[1982] OLRB Rep. July 1020
2040-80-U United Steelworkers of America, Complainant, Fotomat Canada Limited, Respondent.
BEFORE: George W. Adams, Q.C., Chairman and Board Members C. A. Ballentine and J. Wilson.
APPEARANCES: James K. A. Hayes, Brain Herlich and William Mills for the complainant; and Steven J. MeCormack, Peter Nalewaik and David Weeks for the respondent.
DECISION OF THE BOARD; July 15, 1982
By decision dated October 24th, 1980, the Board determined that the respondent had bargained in bad faith and had committed a variety of other violations of the statute in addition. In its remedial order, among other things, the Board directed the respondent "to pay to all bargaining unit employees all monetary losses that the complainant can establish by reasonable proof as arising from the loss of opportunity to negotiate a collective agreement.. .the said damage, if any, running to the date of the first meeting convened by the respondent" as directed by the Board in the same order. Interest on any such amount was also ordered. Subsequent to that ruling the parties met as directed between November 25th, 1980 and December 3rd, 1980. However, collective agreements were not concluded and a further complaint was filed. By decision dated February 13th, 1981, it was found that the respondent had continued to bargain in bad faith and, accordingly, the Board fashioned a second remedial order which, among other things, directed the respondent to execute the collective agreements arising out of offers and acceptances occurring on December 3rd, 1980 and "to pay all bargaining unit employees all monetary losses arising from the loss of opportunity to negotiate a collective agreement together with interest from November 25th, 1980 until the date the respondent" executed the collective agreements.
The Board, in its decision of October 24th, 1980, had also directed the respondent to re-employ all striking employees who made unconditional applications to return to work on or before December 1st, 1980 and that this was to be done whether or not strike replacement employees had to be transferred, laid off or terminated. The basis to this order was that the respondent had bargained in bad faith over a period exceeding that period of time during which striking employees could have returned to work pursuant to the Labour Relations Act. (See section 73.) The Board decided that if it failed to provide for the security of employment of the striking employees the respondent would be rewarded for its unlawful conduct. The complainant filed a fresh complaint dated December 16th, 1980 alleging non-compliance with both this order and the direction that the respondent retable its offer of February 25th, 1980 including a monetary proposal that had been unlawfully withdrawn on June 17th, 1980. As noted in paragraph one, the Board's decision of February 13th, 1981 dealt with the latter aspect of that complaint. A subsequent decision of the Board dated May 25th, 1981 pertained to the alleged non-compliance with the Board order directing the re-employment of striking employees. In that decision, the Board found that the respondent had been motivated by anti-union considerations "when it persisted in characterizing the employees' actions of December 1st, 1980 as a mass resignation and refused to allow any of the employees who were absent without notice on Tuesday, December 2nd to continue their employment with the company". Prior to deploying the employees returning to work under the Board's direction, the respondent had held "retraining" seminars in Toronto. Certain of the employees perceived the seminars as unfair and a walkout ensued. It was the employer's characterization of the walkout as a mass resignation which the Board found to be improper. A remedial order was granted directing reinstatement of the grievors together with lost wages running from a variety of dates depending on when an employee attempted to return to work or learned that such an attempt would be futile. The different dates ran from December 3rd to December 8th, 1980.
By letter dated February 10th, 1982 the complainant wrote to the respondent providing particulars to its claim for monetary losses flowing from these various decisions of the Board. This claim totals in excess of $300,000.00.
On the agreement of the parties, the following issues were placed before this panel of the Board for decision.
What is the period of entitlement over which monetary losses (arising from the loss of an opportunity to negotiate a collective agreement) should be calculated?
What is the appropriate "measure" of damages for this period of entitlement?
Were the grievors, affected by the May 25th, 1981 decision of the Board, under a duty to mitigate monetary losses pending the issuance of that decision?
On behalf of the complainant, it was submitted that the period of entitlement ought to run from February 25th, 1980 until all employees were properly returned to work under the decision and direction of the Board dated May 25th, 1981. With respect to the measure of damages, the complainant took great exception to the Board's obiter in Canada Cement Lqfarge, [1981] OLRB Rep. Dec. 1722 at ¶137 wherein the panel in that case suggested the measure of loss in bargaining cases might be the difference between the terms and conditions that would have prevailed had the respondent bargained in good faith and those terms and conditions which in fact existed. The Board in that decision also expressed some reluctance to award striking employees full indemnity for monetary losses in that they may have contributed to such losses by engaging in strike activity. It was the complainant's submission that after February 25th the respondent's unlawful conduct was the only reason for the failure of a collective agreement to be negotiated and that therefore the bargaining unit employees who remained on strike were on strike only because of the unlawful actions of the respondent. It was submitted that if the Board acted on the basis of the obiter comments in Canada Cement Lqfarge, supra, it would effectively "gut" the remedy devised in Radio Shack, [1979] OLRB Rep. Dec. 1220 to deal with these kinds of first agreement problems. Finally, counsel for the complainant submitted that the Board should not require the grievors affected by the Board's decision of May 25th, 1981 to mitigate their losses because the respondent's failure to comply with the Board's earlier order directing their re-employment caused great confusion in the minds of the grievors. A strike was still in progress when the respondent treated the walkout as a mass resignation and that, to the grievors way of thinking, seeking a job elsewhere would have been inconsistent with the ongoing strike "atmosphere" that prevailed at that point in time. The complainant submitted that even after the February 13th, 1981 decision of the Board directing the execution of collective agreements there remained considerable confusion and difficulty over the grievors precise legal position.
The respondent submitted that no unlawful conduct had been found prior to February 25th and therefore suggested that the period of monetary entitlement ought to run from a point in time somewhat after February 25th, 1980. However, no specific starting point was recommended to the Board. On the issue of measurement, counsel for the respondent relied heavily on the obiter remarks in the Canada Cement Lafarge case and asserted that damages for loss of opportunity to negotiate a collective agreement should not be viewed as the equivalent of a "gross wage claim" for striking employees. Finally, it was urged upon the Board to not deviate from its policy of requiring all grievors to mitigate their losses pending a determination by the Board.
This is the first time the Board has had to consider the details of its approach to bargaining violations first set forth in Radio Shack, supra. Until that point in time, the Board had tended to deal with bad faith bargaining violations by way of bargaining orders. Increasingly, however, it became clear that the bargaining order approach did not respond to the real losses experienced by unions and employees and presented no real deterrence to flagrant employer misconduct at the bargaining table. In Radio Shack, supra, the Board said it would evaluate the bargaining expectancy of employees who were victims of such an unfair labour practice. This case requires us to look at certain aspects of the measurement of such loss.
The complainant has simplified the task by limiting its claim to the level of compensation eventually negotiated with the respondent on December 3, 1981. The increases were of the order of 9% or 27 cents per hour. The complainant points out that it could have taken the position that this settlement was, itself, affected by the unlawful actions of the respondent and is not the best measure of the loss experienced by these employees. However, for its own reasons and in order to simplify matters before the Board, it has decided against taking this approach. Accordingly, we accept this upper limit in the instant case as that level of compensation the employees would have received much earlier than they did had the respondent bargained in good faith and made all reasonable efforts to enter into a collective agreement. Moreover, because collective agreements were entered into, there is no uncertainty over whether or not a collective agreement would have been agreed upon had the respondent bargained in good faith. In future cases the Board may well have to decide whether losses should be discounted to reflect any existing uncertainty and to determine how realistic a complainant's bargaining goals were on the filing of the complaint with the Board. Fortunately, this need not be done in the instant case.
However, we do need to decide from what point in time recoverable losses run from and precisely what losses during the relevant period ought to be recovered. The easiest point in time to determine is the point in time to which bargaining losses run. All bargaining losses can be considered as running to December 3, 1980. On that date the parties entered into a binding memorandum of agreement which the Board directed the respondent to execute in the form of collective agreements pursuant to its decision of February 13, 1981. Employees in the bargaining unit on or after that date should have been paid at the rates provided for in that memorandum of agreement. The employees reinstated by the Board's order of May 25, I 981 are therefore to be compensated at rates of wages provided for in the memorandum of agreement for a period of time commencing between December 3 to December 8, 1980 (as applicable) to the date of their actual reinstatement pursuant to the Board's order. They were unlawfully dismissed and their reinstatement with compensation presents nothing unusual other than the issue of mitigation to be addressed below.
As for the starting date, counsel for the complainant submits that February 25, 1980 is most conservative in the circumstances. It can be pointed out that the first certificate was granted in February of 1979. While other certificates were granted as late as August 8, 1979 and notices to bargaining spanned March 1, 1979 to October 23, 1979, serious bargaining commenced June 28, 1979. A strike deadline was reached on October 22, 1979 and the parties were engaged in a strike impasse until February 25, 1980, the point at which the Board found the respondent to be bargaining in bad faith. No data was presented to the Board to describe "the average period of time" it takes a first agreement to be negotiated from the date of issuance of a certificate. However, if three months was thought an average or at least a reasonable period and assuming nothing unusual in the complainant's bargaining posture, it would seem reasonable to conclude that a collective agreement would have been consummated by at least the end of February. The complainant points out that when the respondent retabled its position pursuant to the Board's order of October 24, 1980 a memorandum of agreement was agreed upon in less than a week. On the other hand, there were a very limited number of pre-strike bargaining meetings and this was the product of the complainant's actions. It set a strike deadline for October 22, 1979 and went on strike with many items still on the bargaining table and with a 45 percent wage increase demand. Moreover, there had been no specific negotiations with respect to the Warden Avenue location and the complainant was seeking to cover many of the units under a single agreement. It is also unlikely that the speed at which the parties consummated an agreement in December of 1980 under "the Board's scrutiny" is a good measure of how impasse negotiations would have unfolded in February of 1980 had the intentions of the respondent been bona fide and had there been no Board involvement. Taking all these factors into account and having regard to all of the evidence before the Board, we find that, on the balance of probabilities, a collective agreement would have been entered into on or about April 1, 1980 and that bargaining losses should commence to run from this date.
The measure of such loss has been simplified by the complainant limiting its claim to the rates eventually negotiated but complicated by the fact that many of the employees in the bargaining unit were on strike until they returned to work pursuant to the Board's order October 24, 1980 sometime in December of 1980. In Canada Cement Lafarge, supra, the Board, in obiter, expressed some concern over sorting out those losses caused by a bargaining unfair labour practice and those caused by the refusal of employees to work through strike action. The Board was also anxious not to encourage striking employees to place great hopes on the Board declaring an employer's bargaining position unlawful with the accompanying expectation that the employer would be directed to save them harmless from all losses experienced including both the "bargaining expectancy" and the wage loss arising from the strike. In short, the Board cautioned trade unions against precipitous strike action with the thought that a subsequent successful unfair labour practice complaint would compensate for all losses incurred.
In the same decision, the Board noted that certain violations of section 15 would not usually cause monetary losses or at least such violations could best be remedied by directions not involving a monetary order. A good example would be the failure to provide certain bargaining unit data. However, this case is not one of those. In this case, the respondent's conduct at the bargaining table was calculated to avoid a collective agreement and it persisted in such conduct from February 25, 1980 to December 3, 1980. There is therefore considerable force in the complainant's submission that the only reason that certain members of the bargaining unit were on strike after April 1, 1980 was because of the respondent's unlawful conduct. On the other hand, the complainant took its members out on strike well before the time at which it established the respondent violated the Act thereby aggravating the losses that would be sustained by these striking employees. There can also be no doubt that the complainant abandoned the bargaining table after March of 1980 preferring, in the words of its witnesses, to lobby the legislature for legislative reform on the issue of compulsory trade union membership dues. While those efforts along with, we might add, the efforts of organized labour in Ontario generally bore fruit in the form of Bill 89 given royal assent on June 17, 1980, we find it difficult to conclude that all the losses sustained from early March of 1980 until June 17, 1980 were the entire product of the respondent's actions. The complainant admitted that it abandoned collective bargaining during this period and only after June 17, 1980 did it actively pursue the complaint filed with the Board. Considering all the facts before us and having particular regard to what the Board considers a premature decision by the complainant to engage in strike action, we have concluded that the losses of bargaining unit employees, including those of striking employees, are best measured by the formula set out in Canada Cement Lqfarge, supra, from April 1, 1980 to June 17, 1980. By this we mean the difference between what they would have received had they continued to work and those wages multiplied by the percentage increase that would have resulted from good faith bargaining (9%), i.e. "the net monetary claim". However, after June 17, 1980 we accept that all the losses of bargaining unit employees were exclusively and directly referable to the respondent's unlawful conduct and striking employees are entitled to be compensated for all losses sustained from June 17, 1980 to December 3, 1980, i.e. their "gross monetary claim". To limit grievors to a net monetary claim for this period would not properly reflect the losses sustained because of the respondent's conduct. The complaint was pursued immediately after the respondent's conduct on June 17, 1982. If the approach also constitutes a powerful disincentive to this type of first agreement violation, it is an approach well grounded in statutory policy. However, sight must not be lost of our treatment of this claim from April Ito June 17, 1982. The Board will continue to scrutinize the conduct of a complainant trade union over the period of its claim in the same manner in future cases. While the suggested approach in Canada Cement Lafarge, supra, cannot now be considered a primary measurement in strike situations, it remains very much a relevant consideration. Bargaining unit employees who did not strike are, of course, only entitled to the 9 percent increase that would have resulted from good faith bargaining.
Finally, we have come to the conclusion that the grievors reinstated by the Board's order of May 25, 1981 would have acted reasonably in the circumstances if they did not seek work elsewhere from December 3, 1980 to February 13, 1981 when the Board directed the respondent to execute the collective agreements based on the memorandum agreement dated December 3, 1980. During that period a grievor could justifiably have concluded that the alternative to employment with the respondent was continued strike action. However, after February 13, 1981, this frame of mind would have been no longer reasonable and the grievors were obligated to mitigate their losses like all other grievors pursuing remedies under this Act. See Little Bros. (Weston) Limited, [1975] OLRB Rep. 83 at page 91; Radio Shack, supra, page 1254.
In summary then, the answers to the issues placed before us are:
The period of entitlement over which monetary losses from bargaining violations are to be calculated is from April 1, 1980 to December 3, 1980.
The appropriate measure from April 1, 1980 to June 17, 1980 for all bargaining unit employees is the net monetary claim as described herein and the gross monetary claim is appropriate in relation to striking employees from June 18, 1980 until December 3, 1980.
After February 13, 1981 grievors affected by the Board's decision of May 25. 1981 were obligated to take reasonable steps to mitigate their losses.