questions:
whether the RNA's were "employees" within the meaning of The Labour Relations Act;
whether the RNA's were included in the "service unit" defined in the collective agreement which it had recently signed;
whether the RNA's were included in the "nurses unit";
whether the RNA's by themselves constituted an appropriate unit for collective bargaining purposes.
The employer's letter was placed before the Board and treated as an application under section 95(2) of The Labour Relations Act. The Board held that, except for the question of the employee's status, none of the questions raised in the employer's letter was properly brought to the Board for determination under section 95(2). In respect of the employer's request for a determination of the "employee status" of the RNA's, the Board noted that the employer in the earlier unfair labour practice complaint had already submitted that these individuals were employees, and that the Board had accepted and relied upon that submission in reaching its decision to dismiss the complaint. In the circumstances, the Board held that the employer could not change his position and now assert that these individuals were not, in fact, employees within the meaning of the Act. The Board further noted that there was nothing before it to suggest that the duties expected of the RNA's had changed materially since the time of the earlier proceedings. By a decision dated March 12, 1980, the Board held that the employer could not relitigate the status of the RNA's and dismissed the employer's application.
7On April 8, 1980, the solicitors for the employees wrote to the Board reciting the same questions which were previously pressed by the employer (i.e. whether the RNA's were employees, whether they were represented by the union, and whether they were "properly included" in the bargaining unit). Again, the Board considered the matter, and in decision dated April 23rd, 1980, decided to treat that letter too as an application under section 95(2) for a determination of the status of the RNA's. This, in turn, raised the question of whether a group of individual employees could apply under section 95 for such determination. The Board scheduled a hearing to entertain the parties' submissions on this issue. At that hearing the Board was advised that the union had filed a grievance alleging that the RNA's were covered by the "service agreement" and that a board of arbitration constituted in accordance with the terms of the agreement, would shortly consider this issue. One of the issues the arbitrator will have to determine is whether the RNA's are among the employees in the bargaining unit represented by the union.
8The sole question before this Board is a narrow one: whether a group of individual employees can make an application under section 95(2) for a determination of their employee status when neither their union nor their employer has done so (or, in the present case, when their employer is prevented from doing so because of a position taken in previous proceedings before the Board). The circumstances giving rise to this question are somewhat unique, but the question itself is not. If the employees are right in their contention, then, at any time, an individual employee can call for a determination of his status whenever he has a question in this regard – thereby calling into question the employer's managerial structure, the scope of the collective agreement, and the distinctions between managerial and non managerial employees to which the union and employer have agreed. The union submits that section 95 was never intended to answer questions "at large" or which might arise in the mind of the individual employee; but only issues between the bargaining parties concerning the negotiation or administration of collective agreement's. There is no such issue here. The union also submits that all of the RNA's were parties to the section 79 complaint in which the Board finding is based on representations and an agreed set of facts which asserted that the RNA's were employees. The union contends that the RNA's cannot now claim they are not employees. It is unreasonable, argues the union, to suggest that the less skilled RNA's who have replaced the registered nurses constitute a new layer of management. In the union's view, the entire proceeding is a colourable device to subvert the union's bargaining rights by asserting managerial authority where none exists. These submissions have two separate aspects: whether, as a general matter, individual employees can resort to section 95 for a determination of their status; and whether the RNA's participation in the section 79 proceeding precludes an application under section 95. In the circumstances, we have found it necessary to address only the first of these questions.
II
9Counsel for the applicant employees submits that section 91(12) of the Act and the recent decision of the Divisional Court in Carmen Fisher et al v. Hotels Clubs Restaurants, Tavern Employees' Union, Local 261, Fuller's Restaurant, and Ontario Labour Relations Board (1980), 1980 CanLII 1882 (ON HCJ), 28 O.R. (2d) 462; 80 CLLC ¶14,021 requires the Board to entertain the employees' application. We have considered both section 91(12) and the court decision in Fuller's Restaurant, but have not found either very helpful in resolving the question presently before us. Section 91(12) does not address the question of who has status to initiate a proceeding; it merely specifies that those persons who are proper parties are entitled to an adequate opportunity to make their submissions. Fuller's Restaurant involved the right of individual employees to present their evidence in a certification application in which they had properly intervened in accordance with a rule (Rule 48) which specifically contemplates such intervention. Their status to intervene was not an issue. There was no doubt that an employee in a proposed bargaining unit has the status to intervene and is a proper party to a certification application (see Nick Masney Hotels Limited, 1970 CanLII 478 (ON CA), [1970] 3 O.R. 461; 70 CLLC ¶14,202 (C.A.)); however, employees cannot bring a certification application – only a trade union can. Similarly, employees may have a right to intervene in proceedings before a board of arbitration, even though they are not parties to the collective agreement (see: Hoogendorn v. Greening Metal Limited, (l968), 1967 CanLII 20 (SCC), 65 D.L.R. (2d) 641 (S.C.C.)); but unless the agreement so provides, they cannot initiate a grievance – only an employer or a trade union can. Indeed, there is no doubt that if a section 95 application is made by one of the parties to the bargaining relationship, the individual employee affected would have the right to intervene and make his submissions. The Board has so held in Brampton Transport Limited, [1969] OLRB Rep. Jan. 1085. The issue in the present case, however, is not whether employees have a right to be heard when their interests are affected by section 95 proceedings; but whether they can, on their own motion, launch such proceeding when there is no questions between the employer or the trade union concerning the status.
10Counsel contends that employees are vitally interested in the determination of their status, that important collective bargaining rights are involved and that the Board should not lightly conclude that they have no mechanism for resolving these questions. It must be remembered however, that within the context of collective bargaining this is not unusual. Terms and conditions of employment, wages, working conditions, pension benefits, seniority rights, job classification and promotion policy may all be jointly negotiated by the bargaining parties and are not subject to review or question by an individual employee. As we have already mentioned, disputes concerning the interpretation of the collective agreement may arise from, or materially affect the circumstances of an individual employee, but that employee may have no right to launch a grievance, and, (subject to section 60 of the Act) the union and employer may settle his grievance without his consent. Employee interest is not always sufficient to justify an independent right of action or review.
11When put in an abstract form counsel's submission has a superficial attraction: employees are interested, "therefore" they "should" have an independent right of access to the Board despite the agreement of their employer and trade union. In a practical sense however, what the submission amounts to is this: despite the agreement of the union and the employer that an individual is not a member of management, that individual may launch a proceeding before the Board for a declaration that he exercises managerial functions; or, alternatively, an individual whom both parties accept as a member of the management team can seek a declaration that he is not. In our view, this is a curious submission, and one for which it is difficult to discern a clear industrial relations rationale. An employee cannot question his terms and conditions of employment, nor, in most cases, the conduct of his bargaining agent; but, counsel contends, he can question his employer's managerial structure. No doubt individual managerial personnel may occasionally wish to dispute their management status, in order, for example, to participate in the benefits or the protection of a collective agreement; or, as the present case demonstrates, employees opposed to the union may look to a status determination as a means to avoid trade union representation. These motivations are readily understandable, but the real question is whether section 95 was intended for this purpose. And it can hardly further an orderly collective bargaining relationship if despite established practice, a collective agreement, or the specific agreement of the union and employer, an employee can assert that he is or is not a member of management, and is or is not covered by the collective agreement.
12Before considering the decided cases concerning section 95, it may be useful to refer briefly to section 1(3)(b) of The Labour Relations Act – the "managerial exclusion" with which section 95 is closely connected. The purpose of the managerial exclusion has been succinctly stated in Corporation of the City of Burnaby, [1974] Can LRBR 1 at 3 as follows:
"The explanation for this management exemption is not hard to find. The point of the statute is to foster collective bargaining between employers and unions. True bargaining requires an arm's length relationship between the two sides, each of which is organized in a manner which will best achieve its interests. For the more efficient operation of the enterprise, the employer establishes a hierarchy in which some people at the top have the authority to direct the efforts of those nearer the bottom. To achieve countervailing power to that of the employer, employees organize themselves into unions in which the bargaining power of all is shared and exercised in the way the majority directs. Somewhere in between these competing groups are those in management – on the one hand an employee equally dependent on the enterprise for his livelihood, but on the other hand wielding substantial power over the working life of those employees under him. The British Columbia Legislature, following the path of all other labour legislation in North America, has decided that in the tug of these two competing forces, management must be assigned to the side of the employer.
The rationale for that decision is obvious as far as the employer is concerned. It wants to have the undivided loyalty of its senior people who are responsible for seeing that the work gets done and the terms of the collective agreement are adhered to. Their decisions can have important effects on the economic lives of employees, e.g., individuals who may be disciplined for "cause" or passed over for promotion on the grounds of their "ability". The employer does not want management's identification in the activities of the employee's union.
More subtly, but equally as important, the exclusion of management from bargaining units is designed for the protection of employee organizations as well. An historic and still current problem in securing effective representation for employees in the face of employer power is the effort of some employers to sponsor and dominate weak and dependent unions. The logical agent for the efforts is management personnel. One way this happens is if members of management use their authority in the work place to interfere with the choice of a representative by their employees. However, the same result could happen quite innocently. A great many members of management are promoted from the ranks of employees. Those with the talents and seniority for that promotion are also the very people who will likely rise in union ranks as well. In the absence of legal controls, the leadership of a union could all be drawn from the senior management with whom they are supposed to be bargaining. If an arm's length relationship between employer and union is to be preserved for the benefit of employees, the law had directed that a person must leave the bargaining unit when he is promoted to a position where he exercises management functions over it."
13The managerial exclusion is designed to protect the institutional integrity of the bargaining parties and ensure that the bargaining relationship is not threatened by conflicts of interest. The section guarantees that the "bargaining table will have two sides". It is part of a general scheme (see sections 12, 40, 56) to maintain the separate identity and independence of the union and employer. The "mischief' to which sections 1(3)(b) and 95 are directed is unlikely to arise where the union and employer have mutually agreed on the appropriate dividing line between managerial and nonmanagerial employees. If neither of these parties perceives a threat to its interests, can an employee raise the matter in the context of a section 95 application? In the present case, of course, neither the trade union nor the employer is raising any question about the status of the applicants, or the potential threat to their collective bargaining interests which might flow from the inclusion of these employees in a bargaining unit. Indeed, even the employees themselves have not raised the issue on this basis. Their position with respect to trade union representation is rooted in their personal opposition to the union rather than a general concern about the integrity and independence of the bargaining parties. If the employees' concern is not one to which section 1(3)(b) was directed, was it intended that their concern could be raised under 95?
14The necessity of a provision such as section 95(2) is readily apparent when one considers the dynamic nature of a business enterprise. After the establishment of a collective bargaining relationship, or the signing of a collective agreement, technological innovations, or changes in business conditions, may result in the creation of new job classifications, or the hiring of new employees. These changes in business organization may alter the duties of individual employees, or shift the focus of managerial authority in the organization, or raise a real question between the parties concerning the appropriateness of an employee's continued inclusion in the bargaining unit. Frequently, of course, these problems can be resolved by joint negotiation between the parties (although if the applicants are correct in their contention, the agreement which the parties may reach cannot be conclusive); or, if a dispute arises concerning the application of the collective agreement, the matter can be resolved by reference to a board of arbitration. (See Re Canadian Industries Limited et al 1972 CanLII 483 (ON CA), [1972] 3 OR. 63, where the Court of Appeal confirmed that a board of arbitration – to which only "the parties" have access – has jurisdiction to resolve certain employee status questions.) Section 95 provides an alternative route to which the parties can resort if they are unable to determine between themselves precisely where the managerial line should be drawn. Counsel contends that, in addition, section 95 is open to individual employees whenever they may have some question concerning their membership on the management team, and further that section 95 can be invoked even though the union and employer have resolved this question to their satisfaction. It is not unusual, in the Board's experience, for employees to overestimate or underestimate their importance in the employer's organizational scheme, nor is it uncommon for employees to misunderstand the true extent or limits on their authority. It is evident therefore that, if section 95 is available in any large enterprise, the number of employees and the volume of organizational changes or employee turnover would create a potential for litigation under section 95 which is almost limitless. Given the disparate views which employees might have concerning the value of trade unionism, and the variety of advantages which could be obtained from inclusion or exclusion from a bargaining unit there is a real likelihood that such litigation would be forthcoming – with obvious impact on the stability of the bargaining relationship. While we do not suggest that these consequences can be permitted to confute the clear meaning of the statute, where the language of the statute is ambiguous, it is a matter of real significance whether the interpretation urged upon us would lead to practical or impractical consequences.
15The contention of the applicant in the present case has been considered and rejected in at least three previous Board cases. In Wallace Barnes Limited 61 CLLC ¶16,198, an employee claimed that she had been improperly discharged and that by virtue of section 1(2) of the Act [which provides that a person does not cease to be an employee by reason of a discharge contrary to a collective agreement] and 95(2), the Board had jurisdiction to determine whether she was still an employee. In dismissing the application the Board commented:
"In sum, then, it appears to us that when the Legislation is looked at as a whole section 68 [now section 95] subsection 2, is designed to deal with questions which may arise between the parties who are negotiating a collective agreement and between the parties to a collective agreement during its operation. Moreover, in our view, it was never intended that employees should be able to refer a question under section 68(2) to the Board but rather this was to be left to one or more of the parties to the agreement. While in a sense employees in the bargaining unit are parties to a collective agreement, since a trade union acts as their bargaining agent, having chosen that agent to act on their behalf they are bound by its actions and, if a collective agreement exists, by the terms of that collective agreement."
In Indusmin Limited [1975] OLRB Rep. March 184, a request by individual employees for a determination of their status was also rejected. Finally, in York University [1978] ORLB Rep. August 790, the Board dealt with a situation in which a group of employees alleged that they were "guards", and thereby excluded from a bargaining unit because of section 11 of The Labour Relations Act. As in the present case, neither the union representing them, nor their employer regarded them as "guards" and it was acknowledged that they had been treated as employees by the parties' collective agreement. In dismissing the application, the Board had this to say:
"In our view there must be a present question arising between the parties to the collective bargaining relationship before there can be a section 95(2) referral. Certainly, it is clear that for a question to arise "in the course of bargaining for a collective agreement" it could be necessary for such question to be raised in the "bargaining forum" and must therefore be a question between the parties to that bargaining relationship i.e. the bargaining agent and the employer; we are of the opinion, that it is no less implicit in the language of the section that the question which must arise during the period of operation of the agreement must also be a question between the parties to that agreement."
16In York University, the Board found that the "guard's exclusion" was intended to protect the interests of the employer, since the inclusion of guards in the bargaining unit might generate a conflict of interest with respect to the protection of the company's property. Section 95(2), in turn, was "intended to promote the stability of labour relations by making available a forum for the settlement of particular questions, where there are interfering with the general collective bargaining relationship". Where the parties had agreed that the employees in question were not "guards", there was no interference with the collective bargaining relationship; and where the company itself had treated the alleged guards as ordinary employees, the Board saw little likelihood of subverting the interests which section 11 was designed to protect. In the result, the Board found that section 95 was restricted to question which arose between the parties, at the bargaining table, or pursuant to the administration of the collective agreement.
17In our view, the scheme of the Act, the decided cases, and the ramifications of an alternative interpretation, all support the inference that section 95(2) was only intended to resolve disputes between the immediate parties to the bargaining relationship. Section 1(3)(b) is designed to protect the institutional interests and integrity of the bargaining parties; but no such interests are at issue here, and it is unlikely that the mischief to which section 1(3)(b) is directed would arise where the company and the union have mutually agreed on the distribution of "managerial" authority, the composition of the "managerial team", and the scope of the bargaining unit. Indeed, if the parties have been able to reach such agreement, there are good policy and practical reasons why it should not be disturbed. It would not further a stable collective bargaining relationship if the parties could be plunged into litigation on matters which they have already settled – even though an individual employee may be dissatisfied with that settlement. Moreover, it seems strange, from a practical point of view, to suggest that the Board should be entertaining applications brought for the purpose of demonstrating hat a company has more (or fewer) managers than either it or the employees' bargaining agent think it has. We agree with the view expressed by the Board in York University, supra that it is implicit that a "question arising during the negotiation of a collective agreement must involve a question between the bargaining parties which must be resolved in order to assist them to reach a collective agreement; and that it is also implicit that a "question" arising during the operation of the collective agreement, is intended to refer to disputes between the parties who have a responsibility for administering that agreement (i.e. the trade union and the employer). Having carefully considered the various submissions of the parties, we are satisfied that section 95 was only intended to resolve issues between the bargaining parties; and was not intended to provide a forum in which employees could question their status when that status was not a matter of dispute between their employer or their trade union. In our view, it is implicit that the "question" to which section 95 refers must involve a question arising between the bargaining parties during the negotiating or operation of the collective agreement.
18In the result, we find that the procedure prescribed by section 95 is not available to individual employees, and the application must be dismissed. It is unnecessary to consider the effect if any, of the employees' participation in the section 79 complaint, which was determined, as we have noted on the basis of an agreed statement of fact and submissions that they were "employees" in the service unit. Likewise, we need not speculate and make no comment on the result if the employees, through a trade union of their choice, made a timely certification application raising the questions set out in paragraph 6 (above).