United Food and Commercial Workers International Union, Locals 175 and 633 v. New Dominion Stores Inc.
[1986] OLRB Rep. April 519
2684-85-R United Food and Commercial Workers International Union, Locals 175 and 633, Applicants, v. New Dominion Stores Inc., The Great Atlantic & Pacific Company of Canada Limited, Respondents, v. United Food and Commercial Workers, Local 206, Intervener #1, v. United Steelworkers of America, Intervener #2
BEFORE: R. O. MacDowell, Vice-Chairman, and Board Members J. A. Ronson and S. 0'Flynn.
APPEARANCES: Douglas J. Wray and WE. Hanley for the applicants; David Churchill-Smith, Charles R. Robertson and Tom Zakrzewski for the respondents; Paul W. Timmins and Jim Andress for intervener #1; Brian Shell, Joseph Ginty and Des Bradley for intervener #2.
DECISION OF THE BOARD; April 7, 1986
I
1This is an application under section 63 of the Labour Relations Act. The relevant portions of that section are as follows:
63.-(1) In this section,
(a) "business" includes a part or parts thereof;
(b) "sells" includes leases, transfers and any other manner of disposition, and "sold" and "sale" have corresponding meanings.
(2) Where an employer who is bound by or is a party to a collective agreement with a trade union or council of trade unions sells his business, the person to whom the business has been sold is, until the Board otherwise declares, bound by the collective agreement as if he had been a party thereto and, where an employer sells his business while an application for certification or termination of bargaining rights to which he is a party is before the Board, the person to whom the business has been sold is, until the Board otherwise declares, the employer for the purposes of the application as if he were named as the employer in the application.
(4) Where a business was sold to a person and a trade union or council of trade unions was the bargaining agent of any of the employees in such business or a trade union or council of trade unions is the bargaining agent of the employees in any business carried on by the person to whom the business was sold, and,
(a)any question arises as to what constitutes the like bargaining unit referred to in subsection (3); or
(b) any person, trade union or council of trade unions claims that, by virtue of the operation of subsection (2) or (3), a conflict exists between the bargaining rights of the trade union or council of trade unions that represented the employees of the predecessor employer and the trade union or council of trade unions that represents the employees of the person to whom the business was sold,
the Board may, upon the application of any person, trade union or council of trade unions concerned,
(c) define the composition of the like bargaining unit referred to in subsection (3) with such modification, if any, as the Board considers necessary; and
(d) amend, to such extent as the Board considers necessary, any bargaining unit in any certificate issued to any trade union or any bargaining unit defined in any collective agreement.
(6) Notwithstanding subsections (2) and (3), where a business was sold to a person who carries on one or more other businesses and a trade union or council of trade unions is the bargaining agent of the employees in any of the businesses and such person intermingles the employees of one of the businesses with those of another of the businesses, the Board may, upon the application of any person, trade union or council of trade unions concerned,
(a) declare that the person to whom the business was sold is no longer bound by the collective agreement referred to in subsection (2);
(b) determine whether the employees concerned constitute one or more appropriate bargaining units;
(c) declare which trade union, trade unions or council of trade unions, if any, shall be the bargaining agent or agents for the employees in such unit or units; and
(d)amend, to such extent as the Board considers necessary, any certificate issued to any trade union or council of trade unions or any bargaining unit defined in any collective agreement.
2For ease of exposition, the corporate respondents will be referred to simply as "New Dominion" and "A & P". Intervener #2, the United Steelworkers of America, will be referred to as "the Steelworkers". Intervener #1, Local 206 of the United Food and Commercial Workers International Union, will be referred to as "Local 206". "Dominion Stores Limited" will sometimes be referred to as "Dominion" to distinguish it from "New Dominion" which is really a subsidiary of A & P.
II
3This application relates to a retail food store in Chatham, Ontario. The employees at the store are currently represented by Local 206. The applicants assert that a transaction (or more accurately, a realignment of the business relationship) between New Dominion and A & P amounts to a "sale of a business" within the meaning of section 63 of the Labour Relations Act. The applicants assert that A & P is a "successor employer" bound by New Dominion's collective bargaining obligations. The applicants are seeking declaration to this effect together with certain relief under section 63(6) which will be discussed in more detail below.
4When this matter came on for hearing before the Board on March 3, 1986, the Steelworkers' union sought to intervene. The Steelworkers argued that the transaction or change of relationship between the respondents which may affect the bargaining rights of Local 206 will also affect the bargaining rights of the employees in the stores where the Steelworkers' union is the established bargaining agent. That, counsel argues, is a legal interest which entitles the Steelworkers to participate in this proceeding. It was conceded that the Steelworkers have already filed other section 63 applications designed to preserve bargaining rights where the Steelworkers' union already has bargaining rights, and that the Steelworkers have no members or bargaining rights at the Chatham store.
5After hearing the parties' submissions, the Board ruled, orally, as follows:
It is apparent that the United Steelworkers of America does not represent any employee in the store or bargaining unit affected by this application. The Steelworkers have no collective agreement affecting such employees. The parties all agree that no findings of fact or law made in these proceedings are binding in any subsequent proceedings involving employees in bargaining units represented by the Steelworkers. The parties also agree that no remedy will be sought or could be given in these proceedings which would affect the rights of the Steelworkers in those stores where it has bargaining rights. The focus of this case is very narrow: a single store in Chatham.
The applicants, the respondents and the intervener, Local 206, all assert that the Steelworkers have no interest in the present proceedings. We agree. There is no doctrine of res judicata which could bind the Steelworkers in some later proceeding involving different parties and, in accordance with the law as we understand it stated, for example, in Oakwood Park Lodge, one panel of the Board can and sometimes should reach a different legal conclusion even if there is no difference in the facts put before it. Here, of course, it is by no means clear that the circumstances affecting the Chatham store where Local 206 has bargaining rights will be the same as in Windsor where the Steelworkers have bargaining rights.
The Steelworkers have an "interest" in a colloquial sense because the "transaction" which affects the bargaining rights of Local 206 may affect the bargaining rights of the Steelworkers as well, and the Board's decision or reasoning may be referred to by counsel in some later proceeding. But that does not give the Steelworkers the right to intervene here or to participate as a party in the present proceeding. The rights of the Steelworkers and the employees it represents will be determined in another section 63 application which has already been filed but which has not yet been scheduled for hearing. We do not think the Steelworkers have such interest as would warrant making it a party in this case.
6After this ruling, counsel for the Steelworkers withdrew and counsel for the remaining parties met in an effort to reach agreement on the facts. Those agreed facts are as follows.
III
7For many years the applicants, UFCW Local 175 and 633, have represented the employees working in A & P's retail food stores across Ontario. For many years there has been a province-wide, multi-store collective agreement regulating the terms and conditions of employment for those employees. The agreement currently covers approximately 105 stores and 9,000 employees: 3,000 to 4,000 full-time employees, and 5,000 to 6,000 part-time employees. The relevant portions of the "recognition clauses" are as follows:
1.01 The Company recognizes Local Union 175 as the exclusive bargaining agent for all employees of the Company in its Retail Stores located in the Province of Ontario, save and except Assistant Store Managers, persons above the rank of Assistant Store Manager, Meat Department employees, persons regularly employed for not more than twenty-four (24) hours per week and students employed in off school hours and during the school vacation period.
1 .02 The Company recognizes Local Union 633 as the exclusive bargaining agent for all Meat Department employees of the Company in its Retail Stores located in the Province of Ontario, save and except persons regularly employed for not more than twenty-four (24) hours per week and students employed in off school hours and during the school vacation period.
1.03 The term "employee" or "employees" as used in this Agreement, unless clearly specified otherwise shall mean only those employees who are included in the bargaining unit, as described in Sections 1.01 and 1.02 above.
PART TIME
1.01 The Company recognizes the Union as the exclusive collective bargaining agent for all employees of the Company in its Retail Stores located in the Province of Ontario, regularly employed for not more than twenty-four (24) hours per week and students employed during off school hours and during the school vacation period.
1.02 The term "employee" or "employees" as used in this Agreement, unless clearly specified otherwise shall mean only those employees who are included in the bargaining unit, as described in Section 1.01 above.
(emphasis added)
All of A & P's retail employees fall into one of these three employee groupings: "full-time", "part-time", "meat department".
8In the spring of 1985, A & P purchased some 92 retail food stores from Dominion Stores Limited ("Dominion"). That transaction closed on or about April 29, 1985. The details are not relevant here, save to note that Dominion did not dispose of all of its retail food stores. There are approximately 30 stores still owned by Dominion; however, after April 29, 1986, that company will no longer be entitled to use the name "Dominion". We do not know precisely what will happen to those stores, but it is clear that they will not be operated or described as "Dominion" stores.
9For commercial reasons, A & P initially intended to maintain the separate identity and operation of the 92 stores it had acquired from Dominion. To accomplish this purpose, A & P incorporated a wholly-owned subsidiary named New Dominion Stores Inc. A & P and New Dominion shared an integrated warehousing facility, but the store operations themselves were kept separate. The employees who formerly worked for Dominion became employees of New Dominion, which paid their wages and otherwise assumed the responsibilities of employer. There was no immediate impact on the bargaining rights of the applicants or the employees they represent. Pursuant to section 63 of the Labour Relations Act, New Dominion, as a successor employer, assumed any outstanding collective bargaining obligations which Dominion may have had with its employees, including those in the Chatham store. In the Chatham store, the employees are represented by Local 206 which has entered into a collective agreement with New Dominion which is to expire in September 1986. The recognition clause of that collective agreement reads as follows:
1.01 The Union shall be the sole and exclusive bargaining agent for all employees of New Dominion Stores, Inc. at its retail stores in Chatham and Wallaceburg, and the townships of Dover and Chatham, Ontario, save and except Store Managers, persons above the rank of Store Manager, Assistant Store Manager.
1.02 The wages, working conditions and all other matters relative to persons regularly employed for not more than twenty-four (24) hours per week and students employed during the school summer vacation period shall be only as outlined in Appendix "B".
10Although A & P decided initially not to integrate the "Dominion" stores into its existing chain of retail foods stores, there was some recognition that these stores had become a part of the A & P corporate family. The integrated warehouse facility is one example, but there were others at the local level. In May 1985, an assistant store manager from the Chatham A & P store spent about a week in the newly acquired "New Dominion" store to assist in the transition. So did a head cashier from the Chatham A & P store. She stayed for only a week, then returned to her own store.
11Both individuals were "borrowed" because they were handy and, for that brief period, there were no comparable New Dominion employees readily available. The assistant store manager was and continues to be an employee of A & P, excluded from the applicants' bargaining unit. Because he exercises managerial functions he is not, in any event, an "employee" under the Labour Relations Act. The head cashier is an employee in the applicants' bargaining unit, but, at the time, it was agreed that for the few days that she was "borrowed" to work in the New Dominion store in Chatham, she would continue to be paid and directed by A & P and covered by the provincial collective agreement between the applicants and A & P. Finally, in August 1985, there was a change in the role played by A & P's "field supervisors" who occupy a managerial position immediately above that of the local store manager. The field supervisor responsible for the Chatham A & P store assumed the additional responsibility to monitor the operations of the Chatham New Dominion Store.
12On Saturday, January 25, 1986, the Chatham New Dominion store closed as usual at 9:30 p.m. The following day all "Dominion" signs and logos were removed from the premises and equipment, and A & P signs or logos put in their place. From Monday, January 27th to Wednesday, January 30th, products with the Dominion label were removed from the shelves and replaced by A & P private label stock. This task was accomplished by the local staff, with the assistance of managers and assistant managers from A & P stores in Windsor and Wallaceburg. The Chatham New Dominion store which was previously identified for corporate purposes as New Dominion store number 980, became A & P store number 362. For all intents and purposes, it is now the same as any other A & P store. The A & P assistant store manager who came over in May 1985 to assist in the transition to New Dominion has returned as the manager of what has now become the second A & P store in Chatham.
13Since the end of January 1986, other New Dominion food stores have been converted into A & P stores - although there are a number of stores which are still being run by A & P as "Dominion" stores. Labour relations policies are controlled centrally by A & P, but New Dominion stores continue to have different pricing, advertising and marketing policies. However, those New Dominion locations recently converted to A & P stores are indistinguishable from the A & P stores covered by the applicants' collective agreement. The employees in Chatham will be paid by A & P, which will undertake all employer responsibilities with respect to unemployment insurance, income tax deductions, Workers' compensation, etc. Indeed, counsel for the respondents advised the Board that, as of February 23, 1986, New Dominion will no longer exist as an independent corporate entity, but will become the "New Dominion Stores Division" of A & P. Counsel for the respondents was not sure of the precise details or time table for winding up the affairs of New Dominion Stores, Inc., nor was he sure whether there would be any formal transfer to A & P of assets nominally owned by New Dominion. He submitted that, as a practical matter, formal legal ownership really does not matter very much because New Dominion was, in any event, a wholly-owned subsidiary of A & P, and thus, subject to its total control. In the case of the Chatham store, A & P has, in fact, assumed total control over the assets, stock-in-trade, equipment and business formerly operated at that location by New Dominion, and has directed the various renovations and changes mentioned above. As counsel for the respondents pointed out, since this business re-organization was "all in the family", the precise legal details are not particularly relevant - at least for labour relations purposes. For example, in the case of the employees working at the Chatham New Dominion store, it is apparent that A & P has, de facto, become their employer.
IV
14The applicants assert that A & P has become a "successor employer" within the meaning of section 63 of the Labour Relations Act and has therefore assumed the collective bargaining obligations of New Dominion. They argue that A & P has become bound by the collective agreement between New Dominion and Local 206; but the terms of that agreement are in conflict with those of their own province-wide collective agreement. The provincial agreement recognizes the applicants as the sole and exclusive bargaining agents for all A & P employees in Ontario, while the Local 206 agreement recognizes Local 206 as the exclusive bargaining agent for employees in Chatham and Wallaceburg, and the townships of Dover and Chatham. The conflict is underlined by the fact that there is already an A & P store in Chatham where the employees are covered by the provincial agreement.
15The applicants further contend that there has been an "intermingling" of employees that would trigger the remedial responses enumerated in section 63(6) of the Act. The applicants argue that the conversion of the New Dominion store imperils their bargaining rights, since it undermines the intent of the province-wide agreement and raises the spectre of employees currently represented by the applicants under that agreement being transferred to the Chatham or other recently converted New Dominion stores. Ordinarily, any new A & P store would automatically fall within the scope of the provincial agreement. Any business expansion or re-organization would take place within that established collective bargaining framework. Now, there is the possibility that in some circumstances a new A & P store can open beyond the scope of the provincial agreement.
16Counsel for the applicants points out that there is already an established A & P store in Chatham. If that store were to close, A & P could continue to service its customers from the converted New Dominion store and the applicants' members would be out of a job, with no right of transfer to the job opportunities in their own locality. This, counsel contends, is contrary to their rights and the established practice under the provincial agreement. The applicants urge the Board to declare that A & P is no longer bound by the Local 206 collective agreement - with the result that the employees at the new A & P store will automatically fall within the scope of the provincial agreement. The applicants maintain that the province-wide unit is the appropriate one under section 63(6)(b) of the Act. Alternatively, the applicants assert that the Board should conduct a representation vote to test the wishes of the employees currently represented by Local 206. If the majority of the employees indicate their preference for the applicants, then the Board should declare that the Local 206 agreement is void and that the store falls within the scope of the provincial agreement with A & P.
17Local 206 argues that there has been no "intermingling" and that, even if there has been intermingling, there is no reason for the Board to hold a representation vote or erase Local 206's bargaining rights. Counsel for the corporate respondents submitted that his clients did not view the situation as a "sale of a business", but in any event there was no reason in law or policy why the agreement with Local 206 should be set aside. In the respondents' submission, there had been no intermingling and the purpose of section 63 was to preserve not extend bargaining rights. A & P emphasized however that it has had a long-standing and generally amicable relationship with the applicants and Local 206 (which, of course, is another Local of the same union) and is quite content to abide by whatever determination the Board might make. The events precipitating this application arose from efforts by A & P to adapt its organization to meet the challenge of a troubled and highly competitive market. There is no suggestion or allegation of anti-union animus.
V
18We have no difficulty in concluding that there has been a transfer to A & P of at least part of the business of New Dominion - namely, the Chatham store. Indeed, it would appear that the corporate re-organization described by the respondents will ultimately result in A & P becoming the employer of all of the individuals now working in the New Dominion stores even if those stores continue to operate under the "Dominion" logo. We find that there has, therefore, been a "transfer" of a "business" or "part of a business" from New Dominion to A & P and that pursuant to section 63 of the Act A & P is the successor to New Dominion in respect of the collective bargaining obligations formerly existing between Local 206 and New Dominion. We have more difficulty with the applicants' assertion that there has been an intermingling of employees within the meaning of section 63(6) of the Act, or that the Board should terminate the bargaining rights of Local 206 or direct the taking of a representation vote.
19The purpose of section 63 of the Act is to preserve a union's bargaining rights and the employees' collective agreement when a business has been transferred from one employer to another. In the absence of section 63, those rights would be jeopardized simply because of the change in the legal identity of the employer. However, section 63 is essentially conservative in its thrust: it protects such rights as an applicant union may have in the "like unit" that existed prior to the transfer. That is the principle focus of the section.
20We are not persuaded that the applicants have established an intermingling of employees as contemplated by section 63(6) of the Act. None of the managerial personnel referred to are "employees" within the meaning of the Act (see section 1 (3)(b)), nor does their activity or change of role in any way impinge upon or complicate the established bargaining relationship of Local 206. The only member of the applicants arguably "intermingled" with New Dominion employee members of Local 206 is a head cashier who ten months ago spent a week in the Chatham store - and, at the time, she was still paid and treated as if she were part of the provincial bargaining unit and covered by the provincial collective agreement. Currently, there is no intermingling at the level of the bargaining unit employees, nor is there any evidence that such intermingling is likely to occur in the near future. As things now stand, the rationalization of A & P's operation which has done away with a separate legal identity of New Dominion Stores, Inc., has not been accompanied by a transfer of any employees from one collective bargaining regime to another.
21Even if we were to find a token intermingling which, technically, might trigger the remedies contemplated by section 63(6), we see no reason on these facts to invoke such remedies. The mischief to which section 63(6) is directed is a situation in which there is a de facto overlap or merger of bargaining units, so that it is difficult to preserve bargaining rights in the "like unit" without creating operational problems for the successor employer or prejudicing the established rights of the employees. It would make no sense if employees working side by side performing similar tasks were subject to different collective bargaining regimes. In such circumstances, it might also make sense to direct a representation vote to determine which of two unions the employees wish to represent them. But that is not the case here. The "like unit" - the former New Dominion store in Chatham - is easily defined and the employee complement represented by Local 206 has not, in fact, been altered by transfers out of that bargaining unit, or the introduction of new employees who may have different union allegiances. In short, there is no reason at this stage to put the bargaining rights of Local 206 to the test of a representation vote. It may be that some of the employees in the Chatham store may consider it advantageous to be represented by the applicants or enjoy the benefits of the provincial agreement. However, that is not a sufficient reason for the Board to exercise its discretion under section 63(6) of the Act. We should also note that if the employee-members of Local 206 wish to be represented by the applicants, those employees will have the opportunity to exercise that option in about four months, during the open period of their own collective agreement.
22For the foregoing reasons, the Board is not prepared to declare that A & P is no longer bound by the Local 206 agreement or to exercise its remedial discretion under section 63(6) to direct that a representation vote be taken. However, it is necessary for the Board to exercise its authority under section 63(4) of the Act to define the like bargaining unit and resolve the apparent conflict between the two collective agreements to which A & P has become bound by virtue of section 63(2) of the Act. In our view, the most sensible way of doing so is to amend the provincial collective agreement so as to preclude its application to the former New Dominion store where Local 206 has bargaining rights, and to amend the current Local 206 agreement to make it clear that it does not apply to the other stores that exist or may be opened in the Chatham-Wallaceburg area. Our intention is to preserve but also confine the rights of Local 206 to the store where it had bargaining rights prior to the transaction under review.
23Having regard to the foregoing and pursuant to section 63(4) of the Act, the Board directs that:
a) The scope clause of the Local 206 collective agreement is amended to read "the union shall be the sole and exclusive bargaining agent for all employees of the Great Atlantic & Pacific Company of Canada Limited at its retail store at 671 Grand Avenue, East, in Chatham, Ontario, save and except store managers, persons above the rank of store manager, and assistant store manager".
b) The A & P provincial collective agreement for full-time personnel shall include in Articles 1.01 and 1.02 the additional words "and employees at its retail store located at 671 Grand Avenue, East, Chatham, Ontario". The same words are hereby also added to Article 1.01 of the part-time provincial agreement.