Lumber and Sawmill Workers' Union, Local 2995 of the United Brotherhood of Carpenters and Joiners of America v. Rexwood Products Limited, 1987 CanLII 3017

[1987] OLRB Rep. February 267

1114-85-U; 0117-85-M Lumber and Sawmill Workers' Union, Local 2995 of the United Brotherhood of Carpenters and Joiners of America, Applicant/Complainant, v. Rexwood Products Limited, Respondent

BEFORE: Robert J. Herman, Vice-Chairman, and Board Members R. J. Gallivan and L. C. Col­lins.

APPEARANCES: Paul Falzone, Marcel Lacroix, Sid Adams and Rocky Skinner for the complainant/applicant; Michael G. Horan and Jack Lacarte for the respondent.

DECISION OF THE BOARD; February 27, 1987

1. As noted in an earlier decision in these proceedings, dated August 9, 1986, these two natters are a complaint filed pursuant to section 89 of the Labour Relations Act, alleging violations f sections 50, 64 and 67 of the Act, and an application pursuant to section 106(2) of the Act, ask­ing that the Board determine whether a particular individual is an "employee" for purposes of the Act. In the prior decision, the Board declined to defer these matters to arbitration.

2. The union alleges that an employee within the bargaining unit, Mr. Gaetan Touzin, has been removed improperly from the bargaining unit by the respondent employer seeking to pro­mote Touzin to a supervisory position outside coverage under the collective agreement. In its application under section 106(2), the union alleges that there has been no material or substantial change in Touzin's duties and responsibilities, that he was included under the collective agreement prior to his purported promotion, and that he does not exercise managerial functions within the meaning of section 1(3)(b) of the Act. The union further alleges that the respondent employer was motivated by a desire to avoid dealing with the union, or, alternatively, a desire to circumvent the provisions of the collective agreement, and is thereby in violation of sections 64 and 67 of the Act. The employer's attempt to exclude Touzin from coverage under the collective agreement is also

allegedly contrary to section 50 of the Act.

3. Except for disagreement over the duties and responsibilities exercised by Touzin subse­quent to the promotion, the parties were not in substantial dispute with respect to the relevant facts. Touzin was initially hired by the respondent in January, 1978 as an electrician. Touzin had previously been working for another employer in the area, and in order to attract him, the respon­dent had to offer Touzin more money than the collective agreement provided at that time for employees in his category. The day after he began to work for the company, the company advised the union of its intention to pay Touzin a wage greater than the collective agreement provided. The union raised no objection at the time. Pursuant to this special arrangement with Touzin, the company did pay him the higher amount for some period, although the evidence is unclear as to how long such payments continued. What was clear from the evidence was that shortly after a wild­cat strike in 1979, Touzin reverted to the wage rates contained in the collective agreement, and by that time the union had raised its objection to the higher wage rate.

4. In the late summer or early fall of 1984, Jack Lacarte, Vice-President and General Man­ager of the respondent, met with Touzin to discuss his work situation. Lacarte testified that during this conversation, Touzin raised his concern with his wage rates and indicated that he wanted to receive more money than the collective agreement provided for him. Touzin indicated to Lacarte that if he was going to be asked to take more responsibility in the electrical department, he wanted to be made a supervisor. There was also some discussion at that time about the possibility of con­tracting out the electrical work to Touzin, but Lacarte indicated that was not a satisfactory approach as the company could not then rely upon Touzin's services to the extent they felt neces­sary. Lacarte further testified that in the late summer or early fall of 1984, he offered to make Touzin a supervisor. Mr. Touzin made clear to Lacarte that if he did not receive more money he would be leaving the employ of the respondent.

5. The company notified the union in a letter dated January 15, 1985, that Touzin was removed from the bargaining unit as of January 1, 1985. As that letter stated, "It has been the desire of the company to have Mr. Touzin work on a contract basis and he is pleased to accept the changeover". Also on January 15, 1985, Lacarte provided to the union a list of current supervisors in the plant. Touzin was not listed as a supervisor; only his supervisor, Peter Lemon, was listed as "electrical supervisor". It is common ground that the only two electricians at the plant throughout the entire relevant period were Lemon and Touzin. Two days after the letter noting that Touzin was going to work on a contract-out basis, the union responded indicating their objection on the basis that "the classification of electrician or any other classification listed in the collective agree­ment cannot be removed from the bargaining unit. The only employees in the plant and yard that are outside the bargaining unit are supervisory personnel...". On February 21, 1985, the union filed a grievance objecting to the purported removal of Touzin through contracting-out, as set out in the company letter of January 15th. The company's response to the grievance was dated March 11, 1985, and noted that Touzin had been appointed electrical supervisor, effective January 1985 (the same time it purported to have contracted out work to Touzin), and, as such, was outside cov­erage of the collective agreement. On the same date, the company provided to the union a revised list of its supervisors, retroactive to January. The only change on this list of March 11th, from the list of supervisors provided in January, was that Touzin had been added as electrical supervisor. Again, we note that the supervisors list provided on January 15, 1985, and presumably up to date as of that day, did not list Touzin as electrical supervisor. It was only the subsequent list issued arch 11, 1985 (after the union had grieved objecting to the purported contracting out to Touzin) that listed Touzin as supervisor, but effective January 15, 1985.

6. Although Lacarte testified otherwise, we find as a fact that the union was not advised that Touzin was purportedly made supervisor until it received, around March 13, 1985, the reply to the grievance indicating that Touzin had been promoted and the list of supervisors retroactive to January 15th. Lacarte explained the peculiar timing of the notices as follows. The notice sent to the union on January 15th indicating that Touzin was going to work on a contract-out basis was sent when Lacarte was "considering making him a contractor". When the union objected on January 17th to this course of action, it more or less confirmed Lacarte's decision that the contracting out was inappropriate and he, accordingly, took steps to stop it. At that stage he "could see that there was no way he was going to receive any co-operation" from the union (presumably in his attempt to pay Touzin more than the collective agreement wage rates) and he went ahead with making Touzin a supervisor, as he had intended since late summer or early fall of 1984. He so promoted Touzin within the first two weeks of January 1985, but did not advise the union at that time because of the "rule of thumb" that the union was only advised within three months of any such promotions. Lacarte offered no explanation as to why the supervisors list of January 15, 1985 did not contain Touzin's name. There was no suggestion that the union was ever aware of Lacarte's or the respondent's direct dealings with Touzin over his wage rates, nor any suggestion that it endorsed such direct discussions.

7. With this evidentiary background we turn to consider the first issue before us: whether Touzin exercises such managerial duties and responsibilities that in our opinion he ought to be und to fall within section 1(3)(b) of the Act. The classification of electrician is covered by the col­lective agreement and Touzin was admittedly an "employee" and subject to that collective agree­ment prior to January 1985 and his purported promotion. The Board must ask itself whether there has been any noticeable change in those duties and responsibilities subsequent to January 1985. For reasons given below, the Board is not satisfied that Touzin is not an "employee" for purposes of section 1(3)(b) of the Act and we do not find that he exercises such managerial functions as to 1?e excluded from coverage under the Act.

8. Lacarte identified in evidence a job description he had drawn up indicating the duties and responsibilities of Touzin subsequent to the promotion. Lacarte testified that the job description accurately reflected those duties and responsibilities. There was no other evidence led, by either party, which suggested that Touzin might exercise managerial functions such that he ought to be excluded from coverage under the Act. The Board is not prepared to give any significant weight to this job description and Lacarte's assertion that it accurately reflects Touzin's job func­tions. We say this for several reasons. First, the job description was drawn up in September of 1985, approximately nine months after the purported promotion took place, and several months after these two applications were filed with the Board. The job description was not shown to the union prior to its introduction at the hearing into this matter. Second, Lacarte himself acknowl­edged in his testimony that Horst Breunig, the plant supervisor, was the immediate supervisor of 11 supervisors within the plant, including Touzin, and that all the supervisors reported directly to Breunig, not to Lacarte. Lacarte indicated that if he wanted information about any of these individuals that his immediate contact was Breunig. Based on his own testimony, it does not appear that Lacarte would have interacted to any meaningful extent with Touzin in his performance as supervisor. Third, one of the union witnesses in cross-examination indicated that he participated in a discussion on or about February 14, 1985, in his foreman's office, and also participating in the discussion was plant supervisor Breunig. The union witness testified that they had been discussing Touzin's status and wages, and during the course of the discussions Breunig indicated that Touzin's job content and duties and responsibilities had not changed subsequent to his purported promo­tion, only his wages had. Breunig is of course the same individual whom Lacarte himself indicated directly supervised Touzin. The company did not call Breunig to testify and the evidence that Breunig felt Touzin's duties had not changed remains unchallenged. Parenthically, we note that Touzin was present in the hearing room and available to be called as a witness but also was not called to testify. Fourth, the evidence that was led, through Lacarte and the job description and the union's cross-examination of Lacarte, suggested that Touzin's duties and responsibilities had not changed subsequent to the promotion in any meaningful respect from what they had been prior to January of 1985. Any managerial aspects of those duties and responsibilities are incidental to the prime purpose and functions performed by Touzin. For all these reasons, the Board finds that Touzin does not exercise managerial functions within the meaning of section 1(3)(b) of the Labour Relations Act, and we find that he is an employee for purposes of the Act.

9. We turn now to consider whether the company has violated any of the pleaded sections of the Labour Relations Act. The company wanted to pay Touzin more than the wage rates con­tained for his classification in the collective agreement, as it reasonably feared he would quit if he did not receive higher rates. The company understandably wished to retain his services, and it tried to find some way to pay him more than the collective agreement provided. After paying him a higher rate for a time, it became apparent to the company that the union continued to object to such payments and accordingly the company began to pay him the rate contained within the collec­tive agreement. Touzin remained unhappy with this arrangement, made this clear to the company in discussions with Lacarte, and the company again attempted to find a way to pay him more. At that time, the company was well aware that the union objected to Touzin receiving more than the collective agreement wage rate. The respondent tried to accomplish this by having Touzin work on a contract basis, rather than as an employee, and took immediate steps to notify the union of this approach. When the union objected (reaffirming its long standing position), by its letter of January 17th and by filing a grievance on February 21, 1985, the company purported to promote Touzin to supervisor, and thereby out of coverage under the collective agreement. It is clear that the purpose of the purported promotion was at least in part based on a desire to circumvent the provisions of the collective agreement and to enable the respondent to pay Touzin a higher wage. The company effectively conceded this factual conclusion in its submissions before the Board.

10. In final submissions, the union conceded the company did have a business reason to want to retain Touzin's services, and to therefore want to pay him more than the collective agree­ment rates, but the union submitted that if the means to effect this purpose was illegal, then an unfair labour practice was still committed. Counsel submitted that what has really occurred is that the company has attempted to deal with Touzin directly and on an individual basis, as it was unsuc­cessful in getting Touzin's exclusive bargaining agent to agree to higher wage rates. In effect, the company through this scheme of conduct has attempted to get around the provisions of the collec­tive agreement and the requirement of negotiating with the union and it is that intent and course of action which elevates this scheme to a violation of sections 64 and 67 of the Act. The applicant fur­ther submitted that the company wants to remove Touzin from the bargaining unit, not only to pay him more money, but also to undermine the bargaining power of the union by reducing the size of the bargaining unit, and should there be a strike in the future, by ensuring that Touzin will be able to work and the company will be able to continue to conduct business during the strike period. The union made no submissions with respect to the alleged violation of section 50 of the Act.

11. Counsel for the respondent submitted that no unfair labour practice had occurred, as the company had a legtimate reason for its conduct, and the employee in question benefited there­by. There was not present any anti-union animus or any attempt to avoid dealing with the union; to :he contrary the company notified the union each time of what it was purporting to do and when he union objected, firstly, to Touzin being paid more than the collective agreement rates, the company stopped so paying him and secondly, when the union objected to the contracting out arrangement, the company cancelled that as well. The legitimacy of the promotion can properly and appropriately be tested through resort to an independent third party adjudication, arbitration. As every action was done openly and with the union being advised, if the promotion was in fact, valid and Touzin is not covered under the provisions of the collective agreement, it cannot be said that the company has committed an unfair labour practice in so promoting him.

[2. Section 50 of the Act reads as follows:

"A collective agreement is, subject to and for the purposes of this Act, binding upon the employer and upon the trade union that is a party to the agreement whether or not the trade union is certified and upon the employees in the bargaining unit defined in the agreement."

Both because the union made no submissions with respect to the alleged violation of this section, and because it is unnecessary given our findings with respect to section 64 and 67 of the Act, we do not propose to consider section 50 further.

13. Section 64 of the Act reads as follows:

"No employer or employers' organization and no person acting on behalf of an employer or an employers' organization shall participate in or interfere with the formation, selection or adminis­tration of a trade union or the representation of employees by a trade union or contribute finan­cial or other support to a trade union, but nothing in this section shall be deemed to deprive an employer of his freedom to express his views so long as he does not use coercion, intimidation, threats, promises or undue influence."

14. Although prior cases of the Board on point have generally dealt with employer communications to employees during negotiating or bargaining conduct, they provide some assistance. In The Citizen, [1979] OLRB Rep. March 177, the Board made the following comments (at paragraph 56 therein):

"Counsel's complaint about The Citizen's statements of July 19th, and the statements contained in its July 24th offer, raise again the issue of the propriety of an employer communicating directly with its employees during the course of negotiations. The question of the extent to which an employer may engage in such communications was fully canvassed by the Board in A.N. Shaw (supra). In that case the Board stated that although employers must be circumspect when communicating with their employees, especially during negotiations, not all communica­tions between employers and employees are prohibited by the Act. Section 56, prohibiting employer interference with the formation, selection or administration of a trade union, or the representation of employees by a trade union, expressly provides that this very general prohibi­tion does not 'deprive an employer of his freedom to express his views so long as he does not use coercion, intimidation, threats or undue influence'. It is only when communications between employer and employees go beyond the bounds of legitimate freedom of expression and encroach upon the union's exclusive right to bargain on behalf of its employees that they become illegal. Such communications become illegal only when they represent, 'in reality', an attempt to bargain directly with employees. Direct bargaining with employees is expressly pro­hibited by section 59 [now section 67] of the Act."

And see Extendicare Health Services Inc., [1985] OLRB Rep. Nov. 1578.

15. Whether or not direct negotiations with an employee, who is represented by a trade union, with respect to altering the wages under which the employee will work constitutes interfer­ence with the "administration of a trade union", it is clear that such negotiations or discussions would interfere with "the representation of employees by a trade union" within the meaning of that phrase in section 64. Regardless of whether the respondent had business interests at stake, its conduct in discussing with Touzin, privately and in the face of its knowledge that the union objected to Touzin receiving higher rates than in the collective agreement, was at least partly moti­vated by an intention to avoid the collective agreement. Such discussions were clearly designed to attempt to negotiate his wage rates with Touzin directly. Direct dealings with an employee which circumvent the union's exclusive bargaining rights, at least where, as here, they are for the explicit purpose of avoiding the provisions of the collective agreement (even where higher rates are being negotiated) constitute interference with the representation of an employee by his or her trade union. The union is authorized under the scheme of the Act, and upon obtaining bargaining rights with respect to the employees whom it represents, to act as the exclusive bargaining agent of those employees. Any attempts by employers to detract from that exclusivity and to deal directly with an individual bargaining unit member, where it is clear that the employer intended to deal directly with the employee in an attempt to negotiate terms and conditions of employment that differ from the collective agreement provisions, violates section 64. That the individual employee was a willing participant in such discussions, or that the discussions were designed to pay the employee more than the collective agreement provided, does not excuse their illegality. It is the union's right, obtained in the instant case through certification proceedings and the awarding of bargaining rights, that is at stake and which must be protected under section 64.

16. It is no defense for the respondent to note it advised the union throughout once it had taken its various positions; for example, it immediately advised the union of its contracting out to Touzin and similarly advised it upon promoting Touzin to a supervisor's position. The illegal aspect of the company's course of conduct lies in its intentionally dealing directly and on an individual basis with Touzin for the reasons it did, and thereby circumventing dealing with his exclusive bar­gaining agent. The company first attempted to negotiate a higher wage rate with the union's aware­ness and compliance, but once it was clear the union would not accept such individual treatment, the company turned to directly discussing with Touzin how to nevertheless accomplish paying him higher wage rates. Although the union did not object to such higher rates when Touzin was first hired, by 1979 it was clear to the company that the union did so object and notwithstanding such objection, the company continued to discuss individually with Touzin how to accomplish such an end. Such conduct in these circumstances can only be viewed as an attempt by the company to bar­gain directly with the individual employee with respect to getting around his wage rates as set out in the collective agreement, and such conduct we find violates section 64.

17. Section 67(1) of the Act reads as follows:

"No employer, employers' organization or person acting on behalf of an employer or an employers' organization shall, so long as a trade union continues to be entitled to represent the employees in a bargaining unit, bargain with or enter into a collective agreement with any per­son or another trade union or a council of trade unions on behalf of or purporting, designed or intended to be binding upon the employees in the bargaining unit or any of them."

18. The Board considered the effect of section 67(1) in American Can Canada Inc., [1983] OLRB Rep. Oct. 1609 where it wrote, in part, as follows in paragraph 9 therein:

"As noted by the Board in A. N. Shaw Restoration Ltd., [1978] OLRB Rep. May 393, at para­graph 17, the scheme of the Labour Relations Act contemplates that the acquisition of bargain­ing rights by a union carries with it an exclusive license to bargain on behalf of the employees in its bargaining unit. That exclusivity of the union's bargaining rights is expressly protected by sec­tion 67(1) which prohibits employers from bargaining directly with employees represented by a union. It is apparent from the facts set forth above that for over twenty-five years the employer has recognized the complainant as the exclusive bargaining agent for the (bargaining unit) employees at its Hamilton plant. It is also apparent that, far from attempting to bargain directly with those employees, the respondent, through the impugned direct communications with employees, has been attempting to arrange a meeting with the Executive of Local 354, as the employees' duly recognized bargaining agent, to discuss an extension to the collective agree­ment currently in force. Thus, the substance of those direct communications clearly indicates that at all material times it was the intention of the respondent to continue to recognize the com­plainant as the exclusive bargaining agent for its Hamilton plant employees. Accordingly, we are satisfied that neither the respondent, nor any person (or organization) acting on behalf of the respondent, has bargained with (or entered into a collective agreement with) any person or trade union other than the complainant in respect of the Hamilton plant bargaining unit. Accordingly, we find that there is no merit in the complainant's allegation that the respondent has contravened section 67(1) of the Act."

19. As can be seen, the Board in that case found no violation of section 67(1) in that res­pondent's conduct. In our circumstances, distinguishing it from those before the Board in American Can Canada Inc., it was clear to the respondent that the union was not condoning the respondent's conduct in dealing directly with Touzin, and in fact the evidence suggests the union as not aware that the respondent continued to deal directly and individually with Touzin. As ell, the substance of the communications before us, and their purpose, were both clearly designed to circumvent the role of the union as exclusive bargaining agent for Touzin, and its role in negoti­ating for his terms and conditions of employment, along with the terms and conditions of employ­ment for the other employees whom it represented. The conduct complained of did not involve order line communications, condoned previously by the applicant, but rather involved a series of direct bargaining attempts, motivated by a desire to get around the provisions of the collective agreement, and ultimately leading to purported promotion of the employee out of the bargaining unit. The breach was committed when the employer attempted to negotiate directly with Touzin, absent the union's consent, with respect to his terms and conditions of employment. That the intention of such negotiations was to circumvent the provisions of the collective agreement, for the urposes of section 67, merely reinforces the need to proscribe such activity. The gravamen of the violation of section 67(1) was the employer's direct negotiations or dealings with Touzin about one of his terms of employment, without having obtained authorization from the union for such negoti­ations, and we find that the respondent has accordingly breached section 67(1).

20. Employees within the bargaining unit, should the employer be allowed to negotiate pri­vately with Touzin and pay him higher wage rates, would clearly perceive their bargaining agent as having limited authority or purpose, and the satisfaction of bargaining unit members with the applicant would be seriously undermined. Such erosion of employee respect for their bargaining agent would be increased by their awareness that an employees circumventing the union and nego­tiating directly with his employer, was able to obtain higher wages than the collective agreement provided and than the union could obtain for him.

21. For the above noted reasons we find that the employer has violated both section 64 and 67 of the Act, in its course of conduct in bargaining directly with Touzin with respect to his wage rate, without the consent of the union, and in its attempt to circumvent the provisions of the collec­tive agreement. With respect to remedial relief we make the following declarations or orders:

a) We declare that Gaetan Touzin is an employee of the respondent, and does not exercise managerial functions so as to exclude him from cover­age of the Act pursuant to section 1(3)(b) of the Act;

b) we direct that Touzin be reinstated to his former position as Class "A" Electrician, a member of the bargaining unit, and that his wage rate be that as contained in the collective agreement for his classification, until such time as he is no longer properly a member of the bargaining unit. Any back union dues with respect to Touzin owed to the union by the company are to be remitted forthwith, together with interest, to the applicant, as if Touzin were continually within the bargaining unit from his hiring to the date of this decision, or until such time as he is no longer properly a member of the bargaining unit, whichever is earlier.

c) We are concerned that the remedial relief should address to the extent possible any undercutting or undermining of the union's ability to represent employees in the bargaining unit because of the employer's breach of the Act. We therefore consider it appropriate that employees be apprised of the nature of the breaches of the Act involved. The respon­dent is accordingly directed to post copies of the attached notice marked "Appendix", after being duly signed by the respondent's General Man­ager, in conspicuous places where they are likely to come to the attention of employees in the bargaining unit, and keep the notices posted for sixty consecutive working days. Reasonable steps shall be taken by the res­pondent to ensure that the notices are not altered, defaced or covered by any other material.

Other than the remedial declarations or orders granted above, no further relief was requested.

22. We remain seized of this matter should there be any problems with respect to the implementation of our directions.

Appendix

The Labour Relations Act

NOTICE TO EMPLOYEES

Posted by Order of the Ontario Labour Relations Board

WE HAVE POSTED THIS NOTICE IN COMPLIANCE WITH AN ORDER OF THE ONTARIO LABOUR REI.ATIONS ROARD ISSUED AFTER A HEARING IN WHICH BOTH THE COMPANY AND THE UNION FULLY PARTICIPATED. THE ONTARIO LABOUR RELATIONS ROARD FOUND THAT WE VIOLATED THE LABOUR RPLATIONS ACT IN OURR ATTEMPTS TO PAY GAETAN TOUZIN MORE THAN THE COLLECTIVE AGREEMENT PROVIDED.

THE ACT DOES NOT ALLOW US TO ATTEMPT TO NEGOTIATE OR BARGAIN DIRECTLY WITH AN EMPLOYEE IN THE BARGAINING UNIT, WITH RESPECT TO ANY OF HIS OR HER TERMS AND CONDITIONS OF EMPLOYMENT, NOR DOES IT ALLOW US TO ATTEMPT TO GET AROUND AMY OF THE PROVISION OF THE COLLECTIVE AGREEMENT BY DEALING DIRECTLY WITH INDIVIDUAL EMPLOYEES. WE HAVE BEEN FOUND BY THE ONTARIO LABOUR RELATIONS ROARD TO HAVE DONE BOTH THINGS, AND THIS CONDUCT WAS IN VIOLATION OF THE ACT.

THE UNION IS YOUR EXCLUSIVE BARGAINING AGENT AND WE MUST BARGAIN WITH THEM, AND NOT INDIVIDUAL EMPLOYEES, WITH RESPECT TO TERMS AND CONDITIONS OF EMPLOYMENT, AND WE ASSURE ALL EMPLOYEES THAT WE WILL DO SO.

REXWOOD PRODUCTS LIMITED

PER: _____________________________

(AUTHORIZED SIGNATURE)

This is an official notice of the Board and must not be removed or defaced.

This notice must remain posted for 60 consecutive working days.

DATED this 27TH day of FEBRUARY 1987.