[1988] OLRB Rep. July 662
3241-87-G The United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, Local Union 67, Applicant v. Calorific Construction Limited, Respondent v. Mechanical Contractors Association of Hamilton, Intervener
BEFORE: R. O. MacDowell, Alternate Chair, and Board Members R. M. Sloan and R. R. Montague.
APPEARANCES: Donald W. Wilson, Fred Wilson, Harry Cybulski, Brian Cavan and Fred Smith for the applicant; Cecil Kalyn and Jim Vair, student-at-law, for the respondent; J. Cameron Nolan for the intervener.
DECISION OF R. O. MACDOWELL, ALTERNATE CHAIR, AND BOARD MEMBER R. M. SLOAN: July 14, 1988
I
- This is an arbitration proceeding which comes before the Board pursuant to section 124 of the Labour Relations Act. The union contends that certain of its members were entitled to travel allowance when they were dispatched to work at the employer's "fabrication shop" at 3450 Landmark Road in Burlington. That location is 2.1 miles beyond the "free zone" established by Appendix G, item I., of the ICI provincial collective agreement. The provision on which the union relies is as follows:
TRAVEL ZONES AND ALLOWANCES
There shall be an area known as Zone 1, which will be a free area inside the limits of which no travelling allowances will be paid. This free area is within a radius of seven (7) miles from the Hamilton Automobile Club, 393 Main Street East, Hamilton. In going to work outside Zone 1 (free zone) and returning daily, the workman shall be at the job at regular starting time and work a full shift.
The limits of the seven (7) mile free zone (known as Zone 1) may be jointly laid out by identifiable roads during the terms of this Agreement.
A travelling allowance of 40 cents per mile shall be paid from the boundaries of the free zone to the job and return each day over shortest normally travelled route.
The maximum travelling allowance shall be twenty-five dollars ($25.00) per day worked. The parttes agree that all jobs situated in the Stelco LED site shall be paid on the basis of a maximum of 27 miles from the boundaries of the free zone to the Stelco LED site. Maximum travel allowance shall change to reflect change in mileage allowance.
- The respondent company does not dispute that its shop is beyond the boundary of the "free zone". The company asserts, however, that no travel allowance is payable because the ICI agreement has no application at that location. In the company's submission, the work at its Burlington facility is more properly characterized as "manufacturing" rather than "construction work", and, that, consequently, the ICI agreement does not apply. The company relies on Article 1.3 and 3 of the provincial collective agreement:
1.3 "Contractor" means an employer performing Mechanical work in the Industrial, Commercial, and Institutional Sector of the Construction Industry under the terms of this Collective Agreement and any successor or assign.
3.1 This is a Provincial Agreement within the meaning of the Labour Relations Act of Ontario and as such applies to the Industrial, Commercial and Institutional Sector of the Construction Industry.
The company also asserts that it has never paid travel allowance to union members working at its Burlington shop and that union officials were aware of that practice, so that even if the agreement nominally applies, the union is estopped from asserting its present claim.
- To complete the contractual framework in which this case must be decided, it may be useful to briefly refer to Article 24 of the provincial agreement:
ARTICLE 24
FABRICATION
24.1 All piping machines, whether power or manually operated, which are required to perform piping fabrication work on the job or Contractor's fabrication location, shall be operated by members of the Union. All pipe work installed by the contractor on the job site shall be cut and fabricated by members of the Union. Contractors who fabricate piping off the job site shall register the fabrication location off site with the Union and shall employ members of the Union to perform the work. The above shall not be deemed to include regular items of self-contained packaged equipment, with associated integral piping normally listed in manufacturers' catalogues. All piping 2" and under shall be fabricated in the jurisdiction of the Local Union where the work is to be installed.
24.2 Where the word "shop" is used in this section it shall be defined as a shop under agreement with the United Association or one of its local Unions in the Province of Ontario.
24.3 Contractors who will be fabricating in a shop outside of the Union jurisdiction wherein the fabricated materials are to be installed must comply with the following, prior to commencing fabrication (regular Union label shops need not comply with this requirement).
"Notify Business Managers or Business Agents for the Union, in writing, on the company letterhead, where fabricating and where fabricated materials are to be installed".
24.4 Both the Union and the employer acknowledge that exceptions may arise where the employer is required to install equipment such as skid mounted vessels, pumps, driers, exchangers, etc. Prior to commencement of this work, where the employer is required to install such components and if the matter cannot be mutually resolved between the employer and the Union, it shall be immediately referred to the Provincial Joint Advisory Board for an immediate solution.
24.5 Item one and two are not intended for use in comfort heating and plumbing.
24.6 Subject to existing jurisdictional agreements between trades, decisions of record, or established area practice, all brackets, hangers and pipe supports that are not specifically itemized and listed in a standard manufacturers' catalogue, are to be fabricated by members of the Union.
- Refer to "Letter of Understanding"
LETTER OF UNDERSTANDING
RE: ARTICLE 24
It is recognized and understood that certain installations dictate a special requirement for prefabrication of piping 2" and smaller.
Generally this situation occurs for special process of welding, bending or joining of piping that is non-standard, and requires specialty skills, a controlled environment or special welding procedures.
The union agrees to install such piping that may be prefabricated outside of its geographic jurisdiction in the province of Ontario, provided that the prefabrication is done in a U.A. Shop with a U.A. Licence Agreement or by the Contractor at his shop under the Terms and Conditions of this Agreement.
November 29, 1982
Article 24 of the provincial collective agreement contemplates the possibility of pipe fabrication on the job site, at a fabrication location, or in an employer's shop requiring the skills of union members, and specifies certain conditions under which such work must be done.
II
The respondent company is an electrical and mechanical contractor. It has been in the construction business for more than 25 years and has collective bargaining relationships with a number of trade unions including the present applicant. The applicant's bargaining rights precede the provincial bargaining scheme which came into effect in 1978. The respondent is a member of the Mechanical Contractors Association of Hamilton, ("MCAO") a component of the Mechanical Contractors Association of Ontario. MCAO is the designated employer bargaining agent for employers working in the ICI sector of the construction industry.
The company acknowledges that it is bound by the ICI provincial collective agreement insofar as its construction activities are concerned. The company has always applied the ICI agreement (and its predecessors) to all of its on-site construction and fabrication work. In addition, the company has always applied the ICI agreement or its predecessors to its Burlington shop. Union members working at the shop from time to time were routinely hired through the union hiring hall, and were paid the stipulated wage rates and benefits. Union dues were deducted and remittances made to the various trust funds established pursuant to the ICI agreement. The company has never paid travel allowances but, until the present controversy, it has willingly applied all of the other terms of the provincial collective agreement to its shop in Burlington.
Cecil Kalyn is the company's President and General Manager. He explained that the bulk of the company's economic activities were "construction oriented", so that it was convenient to use the same tradesmen and payment system for all aspects of its business, rather than set up separate payrolls. However, in Mr. Kalyn's submission, there is no document which obliges the company to apply the ICI agreement to its shop operation, and in particular, to the activities which he describes as "manufacturing". The company has applied the ICI agreement as a matter of longstanding practice and commercial convenience.
The question of travel allowances has come up from time to time, over the years, but has never been pressed to a definitive legal resolution. Ten or twelve years ago (i.e. probably before the onset of province-wide bargaining) an individual believed by Mr. Kalyn to be an "acting" business agent raised the matter and was told that the agreement did not apply to a permanent location such as the company's Burlington shop. The evidence does not establish the office of the person to whom the company refers, nor his authority (if any) to speak on behalf of the union. Nor does the evidence establish the collective agreement terms then in force. More recently when employees have raised the question of travel pay they were told either that it had no application to a permanent shop, or that the shop in Burlington was within the travel-free zone. The latter explanation was accepted until Fred Wilson, the current Business Manager of Local 67, tested that proposition and determined that the shop was, in fact, 2.1 miles beyond the travel-free zone. It was that determination which prompted the present grievance.
Some 90% of the company's business involves the fabrication and installation of material on construction sites. Only 10% of its business is undertaken within the confines of its building on Landmark Road. That 10% may itself be subdivided into three categories: systems which it assembles for installation on construction sites by its own forces; systems which are installed on construction sites by other construction subcontractors; and articles which are sold to buyers outright - in which case the company has no knowledge of how or by whom the equipment may be installed. In each category, though, the company uses members of Local 67 both in the fabrication phase and, when necessary, for installation purposes. That is why the company finds it convenient to rely on the local hiring hall to supply skilled tradesmen, and has historically drawn no distinction between its shop and on-site activities. Members of the applicant (and other trade unions) are recruited, as needed, to work in the shop or on-site, and when their phase of the work is completed they are laid off. Mr. Kalyn testified that the work force in the shop ranges from 5 to 50 employees from various trades, depending upon the level and type of activity in which the company is engaged from time to time. As in the case of the applicant, the company routinely applies the applicable ICI agreement to the work being performed by the other trades.
The evidence respecting the kind and mix of work done at the company's shop is both unclear and somewhat contradictory. Cecil Kalyn testified that only 5% of the work was "construction related", and 95% was what he described as "manufacturing". He explained that by the term "manufacturing" he was referring to orders from customers for specific pieces of equipment which were assembled in Burlington then shipped to the customer's place of business. He cited two examples: a bolt heat treatment furnace which was built and shipped to a manufacturer in Montreal, and a water treatment system which was built for Ecodyne Limited and eventually put into use in the Alberta oil fields. In both cases the company called upon the hiring hall for pipefitters and welders and laid them off when their work was completed. In cross-examination Mr. Kalyn conceded that the shop does do some fabrication in connection with its construction activities. Indeed, at the present time he said that 100% of its work force at Landmark Road is engaged in the fabrication of systems for installation at a large Stelco construction project at Nanticoke. When asked whether the company had been engaged in any other major projects since 1986, Mr. Kalyn mentioned one for Dofasco which lasted for two and a half months and also involved a number of UA members fabricating pipe, taking it to the site, and installing it. Mr. Kalyn pointed out however that most of the fabrication work is actually done on the job site.
Brian Cavan is a welder and member of the applicant, UA Local 67. He has worked for the company on a number of occasions in a variety of capacities. In late 1986 he worked in the shop on material for the Dofasco project mentioned above, until the job moved to the site (inside a steel mill). According to Mr. Cavan, at about the same time he installed pipe on the bolt heat treatment furnace. He was switched from task to task as required. As we have already noted, the furnace is an example of what Mr. Kalyn considers "manufacturing". Mr. Cavan has also worked for the company on a number of local construction sites, but has never received travel allowance because none of them were outside the free zone. Nor did he receive travel allowance when dispatched to work in the shop.
Fred Smith is a steamfitter and a member of UA Local 67. He was dispatched to work at the shop in Burlington when the company called the union hiring hall and requested two fitters and three welders. Mr. Smith worked on the Ecodyne water treatment system and the furnace project mentioned above. He was laid off at the end of January. He was not paid any travel allowance.
III
- Although given notice of these proceedings, the designated employer and employee bargaining agencies - that is, the entities that actually negotiated the current provincial collective agreement - did not appear to make representations as to its application to an employer's "shop" facility. There was no direct evidence concerning the bargaining parties' intentions, or, indeed, whether any of the many employers bound by the provincial agreement (other than the respondent) applied some or all of its terms to their shop work, or some of it. We were not told what the industry practice is, or the practical ramifications of a determination that the provincial agreement applies, in whole or in part, to shop workers who may be associated in their work or bargaining with "on-site" construction workers. Nor were we told whether employers have (or purport to have) distinct "shop agreements" for their fabrication facilities, separate from the ICI agreement (although we observe that, for some trades, separate shop agreements are quite common). Neither party in these proceedings referred us to the potential impact of section 117(b) of the Act, or the ambit of Article 24 of the agreement. We are left therefore, with the language of the collective agreement and the limited evidence before us.
IV
Articles 1.3 and 3 of the provincial agreement restrict its application to the ICI sectors of the construction industry. Those provisions, on their face, do not specifically address off-site activities undertaken in an employer's shop. Pursuant to section 117(b) it might have been open to the provincial bargaining agencies to indicate, unequivocally, that shop work was covered by the agreement, but they have not done so. At best, these provisions are ambiguous.
Article 24 of the agreement is the only one which expressly contemplates work of the kind which the respondent does at its Landmark Road facility. However Article 24 does not specify that fabrication work must be done only in accordance with the terms of the ICI agreement, and, in fact, Article 24.2 suggests the contrary. Article 24.2 defines the term "shop" as one under agreement with the U.A. or one of its local unions in the Province of Ontario. But the U.A. is not, by itself, the designated employee bargaining agency, nor, of course, is a local union entitled to enter into an agreement or other arrangement affecting construction work in the ICI sector without the express authorization of the designated bargaining agencies (see section 146 of the Act). Accordingly, the language of Article 24.2 which, we repeat, deals with a fabrication location or fabrication shop, appears to contemplate a separate and distinct shop agreement with the U.A. or one of its locals rather than the ICI agreement. If employers who engage in ICI construction as well as fabrication in their own shops were intended, automatically, to be covered by the ICI agreement, it is difficult to understand why Article 24.2 would speak of shops under separate agreement with the U.A. or one of its local unions. In our view, the implication of section 24.2 is that shop work, however it is characterized, will be the subject of a separate shop agreement either with the U.A. or one of its locals. Here there is none.
The travel allowance provision also requires careful scrutiny in light of the way in which the terms "job", "job site", "fabrication location" and "shop" have been used in Article 24 which deals with off-site fabrication locations such as the one operated by the respondent at Landmark Road. In our view Article 24 and the travel allowance clause must be read together.
Article 24 distinguishes specifically between a "job" or a "job site" (the terms are used interchangeably) on the one hand, and an employer's "shop" on the other. The implication is that they are distinct kinds of business activity. Work on a job or job site is one thing; work in a shop is another. However item I dealing with travel zones and allowances only applies to roving "jobs" or "job sites" in which a contractor may be engaged from time to time. It does not, on its face, apply to travel to and from a permanent "shop". While the general term "job" found in the travel allowance provision might be broad enough, ordinarily, to include work at a shop, when read together with Article 24, we do not think that this was the bargaining parties' intention. In this agreement jobs or job sites are distinguished from shops.
Does the doctrine of estoppel assist either party in this case? We do not think so —although both parties rely upon it.
The union contends that because the employer has applied most of the terms of the collective agreement to its shop and the union has dispatched workers to that location on the understanding that it would do so, the employer is obliged to apply all of the ICI terms, including the travel pay requirement. For its part, the employer argues that the union has been "officially" aware of its travel pay practice for many years because of the above-noted conversation with the individual believed by Mr. Cavan to be an "acting" business agent for the union, and it cannot now seek to collect travel pay.
In neither case do we find these "estoppel" arguments persuasive.
From the company's perspective, we do not think that the application of some provisions of the ICI agreement to its shop constitutes a representation that all of the terms of the ICI agreement will be applied - especially when that has not been its practice. In appropriate circumstances, the doctrine of estoppel may be invoked to prevent the alteration of a practice not supported by the terms of a collective agreement; however, we are unaware of any case in which estoppel has been relied upon to require an employer to provide a benefit that has neither been promised nor applied before. From the union's perspective, we are not persuaded that some sketchy conversation, many years ago, with some unidentified purported union representative constitutes a representation from the union that it would not seek to enforce a travel pay requirement. Leaving aside the question of whether section 146 of the Act precludes local arrangements, by estoppel, which deviate from the terms of the provincial collective agreement, we are simply not satisfied that in this case the elements of estoppel have been made out.
We mention these matters merely for the purpose of completeness and because they were addressed by counsel in argument.
V
In summary, then, on the basis of the evidence and argument before us, we cannot conclude that the bargaining parties intended that the ICI agreement would apply to the respondent employer's activities in its shop; nor can we conclude that the term "job" in the travel pay provision, when read together with Article 24 which distinguishes job sites from shops, contemplates the payment of travel allowance when tradesmen are dispatched to the latter.
For the foregoing reasons, and subject to the reservations already stipulated, we are satisfied that this grievance should be dismissed.
DECISION OF BOARD MEMBER RENE R. MONTAGUE: July 14, 1988
I disagree with the interpretation the majority gives to Article 24. I agree that the word "job" in Appendix G, item 1 is broad enough to include work at the shop. In my view, Article 24 cannot be interpreted so as to limit the application of the travel allowance provision. In the particular circumstances of this case, where the work is performed is irrelevant.
I would have allowed the grievance.