Public Service Alliance of Canada v. Forintek Canada Corp. and Jacques Carette

[1985] OLRB Rep. July 1050

0721-85-U Public Service Alliance of Canada, Complainant, v. Forintek Canada Corp. and Jacques Carette, Respondents

BEFORE: Owen V. Gray, Vice-Chairman, and Board Members F. W. Murray and S. O'Flynn.

APPEARANCES: Denis J. Power, Aaron Rubinoff, Terry Kearney, Terry Ranger, Raymond Dubois, Peter Garrahan, Mary Mes-Hartree and Charlene Hogan for the complainant; Patricia J. Wilson, Ann Hayward, K. A. French and Jacques Carette for the respondents.

DECISION OF THE BOARD; July 26, 1985

1. This decision deals with a request by the complainant that the Board order the respondent Forintek to produce certain documents said to be relevant to the matters in issue in these proceedings. The request and the parties' submissions thereon were made July 18, 1985, near the end of the second day of the Board's hearing of this complaint. Presentation of the complainant's case in chief was then complete, and the Board had indicated it would not be calling on the respondent to commence presentation of its case before adjourning to September 23, 1985, the next date scheduled for hearing of this complaint. The nature of the request and the reasons for our response to it are best explained by first describing briefly the nature of this complaint and the circumstances in which the request arose.

2. The respondent Forintek is a body corporate engaged in research and development in the forest products industry. It is financed primarily by governments and, indeed, was a federal government organization prior to its "privitization" in 1979. It operates laboratories in Ontario and British Columbia. The complainant trade union was certified by this Board on August 17, 1979 to represent certain employees of the respondent at its Ontario laboratories, which are located in Ottawa. The latest of the parties' collective agreements with respect to this unit was signed April 17, 1984, and covers the period April 1, 1984, to March 31, 1985.

The respondent Jack Carette is a member of the corporate respondent's senior management who deals with employee relations matters and represents the corporate respondent in collective bargaining.

3. The complainant's allegations, as set out in its complaint filed June 25, 1985 and elaborated during the first two days of the Board's hearings, may be stated briefly (not exhaustively) as follows:

(a) Early in the term of the aforesaid collective agreement, Forintek unilaterally commenced a salary survey.

(b) After the complainant gave notice to bargain on January 2, 1985, the respondents advised it and the employees it represented that the salary survey had been completed and that Forintek had concluded that the salaries of certain employees were lagging behind those of their counterparts working in other companies. The respondents proposed making adjustments to the salaries of employees for the period January 1, to March 31, 1985, and solicited the complainant's permission to do so. However, the respondents refused the complainant's repeated requests for a copy of the survey and for particulars of the names of bargaining unit employees whose salaries it proposed to adjust and the amounts of those individual adjustments.

(c) When the parties began formal collective bargaining with a view to entering into a renewal collective agreement, the respondents again refused to provide the complainant with particulars of the survey or of the proposed salary adjustments. It refused to discuss those matters or treat them as the proper subject matter of collective bargaining. It refused to disclose the precise salary being paid to any employee in the bargaining unit unless the complainant could first produce a written release signed by the employee authorizing the disclosure of that information.

(d) During the period from the middle of February to the middle of June, 1985, the respondents repeatedly communicated directly with bargaining unit employees~ telling them that money was available to adjust their salaries if the complainant would only consent to the adjustments, that the complainant had not consented to the adjustments and that the complainant had offered no reason for refusing to consent. During that period the respondents also engaged in various conversations with employee members of the negotiating team and of the executive of the local union into which the bargaining unit was organized, without involving staff representatives of the complainant who were acting as spokespersons for the negotiating team and for the complainant union.

(e) On June 12, 1985, the respondent implemented salary adjustments on a retroactive basis without having secured the consent of the complainant. Some of the employees received no salary adjustment. One of those was the President of the local union.

(f) On June 21, 1985, Forintek's President spoke to employees represented by the complainant. The subject of his speech included the company's negotiations with the complainant trade union and the salary adjustments which the company had recently made. He accused the complainant union of treating employees unjustly and told them that a Ministry of Labour conciliator had expressed surprise at the union's approach to salary negotiations.

The complainant's position is that these and other alleged actions of the respondents amount to attempts by the respondents to effect an end run on the union by bypassing it and going directly to employees with respect to matters that should be part of the negotiations between the complainant union and the respondent employer. It alleges that the respondents have prevented a full, free, honest and rational discussion of issues outstanding between the employer and the union. It says that the conduct of the respondents was calculated to undermine and embarrass the union, and to foster dissension within the unit, so as to result in the respondent employer ridding itself of the union. It says the respondents' conduct frustrated bargaining and amounted to surface bargaining. The company's behaviour with respect to the salary adjustments, and particularly the granting of the salary adjustments, is also said to constitute an unauthorized and unlawful change in working conditions. All these actions are said to be contrary to the provisions of sections 15, 64, 66(a) and (c), 67(1) and 79(1) of the Labour Relations Act.

4. The respondents' position, as set out in their Reply, is that the aforesaid collective agreement permitted the pay increases which are the subject of this complaint. Those increases are said to be in conformity with a salary administration policy which has been communicated to the complainant and to employees. The respondents claim the policy is "to pay employees based on merit at the market average within its ability to pay." They say that:

... the Respondent [Forintek] has refused to negotiate the individual salary adjustments with the Complainant because the Respondent implemented the salary adjustments in question under the 1984-1985 collective agreement, which expired on March 31, 1985 and because the pay increases were allocated on the basis of merit. The Respondent's position on this issue is that the salary adjustments are irrelevant to the negotiation of a 1985-1986 collective agreement.

From the submissions of their counsel, the position of the respondents appears to be that the actual amounts paid to bargaining unit employees is not a matter which Forintek is obliged to disclose to the employees' bargaining agent, and in that respect the respondent proposes to argue that DeVilbiss (Canada) Ltd., [1976] OLRB Rep. Mar. 49 and the decisions which followed it were all wrongly decided. The respondents say their direct communications with employees were merely for the purpose of explaining Forintek's position and clearing up confusion which it perceived among employees on the issues addressed. The respondents deny they acted contrary to the Labour Relations Act in its allocation and distribution of pay increases and denies, further, that they intended to undermine the union or to avoid collective bargaining.

5. The request counsel for the complainant made at the conclusion of the first two days of hearing of this complaint was that the Board direct the respondents to produce the following documents:

(1) Accounting records showing the amount of salary paid to each bargaining unit employee

(a) In the last payroll prior to December 31, 1984;

(b) The last payroll prior to March 31, 1985; and,

(c) The first payroll after June 30, 1985, the accounting records which show the amounts distributed to bargaining unit employees on June 12, 1985, and any records showing when and how those amounts were actually recorded in the books of the respondent corporation.

(2) The salary survey.

(3) The letter distributed by the respondents to managers in the Ottawa laboratories as to what they should do about the salary adjustments - a document from which Mr. Sadler is said to have read at a meeting of employees in the Biotechnology lab on or about January 21, 1985.

(4) Any other document relevant to the salary adjustments.

Counsel for the complainant asked that the Board order direct production prior to the resumption of the hearing of this complaint.

6. Counsel for the respondents agreed that it would produce to counsel for the complainant a copy of the letter referred to in sub-paragraph (3) of the preceding paragraph of this decision. In addition, she agreed that the documents referred to in paragraph numbered (1) would be produced~ although she was not then sure what form certain of the information was in. We do not consider it necessary to make any formal order for production of the documents which counsel has undertaken to produce, and we assume counsel will be able to work out the mechanics of the production of those documents without the assistance of the Board. We need only deal here with the request for an order that the survey and other documentation relevant to salary adjustments be produced.

7. It should be noted that counsel for the complainant prefaced his request for an order that these documents be produced with an observation that he had not made those documents the subject of a summons duces tecum served on any official of the corporate respondent, because counsel for the respondents had indicated at the beginning of the hearing that she would be calling the respondent Carette and the President of the respondent Forintek as witnesses. Had cross-examination of either witness been reached before the Board's hearing adjourned, he would have made his request for documents at that stage, he said. As there was to be a delay in the continuation of the hearing, however, the request was being made so as to facilitate preparation for the continued hearing. For her part, counsel for the respondents agreed that we could treat the complainant's request for an order directing production of documents as though those documents had been named in a summons duces tecum properly served, in advance of our hearing, on the custodian of the documents in question.

8. The jurisdiction of this Board to direct production of documents adequately described in a summons duces tecum properly served on the custodian of those documents was reviewed at length in Shaw-Almex Industries Limited, [1984] OLRB Rep. Apr. 659. We adopt the Board's analysis in that case. We are satisfied that we do have jurisdiction to direct the production of a document described in a properly served summons duces tecum if we are satisfied that the content or existence of the document is arguably relevant to issues properly raised by either of the parties to the proceeding at hand.

9. Counsel for the respondents argued that the Board should not direct production of the salary survey. She acknowledged that the respondents would rely, in their defense of their complaint, on the existence of the survey and on certain of its contents. Forintek's witnesses would say the survey showed that some of its employees were being paid salaries which were between three and twenty per cent less than those paid to workers in comparable positions in other companies. She argued that the Board should not and could not order production of the survey, however, even during cross-examination of a witness who had given such evidence. This proposition was put on several grounds. One was that the survey document contains information to which the respondents' witnesses would not make reference during their testimony and which would not, therefore, be relevant. By way of example, counsel stated that the survey contains information with respect to the work performed by and salaries paid to persons employed by the respondent corporation in its laboratories in British Columbia. Counsel also argued that the presence in the survey document of information about employment relationships in other provinces deprives this Board of jurisdiction to order its production, even if the document itself is in the custody of a person within Ontario who has been properly served with a summons issued by this Board. We are at a loss to understand how a document which contains material admittedly relevant to the issues before us can be immune from production by reason of its containing information which is either irrelevant or extra-provincial in origin or both.

10. Counsel for the respondents also argued that we should not direct production of the survey because to do so would be to grant one of the remedies requested in the complaint. In making this submission, counsel for the respondents characterized the complainant's case as being directed primarily to the proposition that the respondent company was obliged, by the duty to bargain in good faith, to produce the salary survey in the course of and for the purpose of collective bargaining. That proposition, she argued, should only be dealt with after both parties have had an opportunity to present their evidence and make full argument thereon. Counsel went on to comment on the evidence of one of the complainant's witnesses, who she said had conceded that the complainant would not need the survey in question in order to engage in collective bargaining. She suggested it would be unfair to order production of an employer's surveys when, she claimed, a trade union is not obliged to reveal the information it prepares in connection with collective bargaining. She did not argue, however, that the survey had been prepared as a guide to Forintek's collective bargaining strategy or that it contained information about Forintek' s collective bargaining strategy.

11. We begin our analysis of these submissions by agreeing with counsel for the respondents that we are not now and should not now be dealing with any question whether this or any other survey prepared by a party to collective bargaining should be produced to the other party for the purpose of collective bargaining. The question before us is whether this particular survey should be produced in the course of this litigation for the purpose of this litigation. The complainant's position is that the survey is producible because its existence and content are relevant. It does not argue that the content is relevant to its claim that the failure to disclose that survey in collective bargaining is a breach of the duty to bargain in good faith. The complainant's argument is that the existence and content of the survey are relevant in assessing what motivated the respondents in offering salary adjustments in the way they did, in distributing salary adjustments in the way and at the time they did, and in allocating the amounts of those adjustments among employees in the way they did. The complainant will invite the Board to conclude that the respondents' motivation in all of its actions in relation to the salary adjustments was to undermine the union. Counsel for the respondents says her witnesses will explain their actions with reference to the existence and content of this survey, among other things. The complainant will be entitled to challenge that explanation in cross-examination. To deny the complainant production of a document which the respondents claim was the basis of their actions would be to deny the complainant the opportunity to challenge that explanation and unfairly limit the hearing of its complaint.

12. Counsel for the respondents did not suggest that any legal privilege attached to the survey document in question. However, she argued that even if we have jurisdiction to direct production, we nevertheless also have a discretion to refuse to order production. Counsel invited the Board to exercise that discretion in her client's favour with respect to the survey document. We appreciate that in any decision of this kind there will be a process of balancing the need for a fair, open and expeditious process of litigation against the concern that the Board's processes not be used as an instrument to harass or annoy or unreasonably invade the privacy of participants (and non-participants) in the proceedings. Counsel for the respondents did not explicitly accuse the complainant of fabricating issues, on which the existence and content of the survey became relevant, so as to obtain the survey at an early stage and preempt argument that the duty to bargain in good faith did not require production. Counsel for the respondents did not argue that the complainant had failed to establish a prima facie case of breach of anything other than section 15 of the Labour Relations Act. Counsel did, however, describe the complainant's case as primarily concerned with the respondents' refusal to produce the survey for collective bargaining purposes. In the face of that submission, lest it be thought we have failed to appreciate any of its implications, we feel obliged to observe, as we did during argument, that the complainant's case clearly involves considerably more than a question whether a salary survey must be disclosed during collective bargaining in order to comply with section 15 of the Labour Relations Act. Evidence presented by the complainant during its case in chief, if not successfully challenged or explained, is more than adequate to establish each of the complainant's factual allegations and to form the foundation for an inference that the respondent company was driven throughout by the motivation ascribed to it by the complainant. This is not a case in which a complainant has made allegations which are without foundation for the purpose of engaging in a fishing expedition. The issues on which the survey and its contents are relevant are substantial and serious ones. We are satisfied that they have not been raised solely for the purpose of obtaining information to which the complainant might not otherwise be entitled.

13. In Shaw-Almex Industries Limited, supra, the Board noted that in court proceedings, each party to the litigation obtains production of the other parties' relevant documents on an implied undertaking that he will make use of them only for the purposes of that action, and for no other purpose. The authorities for that proposition are set out in paragraph 18 of that decision (a list to which one might now add Lac Minerals Ltd. v. New Cinch Uranium Ltd. et al, 1985 CanLII 2251 (ON HCJ), 50 O.R. (2d) 260 (Ont. H.C.), in which Mr. Justice Craig confirmed that the "implied undertaking" rule is part of the law of Ontario). After reciting the cases that described the "implied undertaking" rule, the Board made these observations at paragraphs 18 and 19 of Shaw Almex Industries Limited, supra:

Although the passages and cases just cited all concern production of documents on discovery in civil actions, the principles set out therein bear equal application to any legally compelled production of documents which occurs in the course of a quasi-judicial proceeding the documents into evidence in a public hearing.

... In our view, there is an implied undertaking by a party to whom documents are produced as a result of the use of a summons duces tecum issued by the Board. It is an undertaking to the Board as much as to the party from whom production is compelled. The undertaking is that the documents will not be sued for collateral or ulterior purposes. The undertaking is similar in scope and effect to the undertaking discussed in the cases cited above. Breach of the latter undertaking is a contempt of court, as is the breach of any undertaking given to a court. By virtue of section 13(c) of the Statutory Powers Procedures Act, breach of an undertaking to the Board may be the subject of contempt proceedings in the Supreme Court of Ontario....

14. We have observed that the complainant seeks production of the survey not for the purpose of collective bargaining but for the purpose of this litigation. Having regard to the "implied undertaking" rule, it would be quite improper for the complainant to make use of the survey in collective bargaining if it obtained it only as a result of this request.

15. We are satisfied that the existence and content of the survey are relevant, that we have the jurisdiction to order its production and that there is no reason to delay production until the point in our continued hearings at which a witness might be cross-examined on its contents or its introduction into evidence might be sought. There will be cases where a balancing of the interests involved requires such a cautious approach. We are satisfied that the interests of both parties in a fair and speedy hearing and resolution of the issues in this complaint favour affording counsel for the complainant an opportunity to examine the document before the hearings resume, so that he can prepare to deal with it at that time without the necessity of further adjournments. Of course, such production is obtained on the basis of the implied undertaking discussed in Shaw-Almex Industries Limited, sup ra. Counsel for the complainant will no doubt take the nature and seriousness of that undertaking into account in assessing with his client whether anyone other than counsel should examine the document at this stage. Counsel's advisor, for example, is also involved in collective bargaining. Should he read the survey as a result only of our order that it be produced for the purposes of this litigation, he could make no use of it during collective bargaining; the mere mention of it during collective bargaining would constitute contempt.

16. Counsel for the complainant has also asked that we direct production of "any other documentation relevant to salary adjustments", which he says would include everything that went into the decision-making process at every stage. We do not doubt our jurisdiction to make an order in such broad and general terms, but we are not satisfied that we should do so in these circumstances. The object in exercising this jurisdiction is not to create a general discovery process analogous to that available in the civil courts. Our object is to expedite the hearing process, and we must be concerned that the steps we take to expedite that process do not take on a separate life of their own which engages the parties in time-consuming arguments over whether generalized discovery of obligations have been met or breached. We do think it appropriate to direct that the respondents produce now any documents on which they propose to rely in the course of presenting their case. As for documents on which the respondents do not propose to rely but which are relevant to the salary adjustments issue, we direct that the respondents have such documentation available with their representatives at the continued hearing in this matter. We note that this latter direction is no different from the obligation which would arise if the complainant were now to serve a summons duces tecum employing that general language, and the approach required by this direction seems consistent with the very reasonable approach taken by counsel for the respondents in not insisting on the formality of service of a summons and conduct money.

17. The only remaining question concerns the mechanics of the production which this order requires be made prior to the continued hearing of this complaint. Counsel for the complainant said he would be content with an arrangement whereby production would be made to him in the offices of counsel for the respondents. Having regard to the Board's analysis in Shaw-Almex Industries Limited, supra, it appears to us that the appropriate formal order is to require that the subject documents be filed with the Registrar on or before a specific date, unless the parties in the meantime can agree on other arrangements.

18. The Board therefore orders and directs that the respondents produce the aforesaid salary survey and any documents on which they propose to rely in their defense of this complaint. Unless in the meantime the parties make alternate arrangements for the inspection of the aforesaid documents, production thereof shall be made by depositing the said documents with the Registrar of this Board at its offices at 400 University Avenue within ten days after the date of the release of this decision or within such further period of time as may be agreed to in writing by the parties. Once filed, the document will be made available for the inspection of an authorized representative of the complainant during the Board's office hours.