International Union of Elevator Constructors, Local #50 v. Beckett Elevator Company Limited, 1982 CanLII 1030

[1982] OLRB Rep. September 1244

2026-81-M; 2582-81-4 International Union of Elevator Constructors, Lo­cal #50, Applicant, v. Beckett Elevator Company Limited, Respondent, v. National Elevator and Escalator Association, Intervener

BEFORE: R. O. MacDowell, Vice-Chairman, and Board Members O. Hodges and J. Wilson.

APPEARANCES: M. A. Green for the International Union of Elevator Constructors, Local #50; W J. McNaughton and A. Hopkirk for Beckett Elevator Company Limited; W Moran for the National Elevator and Escalator Association.

DECISION OF THE BOARD; September 21, 1982

I

1. This is an application under section 124 of the Labour Relations Act. In an earlier decision in this matter, dated April 21, 1982, the Board referred to the applicant union as 'Local 50", the respondent employer as "Beckett", the National Elevator and Escalator Association as the "NEEA", and the International Union of Elevator Construc­tors, the "parent" of Local 50, as the "International Union". For ease of reference, the Board will continue to do so.

2. Certain matters are not in dispute. The NEEA is the designated employer bargaining agency for a number of companies in the elevator industry including Beckett. The International Union is the designated employee bargaining agency. The NEEA has the statutory authority to bargain on behalf of Beckett by virtue of a Ministerial designation and section 143 of the Labour Relations Act. But Beckett is not a member of the NEEA' nor is it a willing participant in this bargaining process. Beckett is a member of a rival employer association known as the Canadian Elevator Contrac­tors Association ("CECA"). The CECA currently has no bargaining status. Apparently, the Minister of Labour originally designated both employer associations to represent their combined membership in bargaining with the International Union, but as the two rival associations were unable to compose their differences, the Minister re-designated the NEEA as the sole employer bargaining agency. It further appears that the NEEA is dominated by four large well established national companies: Dover, Montgomery, Otis, and Westinghouse. Many of the other companies represented for collective bargaining purposes by the NEEA (and more particularly identified in appendix C of the collective agreement between the International Union and the NEEA) are members of the CECA, the rival employer organization. And, of course, all of the companies represented by the NEEA for collective bargaining purposes are competitors in the marketplace to a greater or lesser extent. It is this fact which is really at the heart of the current dispute.

3. Pursuant to sections 142 and 143 of the Act, the designated employer and employee bargaining agencies have negotiated a province-wide agreement by which both Beckett, the direct employer, and Local 50, the local union, are bound. That agreement provides for a limited form of industry-wide "bumping". Certain employees laid off by one employer bound by the agreement have a limited right to continue in employment by displacing certain other employees of another employer bound by the agreement. Thus, a reduction in work and consequent lay-off by one employer/competi­tor bound by the collective agreement triggers a concomitant obligation on the part of other employer/competitors to absorb this surplus by displacing their own employees. While it is easy to understand the utility of such provision from the trade union's point of view, one can also appreciate an employer's lack of enthusiasm about absorbing his competitor's surplus workers at the expense of his own employees. Moreover, if some firms are regularly on the "receiving end" of such transfers, or must absorb them at a commercially inconvenient time, it does not take much imagination to envisage the friction which may arise and the dissatisfaction with the industry-wide bumping provisions — especially since, we reiterate, the transferred employees may be those of a competitor. Bumping provisions are a common feature of many collective agreements, but it is somewhat unusual, even in the context of bargaining with an employer association, that employees of one employer can displace those of another.

4. This application under section 124 has its origin in a dispute between Beckett and Local 50 concerning the proper interpretation of the "bumping provisions' in the province-wide collective agreement. The substance of that dispute is not immediately relevant. It suffices to say that the union claimed that certain of its members should have been employed by Beckett after being laid off by other companies, and that Beckett's failure to immediately employ them in accordance with the terms of the collective agreement, made Beckett liable to pay them compensation for the wages that they had lost. The union's claim was asserted through the filing of a "grievance" under Article 14 of the collective agreement which reads as follows:

Article 14

GRIEVANCE AND ARBITRATION

14.01 Any difference of dispute regarding the application or interpretation of this Agreement or Local Agreements shall be settled locally between the Local Union and the Employer. Upon receipt of a written grievance the Employer Representative and the Union Representative shall meet within five (5) working days to settle the dispute. In the event the matter cannot be settled on a local basis, then either the Union or the Employer shall submit the dispute to the Joint Industry Committee which it is hereby understood and agreed shall have the power to enforce its decision by mutual consent for protection of the public and the entire elevator industry.

14.02 Within a period of seven (7) days after receipt of a dispute or grievance by the Joint Industry Committee, said Commit­tee shall meet. If the Joint Industry Committee is unable to reach a decision or is deadlocked on the issue, then within a period three (3) days thereafter, either party may submit the unresolved dispute to arbitration.

14.03 It is agreed that the Employers and the Unions may mutually agree to a permanent Impartial Arbitrator or panel of permanent Impartial Arbitrators for resolution of differences or disputes. It is agreed that the Employers and the Unions may agree to waive the Joint Industry Committee step in the above procedure and may submit an unresolved difference or dispute directly to an impartial Arbitrator.

14.04 It is understood that neither the Joint Industry Committee nor the Impartial Arbitrator shall have any power to add to, subtract from, or modify in any way any of the provisions of this Agree­ment.

14.05 The decision of the Impartial Arbitrator shall be final and binding upon all parties. The expenses of the Imperial Arbitrator shall be borne equally by both parties.

14.06 It is agreed that the time limits expressed in this Article may be extended by mutual consent of the parties.

(emphasis added)

5. Article 14 provides that if the local parties (i.e., in this case, Beckett and Local 50) cannot resolve their dispute between themselves, either of them shall refer the matter to a Joint Industry Committee ("JIC"). The JIC is composed of members of the two designated bargaining agencies: the NEEA and the International Union. There is no evidence that the individual employers bound by the agreement have any specific representation on the JIC, nor is there any evidence to indicate that the individual employers have any specific authority to appoint such members. The JIC is the creature of the International Union and the NEEA — the designated bargaining agents.

6. Local 50's bumping grievance was referred to the JIC in accordance with Article 14 of the collective agreement. The JIC was composed of representatives of the union, as well as A. Reistetter, the executive director of the NEEA, and two representatives from Dover and Otis, respectively. There is no evidence that Beckett had any input into the selection of those individuals. They represent the NEEA. Mr. A. Hopkirk, an employee of Beckett, appeared before the JIC to make representations, and disputed that Beckett was in breach of its obligations under the collective agreement. The JIC disagreed. The JIC decided that Beckett had indeed breached the collective agreement, and that it was liable to pay certain monetary compensation to several employees who, in the JIC's view, should have been immediately employed by Beckett. Beckett has refused to comply with this determination, and, in consequence, Local 50 has filed the instant application under section 124.

7. The matter referred to by Local 50 in its section 124 application is the purported refusal by Beckett to allow bumping as per Article 10.5 of the collective agreement. Attached to the reference to the Board, and referred to therein, is a copy of the decision of the JIC finding that Beckett had failed to comply with a provision of the collective agreement, and ordering the payment of certain compensation to the employ­ees affected. On its face, the reference to this Board under section 124 has several related aspects: that Beckett has failed to comply with its obligations under the agreement, that this default was raised in a grievance and referred to the JIC in accordance with the agreement, that the JIC agreed that there had been a contractual breach, and that Beckett still refuses to acknowledge its liability despite the JIC decision.

8. The applicant union takes the position that the JIC decision is binding in accordance with Article 14 of the collective agreement, and that this Board should direct Beckett to compensate the aggrieved tradesmen in the sum calculated by the JIC. Alternatively, the union argues that if the JIC decision is not a final and enforceable resolution of the dispute with Beckett, this Board should hear the grievance on its merits, and decide for itself, whether Beckett was in breach of the terms of the collective agreement. Section 124 gives the Board jurisdiction to entertain a grievance "notwithstanding the grievance and arbitration provisions in a collective agreement"; and the union argues that, if necessary, the Board should exercise that jurisdiction. The intervening NEEA also takes the position that the matter has been settled, that there is a final and binding determination in accordance with the terms of the agreement, and that this determination should be incorporated in a Board order and enforced without reference to the merits of the dispute. In the NEEA's submission, the Board should not go behind the JIC decision, but simply enforce it.

9. The union and the NEEA further point out that the JIC is an effective "domestic" mechanism for resolving disputes between the parties without recourse to litigation and the formality inherent in the arbitration process. The JIC — unlike a board of arbitration — is composed of individuals with special knowledge of the industry and, being unfettered by legal formalism, is unable to render a speedy decision more consistent with the spirit and intention of the parties' collective agreement. Indeed, as counsel point out, a number of JIC decisions appear in appendices to the parties' collective agreement, and are intended to govern the relationship of the local unions and employers bound by it. Both the union and the NEEA submit that the Board should not lightly interfere with the decisions of the JIC, or adopt an approach which could undermine its effectiveness.

10. Counsel for Beckett conceded that the JIC decision was "final and binding", but, in his submission it was not enforceable and this Board has no jurisdiction to enforce it. That is the position taken in Beckett's reply. Counsel also argued that the matter of the enforceability and the effect of the JIC decision were entirely different matters from those raised in the union's section 124 application and that he was unprepared to argue that point on the day fixed for the hearing. Counsel submitted that he needed time to consider the issue, and he was not prepared to say why, in his submission, a JIC decision was not enforceable, or to advance any reason why Beckett should so regard it. In his submission, the proper procedure was for the union to file a second grievance claiming non-compliance with the JIC decision. Only then would he address the matter directly. On the other hand, counsel contended that the Board could not deal with the merits of the grievance because there was a "final and binding" JIC decision. In summary then, Beckett's assertion is that the JIC decision is not enforceable in the section 124 application as presently framed, and perhaps not at all; but on the other hand that this Board cannot consider the union's grievance on the merits because there is a "final and binding" JIC decision on the question. Later in the day, however, when dealing with Beckett's related application under section 151 of the Labour Relations Act, counsel for Beckett revealed that his argument with respect to the JIC decision would refer to whether it was properly constituted under the collective agreement. But once more, despite the strenuous objection of the other parties, he would not elaborate.

11. We might note at this point, as we did at the hearing, that we do not find Beckett's position very compelling. It is difficult to accept that a dispute has been "settled" and, therefore, is not arbitrable when it is obvious that it has not been settled at all because Beckett refuses to recognize or abide by the purported settlement. The reality is that there has been an alleged breach of the collective agreement, and, to date, the aggrieved employees have not been able to secure the redress to which they may be entitled if such breach has in fact occurred. Moreover, the legislative thrust of section 124 is plain: construction industry grievances generally should be resolved quickly — if necessary, by this Board and notwithstanding the grievance/arbitration provisions in the parties' collective agreement. In this context we do not think we should take an unduly technical approach to the grievance procedure if to do so would result in the defeat of an otherwise valid substantive claim, nor should we lightly accede to the submission that a party is "surprised" by an issue which appears to be raised in its own pleadings.

12. After the conclusion of the hearing in this matter, and upon a consideration of the issues raised, the Board decided, on its own motion, to solicit further representa­tions from the parties on the potential effect of sections 142 and 143 of the Labour Relations Act. Those sections read as follows:

13. Where an employee bargaining agency has been designated under section 139 or certified under section 140 to represent a provincial unit of affiliated bargaining agents, all rights, duties and obligations under this Act of the affiliated bargaining agents for which it bargains shall vest in the employee bargaining agency, but only for the purpose of conducting bargaining and, subject to the ratification procedures of the employee bargaining agency, conclud­ing a provincial agreement.

14. Where an employer bargaining agency has been designated under section 139 or accredited under section 141 to represent a provincial unit of employers,

(a) all rights, duties and obligations under this Act of employ­ers for which it bargains shall vest in the employer bargain­ing agency, but only for the purpose of conducting, bar­gaining and concluding a provincial agreement. ...

[emphasis added]

However efficacious the JIC procedure might be, the Board had some doubt whether the designated bargaining agencies could, by agreement, extend their influence beyond bargaining and into the ongoing administration of the collective agreement. The JIC is merely the alter ego of the union and the NEEA, and it has imposed what is said to be a binding settlement of a grievance — including a finding of liability and an award of compensation. Since the NEEA has the right to represent Beckett only by virtue of, and subject to, sections 139 and 143 of the Act, it was by no means clear to the Board that it could properly create a mechanism by which a "binding" settlement could be imposed upon an unwilling employer such as Beckett. Yet the effect of the JIC decision was an integral part of the arguments of both the applicant union and the NEEA. Hence, the Board's request for further representations.

13. Before turning to the language of Article 14 (wherein the union and the NEEA find a binding determination which this Board has but to enforce, and Beckett finds a bar to our consideration of the grievance,) it may be useful to briefly sketch in the statutory considerations which may bear upon our interpretation of the parties' agree­ment.

II

14. For some years commentators have suggested that instability in construction industry labour relations could be attributed to an unstable economic environment, and to unduly fragmented collective bargaining institutions. (See, generally: H. Carl Goldenberg, Q.C. and J. H. G. Crispo, Editors, Construction Labour Relations, Canadian Construction Association 1968; H. D. Woods "Memorandum on the Industrial Relations Features of the Problem" in H. Waisberg J. Report of the Royal Commission on Certain Sectors of the Building Industry, Queen's Printer, Toronto, 1974; J. B. Rose, Public Policy Bargaining Structure and the Construction Industry, Butterworths, Toronto, 1980; and specifically, D. E. Franks, Report of the Industrial Enquiry Commission Into Bargaining Patterns in the Construction Industry, 1976.) The proposed solution was extended area bargaining, and the new province-wide bargaining scheme reflects a legislative acceptance of that prescription. In 1978, the Legislature fundamen­tally altered the structure of collective bargaining in the construction industry by introducing a system of province-wide bargaining, by trade, through employer and employee bargaining agencies designated by the Minister of Labour. Previously, the only way that an employer association could acquire bargaining rights was through the acquiescence of the employers concerned, or through the process of "accreditation" (sections 125 to 134 of the Act). In order to be accredited, the employer association had to show that it represented the majority of the employers, employing a majority of the employees represented by a particular trade union. In this respect, the procedure was roughly analogous to the certification of a trade union. Under the new system, however, there is no requirement for a showing of support. The Minister is given a broad authority to designate such employer or employee bargaining agencies as he sees fit in accordance with his own assessment of the requirements of the situation (which may, of course, include the representativeness of the employer association). But having en­dorsed the proposition that extended area bargaining is more conducive to industrial relations stability, the Legislature has also sought to protect the individual employer's authority to deal with his own employees, subject to the terms of the province-wide collective agreement. The employer's rights are vested in the designated bargaining agency only for the purpose of collective bargaining and concluding a provincial collective agreement. The day to day relationships between the employer and his employees, the administration of the collective agreement, and the application of that collective agreement to the circumstances of individual employers, are all left for resolution at the local level — subject only to the injunction that there cannot be a local arrangement inconsistent with the provincial agreement (see section 146 of the Act). Thus, while recognizing the necessity of vesting considerable authority in the employer association for the purposes of collective bargaining, the Legislature has sought to limit that authority to the conduct of bargaining. In addition, the designated bargaining agencies are both under a statutory obligation to represent their constituents in a manner that is neither arbitrary, discriminatory, nor in bad faith (see section 151).

15. The new province-wide bargaining scheme is an attempt to reconcile different and potentially competing concerns: the need for extended area bargaining in order to promote industrial relations efficiency; and the desire to recognize, to some degree, the autonomy of the individual employer. Both objectives are important, and it is hardly surprising that the Legislature should attempt to strike a balance between them —especially since, on the "employer side", the interests at issue may be much more diverse than on the "union side" where, by definition, all of the union locals represented by the designated employee bargaining agency must be affiliated to a common trade union parent (although even on the "union side" there is sometimes competition between locals and friction with the employee bargaining agency). The employers represented by the designated employer bargaining agency may be active competitors in the market­place, with diverse and conflicting interests, and may not even be members of the employer association with the statutory right to represent them. Thus, the Statute provides that the employer association has the right to negotiate the agreement in the first instance, there is a prohibition against local arrangements, and the employer association has access to this Board under section 124/or section 89 in order to ensure that the system is being maintained and the agreement is being uniformly administered. By the same token, however, the local union (affiliated bargaining agent) and employer have access to this Board under section 124, the Statute restricts the role of the designated bargaining agents to "conducting bargaining and concluding a provincial agreement," and there is a statutory duty of fair representation.

16. In the instant case, the NEEA clearly has the legal authority, by virtue of section 143 of the Act, to represent Beckett — but only in accordance with that section and, consequently, "only for the purpose of conducting bargaining and concluding a provincial agreement". Article 14 of the collective agreement, however, includes a mechanism representing the union and the NEEA — but not Beckett — which in their submission can render a decision which is final and binding upon all parties. That decision can include a definitive interpretation of the collective agreement, a finding that there has been a breach of its terms, a direction that compensation be paid, and an order as to costs. But an individual employer like Beckett is unrepresented on the decision-making body. At most, such employer can, as Beckett did in this case, make submissions that it does not feel that there has been a breach of the agreement, or that the measure of damages is not that ultimately assessed by the JIC. There are none of the procedural or legal safeguards which would be available before this Board or a board of arbitration.

17. We have carefully considered the submissions of the union and the NEEA, and we are not unmindful of the valuable role which the JIC was played, and can continue to play in resolving labour disputes in the elevator industry. However, in our view, the thrust and intent of the legislation is clear: a designated employer bargaining agency cannot, through the process of collective bargaining itself or otherwise, extend its role beyond "the conduct of bargaining and concluding a provincial agreement". No doubt the designated bargaining agency will have an interest in the enforcement of such collective agreement, and such interest would give it status to appear in any arbitration proceeding involving that agreement. There is also a legitimate concern that the agreement be applied uniformly and not be undermined by contradictory local arrange­ments. Moreover, as a practical matter, if the designated employer and employee bargaining agencies are ad idem on the meaning of the terms which they have concluded, an employer bound by that agreement might be hard pressed to prove that they are wrong. JIC decisions might also provide some evidence of the parties' intentions, or, if duly incorporated by reference, may come to be terms of the contract. The parties may even find it necessary to amend the agreement during its operation to meet changing circumstances and, subject to section 151; there is no reason why they cannot do so. However, to suggest that the designated bargaining agencies may have a role to play in interpreting the collective agreement is not to say that, through a mechanism of their own creation, they can reserve to themselves the exclusive right to determine whether the agreement has been properly applied or administered by an individual employer which is not a member of the employer association and has not delegated such authority to it. In this respect, the situation is quite different from the ordinary settlement of a grievance by the parties to a collective agreement which would preclude an arbitration of its merits. Here, in our view, the parties cannot bind a non-member such as Beckett or preclude arbitration. Accordingly, we cannot accept the contention of the union and the NEEA that Article 14 (via the JIC) generates a binding determination which this Board need only endorse and enforce. To accept that proposi­tion would be to sanction a result which, in our view, is inconsistent with the scheme of the Act. We decline to do so. On the other hand, neither can we accept Beckett's assertion that the JIC process somehow derails a grievance or precludes arbitration of its merits — not least because this Board has plenary jurisdiction notwithstanding the grievance/arbitration provisions in the agreement and would be quite prepared to exercise that jurisdiction to avoid any technical morass of the kind adverted to by counsel for Beckett. The opening words of section 124 are intended to avoid such difficulties.

III

18. For the foregoing reasons, the Board finds that the interpretation urged on us by the union and NEEA would be inconsistent with the scheme of the Act. But is it even required by the terms of Article 14? The wording is by no means unequivocal. In contrast to the situation of an arbitrator whose decision, by Article 14.05, is expressly made "final and binding", by the provisions respecting the JIC:

In the event the matter cannot be settled on a local basis, then either the Union or the Employer shall submit the dispute to the Joint Industry Committee which it is hereby understood and agreed shall have the power to enforce its decision by mutual consent for the protection of the public and the entire elevator industry.

The words "by mutual consent" may be simply redundant, or alternatively, serve to reinforce the role of the designated bargaining agencies in controlling the disposition of local grievances — thereby raising, once again, the considerations set out above. If, on the other hand, the consent envisaged is that of the local or immediate parties to the grievance, then that conflict is avoided, but since Beckett has not clearly consented to abide by the JIC decision, there can be no basis for the argument that the matter has been resolved. Generally, we would be inclined to adopt that interpretation of the agreement which does not raise a potential conflict with the Act; however, we do not have to reach a final conclusion on this issue. Whether the JIC is unenforceable because of a conflict with the Statute, or because of an absence of consent, is, in our view, immaterial given the general jurisdiction of the Board under section 124. It suffices to find, as we do, that the union's grievance has not been resolved, and we are prepared to entertain it.

19. The section 124 application is therefore referred to the Registrar so that it can be listed for a further hearing on the merits.

IV

20. This application under section 124 was scheduled for hearing together with an allegedly related application under section 89 of the Act alleging that the NEEA had breached its section 151 duty of fair representation. Counsel for Beckett asserted that this fair representation complaint was intimately related with the section 124 application and the two proceedings should be consolidated. However, the alleged misconduct of the NEEA was not particularized at all, and counsel for Beckett was most reluctant to reveal the thrust of its case — other than the general suggestion that some impropriety could be inferred from the nature of the "bumping" clause, the structure of the JIC, or the apparent domination of the NEEA by major employers. On the other hand, the clause at issue in the section 124 application has been in place for some years, as has the system of bargaining which produced it. If Beckett had a concern about this process, it certainly did not move expeditiously to assert it; moreover, the collective agreement in question is up for renegotiation in the spring of 1982, and for the reasons we have already mentioned, we do not think the JIC can preempt local administration of the agreement. To the extent that the JIC was the focus of Beckett's complaint, the concern may be academic.

21. Had Beckett been more candid and explicit with the Board in setting out the thrust of its section 151 complaint, the Boaikl might well have been more sympathetic to Beckett's plea to combine that complaint with the section 124 application. If there were clearly a common factual foundation for both proceedings, or if the relief requested in each was clearly interrelated, the Board might be more disposed to combine them. On the basis of the submissions before us, however, we are not convinced that a sufficient case for consolidation has been made out. Accordingly, the Board directs:

(a) that the section 124 application be relisted for a hearing on the merits of whether Beckett has breached the collective agree­ment;

(b) that the complaint alleging a breach of section 151 of the Act also be relisted for hearing, but not necessarily before the same panel of the Board; and

(c) that in respect of the alleged breach of section 151 of the Act, the complainant, Beckett, forthwith furnish full particulars of any and all incidents which it alleges involve misconduct consti­tuting or, supporting, a purported breach of section 151 of the Act.

(The attention of the complainant is directed to Rule 72 of the Rules of Practice.)

22. These matters are referred to the Registrar.