[1983] OLRB Rep. November 1869
0708-82-M; 0709-82-M International Association of Bridge, Structural and Ornamental Iron Workers, Applicant, v. Ontario Hydro, Respondent
BEFORE: Owen V. Gray, Vice-Chairman and Board Members J. D. Bell and H. Kobryn.
APPEARANCES: John M. Wissent, Norman Brown and Mike Zimmerman for the applicant; Michael Hines and Tony Mollica for the respondent.
DECISION OF THE BOARD; November 3, 1983
These are two referrals concerning the interpretation, application, administration or alleged violation of a collective agreement to the Board for final and binding arbitration pursuant to section 124 of the Labour Relations Act. These referrals were consolidated by order of this Board, differently constituted, on September 27, 1983.
These referrals were first scheduled for hearing on July, 1982, then adjourned sine die on consent of the parties and the Board. There was no request to reschedule these referrals until the Board received a letter from solicitors for the applicant union, dated August 23, 1983, the relevant portions of which read as follows:
We have this day been contacted by a Labour Relations Officer who advises that Mr. Norman Brown, the grievor, wishes to have these matters rescheduled for hearing and the Board requires the Union's acquiescence in this regard.
Accordingly, on behalf of the grievor, we request that the matter be rescheduled for hearing.
However, as we have previously pointed [sic] to Mr. Brown, the Union is not processing these Referrals on his behalf but the Union takes the position that Mr. Brown is free to do so on his own behalf. Accordingly, in arriving at hearing dates suitable to all of the parties, we suggest that the Board contact Mr. Brown directly, although we would appreciate being advised of any rescheduled hearing dates.
As a result, these referrals were scheduled for hearing September 27, 1983. When the matter came before the Board on that day, Mr. Brown was in attendance and requested an adjournment for the purpose of obtaining legal counsel. The Board then ruled that the matter would be adjourned to October 17th on terms, inter alia, that Brown advise the parties and the Board of the name and address of counsel as soon as counsel was retained. Mr. Brown complied with that condition prior to October 17, 1983.
- In the meantime, the solicitors for the applicant union again wrote to the Board. The relevant portions of their letter dated October 3, 1983 are as follows:
We attended on behalf of our client the hearing in the above matter on September 27 last. We again wish to make our client's position clear. As we stated in our letter of August 23, 1983, and as we stated to the Board at the hearing, our client is not processing these Referrals on behalf of the grievor, Norman Brown, although he is free to process them on his own behalf. Accordingly, our client is no longer the Applicant in these Referrals.
We write to you with respect to this in view of any liability that may be incurred pursuant to Section 124(4) of the Act. As our client is no longer the Applicant, it is our view that such liability, if any must be borne by Mr. Brown himself.
(emphasis added)
The author of this letter was in attendance on October 17, 1983 as counsel to a witness subpoenaed by the respondent employer. At the outset of the hearing, the Board indicated to him and to counsel of record for the parties that the emphasized portions of his letter gave the Board concern with respect to its jurisdiction to continue to hear the referral. The Board's concern was whether the applicant union's characterization of itself as "no longer the applicant" was tantamount to a withdrawal of the referral.
The author of the letter argued that an applicant in a referral under section 124 could make any arrangement it wished with the grievor (or anyone else) to handle the presentation and argument of the grievance before the Board. He characterized the union's arrangement with the grievor as an "assignment" which made the grievor a party to the referral in place of the union. He argued that nothing in section 124 prevented the free substitution of one entity for another as party to the referral. He said that the words "parties to the Board" in subsection (4) of that section should be read together as describing whatever entities finally appear before the Board at the conclusion of the process of substitution said to be available in the manner described. No authority was offered for any of these propositions.
After hearing these submissions and the submissions of the other counsel involved, the Board delivered the following oral ruling:
"Notwithstanding Mr. Fishbein's submissions, we are of the view that the parties referred to in subsection (4) of section 124 of the Act are the same parties referred to in subsection (2) of that section. So long as a referral remains before this Board, the referring party cannot isolate itself from the liability which arises under subsection (4) of section 124. The referring union may make private arrangements with grievors with respect to engagement of counsel, presentation of evidence and the internal allocation of costs of the proceedings. However, so far as the Board is concerned the referring union remains a party within the meaning of section 124(4) unless and until the arbitration is completed or the referral is withdrawn. The referring union cannot cease to be the nominal applicant without thereby terminating the referral."
The Board hereby confirms its oral ruling.
In the face of the Board's ruling, the solicitor for the union advised the Board that it would remain the named applicant in these proceedings, and that the solicitor selected by the grievor would present the applicant's case.
The parties agreed on the facts set out in the balance of this paragraph. The grievor, Norman Brown, had been an employee of Ontario Hydro at the Bruce Generating Station construction project. He started work there in early 1981, and was a member of the bargaining unit described in the applicable collective agreement between the union and the Electrical Power Systems Construction Association. Brown was discharged by Ontario Hydro, allegedly for cause, on January 8, 1982. He began working again for Ontario Hydro at the same project on May 6, 1982, and continued working there until June 4, 1982, when he was laid off. By two letters dated June 16, 1982, the union grieved Brown's discharge of January 8, 1982 and his lay-off of June 3, 1982. Those grievances were then referred to this Board, scheduled for hearing and adjourned as noted above.
With this background, counsel for Ontario Hydro made two preliminary objections to the Board's jurisdiction to deal with the grievances. The first was that these grievances had been settled and there was, accordingly, nothing for the Board to arbitrate. The second was that the extreme delay in bringing the referrals back before the Board should lead the Board to decline to hear the grievances. Counsel for the employer requested that the Board hear evidence and argument on these preliminary objections before entertaining evidence and argument on the merits. Counsel for the grievor took the position that all the evidence, including evidence solely relevant to the merits, should be heard at the same time. In response to questions from the Board, counsel for the employer indicated that he would call two witnesses on the question of settlement and delay, neither of whom would be called by him on any issue relating to the merits of the grievances. On those issues he said there would be four additional witnesses. Counsel for the grievor advised the Board that he would call one or two witnesses with respect to the settlement and delay, both of whom would also be called with respect to the merits. In addition, he would call a third witness with respect to the merits of the grievances. In those circumstances, the Board advised the parties that it would hear evidence and argument limited to the issues of settlement and delay and reserve on those issues pending the continued hearing dates which would have been necessary in any event in order to hear the anticipated evidence on the merits of the grievances.
The respondent's first witness was Donald J. Laut, Project Personnel Manager at the Bruce Generating Station Project. Mr. Laut has been with Ontario Hydro in various personnel capacities since January 1956. Thegrievance letters of June 16, 1982 were addressed to him, and he responded by letter dated June 29, 1982. While formally denying the grievances, his letter indicated a willingness to discuss them further. Mr. Laut left on vacation after this letter was sent. On his return from holiday, he learned that the Labour Relations Officer appointed in connection with these referrals had met with Mr. Miller of his staff and with the business agent of Local 736 of the Iron Workers, Mr. Zimmerman. He was told that the Labour Relations Officer had proposed a solution which Mr. Williams, Ontario Hydro's mechanical superintendent, had rejected despite the apparent willingness of the union to consider it.
Thereafter, Jim Phair, General Organizer of the applicant International Union, contacted Laut to explore further the possibility of a settlement. After several discussions with Phair and with members of his staff as well as with the mechanical superintendent on the project, Laut contacted Phair by telephone at the offices of the union's solicitors. He then told Phair that Ontario Hydro was prepared to accept a settlement which would involve Brown's re-hiring at the end of August, 1982 with no retroactive pay and with a seniority date agreed to by the parties. This settlement was accepted by Phair, who said he would discuss it with Brown and reduce it to writing in the form of a "memorandum". Brown's scheduled date for return to work passed without the arrival of Brown or the memorandum. Laut did hear from Phair, however, who told him that Brown had rejected the settlement they had made.
In cross-examination, Laut said the discussion of a memorandum was not unusual. He expected a written statement of settlement as a matter of course when settling grievances, although the written statement would more often be generated by "signing off" on the standard grievance form usually used when a grievance is initiated. Asked why a written statement would be made after effecting what he claimed he had regarded as a firm oral agreement, Laut replied that it would be made "for record purposes".
The second witness on behalf of the employer was James Phair. Phair confirmed Laut's evidence. He confirmed that the terms of settlement discussed were that Brown could have his job back with seniority dating back to August 1, 1981, but without retroactivity as far as pay went. In their telephone conversation, Laut had advised him that Brown could start the next morning, which was August 24, 1982. Phair had then spoken to Brown, who was present at the union's solicitors' office. Brown agreed that he would take the settlement offered, although he did so reluctantly. When Phair told Brown that he could go to work the next day, Brown said he had prior commitments and would prefer to start the following Monday, August 30, 1982. Phair then called Laut back and told him Brown was in agreement with the terms of the settlement, but would prefer to start the following Monday rather that the following day. Laut told Phair that Ontario Hydro could accomodate Brown in that respect. Phair then told Laut that Zimmerman, the business agent for Local 736 of the union, would hand-deliver minutes of settlement to the project the following day. Phair said he thought a settlement had been reached by this point.
After the last of his conversations with Laut, Phair told Brown to meet him and Zimmerman at the Constellation Hotel the following morning to execute minutes of settlement. When Brown met with Phair at the Constellation Hotel the following morning, he told Phair that he had changed his mind. He asked whether he could return to work the following Monday but still process the grievance with respect to back pay. Phair told him he could not, pointing out that getting his job back was part of an overall settlement which required him to give up the possibility of retroactive pay and accept the deemed August 1, 1981 seniority date. Brown expressed concern that this seniority would not be sufficient to prevent Ontario Hydro from trying to get rid of him again. Despite Phair's assurances that this seniority seemed adequate to survive the next round of lay-offs, Brown persisted in his refusal to sign the minutes of settlement. He told Phair that he wanted to pursue the matter on his own. Phair then told Brown he was going to close the union file on these grievances. He told Brown he felt the union had secured the best settlement they could possibly get for him, and if Brown wanted to go on with it on his own that was his prerogative. He then contacted Laut and told him Brown had not signed and that the union would not proceed with the grievances.
Phair made it clear during cross-examination that the delay between completion of his telephone conversations with Laut and presentation of the minutes of settlement to Brown was not for the purpose of affording Brown an opportunity to consider the settlement, but merely resulted from the logistics of having the minutes typed up. Phair also made it clear that he felt the contents of the minutes of settlement shown to Mr. Brown on August 24. 1982 accurately reflected the terms settled by Phair and Laut during their telephone conversations the previous day and agreed to that day by Brown.
In his evidence, the grievor confirmed he had met with Phair and Zimmerman first at the offices of the union's solicitors, and again the following day at the Constellation Hotel. He acknowledged that the terms of settlement discussed between Phair and Laut had been discussed with him, and that at the first meeting he had "verbally agreed" to take the settlement. He said that he changed his mind after leaving the meeting. He became concerned about the seniority provided for in the settlement. He did not think it was enough, and worried that the company might not honour it. When he met with Phair and Zimmerman the following day, he was shown minutes of settlement which he conceded reflected the terms to which he had "verbally agreed" the day before. He refused to sign the minutes of settlement because of his change of mind.
Mr. Brown confirmed having received a letter from Mr. Phair dated August 26, 1982 which read, in part, as follows:
"As you will undoubtedly recall, you and I and Mike Zimmerman, Business Agent of Local 736, met in the offices of our solicitors on Monday, August 23, 1982 with respect to these matters. At that time, we discussed Ontario Hydro's offer to settle the grievances on the basis of your immediate reinstatement to the Bruce Generating Station with a seniority date of August 4, 1981. This appeared to be Ontario Hydro's final position and represented an increase of their last offer to settle, which was reinstatement with a seniority date of only November 1, 1981. The greater seniority date of August 1, 1981, would virtually have assured you of escaping the expected fall lay off at the Bruce Generating Station. We advised you that we thought it was an excellent settlement in the circumstances and you, after some deliberation, advised us that you would accept the settlement. Accordingly, we immediately notified the Personnel Manager at the Bruce Generating Station that the Union accepted the offer and that the grievances would be settled on that basis. In fact, as an accommodation to you Ontario Hydro even agreed that your first day of work would not be until Monday, August 30, 1982.
However, on Tuesday, August 24, 1982, when I and Mike Zimmerman met you with written Minutes of Settlement, you repudiated your earlier agreement to settle the matter on this basis and refused to sign the Minutes of Settlement. Accordingly, as I advised you then and as I advised you in the course of the meeting in our solicitors office, the Union cannot process your grievance any further."
The final witness on behalf of the grievor was Michael Zimmerman, the Assistant Business Agent for Local 736 of the Ironworkers. Zimmerman confirmed that the proposed seniority date which had been the subject of discussions was August 1, 1981. Another date which had been the subject of earlier of discussion was November 1, 1981. These discussions had been triggered by the suggestions of the Labour Relations Officer, and had revolved around giving Brown a seniority date as of "the first of' some month. On being shown the minutes of settlement, which designated August 4, 1981 as Brown's new seniority date, Zimmerman noted that August 1, 1981 was a Saturday and August 4th was the Tuesday following the Civic holiday Monday. He said he had not noticed the difference between August 1st and August 4th in the minutes of settlement and did not remember anyone else commenting on the difference at the meeting of August 24, 1982, at the Constellation Hotel.
Counsel for the respondent employer argues that the evidence discloses an oral settlement of the matters raised in the grievances referred to this Board. He argues that this precludes the Board from proceeding with the referral.
Counsel for the grievor argues that the matter was not settled. He asks us to find that the conversations between Laut and Phair contemplated as pre-conditions to a final settlement both the grievor's agreement with its terms and the execution by all parties, including the grievor, of a document reflecting those terms. He asks us to find that, from the grievor's point of view, there was no settlement until he signed the document. He argues that there was at least one issue, seniority, which had not been resolved to the grievor's satisfaction and therefore could not be said to have been settled. He points out that while the oral discussions provided for a deemed seniority date of August 1, 1981, the minutes of settlement prepared and placed before Mr. Brown referred to August 4, 1981. He argued that we should take into account that the reasons for the grievor's change of heart might be good ones. Finally, counsel for the grievor asks us to weigh the costs to the grievor of having "the rug pulled out from under him" against the prejudice to the company if the grievances are now arbitrated on their merits.
On the evidence before us we have no difficulty finding that on Monday, August 23, 1982, the trade union and the employer concluded an oral settlement agreement, the terms of which were that the grievor could return to work August 30, 1982 without back pay and with seniority calculated from "the first of" August, 1981. We find that the grievor accepted these terms, and that his acceptance was communicated to his employer in the course of finalizing the details of the oral settlement. Accordingly, it is not necessary for us to determine whether the grievor' s concurrence was or was not a pre-condition to settlement at any point prior to the last of the conversations between Phair and Laut.
As to the reference to August 4th in the minutes of settlement prepared by the union, we find the union's use of that date consistent with its apparent understanding that August 4th was effectively "the first of" August, 1981 for seniority purposes. If that was not Brown's understanding as well, we would have expected him to say so on August 24, 1982 or in his evidence before this Board. His testimony that the memorandum did reflect the terms to which he had agreed persuades us that the difference between the two dates is inconsequential. In any event, if this understanding was mistaken, if August 4th was not "the first of the month" for seniority purposes, then this was a minor and unilateral mistake by the union which in no way detracts from the clear agreement of the parties that the grievor' s seniority would date from "the first of' August, 1981.
We also find that on August 23, 1982, after the terms of the agreement had been settled orally, the parties to the agreement expected that those terms would be reduced to writing in a document to be executed by the union and delivered to the employer. There is no evidence that the employer expected the grievor's signature to appear on the anticipated document. Whether the grievor's signature was expected or required, however, the fact remains that the document was never executed by the union or, indeed, by the employer. What effect does this have on the arbitrability of the grievances which were the subject matter of the oral settlement?
Nothing in the collective agreement, the Labour Relations Act or the common law requires that the terms of settlement of a grievance arising under a collective agreement be reduced to writing before that settlement can be enforced.
Although the settlement of a grievance need not be made or evidenced in writing, it very often is. That was certainly the experience of the trade union and employer witnesses in this matter. It is not hard to see why that would be so. A written memorandum evidencing the agreement of the parties greatly facilities the proof of, and thereby reduces the potential for dispute over, the agreement's existence or terms.
Of course, not every written agreement is a mere memorandum evidencing the terms of an existing oral agreement. In complex matters, negotiations may proceed orally until the parties feel they have reached agreement in principle, leaving the details to be worked out thereafter in the process of drafting a written agreement. To the extent the anticipated written agreement is required or expected to contain terms or resolve points not finalized during oral negotiations, it can fairly be said that there is no agreement until the required document has been finalized and executed. Delivery and execution of the anticipated document is, in those circumstances, a pre-condition to the existence of a binding agreement. In each case where a written agreement is contemplated, it is "a question of construction, whether the parties intended that the terms agreed should merely be put into form, or whether they should be subject to a new agreement the terms of which are not expressed in detail.": (Winn v. Ball, (1877) 7 Ch. D. 29 per Jessel, M.R. at p. 32; see also Re Dominion Stores Limited and United Trust Co. et al, 1973 CanLII 692 (ON HCJ), 42 D.L.R. (3d) 523 (Ont. H.C.) at pp. 527 to 529; aff'd 1974 CanLII 32 (ON CA), 52 D.L.R. (3d) 327 (Ont. CA.); aff'd 1976 CanLII 33 (SCC), 71 D.L.R. (3d) 72 (S.C.C.)).
The purpose of any grievance arbitration process is to secure prompt, final and binding settlement of disputes involving the application and interpretation of collective agreements, in the interest of industrial peace (see Heustis v. New Brunswick Electric Power Commission, [19751 2 S.C.R. 768 per Dickson, J. at 781). The pre-arbitration grievance procedures typically provided for in collective agreements afford the parties an opportunity to resolve disputes promptly, informally and without the expense of arbitration. The requirement that such procedures be exhausted before proceeding to arbitration enhances the prospects of settlement. Section 124(2) serves a similar purpose by providing for the appointment of a Labour Relations Officer to endeavor to effect a settlement before the Board conducts a hearing. Our labour relations system relies on and values the ability to settle disputes. This Board is loath to adopt any approach which might limit or impair the settlement process or discourage its use: Crown Electric, [1978] OLRB Rep. Apr. 344; Bot Construction (Canada) Limited, [19821 OLRB Rep. Dec. 1811. It is important that boards of arbitration not impose unnecessary technicalities or limitations on the settlement process,because to do so would undermine the finality of settlements parties feel they have achieved in good faith. (See Ford Motor Company of Canada Ltd., (1952) 3 L.A.C. 1159 (Lang) at 1161; City of Sudbury, 1965 CanLII 991 (ON LA), 15 L.A.C. 403 (Reville); Re Continental Can Co. of Canada Ltd., 1975 CanLII 2055 (ON LA), 10 L.A.C. 35 (Weatherill).)
The question of the efficacy of an oral settlement agreement arose in Re But-Rite Upholstering Co. Ltd., 1979 CanLII 4007 (ON LA), 24 L.A.C. (2d) 428 (Rayner). In that case an arbitration hearing had been adjourned pending settlement discussions. When the hearing resumed, company counsel took the position that the matter had been settled in the meantime. Union counsel took the position that the matter had not been settled. Both counsel agreed that their settlement discussions had reached a point at which they had reached oral agreement on the terms of a settlement which had been reflected in an unexecuted handwritten draft agreement which both counsel had pronounced satisfactory. The handwritten draft had been typed up and the typed version circulated for execution. At that point, union counsel had learned of the possibility of retroactive legislation which might make taxable the payment of damages contemplated by the settlement. That had led the union to refuse to sign the minutes of settlement. The union then argued that the settlement had to be in writing and signed to be binding, by analogy with collective agreements. It also argued that the parties' intention had been that there would be no binding settlement until all documentation was complete. The board of arbitration in that case concluded,at p. 430-431:
The Board is of the opinion that the parties reached settlement on all substantive matters. There were not matters left in dispute after the parties had reached their settlement. It is true that the settlement contemplated the reduction of the settlement to writing and signing by both parties. However, in our view, this was a mere procedural matter and was not an essential part of the settlement. If the union had suggested that there was [sic] some substantive terms that had not been covered by the settlement, the matter would be quite different. No suggestion was forthcoming.
The Board is also of the opinion that the analogy that union counsel attempted to draw between the settlement and the requirement that a collective agreement be in writing is not persuasive. There is no doubt that the grievor approved the settlement at the conclusion of the hearing. Thence was ratification, if such was necessary at that time. Obviously, a collective agreement is far different in scope and impact from minutes of settlement. In the first place, the collective agreement covers a multitude of employees and is drawn to cover many possible future situations and potential areas of conflict. A collective agreement must also be ratified by members of the bargaining unit. All of these reasons indicate the purpose behind the provisions of the Ontario Labour Relations Act, R.S.O. 1970, c. 232, which require an agreement to be in writing. These reasons do not pertain to a settlement.
Moreover, one cannot conclude that the settlement should be vitiated simply because of some potential impending legislation that may or may not be enacted and may or may not be retroactive.
In essence, the parties reached agreement on all terms and should be held to that agreement.
Accordingly, the board concludes that the parties reached agreement and the grievance is no longer arbitrable.
We come to the same conclusions in this case as did the board of arbitration in Bitt-Rite. There were no matters left in dispute after Laut and Phair had reached their settlement. Ratification, if it was necessary, was provided by the grievor. We find that the creation and signing of a memorandum contemplated by Messrs. Laut and Phair was a procedural matter and not an essential part of the settlement they reached.
The grievances referred to the Board in these proceedings were settled in August of 1982. They are, accordingly, no longer arbitrable, and they are hereby dismissed.
In the result, it is unnecessary for us to review the evidence and argument we heard on the question whether the grievor's delay should result in a dismissal of these grievances. It is also unnecessary to hear evidence with respect to the merits of the grievances. Accordingly, the hearing dates of November 22 and 23 set aside for that purpose are hereby cancelled.