[1988] OLRB Rep. January 13
2007-87-FC Teamsters Local Union No. 419, affiliated with the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Applicant v. Crane Canada Inc., Respondent
BEFORE: Rosalie S. Abella, Chair, and Board Members W. Correll and A. Hershkovitz.
APPEARANCES: Nelson Roland, John A. Stewart, Larry Bouillon and Conrad Sobon for the applicant; E. Rovet, Robert A. Hall and A. Sabada for the respondent.
DECISION OF THE BOARD; January 15, 1988
- This is an application for a direction that a first collective agreement be settled by arbitration pursuant to section 40a of the Labour Relations Act. At the outset of these proceedings, both parties agreed to waive the statutory time limits.
THE FACTS
The union was certified on December 23, 1986, gave Notice to Bargain on January 14, 1987, and gave its first set of proposals to the company, Crane Canada Inc., on January 29, 1987. The company tendered its first proposal on February 2, 1987. Negotiating sessions dealing with non-monetary issues took place on March 12, March 23, April 7, April 10, and May 19. By mutual agreement, the monetary issues, including benefits, were to be dealt with the assistance of a Conciliation Officer. By the end of the May 19 session, most non-monetary and language issues had been agreed upon and the union, therefore, requested the appointment of a Conciliation Officer to deal with the outstanding issues. An officer was appointed on June 1 and the first meeting under her auspices took place on June 30, 1987.
There is no dispute between the parties that prior to the June 30th meeting, negotiations had gone well. The company had been represented by A. Dixon, Manager of the plant, Robert Hall, Vice-President responsible for the company's Supply Division consisting of 40 branches across Canada, and their counsel Ernest Rovet. The union was consistently represented by John Stewart, Recording Secretary of Local 419 and Larry Bouillon, and the union steward.
The union's application is based on the events at the subsequent negotiating sessions which took place on June 30, August 26 and October 6, 1987. It is their contention that the company's conduct from June 30 until the date of this application on October 22 represents "the failure of the respondent to make reasonable or expeditious efforts to conclude a collective agreement", in accordance with section 40a(2)(c) of the Act. Although considerable evidence was led dealing with the details of the pre-June bargaining sessions, in view of the assertions of both parties that these sessions proceeded routinely, there is no need to outline them here.
Going into the June 30th session, the outstanding issues were union security (Article 4.01 of the Company's May 19, 1987 draft agreement), the selection of persons to act as arbitrators (Article 7.02), qualifications for entitlement to Statutory Holidays (Article 12.03 and 12.04), seniority in the event of work absence (Article 14.02 (e) and (f)), the term of the agreement and retroactivity of wages (Article 23.01), health and welfare benefits (Article 17), and wages, including shift premiums (Article 10). In addition, there remained outstanding those items listed as an Addendum on page 38 of the Company's May 19th proposal, including the provision of winter jackets, sick leave, and severance pay. It is worth noting that on two key items - contracting out, and the designation of specific shifts - the union felt it had made major concessions "in the spirit of cooperation" and in the hopes that their compromises on these significant matters would inspire generosity from the company on monetary issues.
Based on the relative ease of the negotiating sessions up to and including May 19th, the union attended the June 30th meeting feeling optimistic that a collective agreement could be achieved before the strike deadline of July 24, 1987. When they attended the June 30th meeting with the Conciliation Officer, however, the company would tender no proposal on wages because it felt that the parties were too far apart on amounts. Nor did any discussion take place on the outstanding non-monetary issues because of the company's view that the wage disparity was so great as to make negotiations fruitless that day. Counsel for the company also suggested that a later session, closer to the July 24th strike deadline, might generate a moderated stance from both parties. The union, although frustrated by the inability to achieve agreement on any matters, or even to learn of the company's position on wages, hoped that "once the clock started to tick", the parties could again meet. They requested a 'No Board' report at the end of the brief June 30th session and it was granted on July 7.
On July 20, on his own initiative, a different Conciliation Officer convened a meeting between the parties for July 22. Although Dixon was not present for this meeting, the usual negotiating team for each side attended. The union found the company's position "inexcusable". The company was not prepared to provide any paid sick leave except on the existing discretionary basis, and even then only on the condition that the existing corporate practice not be part of the collective agreement; in exchange for a new company proposal on severance pay, it wanted the union to delete a clause dealing with vacation pay for employees with 15 years' seniority even though the term had previously been agreed to by the parties; it would not agree to a successor rights clause; it refused to pay shift premiums; it would not change its position on the seniority provisions in Article 14.02; it agreed to a one year term, but commencing prospectively from August 1, 1987 rather than from the date of certification (December 23, 1986) or the first notice to bargain (January 14, 1987); it agreed to the union's request that the Teamsters' Health and Welfare plan be implemented rather than its own, but proposed wages sufficiently close to the existing pay scale (an increase of 25 cents/hour) that they would have resulted in a significantly lower take-home pay given the combined cost of this plan (40-50 cents/hour) and union dues ($16.00/month).
The union thus found itself in the "very embarrassing" position of being faced with a proposal that would provide less or no financial benefit to employees in joining the union. They were particularly upset because 3 workers were red-circled, 2 of whom had left the company two weeks before this proposal was presented, the third being the union organizer and steward, Larry Bouillon, who had attended all the negotiating sessions for the union. Bouillon had been hired by the company in September 1986 at a higher wage than most employees in the bargaining unit because of his more than 25 years in the plumbing supply business. Moreover, the company consistently failed to provide specific information on its own Health and Welfare package to enable the union to decide if it provided an acceptable and cheaper alternative to the union's benefit package, even though Hall admitted that pamphlets on the company plans existed and were readily available.
Stewart took the company's proposal back to the membership at a meeting he subsequently called for July 23. Based on the terms, and on the red-circling of their union steward, they voted 9-1 in favour of a strike. On the next day, July 24, the union, though entitled to strike, delivered a letter to Dixon asking for further negotiations so that a strike could be averted. Four days later, on July 28, having received no response from the company, the union went on strike. They remain on strike.
In mid-August, the conciliator who had conducted the July 22nd meeting convened a further one for August 26, 1987. Although the union negotiating team remained the same, the company did not send their counsel and replaced Hall with Doug McLean, the Industrial Relations Director for Crane Canada Inc. At the outset of this session, when the parties met face-to-face, McLean apologized for having no history of what had gone on in negotiations to date. In the course of the 1-1-1/2 hour meeting, the union had to explain much of what was at issue and gave McLean a revised monetary proposal. No progress was made on non-monetary issues and the company neither responded to the union's revised wage proposals, except to suggest that they were still too high, nor offered any position on the non-monetary issues. Nothing was accomplished at the meeting, but McLean suggested to Stewart that he call him in Montreal to discuss the issues.
On September 14, Stewart called McLean and asked if he had any position on the union's latest proposals or the resolution of the outstanding issues. McLean explained that he was preoccupied with the sale of the company's Plumbing Division and had had no time to deal with this set of negotiations. Stewart suggested that the company develop a grid for wages, whereby the hourly wages would be pegged to seniority. McLean was non-committal, indicating that after he considered it more fully and checked with his superior, he'd call Stewart on September 16th. On the 16th McLean called, leaving the message that he had no response but would call again on September 18th. When McLean did not respond on the 18th, Stewart sent him a telegram on September 23rd. It read:
"On Monday September 14, 1987, I telephoned yourself and expressed what I thought were workable options for the resolution of the strike. You seemed interested but said you would have to check the ideas with your superior. You said you would call me on Wednesday Sept. 16th which you did, leaving a message that you would get back to me on Friday September 18th. As of this writing, t have not heard from you. Your actions would seem to indicate that Crane Canada is making little or no effort to resolve the current strike of the members whom we represent."
In response, McLean called, calling the telegram "hostile". He apologized to Stewart for not calling on September 18th but said he was busy with arbitrations. When Stewart asked him if he'd given any further thought to his ideas, McLean said that he had not, but would check with his superior and let Stewart know the results. He never did.
On October 5, however, McLean did call Stewart to advise him that because he was sick, he was unable to attend the meeting instigated by the Conciliation Officer for the next day, October 6. He told Stewart he would be sending Jacques Morissette in his place, Morissette being his "right hand man" and the Regional Personnel Manager for Crane in Brantford. Morissette was with both the Valve and the Plumbing Divisions but had never been involved with the Supply Division. Stewart asked McLean if Morissette had authority to resolve the issues and McLean replied affirmatively, thereby persuading Stewart that there was no point in delaying the meeting.
At the October 6 Conciliation Meeting, Morissette and Dixon attended for the company, while the union added the president of Local 419 to their usual team of Stewart and Bouillon. Morissette presented a document on wages he had received the day before in Montreal during a 30-45 minute meeting with McLean. Although the proposal was to a certain extent based on Stewart's suggestion of a wage grid, the grid extended over 48 months even though the parties had agreed that the term of the agreement would be one year. The company proposal represented no change in dollar amounts for 5 of the employees, and an improvement for another. Bouillon remained red-circled, and one more employee was now red-circled for the first time. In the union s view, and based on some informal research they had done, the proposed wages were significantly less than those paid in similar union and non-union businesses. Moreover, almost half of the 12 bargaining unit members would end up getting less take-home pay than they did before they were unionized. Nor was retroactivity or a signing bonus proposed by the company.
When Stewart asked Morissette about other outstanding issues, such as information on the company's Health and Welfare Plan, severance pay, union security, or sick leave, Morissette said that he knew nothing about them. It was his understanding that the only issue left to be negotiated was the wage package, and it was the only one about which he had any information.
In response to the company's wage offer, the union modified its wage proposal by 40% from its original position, agreed to the company's Health and Welfare Plan at an hourly cost of 8 cents-10 cents, even though it had still not received any details from the company about the extent of coverage, agreed to the company's proposal that sick leave continue under the existing corporate practice, reduced its request for a shift premium from 50 cents to 25 cents per hour, but retained its request for a union shop and a signing bonus of $500.00. It was the union's understanding that Morissette would respond to their new proposals within 2 days. At the conclusion of the meeting, the union vigorously protested the company's conduct and considered themselves 'blindsided', particularly in the face of having made such substantial concessions. Stewart told the company he felt he had no alternative but to bring a first-contract application.
Not having heard from Morissette or anyone else responding to the union's latest proposals, Stewart instituted these proceedings and personally delivered the documents to Dixon on October 22. Later that week he received a letter dated October 23 from Morissette confirming the company's position of October 6th and, in what appeared to Stewart to be a curious reference, asked Stewart in the post-script of the letter to disregard a previous letter dated October 7th. Stewart had never received the earlier letter. He only later learned that Morissette, about to leave on 3 weeks' holiday, had given the letter to Dixon for delivery to Stewart. Hall, who received a copy from Dixon, told him not to send the October 7 letter to Stewart because he disagreed with its reference to an agreement on sick leave. In Hall's view, this was an erroneous assumption, and the letter was therefore changed by Morissette when he returned from holiday on October 23, deleting reference to sick leave. Morissette was not told until the end of October that Stewart had not been sent the October 7th version. He never offered the union any explanation for the change between the October 7 and October 23 letter.
Crane has three divisions - Supply, Plumbing and Valve. For the past 12 years, Robert Hall has been in charge of the Supply Division, which employs 570 to 1600 employees working for Crane across Canada. Although Doug McLean, as Crane's Director of Industrial Relations, normally negotiates for the company, Hall explained that when these negotiations started, McLean was unavailable to attend because he was conducting negotiations in New Brunswick and Quebec. McLean had also been in failing health for 1-1/2 years and, in fact, due to his illness, eventually took early retirement at the beginning of December, 1987. Hall had never before negotiated a collective agreement but was responsible for ensuring that this one proceeded in "an orderly way" until McLean could step in. The overall authority was to rest with the company president, Gordon Kelly, based on Hall's recommendation. Hall said that he went over the union's proposals with McLean but acknowledges that he spent very little time with him.
According to Hall, the company refused to present its wage proposal to the union on June 30th because of the union's insistence on a proposal that there be paid sick days, even though the union had modified its proposal from 18 to 6 paid sick days. Sick leave plans do not exist in any of Crane's 8 collective agreements, and the company practice was that sick pay was in the discretion of branch managers for the first 4 days. Otherwise, Crane had no paid sick leave policy anywhere in Canada. Hall admits that the union's "adamancy" on sick leave caused him to decide not to put the company's wage package on the table on June 30th and that the meeting broke up as a result. It is worth noting that although the union did not modify its sick leave proposal before the next Conciliation meeting, (it did not accept the company's proposal until the October 6th meeting), Hall nevertheless presented the company's wage package at the very next meeting on July 22.
The company's first wage proposal on July 22, according to Hall, represented for most bargaining unit members a wage increase of 5.5% (or a $400.00 annual increase) "albeit 4 people were being red-circled". Hall admitted that he was well aware that red-circling Bouillon would give him less take-home pay but said this was only a first offer and could change. The red-circling of Bouillon never did change during negotiations, although on November 12, 1987, the company put $3,000.00 on the table for retroactivity pay to be distributed by the union in its discretion, and said that it expected that in its distribution of this money, the union could resolve any inequities it felt existed for Bouillon.
Hall explained that although McLean was too sick to attend the July 22nd meeting, he was sufficiently better to attend the next one on August 26th. The only discussion Hall had with McLean before this August meeting to review the wage proposals and outstanding issues lasted 1-1/2 hours. It was Hall's expectation that thenceforth McLean would continue with the negotiations. When McLean advised him 2 days before the October 6th meeting that he was too ill to attend the meeting, Hall approved Morissette as the replacement. According to Hall, he never saw the union's subsequent wage proposals or even discussed them with McLean or Morissette until after the union brought this application.
Of Crane's 8 collective agreements, 3 are in Ontario at Stratford, Brantford and Trenton, but none are in Crane's Supply Division. A collective agreement had been in operation in a Supply Division in Vancouver but this branch was closed in 1983. Moreover, there was an attempt to negotiate a collective agreement with the Teamsters in a Supply Division branch in Hamilton in 1983 but no agreement was ever reached. Hall's involvement in the Vancouver agreement and the negotiations in Hamilton was "very little", although he did have discussions with the then manager of the Hamilton Branch, Crane's President, and Doug McLean during the Hamilton negotiations. The company's first proposal to the union in the case before this panel of the Board was modelled on the proposals to the Teamsters in Hamilton in 1983. Hall was involved, after discussions with others in Crane, in designing the company's January, 1987 proposals.
Although Hall did not consult with Kelly before attending any of the negotiating sessions in this case, he said that his goal was uniformity of contracts and to ensure that nothing agreed to would have an adverse effect on other contracts at Crane. Yet he admits that before developing the company's January proposals, he did not review the terms of the 3 other existing collective agreements in Ontario. These agreements contain provision for shift premiums ranging from 25 cents - 35 cents, and Hall admitted that it was "traditional" to pay shift premiums in union contracts. He considered the union's 50 cent shift premium (later modified to 25 cents) too 'gilt-edged', particularly because he felt that in agreeing to pay shift premiums to members of this bargaining unit, and notwithstanding the current existence of shift premiums in the other Ontario agreements, Crane would have to pay it to all the 250 comparable non-union employees in the Supply Division on the basis that it was, according to Hall, Crane's policy to "treat Crane employees the same, whether they're union or non-union". Although Hall admits that he thought shift premiums were an "inevitable" part of the agreement, he did not give Morissette authority to negotiate them because he felt it was "just a fluffy" item.
Morissette, in fact, was only given authority to present a final wage scale, with no authority to modify it, but some to redistribute it to account for benefit adjustments. He was given no instructions on shift premiums, signing bonuses, union security or sick leave. Morissette flew to Montreal the day before the October 6 meeting to meet with McLean for no more than 45 minutes and received no information or documentation from McLean other than a page outlining the company's new wage scale. He was told that everything but the wage package had already been agreed to. He was also told that the money offered was "in line" with the other branches in Crane's Supply Division, none of which are unionized. He knew there was an ongoing strike but was not aware of how long it had been continuing. Neither he nor McLean had received from Hall copies or notes of the union's proposals, nor did Morissette have any way of knowing whether the union's October 6 proposals represented any, let alone a 40% movement in their position on wages. He was not aware of what had occurred during previous negotiations or who had offered what to whom. Morissette neither consulted with nor talked to Hall (nor did he even know Hall was involved in these negotiations) until November 12, and Hall never knew until he read it in the pleadings that the union expected to hear from Morissette 2 days after the October 6th meeting. According to Morissette, the union's assertion that they would apply for a First Contract direction lead him to believe that his responsibilities were over, that negotiations had "broken down", and that the matter was back in McLean's hands. He advised McLean on October 7 of the events of the October 6 meeting, but did not discuss with him whether negotiations should continue.
THE LAW
- The relevant portions of section 40a are:
40a.-(1) Where the parties are unable to effect a first collective agreement and the Minister has released a notice that it is not considered advisable to appoint a conciliation board or the Minister has released the report on a conciliation board, either party may apply to the Board to direct the settlement of a first collective agreement by arbitration.
(2) The Board shall consider and make its decision on an application under subsection (1) within thirty days of receiving the application and it shall direct the settlement of a first collective agreement by arbitration where, irrespective of whether section 15 has been contravened, it appears to the Board that the process of collective bargaining has been unsuccessful because of,
(a) the refusal of the employer to recognize the bargaining authority of the trade union;
(b) the uncompromising nature of any bargaining position adopted by the respondent without reasonable justification;
(c) the failure of the respondent to make reasonable or expeditious efforts to
conclude a collective agreement; or (d) any other reason the Board considers relevant.
It is the union's position that the process of collective bargaining has been unsuccessful because of the failure of the company to make reasonable or expeditious efforts to conclude a collective agreement, in accordance with section 40a(2)(c). In the company's view, the process of collective bargaining is not complete, and a direction, therefore, from the Board to settle a first collective agreement is premature at this time.
The contention that the process of collective bargaining should be "allowed to take its full course" has been accepted by this Board (Teledyne Industries Canada Limited, [19861 OLRB Rep. Oct. 1441). The very fact of a First Contract application is representative of at least one party's view that the process has been unsuccessful. It therefore falls to the Board in each case to assess the process to determine whether it is in fact unsuccessful, bearing in mind the realities of that process. One party's lack of success at any point in time may well be another party's legitimate but temporary bargaining tactic. It is true that section 40a is remedial legislation, but it is equally true that it was not meant to supplant the primacy of collective bargaining (Nepean Roof Truss Limited, [1986] OLRB Rep. July 1005).
In the case before us, we are satisfied not only that the process is unsuccessful, but has sufficiently run its course for us to conclude that there is a causative link between the breakdown of the process and the company's failure to make reasonable or expeditious efforts to conclude a collective agreement. The company's refusal to present a monetary package on June 30 because of the union's demand for sick leave, notwithstanding the union's modification from 18 to 6 days; its insinuation of McLean and Morissette into the process at crucial times, giving neither complete information nor authority to negotiate the several outstanding issues; McLean's inability or refusal to respond to the union's revised proposal after the August 26 meeting; Morissette's almost total lack of knowledge about the preceding sessions; Hall's general refusal either to inform himself of terms already agreed to in other Crane collective agreements, and his reneging in October on his own proposal on sick leave tendered on July 22 and accepted by the union on October 6, lead us to conclude that the company's efforts were neither reasonable nor expeditious once the negotiations entered the monetary phase and that bargaining was unsuccessful as a result of this conduct.
Although we are aware that McLean's illness and other commitments made him incapable of the primary role he would otherwise have had, his recurrent incapacity was known to the company for one and a half years. Had Crane been serious about meaningful bargaining, McLean would have either been replaced, or at least replaced from time to time with informed bargainers who had the appropriate negotiating authority. Even when McLean did finally appear at a session on August 26th, he had not been adequately briefed, provided with necessary documentation, nor given the mandate to attempt to conclude an agreement. It is not enough to present a physical body at scheduled sessions at a bargaining table to be able to argue that reasonable efforts are being made. To escape the attribution of dilatory or unreasonable bargaining efforts, it is important that the bargaining representative know the process - its history and its parameters - and be able to participate meaningfully in attempting to conclude an agreement (Mansour Rockbolting Limited, [1986] OLRB Rep. Oct. 1346).
The test of what is reasonable or expeditious is an objective one, not simply one party's personal belief that it has executed its bargaining functions adequately in accordance with its own expectations (see Formula Plastics Inc., [1987] OLRB Rep. May 702 dealing with an application pursuant to section 40a(2)(b)). There is no doubt that the company was entitled to attempt to restrain the union's wage demands, or, as the need arose, to replace negotiators when circumstances made it unavoidable. But using any objective standard, it was neither reasonable nor expeditious to bring to the negotiations, consistently and consecutively, company negotiators who were ill-prepared, lacking adequate bargaining authority, or were unequipped or unwilling to contribute to the incremental process bargaining necessarily entails.
It is not a question of whether the company intended deliberately to harm the process -there is no prerequisite for an antipathetic animus in entitlement to access to section 40a directions. Nor is it a question of the company simply hard-bargaining in attempting to provide wage parity between union and non-union employees - conduct which may not be violative of section 15 may nevertheless trigger first contract arbitration under section 40a (Nepean, supra). And, finally, it is no defence to a section 40a application, as the company argued, that what the company offered in wages was no less than what would likely be awarded in the terms of a First Contract under the Act - the test is whether the bargaining was unsuccessful because of any of the enumerated grounds, not a speculative exercise in the possibility of ultimate arbitral approbation. It is not useful to speculate on what an arbitrator might do, or even on what further concessions in wages the union might have made had they been faced after June 30th with informed, authoritative negotiators who were willing to negotiate meaningfully about other outstanding contract proposals. The union had persistently made major concessions during the negotiating period, even over wages, notwithstanding the frustrations it faced, and it indicated no unwillingness to continue the process. It did, however, finally come to the understandable conclusion that the company's efforts ranged from superficial to obstructive.
In all the circumstances of this case, we are satisfied that the process of collective bargaining has been unsuccessful because the company failed to make either reasonable or expeditious efforts to conclude a collective agreement. The Board, therefore, directs the settlement of a first collective agreement by arbitration.