[1984] OLRB Rep. December 1682
2156-84-R Retail, Wholesale and Department Store Union, AFL:CIO:CLC:, Applicant, v. Beacon Vanier Taxi (1984) Co. Ltd. Eastway Taxi Bob Labrie Taxi, Respondents
BEFORE: R. O. MacDowell, Vice-Chairman, and Board Members W. H. Wightman and C. A. Ballentine.
APPEARANCES: Frank Reilly for the applicant; no one appearing for the respondents.
DECISION OF THE BOARD; December 18, 1984
The name of one of the respondents is amended to read: Beacon Vanier Taxi (1984) Co. Ltd.
This is an application for certification.
The Board finds that the applicant is a trade union within the meaning of section 1(l)(p) of the Labour Relations Act.
In this application for certification the union seeks to represent a group of drivers and owner-operators engaged in the taxi business in Ottawa, Ontario. The application raises a variety of problems. The applicant union submits that the three respondents should be treated as one employer pursuant to section 1(4) of the Labour Relations Act; moreover, there is also a question concerning the description of the appropriate bargaining unit. This problem arises because of the uncertain status of certain "owner-operators" who may be "dependent contractors" within the meaning of section l(l)(h) of the Act. Under section 6(5), dependent contractors are entitled to their own separate bargaining unit and may only be included in a "mixed unit" with other employees if there is evidence to satisfy the Board that a majority of the dependent contractors wish to be included in such "mixed unit". Finally, there is a question as to the identity of the "real employer" of these individuals — hence the union s submission that, in substance, the three business entities named as respondents should be treated as one employer for the purposes of the Act.
Notice of this application and of the hearing, in Form 4, was served upon each of the named respondents. That notice specifically indicates that there would be a hearing before the Board, in Toronto, on November 30, 1984, and that the purpose of the hearing is "to hear the evidence and representations of the parties with respect to all matters arising out of and incidental to, the application". The respondents are advised that:
IF YOU DO NOT AFFEND AT THE HEARING, THE BOARD MAY PROCEED IN YOUR ABSENCE AND YOU WILL NOT BE ENTITLED TO ANY FURTHER NOTICE IN THE PROCEEDINGS.
In response to the application and notice of hearing, the respondent Beacon Vanier Taxi (1984) Co. Ltd. filed a reply and a Form 74 Declaration indicating that notice to employees of the application had been posted in conspicuous places where such notice would most likely come to the attention of all employees who might be affected by the application. Beacon's reply asserted that it had no drivers in its direct employ.
Eastway Taxi did not file a reply. However, Mr. Ouellett, its "president", also filed a declaration of posting in Form 74, and executed a waiver of hearing form in which, on behalf of Eastway, he consented to the Board issuing a decision in this matter based upon the material filed without a hearing. Bob Labrie Taxi (said to be correctly described as "Robert Labrie") filed a reply but did not indicate any position with respect to the request for a section 1(4) declaration, or anything else.
When the matter came on for a hearing before the Board on November 30, 1984, no one appeared on behalf of any of the named respondents. The applicant union was caught somewhat by surprise. It had anticipated their appearance — particularly in light of its request for the application of section 1(4) of the Act, and section 1(5), which reads as follows:
(5)Where, in an application made pursuant to subsection (4), it is alleged that more than one corporation, individual, firm, syndicate or association or any combination thereof are or were under common control or direction, the respondents to the application shall adduce at the hearing all facts within their knowledge that are material to the allegation.
The Board waited, for a time, to see if the respondents were simply late, then, on the union's request, heard the union's evidence and representations — which, in the circumstances, were uncontradicted and unopposed.
A good deal of that evidence was impressionistic or based upon hearsay, and while the Board is entitled to admit and rely upon such evidence (see section 15 of the Statutory Powers Procedures Act), we are not entirely sanguine about doing so. On the other hand, the applicant union and the Board have been put in that position solely because none of the respondents saw fit to appear at the hearing — despite the express warning (in bold type) on the notice of hearing which they obviously received. Given that express warning, and the fact that time is of the essence in certification matters, the union was entitled to, and eventually did insist upon proceeding in the respondents' absence — waiving its right to rely upon section 1(5) and "taking a chance" that its own (unrebutted) evidence would be sufficient to tip the balance in its favour. Nevertheless, the Board is troubled by the absence of more precise evidence concerning the commercial relationship between the named respondents. The situation would have been much clearer if they had attended at the hearing.
The union's chief witness was Larry Phalen, who testified that he has a number of years' experience in the taxi industry. He told the Board that the taxi business involves three kinds of "players": a "broker" who runs a dispatch service accepting calls from customers for cars which may be owned or driven by others; "owners" who own the cabs, either outright or pursuant to a hire purchase, installment payment, or rental agreement; and "drivers" who are licenced to operate the cabs. The driver is dependent upon the owner who supplies the vehicle and the broker who supplies dispatch and related services. In the instant case, the "broker" is Beacon Vanier, the apparent owners of most of the cabs are either John Ouellett carrying on business as Eastway, or Bob Labrie. There are also several drivers who own their own cab and have a direct relationship with Beacon Vanier but none with Eastway or Labrie.
Phalen testified that, to the best of his knowledge, Beacon Vanier owns the dispatch system, certain building facilities, and the taxi licence plates attached to all the vehicles. Beacon Vanier controls those taxi licences which are necessary for the automobile to operate as taxicab. Ouellett and Labrie each own a fleet of cars and, with Beacon Vanier's approval, recruit drivers to run them. Such persons recruited by Ouellett or Labrie (acting as "middle men") must sign a contract directly with Beacon Vanier. Phalen put in evidence a copy of a contract between Pete Seguin and Beacon-Vanier Taxi Rental & Service Ltd. which reads as follows:
THIS AGREEMENT MADE in duplicate this
17th day of Aug., 1984.
Between:
BEACON-VANIER TAXI RENTAL & SERVICE LTD
(herein after [sic] called the "Company")
of the First Part, and —name Pete Seguin
(herein after [sic] called the "Contractor") of the Second Part
WHEREAS the Company carries on the business of providing a taxi service under the firm name and style of Beacon-Vanier Taxi Rental & Service Ltd. and the said business is conducted by means of a call dispatch system run by the Company and through taxi contracts by the Company.
AND WHEREAS the Contractor has requested that the Company allows him to pay stand rent for his own purposes including use in his employment.
The Contractor hereby agrees to pay the Company the sum of $45.00 for each day Stand rent. The Contractor using his own vehicle in his employment shall be responsible to carry his own coverage of C.P.P., U.I.C., and other matters. The Company's responsibility shall be limited to Dispatch Calls.
This agreement may not be assigned without the written consent of the Company.
This agreement shall ensure to the benefit of and be binding upon the heirs; executors, successors and assigns.
In witness whereof the Company has hereunto affixed its Corporate Seal, attested by the hands of its proper officer and the Contractor has hereunto set his hand and Seal.
Beacon-Vanier Taxi Rental & Service Ltd.
"John P. Ouellett"
The Contractor "P. Seguin"
It will be seen that the document establishing a contractual relationship between Seguin and Beacon-Vanier, and providing for the payment of certain "stand rent" is signed on behalf of Beacon-Vanier by John Ouellett, the principal of Eastway.
The system seems to be that the driver pays a fee to Ouellett for the vehicle, equipment and dispatch services, and Ouellett, in turn, pays a portion of that fee to Beacon-Vanier. The witness did not know the precise relationship between Ouellett and Beacon Vanier. The drivers work through either Eastway (Ouellett) or Labrie. They do not interchange. The drivers regard themselves as being employed by both Beacon Vanier and Eastway (Ouellett) or Labrie. Phalen did not know the details of the relationship between Beacon Vanier and the five owner-drivers.
The drivers depend for the majority of their calls and, hence their income, upon the dispatch services provided by Beacon Vanier. Beacon Vanier has rules respecting driver appearance, courtesy, and promptness. The drivers must conform to those rules. Customer complaints are directed to Beacon Vanier. Driver discipline is maintained by Beacon Vanier's dispatcher who has the authority to discipline drivers by refusing them calls. Beacon Vanier may also refuse dispatch services to drivers who have not remitted their daily fees through Ouellett.
Beacon Vanier has a charge or "chit" system available to its regular customers. Those chits bear Beacon Vanier's name. Upon receipt from a customer, the driver can give the chit to Ouellett for reimbursement, can approach Beacon Vanier directly, or can tender a series of chits in satisfaction of the prescribed daily stand rent.
Although, as we have already noted, there are at least five individuals who own their own vehicle and have no direct relationship with Ouellett or Labrie, the union drew no such distinction during its organizing campaign. Each driver was approached at or in his vehicle and invited to sign a membership card which reads as follows:
I hereby request and accept membership in the Retail, Wholesale and Department Store Union and promise to abide by the Bylaws of the union and the Constitution of the International Union. I authorize the union to represent me in any negotiations concerning wages, hours, and working conditions with my employer.
These cards were signed in group situations, which included both drivers and owner-operators, or following a meeting which likewise included both categories of driver. There is no evidence that the drivers drew any distinction, nor that the owner-operators, when they signed their cards, had any objection to being included for bargaining purposes in a unit along with their fellow drivers. On the contrary, Harry Ghadban (a union official) described an incident in which all of the drivers engaged in a work stoppage (subsequently settled) because some of their number had been "disciplined" by denying them access to the dispatch services. All of the drivers, including the owner-operators, participated in this work stoppage in a demonstration of solidarity. At the time the owner-operators indicated that they were prepared to support their fellow drivers because they were "all in this together" and had to "stick together". None of the individual owner-operators responded to the notice of this application to indicate opposition to a mixed unit. In summary, the only evidence before the Board suggests that if the owner-operators are considered as "dependent contractors", they are content to the included in the same bargaining unit as the other drivers.
- Section 1(4) of the Act reads as follows:
Where, in the opinion of the Board, associated or related activities or businesses are carried on, whether or not simultaneously, by or through more than one corporation, individual, firm, syndicate or association or any combination thereof, under common control or direction, the Board may, upon the application of any person, trade union or council of trade unions concerned, treat the corporations, individuals, firms, syndicates or associations or any combination thereof as constituting one employer for the purposes of this Act and grant such relief, by way of declaration or otherwise, as it may deem appropriate.
Section 1(4) was enacted in 1971, and deals with situations where the economic activity giving rise to the employment or collective bargaining relationships regulated by the Act, is carried out by or through more than one legal entity (several individuals, companies, a joint venture, etc.). Where such legal entities carry on related business activities under common control or direction, the Board is empowered to pierce the corporate veil or treat the entities, which at common law are legally separate, as one employer for the purposes of the Act. Section 1(4) ensures that the representational rights of the union and its members will attach to a definable commercial activity rather than the particular legal vehicles through which that activity is carried on. Legal form is not permitted to dictate or fragment what would otherwise be a coherent bargaining structure; nor will alterations in such legal form undermine established bargaining rights. Frequently, section 1(4) is invoked to preserve established bargaining rights which might otherwise be eroded by a change in the legal identity of the employer and the application of the common law notion of privity of contract. But it may also be invoked on a certification application where the evidence suggests not only related activities, but a form of joint control over important aspects of the employment relationships which would be the subject of collective bargaining. Section 1(4) avoids the difficulties which can sometimes arise in identifying "the real employer" of a group of employees. Of course, section 1(4) is discretionary. Even if its prerequisites are established, the Board need not apply it where there is no sound collective bargaining reason for doing so — for example, where ascribing bargaining rights to one of the related entities could be done without posing problems for bargaining or collective agreement administration stemming from the uncertainty as to the identity of the true employer with whom the union must bargain and who will exercise the statutory and contractual rights established by the Act.
There is no doubt in the instant case that the respondents are engaged in related activities or businesses. The employees are certainly under the common control and direction of the respondents; moreover, Eastway and Labrie certainly appear to be acting under the direction of or as agent for Beacon Vanier. Whether, in law, Ouellett is an employee of Beacon Vanier payable by some form of commission, or an independent contractor acting on his own behalf and also on behalf of Beacon Vanier, the fact is that he appears to have signing authority for the latter firm. (See the contract mentioned above.) Indeed, many of the indicia of control would suggest that it is Beacon Vanier rather than Ouellett or Labrie who is the "real employer" of the individuals whom the union seeks to represent — even though Ouellett and Labrie may also have certain authority to hire or fire subject to Beacon Vanier's approval. Be that as it may (and noting the difficulties with the evidence mentioned above), there is certainly a prima facie case for a 1(4) declaration and no reason advanced by the respondents why it should not be granted.
Having regard to the foregoing, the Board finds and declares that the respondents are to be treated as one employer for the purposes of the Act. The Board further finds that the unit of employees appropriate for collective bargaining should be a "mixed unit" consisting of all drivers and owner-operators of the respondent(s) licenced by the Municipalities of Gloucester and Vanier in the Ottawa-Carleton region, save and except dispatch staff, supervisors, fleet owners, and persons above the rank of dispatch staff, supervisors, and fleet owner".
There is some considerable discrepancy between the number of employees that the union claims are in the above-described unit and the number identified by the respondents in their replies. However, it appears that regardless of the resolution of this dispute concerning the precise composition of the bargaining unit, more than fifty-five per cent of the employees of the respondent, at the time the application was made, were members of the applicant on November 20, 1984, the terminal date fixed 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.
Accordingly, pursuant to section 6(2) of the Act, the union will be certified on an interim basis in respect of the bargaining unit set out in paragraph 18 above. A formal certificate must await a resolution of the dispute concerning the precise composition of the bargaining unit. To this end, the Board hereby appoints an Officer to inquire into the employee lists and composition of the bargaining unit and to report to the Board with respect to this matter.