[1988] OLRB Rep. May 506
2830-87-U: Leopold Morin, Complainant v. Canadian Auto Workers National Union and Local 222 Oshawa, Respondents v. General Motors of Canada Limited, Intervener
BEFORE: Rosalie S. Abella, Chair.
APPEARANCES: Paul Morin, Michael Johnston and Brian King for the complainant; John Moszynski, Robert Nickerson, Pat Clancy and John Sinclair for the respondents; E. T. McDermott and Jay Wilber for the intervener.
DECISION OF THE BOARD; May 30, 1988.
The complainant, Paul (Leopold) Morin, alleges that the respondents, the Canadian Auto Workers National Union (C.A.W.) and Local 222, have violated the duty of fair representation required by section 68 of the Labour Relations Act in negotiating a collective agreement in 1987 with the intervener, General Motors of Canada Limited (G.M.) which reduced the automatic retirement age from 70 to 65. It was the reduction to 65, rather than the fact of a fixed retirement age which formed the substance of his complaint. The essence of Morin's complaint is that the age reduction was arbitrary, discriminatory, and in bad faith, because, among other reasons, the age limit has no effect on Quebec workers at G.M. since mandatory retirement cannot be enforced under Quebec law. According to Morin, therefore, the alteration of the age to 65 by the C.A.W. has an adverse impact on Ontario workers and because this was a foreseeable disparity, ought not to have been negotiated by the union. He was not concerned about this disparity when the retirement age was 70.
Morn has been an employee at the G.M. Oshawa plant for 23 years and was at all times a member of the U.A.W. and its successor, the C.A.W. He is employed as a Millwright, part of the Skilled Trades Group of the Local. He had not actively participated in the union until he was elected in March of 1987 to the position of alternate committeeman. He is 65 years old.
The provision of the collective agreement alleged by Morin to offend section 68 of the Act is section 55. It reads:
Effective with the effective date of this Agreement and until September 30. 1988 management may terminate the employment of any employee on or after the first day of the month following the month in which such employee's seventieth (70th) birthday is reached. Effective October 1, 1988 and thereafter Management may terminate the employment of any employee on or after the first day of the month in which such employee's sixty-fifth (65th) birthday is reached. Any such termination shall break such employee's seniority.
Although the language used suggests that termination at age 65 is permissive, both the C.A.W. and G.M. acknowledge that it has historically been interpreted as a mandatory provision.
As an alternate committeeman, Morn said he kept himself informed of developments in negotiations underway between the C.A.W. and Ford, Chrysler, as well as G.M. He was aware of the pattern bargaining tradition whereby the C.A.W. designated one of these three companies as its "target company" on the understanding that any agreement concluded with the first company would set the pattern for the other two. For the 1987 bargaining round, the C.A.W. decided in September that the first set of negotiations would be with Chrysler. After a highly publicized four day strike, the C.A.W. ratified an agreement with Chrysler on September 19th and 20th. The major thrust in bargaining had been achieved, namely the substantial improvement of benefits for current and future retirees and, in particular, inflation protection for these workers through indexation. On October 3rd and 4th, an agreement with Ford was ratified on virtually identical terms as the provisions in the Chrysler agreement.
In accordance with its usual practice, the C.A.W. prepared and issued thousands of copies of a newsletter for employees to review at the ratification meetings. These newsletters, released in September for Chrysler and in October for Ford, outlined and explained the terms of the agreement. On the front page of both of these newsletters, C.A.W. President Bob White explained the significance of the agreement as follows:
We have made the largest improvements in pensions, both for current and future retirees, in our history. We have been successful in negotiating cost-of-living increases in pensions for future retirees. For current retirees, we made pension improvements in all categories and negotiated periodic increases over the life of the six-year pension agreement.
This agreement will allow our older members to retire with a decent income, significantly protected against inflation, thus improving the job security of younger members.
On page 3 of each of these newsletters, there is a bold-faced headline called "mandatory retirement" with the following explanatory paragraph:
Mandatory retirement
The automatic retirement age has been changed from 70 to age 65. Those who are 64 or more are allowed one more year before they must automatically retire.
Morin stated that he had heard rumours in September and October about the indexed pensions and the mandatory retirement provisions, including rumours that the retirement age had been reduced to 58 and 62. He paid no attention to these rumours, he said, and asked no one about their veracity because he did not take them seriously.
The ratification meetings for G.M. took place on October 24th and 25th. There were two meetings scheduled for October 25th, the first at 10:00 a.m. for Production Workers to which all union members were invited, and the second only for Skilled Trades Group members at 1:00 p.m. Morin attended only the afternoon session even though he knew that at the morning session all generic benefit and contract provisions would be explained, because he said he was only interested in what had been achieved for the Skilled Trades. Although the C.A.W. had distributed 20,000 copies of its newsletter to employees, Morn said he did not see a copy of it until after the ratification meeting. Nor, he says, did anyone at the afternoon meeting discuss the mandatory retirement clause either from the platform or by way of questions from the floor. He does not rely, however, on his not having seen the newsletter at the ratification meeting, or not having sufficient notice of the issues; rather, it is his contention that the age reduction itself from 70 to 65 inherently violates section 68 of the Act. By secret ballot, the overall vote in favour of the G.M. agreement was 89%, with 92% of the Production Workers and 77% of the Skilled Trades workers in favour.
According to Bob Nickerson, Secretary-Treasurer of the C.A.W., proposals for the 1987 round were developed through a Collective Bargaining Convention held every three years in accordance with the C.A.W. constitution. 244 delegates were elected to this Convention and were numerically representative of the numbers of members they represent. The Oshawa local had four elected delegates. In addition, the heads of each of C.A.W.'s 510 locals were entitled to attend.
The purpose of the Convention was to develop a "wish" list that eventually would form the basis of master collective agreement bargaining proposals, based on amendments and suggestions that had been forwarded to the C.A.W. executive over the previous three years. These suggested amendments were distributed by topic to various committees weeks before the Convention for the com- A mittees' recommendations. The Skilled Trades Group drafted a separate document with suggestions for amendments to the local agreements.
- At the 1987 Collective Bargaining Convention, it was agreed that inflation protection for retirees would be a high priority, a goal no other union had achieved in Canada. To achieve it within the C.A. W., it was agreed that the support of younger as well as older workers was necessary. In balancing the competing needs and interests of all workers, it was agreed at the Convention that to obtain support from C.A.W. members for substantial increases and inflation protection in pensions, measures that would necessarily reduce to some extent the quantum of available money for wages and other benefits, it would be necessary to provide an inducement to younger workers. The inducement unanimously agreed to at the national Convention was the reduction of the mandatory retirement age to 65 and greater job security. The implementation of the age reduction to 65 was delayed by one year to give 65 year old workers "a one year grace period".
4
Inflation protection and improved pensions became the major platforms in bargaining with Chrysler, and the brief strike reflected the significance to the C.A.W. of being able to achieve their implementation. The Chrysler collective agreement ultimately incorporated the objective by raising the pension benefits from $22.05 to an eventual $36.00 per-month..times-years-of-service for retirees and providing 90% inflation protection, with an upper limit to ensure that former retirees would not receive more than future retirees. The same gains were achieved in the Ford and G.M. settlements.
Nickerson acknowledged that the mandatory retirement provision has not been applied in Quebec because it cannot be in the face of the relevant provincial law. Section 10 of the C.A.W. constitution, guaranteeing every member of CAW-Canada equal treatment, deals with race, sex, creed, colour, marital status, sexual preference, disability, political or religious affiliation and place of origin, but does not refer to age. Even before the 1987 agreements, some Locals had retirement ages of 65, and others had ages other than 65 or 70. Evidence given by G.M. indicates that the automatic retirement age in its collective agreements with the U.A.W. and C.A.W. from 1953 -1968 was 69 or 68, depending on entitlement to other benefits, 68 from 1968 until 1979, and 70 from 1979 until 1987.
Section 68 states:
A trade union or council of trade unions, so long as it continues to be entitled to represent employees in a bargaining unit, shall not act in a manner that is arbitrary, discriminatory or in bad faith in the representation of any of the employees in the unit, whether or not members of the trade union or of any constituent union of the council of trade unions, as the case may be.
Simply put, this section obliges a union to act in a manner which is objectively rational, equitable in process and substance, and benignly motivated. The section 68 duty to represent employees fairly flows from the recognition that union representation truncates the capacity of individual employees to negotiate their own employment contracts with their employer. The sovereignty of the individual is traded for the benefits derived from collective representation, benefits logically and logistically presumed to be better achieved when individuals act in concert. This economic equation - pluralistic pressure enhancing the possibility of improved concessions from employers -forms the historical basis for collective bargaining.
- Although section 68 primarily represents a deferential approach to union policies and
practices, these are nonetheless subject to scrutiny. In balancing the competing claims and interests of the persons it represents, the union acts in a quasi-fiduciary role, and must act and be seen to act in a manner free from arbitrariness, discrimination or bad faith. Given the heterogeneity of concerns in any given bargaining unit or union, it will not always be possible to achieve consensus or even majority approval. But so long as the union has considered the alternatives, duly weighed the competition of concerns, and made its decision rationally and in good faith, its conduct will not violate section 68.
In this case, the C.A.W., through its elaborate and broadly representative Collective Bargaining Convention, decided that improved and indexed pensions would form the primary plank in its bargaining strategy with the "three auto giants" in 1987. It understood that the achievement of this objective, as necessarily reducing the global economic package available for other demands, might have less appeal to its overall workforce as a singular platform without a countervailing inducement. The inducement arrived at was greater job security for younger workers and a reduction of the automatic retirement age from 70 to 65. Not only was the measure not designed to impact adversely on older workers, it was devised to provide them with improved financial security on their retirement. The C.A.W.'s strategic calculation proved highly successful with the overwhelming majority of its workforce at Chrysler, Ford and G.M., and a milestone was achieved in the negotiation of indexed pensions for current and future retirees.
Of the 43,000 workers at G.M. in Canada, including 18,000 in Oshawa and 2,800 in Quebec, 271 were over 65. By itself, the issue of majoritarian approval is not determinative. There are conceivably union issues or policies which may well satisfy the majority but nonetheless violate the duty fairly to represent all employees, including the concerns of a minority of them. Majority support cannot insulate union policies or decisions from Board censure if they are arbitrary, discriminatory, or in bad faith.
There is no doubt that those employees outside Quebec who are 65 or over are now, with one year's notice, expected to retire earlier than under the previous collective agreement. But the fact that the retirement age has changed does not necessarily mean that there has been discrimination within the meaning of section 68. The term discrimination in human rights has itself undergone a metamorphosis over the past 15 years, expanding its reach to embrace systemic concepts. But what has not changed is its intrinsic character - it is the antithesis of fairness. In a labour relations context, discrimination means that the union is not entitled to behave, either procedurally or substantively, in a way which disregards the rights of the employees it represents to be free from proscribed motives or effects. What is proscribed in the circumstances must ultimately be measured by an objective barometer, bearing in mind the political and economic exigencies of the situation faced by the union. In a human rights context, the term "discrimination", may be tautological with the terms "arbitrary" and "bad faith". But what is discriminatory in a human rights sense may or may not also be discriminatory within the meaning of section 68. And just as it is that not every case of adverse impact leads to a finding of discrimination in human rights - the definition of discrimination containing as it does its own inherent limits - so it is that not every adverse impact results in a violation of section 68. This is particularly significant when the character of a union as a creature of collective interests is understood. It will necessarily be the case that not every concern of each individual can be consistently accommodated. Section 68 does not, however, provide a vehicle by which the Board may, without restraint, substitute its own preference or opinion as to the union's course of conduct; it must simply be satisfied that all relevant interests have been weighed and that the union has made an honest judgment in the circumstances.
In this case, all such interests were clearly taken into account, including the difference in Quebec law. The existence of specific local laws to which collective agreement terms may be subject does not preclude a union from developing policies of more general application. The C.A.W., in accordance with its constitution, decided to attempt to bargain for improved benefits for older workers, and to do it, offered greater job security to its younger members as an incentive. These are precisely the kinds of 'hard choices' unions are called upon and expected to make in their own and their members' interests. Far from disregarding the concerns of those who were 65 or older, the C.A.W., in seeking and being mandated to protect vigorously, even to impasse, some of these long term older workers' economic interests, decided of necessity that it could best do this by conceding others. It weighed the right to work until an older age against the right to greater economic security after retirement at whatever age, and chose, on balance, to protect its members from the financial repercussions of a fragile pension on retirement. In so doing, it was neither arbitrary, discriminatory, nor acting in bad faith.
For all the foregoing reasons, this complaint is dismissed.