[1985] OLRB Rep. August 1290
0130-85-M International Union of Operating Engineers, Local 793, Applicant, v. Piggott Construction Limited, Respondent
BEFORE: N. B. Sattetjleld, Vice-Chairman, and Board Members J. Wilson and N. Wilson.
APPEARANCES: Jack J. Slaughter, Len Budge and C. T. Unsworth for the applicant; R. A. Werry and Joe Keyes for the respondent.
DECISION OF THE BOARD; August 9, 1985
The applicant has referred a grievance in the construction industry 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.
The applicant, International Union of Operating Engineers Local 793 ("the union") and the respondent, Piggott Construction Limited" ("the employer") agree that they are bound to the provincial agreement between the Operating Engineers Employer Bargaining Agency and the Operating Engineers Employee Bargaining Agency effective from May 7, 1984 to April 30, 1986 ("the Agreement").
The union seeks a declaration that the employer has violated Article 3 - Union Security - of the Agreement, in particular clause 3.4 thereof respecting the subcontracting of work covered by the Agreement. There is no dispute that the work giving rise to this grievance is work coming within the scope of the Agreement. The union alleges that the work in issue was performed by a subcontractor who was not in contractual relations with the union as required by clause 3.4 as set out hereunder:
3.4a) The Employer agrees to engage only those sub-contractors and equipment rentals (except equipment dealers) who are in contractual relations with the Union to perform work set out in the classifications of this agreement, dredging, or as otherwise agreed to by the parties.
b) Owner-Operators who perform work covered by this Agreement shall be signatory to an Agreement with the Union and shall also be:
i) a member in good standing of the Union; and
ii) in good standing on contributions under the Health Plan, Pension Plan, Training Fund and Working Dues, as required by this Agreement
If the Union advises an Employer bound by this Agreement that an owner-operator engaged by such Employer is in violation of this Article, the Employer shall within 24 hours replace such owner-operator.
The Board heard the evidence of Glen Budge and Canon Unsworth for the union and Dan Cavanagh for the employer. The findings of fact set out herein are based primarily on the Board's assessment of the evidence of Budge and Cavanagh having regard for their demeanour as witnesses.
The employer had obtained a contract for work which included completing the excavation for the basement of an office tower in the City of Ottawa. When the employer acquired its contract, approximately 75% of the excavation had been completed by another contractor. The excavation involved the removal of rock and preparatory to seeking bids from subcontractors for this work, the employer estimated what it would cost were it to perform the work itself, based on the nature and quantity of sub-soil and rock to be removed and unit costs developed over its years of experience with such work. The employer uses such cost figures to assess the bids which it receives for work which it puts out to tender. The employer received bids from two subcontractors with approximately $100,000 difference between them. It notified the low bidder by letter of intent that the employer would let a contract to it. When that bidder came to the work site to examine the work, it sought to qualify its bid to the extent that its price became virtually the same as the higher bidder. After analyzing this turn of events, the employer decided it would perform the work using its own forces.
Preparatory to undertaking the work itself, the employer examined the work and decided to remove the rock by mechanical means rather than by drilling and blasting, apparently because of a high risk of damage to an adjacent property were explosives to be used. The decision was made to use a piece of equipment called a hoe ram of a particular capacity. The Board was told that there are ten different sizes of hoe rams. The employer sought to find one with sufficient capacity which it could rent. The only one it could locate belonged to an excavator called Ken Gordon Excavations. It may be inferred from the evidence that the equipment was available to the employer only if it took an operator along with the equipment. The employer arranged for the equipment and the operator on a per diem basis and performed the work in question using this equipment and operator.
Budge, who is the business representative for the union in the Ottawa area, advised the respondent that Ken Gordon Excavations ("Gordon") was not under any collective bargaining arrangements with the union and asked that Gordon be removed from the job site and replaced with a subcontractor who satisfied the requirement of clause 3.4.
The Board is satisfied that the arrangements which the employer made with Gordon for the supply of the hoe ram equipment and operator constitute engaging a subcontractor within the meaning of clause 3.4 of the agreement for the same reasons stated by the Board in its decision in Eton Construction Limited, [1981] OLRB Rep. July 872. In that case, the employer had entered into an arrangement on a time and material basis for the performance of certain work which came within the collective agreement to which the employer was bound and about which work the collective agreement placed limitations on how it could be subcontracted. The Board finds on the evidence that Gordon was not under contractual relations with the union as required by clause 3.4. Furthermore, having regard to the language of clause 3.4 of the agreement and particularly the reference therein to subcontractors and equipment rentals (except equipment dealers), the Board finds that Gordon's relationship to the employer was that of a subcontractor within the meaning of clause 3.4. Since Gordon was not in contractual relations with the union as required by that clause, the employer's use of Gordon in those terms was a violation of clause 3.4 of the Agreement.
The union's referral includes a request for damages. The Board asked, in the course of the proceedings, whether the parties wished the Board to remain seized respecting the amount of damages should the Board find liability in the employer. Both parties requested the Board to receive evidence on the amount of damages which would be owing. The amount of damages which the union is seeking is the sum which would have been paid in wages to its members and in contributions on their behalf made to the union's welfare and pension trust funds for the number of hours worked by Gordon's operator. In Eton, supra, the Board considered it proper to award damages on that basis for violations of the subcontracting provisions in the collective agreement, stating that it was "... now well established that the appropriate redress of a complaint such as is before us includes payment by the employer of an amount equal to the contributions to various trust funds, which would have accrued to members of the applicant who would have been employed by the respondent save for the respondent's violation of the collective agreement". In this respect see Napev Construction Limited, [1980] OLRB Rep. Feb. 260; Re McKenna Brothers Ltd. and Plumbers Union Local S2 7, 1975 CanLII 2128 (ON LA), 10 L.A. C. (2d) 273 (Shime) and Re Blouin Drywall, Contractors Ltd. and United Brotherhood of Carpenters and Joiners of America, Local 2486, 1975 CanLII 707 (ON CA), 57 D.L.R. (3d) 199. Since Blouin Drywall and McKenna Brothers, it has generally been sufficient for a trade union claiming damages for violation of the hiring hall or subcontracting provisions of its collective agreement, to simply establish that it had sufficient unemployed members at the times material to the grievance to have supplied the needs of the employer directly or through its subcontractor. In the instant case, the union did not adduce any evidence that unemployed members of the union were available at the time of and subsequent to the employer's violation of the agreement. Nor did the union adduce any evidence that there were subcontractors with employees who were members of the union available to perform the work in question. Therefore the union has failed to establish before the Board that the union or its members have suffered a loss as a result of the employer's violation of clause 3.4 of the agreement. Accordingly, there is no basis on which the Board can award the damages sought by the union.
In view of that result, it is unnecessary for the Board to deal with the arguments made in the alternative by employer counsel that the Board should not award damages even if it found a violation of the subcontracting clause.
Therefore, having regard to all of the evidence before it and pursuant to section 124 of the Labour Relations Act, the Board declares and directs that:
(1) Piggott Construction Limited ("the employer") and the International Union of Operating Engineers, Local 793 ("the union") are bound to the provincial agreement between the Operating Engineers Employer Bargaining Agency and the Operating Engineers Employee Bargaining Agency effective from May 7, 1984 to April 30, 1986 ("the Agreement");
(2) the employer has violated clause 3.4 of Article 3 - Union Security - of the Agreement by subcontracting work covered by the Agreement to Ken Gordon Excavations contrary to the provisions of that clause; and,
(3) the employer shall cease and desist from violating clause 3.4 of the collective agreement.