[1982] OLRB Rep. August 1179
0431-82-R Canadian Union of Public Employees, Applicant, v. Regional Municipality of Hamilton-Wentworth, Respondent
BEFORE: R.O. MacDowell, Vice-Chairman, and Board Members S. Cooke and F.W. Murray.
APPEARANCES: Helen O'Regan for the applicant; C. E. Humphrey, L. Fleming, T.A. Cruicks hank for the
respondent.
DECISION OF VICE-CHAIRMAN R.O. MACDO WELL AND BOARD MEMBER S. COOKE; August 26, 1982.
This is an application for certification.
The Board finds that the applicant is a trade union within the meaning of section l(l)(p) of the Labour Relations Act.
Having regard to the agreement of the parties, the Board further finds that if the individuals potentially affected by this application are "employees" of the respondent, the unit of those employees appropriate for collective bargaining should be described as follows:
All employees of the respondent employed at 50 Murray Street West, in the City of Hamilton, save and except supervisors, employees above the rank of supervisor, and clerical employees".
In so finding the Board notes that the bargaining unit description was not put in issue before us, and in accepting the parties' agreed description, we do not resile from the Board's general reluctance to accept descriptions which directly or by implication are limited to an employer department or (in the case of a public employer) a program.
The respondent contends that the individuals potentially affected by this application are not its employees; rather, they are participants in a rehabilitation program designed merely to simulate employment. The respondent argues that they are not entitled to form or join a trade union, or bargain collectively under the Labour Relations Act. The applicant union concedes that the employment of these individuals has a rehabilitative aspect, but argues that they are nevertheless "employees" within the meaning of the Act. In the union's submission, the respondent may be an employer of last resort, but it is still an employer to which the Act applies.
The Helping Hands program has been operated by the Social Services Department of the Hamilton-Wentworth region since 1976 when it was determined that there was a need to provide home maintenance and related services to elderly citizens who by reason of age or infirmity could no longer provide for themselves. But since the provision of these services (i.e. cleaning, washing windows, installing screens or storm-windows, defrosting refrigerators, fetching groceries, cutting lawns, etc.) did not require any particular skills, it was decided that they could be provided by individuals on the Municipal Welfare Rolls at minimum cost, and some advantage to both the persons employed, and the recipients of their services. In this respect, it might be said that the program has two purposes: to assist the elderly; and to assist some of the chronically unemployed individuals on the welfare rolls, who through working with the respondent might be able to both provide for themselves through their own efforts and improve their job habits and skills sufficiently so as to be able to compete in the regular job market. By employing individuals on the municipal welfare rolls, the respondent hopes to provide not only services to persons in need, but also useful employment experience to persons who have previously had difficulty holding a job.
For the most part, the senior citizen clients do not pay for the services they receive, and those who do, do not pay the full value. Initially, the program was substantially funded by a Federal Government Local Initiatives Program grant. It is now funded to the extent of some 80% by the province and 20% by the municipality. Funding is reviewed annually and the number of individuals in the program is governed accordingly. There is no evidence concerning the particular statute pursuant to which these funds are dispersed or the government department(s) through which they are administered.
Potential "participants" are drawn from the Municipal Welfare Rolls and may be referred by social workers, Canada Manpower, or other agencies concerned with employee retraining. Participants fill in an application at the municipality's welfare office and are interviewed by Ruth Cioruch, the project manager. Ms. Cioruch was formerly employed by the Amity Rehabilitation Centre which runs a program similar to that of Goodwill Industries She determines whether the applicants are appropriate and considers whether they are interested in earning a regular hourly wage, and "bettering themselves". Often the potential applicants are bored, have serious personal problems, or little education, and have been unemployed or only sporadically employed for long periods.
Ms. Cioruch testified that about one in eight applicants is selected. Those who appear apathetic or seem to be merely going through the motions, are rejected, or referred, if necessary, to other programs. Sometimes the persons hired have considerable work experience as for example, a former Stelco employee with 20 years work experience who went "off the track" because of an alcohol problem. Another participant in the program had worked successfully for Dofasco for a year but was laid off and had marital problems. The respondent gives priority to persons who have difficulty participating in a competitive labour market and who would otherwise be on social welfare. And, of course, the difficulties encountered by such individuals have been exacerbated by the current recession.
The program employs three supervisors, two dispatchers and a clerk typist. One of the supervisors was promoted to that position after working successfully in the program for 14 months. The participants work approximately 35 hours per week. For the first six months, they make $3.50 per hour. If Ms. Cioruch, the program director, is satisfied that they are trying to improve, they are advanced to $3.75 per hour and later, to a maximum of $4.00 per hour. In addition, the respondent provides the participants with bus passes, and drug cards in recognition of their low wage rates. When they have no specific duties to perform (i.e. no snow in winter or specific demands from the elderly clientele) the participants are kept busy working for related social welfare agencies, receiving counseling or learning techniques which would allow them to participate in a more competitive labour market. For example, they learn how to complete resumes, participate in interviews, etc. They are paid for the time when they are engaged in this process, although, normally, as already noted, they are fully occupied actually working for the senior citizens.
II. The program participants are regularly assessed on their performance, and such things as tardiness, attendance, level of concentration, and so on, are noted, and may trigger a remedial response in terms of counseling or otherwise. Misbehavior by one of the participants is dealt with in what the respondent considers to be a constructive way, either by counseling, discipline or both. An individual who fails to appear for work, may be suspended for a few days (after a verbal warning) to bring home to him that he has undertaken a responsibility to appear on a regular basis. Persons who are unable to follow instructions or have deep seated personal problems are terminated and sometimes referred to other social programs. Such persons go back on unemployment insurance or the municipality's welfare rolls.
The average participant stays in the program for between 18 months and 2 years. However, there are as many as five individuals who have continued to work for the respondent for as long as five years that is, since the program's inception. Participants are encouraged to seek employment elsewhere and many participants in searching for other jobs is paid for by the respondent. It is a mark of success when an individual "makes it" in the competitive job market, and finds a job with a regular employer. Thus, in contrast to a normal employer who wants to keep experienced employees, the respondent is not unhappy to see program participants improve their skills and work habits, and leave.
While working for the respondent, participants sign in on a time sheet which becomes their daily attendance record. For payroll purposes, a computer card is completed which is sent to the municipality and processed as part of its ordinary payroll. Deductions are made for the Canada Pension Plan, Unemployment Insurance, and Income Tax if such is payable. Participants work approximately 35 hours per week; but certain individuals who are attendant-companions to elderly citizens work irregular hours in accordance with the needs of the persons whom they are serving. While carrying out their duties, the participants in the program are spot-checked by supervisors who ensure that they are performing their duties in a satisfactory manner.
To this point we have used the respondent's terminology and have referred to the persons affected by this application as "participants". For the sake of convenience we shall continue to do so, however the question before the Board is whether they are also "employees" within the meaning of the Labour Relations Act.
If one applies the usual legal criteria to the relationship between the respondent and the participants, there is little doubt that it points to an employer-employee relationship. The participants are not volunteers, students, or independent contractors. They work for wages. They are interviewed, hired for a job and paid at a fixed rate computed hourly, from which the usual "employee" contributions (U.I.C., C.P.P., income tax, etc.) are deducted. Their wages are dealt with by the payroll department in the same manner as other employees. They perform tasks assigned by the respondent and subject to the respondent's express direction and supervision. Those tasks are not generically different from other social service functions performed by the respondent. The participants are providing services to the elderly which might not be provided otherwise, or would have to be provided with regular social service staff or municipal employees at much higher cost. While these services may not be considered essential to the ongoing operations of the region, one can envisage other municipal services which likewise are not "essential" in this sense. Adequate performance by the participants leads to limited advancement, while inadequate performance or misconduct may result in discipline or termination. Five of the twenty-eight individuals currently in the programme have worked for the respondent for more than five years. That is how they have earned their living, and the union submits that it would be incongruous for the Board to find that they are not employees with the same legal rights as other employees.
The respondent argues however that even if the participants have many of the characteristics of employee status the Board should consider the problem from a collective bargaining point of view. From this perspective, it is argued, it is extremely difficult to envisage the application of the usual machinery and sanctions of collective bargaining or to reconcile its premises with those of the program. In the respondent's submission collective bargaining is an alien process which is potentially disruptive to the special relationship between the respondent and its clients. In this regard we were referred to a decision of the National Labour Relations Board in Goodwill Industries of Southern Calfornia 96 LRRM 1061 which involved a rehabilitative work program for persons whose physical, emotional and social handicaps rendered them ineligible for work in private competitive industry. At page 1062-3 the NLRB commented:
"From the foregoing, it is clear that the Employer's clients whom Petitioner seeks to represent are employees in the generic sense of the term. Clients work for a set number of hours a day, perform functions which are of recognized economic value, and are paid for the performance of those functions. Nevertheless, it is equally clear that this employment relationship is different in many, if not most, significant respects from the normal employment relationship.
The focus of Goodwill's employment concern is upon rehabilitating its clients and preparing them for work in private competitive industry, not on producing a product for profit. Prospective clients are "hired" not on the basis of their competence, but on the basis of the severity of the impairments presumably the more severe their impairment, the more likely they are to be hired. Wages are the same regardless of the client's performance or tenure, and are as such an instrument of the rehabilitative process as they are recompense for productive activity. In addition, clients are counseled rather than disciplined, are rarely, if ever, discharged, and are allowed to continue their employment as long as they desire. The picture presented is thus that of an employer whose primary objectives are the converse of a normal employer's objectives —so much so that Goodwill might better be classified as a vocational clinic than as a viable entrepreneurial concern.
This unusual employer-client relationship presents us with that rare, possibly nonrecurring, instance where an employer's concern for the welfare of his employees competes with, and in some sense displaces, the Union's ordinary concern for employee well-being. The Union's normal objective — that of securing improved working conditions for the employees it represents is here avowedly and convincingly embraced by the Employer itself with, however, a difference in emphasis as to how that goal should be accomplished. To permit collective bargaining in this context is to risk a harmful intrusion on the rehabilitative process by the Union's bargaining demands. For example, if the Union demanded higher wages, this could well force the Employer to either reduce its client work force or hire more productive workers thus compromising the Employer's rehabilitative efforts. Union demands for higher benefits for senior employees might tempt the Employer to reconsider its policy of keeping clients on as long as necessary. Conversely, union demands for unlimited employment tenure could prejudice the Employer's efforts to provide charitable employment to as many disabled people as possible. The collective-bargaining process, in short, is likely to distort the unique relationship between Employer and client and impair the Employer's ability to accomplish its salutary objectives.
On the basis of the above considerations, we are convinced that, although clients may arguably be said to be employees within the meaning of the Act, it will not effectuate the purposes of the Act to assert jurisdiction over them. Accordingly, we shall dismiss the petition."
The respondent contends that the Board should adopt the same approach and conclude that the respondent's clients are not employees within the meaning of the Act.
- The respondent also drew our attention to a recent reference under section 51 of the Employment Standards Act concerning the employee status of an individual working in a Salvation Army sheltered workshop (see: Re Christine Kaszuba and Salvation Army Sheltered Workshop, decision of K.M. Burkett dated December 10, 1981). There, as in the instant case, the alleged employer argued that it provided only a "simulated" working environment for individuals who were not likely to be able to enter the competitive labour market, or who required such experience prior to entry into the competitive labour market. In Kaszuba there were 150 "clients" in the program, all of whom had been certified by a physician as medically unemployable. The majority of the clients were chronic schizophrenics who required continuing treatment and medication for their condition. The complainant Kaszuba, for example, had both psychiatric problems, and was subject to serious epileptic seizures.
These clients were paid a token rate of 50~ per hour, which was calculated with reference to the forgivable allowance under the Family Benefits Act of which most of the clients were recipients. At any one time 80 of the 150 clients would be involved in the school program offered in conjunction with the Toronto Board of Education wherein they would learn English grammar and literature, mathematics, typewriting, arts and crafts, business machines, etc. Two qualified teachers on the staff of the Toronto Board of Education were assigned full-time to the Workshop to carry out the teaching responsibilities. The Workshop also employed a professional hairdresser to help clients with their grooming and organized social activities including a period at a Salvation Army Summer Camp for persons who wished to attend. In all the circumstances, and particularly having regard to the medical evidence that a simulated working environment was a medically accepted tool in the rehabilitation of mentally handicapped unemployables, the referee concluded that the clients were not "workers" or "employees" under the Employment Standards Act. The respondent urges this Board to reach the same conclusion on the facts here.
Before dealing with Goodwill Services and Kaszuba we wish to indicate one feature of the evidence which we do not consider determinative. We do not attach much significance to the fact that an arrangement may be described as a "make work" scheme funded in whole or in part by the public purse. Over the years (and particularly in times of economic difficulty) many Canadians have derived their wages through work support program such as Dree, LIP, the Young Canada Works Program, and numerous other schemes for the support of employment through direct channeling of Government funds to employers both public and private. The whole purpose of such program is to draw on the pool of unemployed workers in an area or category (e.g. youth), and it is not at all unusual to find that such program give preference to the "hard core" unemployed, whose U.I.C. benefits have expired and who have little chance of finding other jobs. Nor is it unusual that such individuals would be employed by a public sector employer to do annual work of a community service character. And, as in the instant case, the number of jobs provided will be contingent upon the funds made available. In today's society there is nothing particularly novel about employment in a publicly funded "make work" program of limited duration where the participants have no real prospects of advancement. One may question the value of collective bargaining for such persons but that does not mean that they are not employees. (See: Waterloo Roman Catholic Separate School Board, [1977] OLRB Rep Dec. 856, and Kelowna Centennial Museum Association, [1977] 2 Can LRBR 285 — both of which involved persons employed in a government funded make work program, performing jobs which, but for those government funds would not be done.)
From a practical and policy point of view, we find that NLRB's analysis quite attractive. It is difficult to fit the circumstances here into the adversarial model upon which collective bargaining is based. The respondent's relationship with the participants is obviously not the same as that of a typical employer. Moreover, collective bargaining, if permitted, will take place under severe constraints. There are real impediments to the application of collective bargaining methods and sanctions (for example a strike). Indeed, one may well question the efficacy of formal collective bargaining for persons in the position of the participants here, and, as a practical matter, there may be little prospect of improving their economic circumstances without prejudicing the existence or scope of the programme itself. On the other hand, the NLRB view must be put in perspective. The issue there was somewhat different. We have to decide whether the participants are "employees", while the NLRB had to determine whether it would exercise its discretion to exert jurisdiction over a charitable institution whether or not the individuals affected were employees. The NLRB has a discretionary jurisdiction to extend or restrict coverage of the statute which has no counterpart in Ontario, and in exercising that discretion the NLRB can make its own subjective assessment of the desirability of permitting collective bargaining. That is why the NLRB could conclude that the individuals in question were "arguably employees" yet still dismiss the application. Here the issue and the scope for discretion is much narrower. This is not to say that the Board should ignore the statutory purpose in making this, or any other decision. It is simply that in determining the coverage of the Act itself, the governing statute gives the OLRB less latitude than the NLRB.
The Kaszuba decision provides a useful backdrop, against which the present case can be considered, but in our view the facts are readily distinguishable and the situation is this case is much closer to the line. The participants here are not medically certified as unemployable. They do not earn a token wage rate. They earn a rate fixed with reference to the minimum wage applicable to all employees in Ontario. This wage is not merely symbolic or an incentive. It is their livelihood, and some of them have been earning their living in this way for as long as five years. There is no program of teaching or social activities here. Counseling is secondary. The focus of the respondent's program is steady remunerative work. Here, although lacking in skills and perhaps chronically unemployed, the participants do appear to be more or less employable. Rehabilitation is an aspect but employment is the dominant theme. In the circumstances it is much more difficult to deflect the cumulative effect of the factors pointing to an employment relationship. And, of course, despite our own expressed reservations about the efficacy of collective bargaining, we must note that the vast majority of the participants have signed membership cards indicating their desire to engage in that process. Thus, while the respondent may regard itself as an altruistic entity concerned solely with the welfare of the participants, the participants themselves appear to regard their position as similar to that of other employees, and, like other employees, they are seeking a measure of self determination through the vehicle of collective bargaining.
We have found this case a particularly difficult one, for the individuals affected here are on the periphery of the Act's coverage, and neither the facts nor the policy considerations underlying the Act itself point unequivocally to the correct conclusion. And just as the Board has always given a liberal interpretation of the legislation in order to accomplish the objectives expressed in its preamble, it is our view that the Board should be equally careful about extending coverage where the logic of collective bargaining seems inconsistent with the character of the relationship potentially regulated. The concept of employment is a flexible one which must be determined, in part at least, by the statutory purpose and context. On balance, however, while this case is much closer to the line than Kaszuba, we are satisfied that the participants here must be considered "employees" even though the program has a rehabilitative aspect, and the respondent, as an employer of last resort, has objectives which are different from those of an ordinary employer. Nevertheless, we do not think that the cumulative evidence of an employment relationship (summarized in paragraph 15) can be ignored, nor are the contrary indications sufficient to alter that conclusion.
The Board is satisfied on the basis of all of the evidence before it that more than fifty-five per cent of the employees of the respondent in the bargaining unit at the time the application was made were members of the applicant on June 10, 1982,theterminaldatefixed for this application and the date which the Board determines under section 103(2)(j) of the
Labour Relations Act to be the time for the purpose of ascertaining membership under section
7(1) of the said Act.
- A certificate will issue to the applicant. 24. The opinion of Board Member F.W. Murray will follow.