International Union, United Automobile, Aerospace & Agricultural Implement Workers of America and Local 636 v. Thomas Built Buses of Canada Limited, 1980 CanLII 867

Ontario Labour Relations Board

[1980] OLRB Rep. February 264

1603-79-U International Union, United Automobile, Aerospace & Agricultural Implement Workers of America and Local 636, Complainant, v. Thomas Built Buses of Canada Limited, Respondent.

BEFORE: Pamela C. Picher, VIce-Chairman and Board Members C. G. Bourne and H. Simon.

APPEARANCES: Len MacLean, L. Charlick and Cliff Binns for the complainant; T. F. Stone and Larry Bannon for the respondent.

DECISION OF THE BOARD; February 8, 1980

Decision

1. The United Automobile, Aerospace and Agricultural Implement Workers of America and its Local 636 have complained to the Labour Relations Board that the grievors (the trade unions and all employees in the relevant bargaining unit) have been dealt with by the respondent company, Thomas Built Buses of Canada Limited, contrary to the provisions of sections 37, 42, 56 and 58 of The Labour Relations Act.

2. At the outset of the hearing, counsel for the employer raised a number of preliminary objections. His primary submission was that the Board should decline its jurisdiction to hear this complaint and defer to a board of arbitration that has been established to hear the related grievance.

3. Counsel for the union explained that the essence of the complaint rested in the allegation that the respondent has violated section 56 of the Act which reads as follows:

"No employer or employers' organization and no person acting on behalf of an employer or an employers' organization shall participate in or interfere with the formation, selection or administration of a trade union or the representation of employees by a trade union or contribute financial or other support to a trade union, but nothing in this section shall be deemed to deprive an employer of his freedom to express his views so long as he does not use coercion, intimidation, threats, promises or undue influence."

4. It is common ground between the parties that a two day work interruption occurred at the respondent's plant commencing on October 3, 1979. Although the union denies liability for the work interruption, the company took steps to invoke article 5.06 of the collective agreement in effect between the parties which reads as follows:

"The Union and the employees agree that in return for such Union security they must accept the liability for any violation of the 'no strike' provisions of this agreement. Accordingly, it is agreed that in the event of any violation of the 'no strike' clause of this Agreement by the Union and/or the employees, or a group of employees, the company may at its discretion file with the Union a statement as to the appropriate penalty in the form of a cancellation of dues deduction and/or in the form of loss of seniority or a fine upon the employees. In the event that the parties are unable to agree upon the disposition of the matter, then either party may submit the dispute to a Board of Arbitration and the parties shall be bound by its decision."

The company has not submitted a grievance against the union claiming damages for the work interruption. Instead, on October 4th, the company sent the union the following statement pursuant to article 5.06 of the agreement:

"October 4, 1979.

Mr. Vein Eaton,

Chairman of Thomas Branch, Local 636,

AND

Mr. Lorne Charlick,

International Representative U .A.W.

STATEMENT BY THE COMPANY PURSUANT TO SECTION 5.06 RE THE ILLEGAL STRIKE

Pursuant to section 5.06 of the Collective Agreement and arising out of the illegal strike commencing on or about October 3, 1979, the Company herewith files a statement as to the appropriate penalty for breach of Article 4 of the Collective Agreement.

(1) For each day the strike continues commencing October 3, 1979, one month's Union dues shall be withheld and not forwarded to the Financial Secretary of the Local as referred to in Section 5.04.

(2) Each employee participating in the illegal strike commencing on or about October 3, 1979 or thereafter shall be subject to a fine in the amount of one day's pay, at base rate, for each day or part thereof on which they participated. Such deductions, to be made at a time determined by the Company following the conclusion of the illegal strike.

This statement is filed pursuant to Section 5.06 of the Collective Agreement. It in no way precludes the Company's position with respect to discipline up to and including discharge of employees for their participation in the illegal strike.

Larry Bannon,

Vice-President & General Manager."

5. Approximately 67 employees out of approximately 90 in the bargaining unit participated in the work stoppage. On October 5th the company gave a written warning to approximately 15 of the employees and notified the other 52 that they would be subject to a two-day suspension with loss of pay. Counsel for the complainant stated that the union considered that the above noted discipline administered to the employees who participated in the work interruption was a substitute for the fines proposed ithe company's letter of October 4th. We note that at the hearing, however, counsel for the employer indicated that the company still intended to impose the fines.

6. In response to what the union viewed as the only outstanding penalty proposed in the company's October 4th letter filed pursuant to article 5.06 of the agreement, the union, in a letter to the company dated October 9, 1977, requested the company to withdraw its intention to withhold union dues. The union indicated that its letter should be viewed as a grievance lodged pursuant to the terms of the collective agreement.

7. In a letter which the parties agree should be dated October 26, 1979, the company informed the U.A.W. and its Local 636 of its decision to implement its previously announced intention to withhold union dues:

"This is to advise you that further to our letter of Oct. 4, 1979 and pursuant to Article 5.06 of the Collective Agreement we are witholding [sic] Union dues for the months of October and November 1979.

These funds will be held in escrow pending a decision from the board of arbitration."

It is common ground between the parties that pursuant to this letter the company declined to remit to the union dues deducted from all the employees' wages for the months of October and November, 1979. In a letter dated November 24, 1979 the company informed the unon that the cues withheld totalled to $2,385.20.

8. A board of arbitration has been constituted to hear the union's grievance challenging the employer's right to withhold union dues; a hearing has been scheduled for April 1, 1980. On November 22, 1979, the union wrote a letter to the company stating that its decision to proceed with the union grievance relating to the withholding of union dues was without prejudice to the instant complaint before the Labour Relations Board. Counsel for the union acknowledges, however, that the employer's first notice of the instant complaint was on December 4, 1979, its date of filing.

9. It is the employer's position that deducting dues from employees and failing to remit them to the union constitutes "a cancellation of dues deduction" within the meaning of article 5.06 of the collective agreement. Counsel for the employer stated that in the event that its actions in this regard are upheld either by a board of arbitration or this Board as being in compliance with the terms of the collective agreement, it intends to return the dues to the employees forthwith. The intended penalty, as characterized by the employer, therefore, focuses on depriving the union of the use of the dues rather than forcing the payment of a damage claim.

10. Counsel for the union argues that the company's failure to remit to the union dues it has deducted from employees' wages is both a violation of article 5.06 of the collective agreement and a violation of section 56 of The Labour Relations Act. With respect to article 5.06, union counsel submits that the company's right is limited to filing with the union a statement containing its view of the appropriate penalty. In the face of a dispute over the appropriateness of the penalty, counsel argues that the article does not entitle the employer to take unilateral action prior to the resolution of the disagreement by a board of arbitration. Additionally, counsel for the union takes the position that the "cancellation of dues deduction" referred to in article 5.06 does not encompass a refusal to remit to the union dues already collected from employees.

11. Regarding the alleged violation of section 56 of the Act, counsel contends that the employer's wrongful impounding of dues constitutes interference with the trade union and its ability to represent employees in the bargaining unit. In its view such action has the calculated effect of weakening and discrediting the union in the eyes of the employees in the bargaining unit, thus fermenting dissent and undermining the union's strength.

12. Counsel for the union commented to the Board that it had not been informed prior to the hearing that the employer intended to return the dues to the employees if its actions were upheld by this Board or a board of arbitration. Whether the dues are held by the employer to satisfy an alleged damage claim or returned to the employees, however, is, according to counsel for the union, immaterial to its position that the employer's impounding of dues is in violation of both article 5.06 of the collective agreement and section 56 of The Labour Relations Act.

13. Counsel for the employer requests that the Board defer to the board of arbitration which has been set up to hear the union's grievance on the grounds that the dispute is, in essence, a disagreement over the interpretation of article 5.06 of the collective agreement rather than an unfair labour practice complaint. Counsel for the union, on the other hand, characterizes the union's complaint as one that extends beyond the collective agreement to encompass an alleged unfair labour practice which has jeopardized the union's ability to act as bargaining agent for the employees in the bargaining unit. As the Board has been given the explicit jurisdiction to resolve unfair labour complaints, counsel for the union argues that this Board rather than a board of arbitration should hear the union's complaint.

14. In support of its argument that the Board should decline to defer to arbitration, counsel for the union referred the Board to its decision in Truck Engineering Limited [1977] OLRB Rep. Jan. 2. The facts in Truck Engineering are similar to the facts in the instant case. The collective agreement in effect between the parties in Truck Engineering contained a clause identical to section 5.06. Following a work stoppage, the employer filed a letter pursuant to the equivalent of article 5.06 indicating its "intention to claim damages for losses incurred...". The employer's letter further indicated that dues would be deducted "as per usual and held by the Company until the ... damage claim ha[d] been paid". The company in Truck Enginerring asked the Board to defer to arbitration on the grounds that the dispute between the parties was essentially one of interpreting the respective rights of the parties under the equivalent of article 5.06 in their collective agreement. The Board declined to defer, however, on the grounds that the facts raised numerous issues which might go beyond the interpretation, application or alleged violation of the collective agreement. In its decision on the merits [1978] OLRB Rep. Jan. 70 the Board found that the employer's failure to remit dues deducted from employees' wages had been done in violation of section 56 of the Act. The Board stated at paragraph 13 of its decision,

"As distinct from the situation where an employer fails to make any dues deductions, in the instant case the respondent continued to checkoff union dues from employee wages. This is thus not a case where employees could simply turn to an alternative procedure for paying their dues. Flaying deducted the money in the form of dues payments, the respondent failed to fulfill its responsibility of forwarding the sums to the complainant union in accordance with the terms of the employee authorizations. In doing so we are of the view that it directly interfered with the flow of union dues to the complainant from those of its members employed by the respondent, and that this unilateral action constituted a form of direct interference with the administration of the complainant contrary to section 56 of the Act. What we have here is the unilateral impounding of union dues and not a mere failure to deduct union dues from employee wages."

15. Counsel for the employer contends that a critical distinction exists between Truck Engineering and the instant case: Truck Engineering Limited held the deducted dues as ransom for the payment of damages allegedly flowing from the work stoppage rather than file a specific grievance under the collective agreement seeking damages for the work stoppage. Counsel notes that in this case, on the other hand, the employer is not holding the dues pending payment of a damage claim. The distinction between the two cases drawn by counsel for the company does, indeed, exist. The Board is not satisfied, however, that it is a material distinction for the purposes of deciding whether or not to defer to arbitration. That the company has not sought to hold the dues as security for the payment of a damage claim in this case does not diminish the union's contention that the failure to remit dues deducted, for whatever reason, undermines the union's very ability to act as bargaining agent for its employees and, in so doing, violates section 56 of The Labour Relations Act.

16. In Kodak Canada Ltd., [1977] OLRB Rep. Feb. 49 the Board declined to defer to arbitration on an alleged violation of section 70 of the Act. The Board was persuaded that the dispute had implications which extended beyond the collective agreement and thus could not be properly characterized as simply a dispute relating to the interpretation, administration or alleged violation of the collective agreement. At page 56 the Board stated:

"At most these statements [contained in United Gas Ltd., 65 CLLC ¶16,056] raise a general presumption that grievance arbitration is to be the preferred forum where that procedure has been preserved by the statutory freeze. This general presumption recognizes that disputes arising out of collective agreements, and not having implications that extend beyond those collective agreements, should be dealt with by reference to the dispute resolution procedure of grievance arbitration. However, once a dispute can be characterized as being something more than just a dispute relating to the interpretation, administration, or alleged violation of a collective agreement, this general presumption must necessarily give way. Although grievance arbitration is the proper forum for the resolution of matters relating to individual collective agreeements, it is the Labour Relations Board that has been entrusted with the responsibility for resolving matters that go to the general structure of collective bargaining in this Province. Where such matters arise, therefore, it is this Board that provides the proper forum for their resolution, and deferral to grievance arbitration can no longer be the appropriate response."

17. The allegation in this case is that the employer's failure to remit dues deducted from employees' wages has undermined the trade union and interfered with its ability to represent the employees in the bargaining unit for which it is the exclusive bargaining agent. The Board has evaluated the various aspects of the union's complaint and is satisfied that it cannot be simply characterized as a dispute relating to the interpretation, administration, or alleged violation of article 5.06 of the collective agreement. The union's complaint extends beyond the collective agreement to encompass allegations that the employer has wrongfully interfered with the union's capacity to act as bargaining agent and, in so doing, has committed an unfair labour practice in violation of section 56 of the Act. The Board is persuaded that the union's allegation of an unfair labour practice is not a spurious characterization of the matter designed to mererly cloud what is essentially a dispute over the administration, interpretation or alleged violation of the collective agreement. In these circumstances, we are of the view that this Board is the proper forum for the resolution of the union's complaint.

18. For the foregoing reasons, therefore, the Board declines to defer to arbitration and will hear the merits of the union's complaint.

19. Counsel for the employer raised an additional preliminary objection. He argued that the union had sat on its rights prior to filing this complaint and should not now be allowed to proceed. The union's complaint was filed with the Board on December 4, 1979. This period of time may either be described as approximately five weeks following notification of the implementation of the employer's previously declared intention to refuse to remit dues or four days following the conclusion of the last month for which the employer refused to remit dues. The Board is not persuaded that these time lapses constitute an unwarranted delay and will, therefore, proceed to hear the matter on its merits.