[1985] OLRB Rep. November 1578
2778-84-UCanadian Union of Public Employees, Complainant, v. Extendicare Health Services Inc., Respondent
BEFORE: Lita-Rose Betcherman, Vice-Chairman, and Board Members A. Grant and P. V. Grasso.
APPEARANCES: James K. McDonald, Bruce Land and Gloria Dodd for the complainant; Robert Atkinson, David Cameletti, B. H. Stewart and Scott Thornton for the respondent.
DECISION OF THE BOARD; November 6, 1985
1The name of the respondent is amended to "Extendicare Health Services Inc."
2This is a complaint under section 89 of the Labour Relations Act alleging that the respondent (1) interfered with the administration of the trade union by bargaining directly with the employees in violation of sections 64, 66(1), 67 and 70, and (2) altered terms and conditions of work during the freeze period in violation of section 79 of the Act and section 13 of the Hospital Labour Disputes Arbitration Act. In the course of the hearings, the complainant union withdrew allegations of bad faith bargaining.
3In January, 1984 the respondent purchased this 214-bed nursing home. The complainant represents 130 full-time and part-time employees at the Home all of whom are in the same bargaining unit. The terms and conditions of the collective agreement, extended by the Inflation Review Act, were due to expire at the end of March and on January 9, 1984, the complainant served notice to bargain a renewal of the agreement upon the respondent, thus triggering the freeze period.
4Attempts to include this Home in joint negotiations with other CUPE Homes belonging to the respondent failed. Separate negotiations were equally unsuccessful. The union applied for conciliation and ultimately binding arbitration pursuant to the Hospital Labour Disputes Arbitration Act. On December 11, 1984, the parties were advised that a hearing date for the arbitration had been set for the end of April, 1985.
5During the stages of the bargaining process, the respondent had been conducting a review of its newly-acquired facility. A number of problems were identified and it was decided that various changes were necessary, such as the realignment of some units, regrouping of some residents, peak period staffing, an additional RN for improved supervision and more Activities personnel to initiate a restorative programme among the residents. There was never any doubt that a reduction in staff hours would result from these changes. Before the changes could be implemented, however, an in-service training programme and audit was to be completed. Implementation was further delayed by changes in senior management at the Home. Several supervisors were replaced and a new Administrator, Mr. Scott Thornton, was appointed in April, 1984. In any event, it was not until December, 1984 that the decision was made to proceed with the staffing changes. Mr. Thornton was instructed by the head office to work out details and to contact the union.
6On December 31, 1984, Mr. Thornton advised the president of the local union, Ms. Gloria Dodd, that staff reductions were imminent. He suggested calling a meeting of the Labour-Management Committee to discuss the changes and asked her to invite Bruce Land, the business representative who services this local union, to attend. Ms. Dodd informed Mr. Land of her conversation with Mr. Thornton, expressing the opinion that the changes would not be major.
7On January 2, 1985, a Labour-Management Committee meeting was held, attended on the union side by Ms. Dodd, the vice-president Ms. Bostick, and a steward Ms. Teleford. Mr. Thornton advised them of the coming cutbacks and solicited their advice as to how these could best be accomplished in accordance with the seniority provisions of the agreement. He told them he was planning to hold individual interviews with the employees to enable them to select shifts and hours under the new scheduling arrangement; he showed them samples of letters going out to each employee in this connection. It is agreed that the union members raised no objection to the company's plans at the committee meeting. At Ms. Dodd's request, Mr. Thornton held two meetings on January 3rd to explain the changes to the staff at large.
8Subsequent to the January 2nd meeting, Ms. Dodd reported to Mr. Land that the proposed staffing changes would be "drastic" after all. On January 4th, Mr. Land telephoned Mr. Thornton. He stated that the company was violating the statutory freeze period and asked to meet with someone at the head office. At a meeting of the local union on January 6th, with Mr. Land present, it was decided that the union would not co-operate with the company in the cutbacks; in particular, the employees would not select shifts and hours under the new schedule. This decision was not communicated to Mr. Thornton.
9On January 7th Mr. Thornton held interviews with the two most senior employees affected by the changes. Ms. Bostick sat in at the meetings. Neither employee would make a selection among the shift options offered, stating that they disagreed with the company's actions, and referred Mr. Thornton to the union. Ms. Bostick stated that she could not speak for the union. Mr. Thornton testified that he was confused by the employees' attitude as he was under the impression that he had reached an understanding with the union at the January 2nd Labour-Management Committee meeting. According to the testimony of the three employees involved in the interviews, Mr. Thornton stated that "Bruce Land was the cause of all this" and said that if the union wanted to play hardball, the company would too. Mr. Thornton did not deny making these comments, but stated that the reference to hardball was simply a relay of a remark made by the respondent's vice-president. He also acknowledged saying that Russia was the only country where people did not have the opportunity to express a choice. After these abortive interviews, Mr. Thornton cancelled the rest. According to a union witness, Mr. Thornton met later that same day with five or six employees. She testified that he was upset at having to cancel the interviews and told the employees that they were the union and should make their own choices. Mr. Thornton testified that he did not recall such a meeting taking place.
10On January 9th, Mr. Land met with the respondent's vice-president in charge of Human Resources and its manager of labour relations. He stated that the proposed changes were a violation of the statutory freeze and of the collective agreement. While making it clear that the reduction in hours would be implemented, the company officials asked Mr. Land if he would discuss without prejudice ways or means of lessening the impact on the staff. Mr. Land declined. He testified at the hearing that in his view any co-operation would have constituted acquiescence in what the union regarded as the company's illegal actions.
11On January 21st the manager of labour relations telephoned Mr. Land to say that the company had developed alternative staffing patterns which would lessen the number of affected employees and, furthermore, that the implementation date had been postponed for a month until February 25th. Mr. Land reiterated that the union would not co-operate in any staff reduction. He advised the labour relations manager that the union had filed the present complaint with the Labour Relations Board.
12On January 25th Mr. Thornton convened a Labour-Management Committee meeting to discuss the revised schedule with the local union executive members. He again attempted to enlist their co-operation with little success. The union members involved alleged that Mr. Thornton made various statements critical of Mr. Land and the union; while denying most of their allegations, Mr. Thornton acknowledged that he referred to Bruce Land's opposition to the company's plans and that he mentioned the word "pawns" although he meant to include himself when he used it. Later that day, Mr. Thornton convened a general staff meeting to explain the revised schedule. According to union witnesses, he criticized the role of the union, accusing it of misleading the employees and of forcing them to give up the right to make their own decisions. What was said, according to Mr. Thornton, was that there was a great deal of misinformation floating around and that the uniorl did not have its facts and figures correct. He acknowledged telling the employees that they had the right to make their own decisions.
13On this same date, January 25th, letters were sent to all employees asking them to come for interviews regarding the revised schedule. On January 31st the employees were interviewed by Mr. Thornton in groups of four. About half the employees selected shifts and hours from among the options offered to them.
14On February 25th the staffing changes took place. A document entered as Exhibit 40 details the changes. Prior to February 25th, 1985, all 130 employees with 11 exceptions worked fixed 7-1/2 - 8 hour shifts; of these 76 worked full-time and 54 worked part-time. After that date, a number of employees had their shifts changed; 11 full-time employees and 20 part-time had their shift hours reduced; 7 part-time employees had their hours increased although some now worked short shifts: the overall result was a net decrease in hours of 3.5% or 125 hours per week.
15In support of its allegation that the respondent has violated the statutory freeze, the complainant argued as follows: Article 12:01 of the collective agreement establishes a normal work day of 8 hours for nursing staff and 7-1/2 hours for non-nursing staff. It was pointed out that the agreement did not include a disclaimer to the effect that Article 12:01 did not represent a guarantee of hours of work and evidence was adduced to show that the company was attempting to introduce such a clause in the new agreement. It was submitted that Article 12:01 represented a norm and that in reducing the hours of so many employees unilaterally, the respondent established a new norm. This action ran counter to past practice whereby employees were always assigned full shifts, the few existing exceptions having been made with the union's consent. It was submitted that the changes were a new development which the employees could not have reasonably expected and that this in itself indicated a violation of the freeze. Simpsons Limited, [1985] OLRB Rep. April 594. Counsel argued that there was no compelling business reason to justify the respondent's action.
16With regard to its allegation that the respondent had violated sections 64, 66, 67, and 70 of the Act, the complainant argued thusly: Notwithstanding the union's express objections to the staffing changes Mr. Thornton attempted to effect these changes by negotiating directly with the employees. Furthermore, he made statements to the employees likely to undermine the union's credibility. It was submitted that through his actions Mr. Thornton interfered with the bargaining process and with the administration of the union, contrary to the aforesaid sections of the Act.
17The respondent's position is that it had the right to reduce hours of work under the collective agreement and that this right continued under the freeze. It was argued that Article 12:01 does not provide a guarantee of work even without a disclaimer clause and that Article 12:01 expressly contemplates a reduction in hours. As well, the respondent relied upon the language of the management rights clause (Article 2:01) which gives the employer the right to determine "the allocation and number of employees required," citing as authority the Board's decision in Scarborough Centenary Hospital Association, [1978] OLRB Rep Oct. 949. Counsel submitted that, in order to show a violation of the freeze, the union would have to prove that the company was estopped from exercising its alleged right to reduce hours. Counsel emphasized that the evidence revealed only one instance where the predecessor employer had asked the union's consent to reduce the hours of a few employees and argued that this was insufficient to support a finding of estoppel. He further pointed out that at the time of the acquisition eleven employees were working short shifts. Counsel asserted that the "reasonable expectations" test applied only to first agreements. In support of the proposition that an employer did not need "compelling" business reasons to exercise its rights during a freeze period, he cited the decision of the Board in Corporation of the Town of Petrolia, [1981] OLRB Rep. March 261. The respondent stressed that it had bona fide reasons for its actions, namely improved delivery of care and cost efficiency.
18With respect to the charge of bargaining directly with the employees, the respondent asserted that there was no bargaining in process at the time as the parties were waiting for arbitration and, secondly, that Mr. Thornton's interviews and staff meetings were predicated upon the company's right to make changes in shifts and hours of work. Counsel analyzed the sections of the Act purportedly violated and the evidence regarding Mr. Thornton's comments and postulated that the former were not applicable and that the latter fell within an employer's permitted freedom of expression.
19The provisions of the collective agreement referred to by the parties are reproduced in relevant part below:
ARTICLE 2:00 - MANAGEMENT RIGHTS
2:01 The union recognizes that it is the right of the employer to exercise the regular and customary functions of management except insofar as such rights are modified or limited by this agreement.
The union recognizes that it is the regular and customary functions of the employer to
(c) generally manage and operate the Nursing Home in all respects in accordance with its obligations, determine the kinds and locations of machines, equipment to be used, the allocation and number of employees required, the standards of performance for all employees, and all other matters concerning the Nursing Home's operations.
ARTICLE 12 - HOURS OF WORK
12:01 Dietary & housekeeping aides, nurses' aides, cooks I & 11, maintenance man and activities director
(a) The normal hours of work shall average thirty-seven and one half (37-1/2) hours per week, over the four (4) week work schedule, but shall not exceed seventy-five (75) hours in any two (2) week period. The standard hours of work shall be seven and one-half (7-1/2) hours per day. Any work performed in excess of seventy-five hours in a two (2) week pay period shall be compensated at the rate of time and one-half regular straight time pay.
Registered Nurses, Graduate Nurses and Registered Nurses' Assistants
(b) The normal hours of work shall average forty (40) hours per week over the four (4) week work schedule, but shall not exceed forty eight (48) hours in any one week. The standard hours of work shall be eight (8) hours per day. Any work performed in excess of eighty (80) hours in a two week pay period shall be compensated at the rate of time and one-half regular straight time pay.
12:10 Employees shall not have their hours of work reduced without prior notification of the union by the employer.
20There is no dispute that the respondent substantially altered the hours of work of a considerable number of employees during the freeze period. There is no question that this constituted a new schedule of indefinite duration and not merely a temporary change in hours. It is common ground that the number of residents at the Home remained the same. The evidence discloses that as of January 4, 1985, the respondent had learned from a union official in authority that the union disapproved of its plans. Any possible doubt that the local union concurred with Mr. Land should have been dispelled by the upshot of the employee interviews on January 7th. The Board holds that the eleven short shifts in place were not a precedent for the reduction in hours in that the union had agreed to the former.
21The purpose of the statutory freeze is to provide a period of stability during the negotiation of a collective agreement. In determining whether the freeze has been violated, the Board asks whether the employer is conducting business as before (Spar Aerospace Products Limited, 1119781 OLRB Rep. Sept. 859). In that there is a successor employer involved, it is worth stating that the "business as before" test applies to the predecessor employer's conduct of business at this nursing home and not to the successor employer's method of operation at its other facilities.
22The question is whether the respondent had the right during the freeze to unilaterally reduce hours of work to the extent it did. Section 79(1) of the Act preserves "terms and conditions of employment or any right, privilege or duty, of the employer, the trade union or the employees." Where an agreement is under renewal as in the instant case, the Board will look first of all at the expired agreement to discover the terms and conditions of employment.
23In the Board's view, the management rights clause does not assist the respondent. While that clause enables the employer to determine the number and allocation of employees required, there is nothing in it which gives the employer the right to shorten normal hours of work. In the Scarborough Centenary Hospital Association, supra, case, the Board found that this language entitled the employer to determine the number of employees required as cashiers; it also found that the status of the employee in question had been changed: that is not so in the present case. In Article 12 the parties have specifically addressed the matter of hours of work and it is this article which is relevant to the issue.
24To determine whether the employer had the right to reduce hours under the expired agreement, it is instructive to look at the arbitral jurisprudence. The practical question is this: During the term of the most recent collective agreement, would the complainant have been able to grieve the reduction of hours successfully?
25In Re Ballycliffe Lodge and Service Employees Union, Local 204, (1984) 1984 CanLII 5256 (ON LA), 14 L.A.C. (3d) 37 (Adams), the "hours of work" clause was essentially the same as in the instant agreement: in addition, there was a "no guarantee of hours to be worked" clause. At page 44 of the award, the majority of the arbitration board observed:
The general acceptance that a "normal hours of work" provision does not constitute a guarantee of hours to be worked is itself subject to the parallel understanding that a new norm cannot be established by unilateral management initiative.
The award goes on to say that an hours of work clause "stipulates what the normal hours of work per day are to be, and by this stipulation, management is precluded from establishing a new norm by the indefinite or ongoing scheduling of hours per day and different from those set out in [the hours of work clause]."
26In Re E. S. & A. Robinson (Canada) Ltd. and Printing Specialties & Paper Products Union, Local 466, (1976), 1976 CanLII 2220 (ON LA), 11 L.A.C. (2d) 408 (Swan), where the agreement provided for a "normally designated work week", the majority of the board upheld the employer's right to shorten working hours temporarily to avoid layoff, but held that a new schedule of normal hours was not permitted. The award states at page 414:
The company would be unjustified in changing that normal designation in any way which would create a new norm, but it would be justified, in appropriate circumstances, in scheduling work in an "abnormal" way. Whatever else this may mean, it would certainly prohibit any permanent or long-term change, by unilateral action, in the work-week.
27The above-quoted awards of two of the leading arbitrators of the province indicate that an "hours of work" clause, such as Article 12.01 in the instant agreement, while not guaranteeing hours of work, would not permit the employer to establish new, normal working hours unilaterally. The employer's case law is not inconsistent with the foregoing arbitral opinion in that, in almost all the cases cited, the reduction in hours was temporary or governed by different contractual language.
28In the Board's view, Article 12:10 does not override Article 12:01 and, in fact, is consistent with the above interpretation. Article 12:01 does not prohibit the employer from reducing hours temporarily under certain circumstances. All Article 12:10 says is that when this occurs, the union must be notified. To construe Article 12:10 as a permit for the employer to impose new normal or standard hours of work at will would be to negate the normal or standard hours of work set out in Article 12:01.
29At the very least, the Board finds that the employer did not have the express right prior to the freeze to introduce, without the union's consent, new normal hours of work differing from those set out in Article 12:01. However, as well as terms and conditions of employment, section 79 freezes rights and privileges. The Board must now examine the relationship of the parties to see if it has generated a "privilege" protected by the freeze. As the Board stated in A E S Data Limited, [1979] OLRB Rep. May 368, "The section requires both parties to maintain the existing pattern of their relationship." The evidence discloses that prior to the freeze there were no short shifts at this Home except with the union's consent. Thus, given this interpretation of the collective agreement, the Board considers that full-time non-nursing staff could reasonably expect to work 7-1/2 hours a day and nursing staff 8 hours a day during the freeze - the test set out in Simpsons Limited, supra. The Board concludes that the relationship between the parties did not give the employer the privilege to shorten normal hours of work unilaterally.
30For the foregoing reasons, the Board finds that the employer violated section 79 of the Labour Relations Act and section 13 of the Hospital Labour Disputes Arbitration Act by shortening the working hours of some employees as it has done.
31With respect to the other complaints, the Board finds on the evidence that the respondent was attempting to effect the desired staffing changes through direct dealings with the employees rather than with their bargaining agent. Moreover, we find that Mr. Thornton's comments at the employee interviews and at the staff meetings tended to undermine the credibility of the complainant in the eyes of its membership. The Board concludes, therefore, that the respondent interfered with the administration of the trade union in contravention of section 64 of the Act. The respondent acknowledged that it conducted itself as it did, in the face of the union's objection, on the assumption that it was acting within its rights. Since this assumption has been found to be incorrect, the respondent's case on this head falls to the ground.
32The Board declares that the respondent has violated the Labour Relations Act and the Hospital Labour Disputes Arbitration Act and orders the respondent to cease and desist violating the aforesaid Acts. The Board directs the respondent to compensate the affected members of the complainant union for all losses suffered as a result of the alteration in hours. The Board rejects the complainant's request for a posting as unnecessary once the respondent's misapprehension has been corrected. The Board shall remain seized in the event that the calculation of the payments raises difficulties between the parties.