[1989] OLRB Rep. May 427
2354-87-R; 2310-88-U United Food and Commercial Workers International Union, Applicant/Complainant v. Coca-Cola Ltd., Respondent v. Group of Employees, Objectors
BEFORE: K. G. O'Neil, Vice-Chair, and Board Members D. G. Wozniak and H. Peacock.
APPEARANCES: E. Posen and B. Hill for the applicant/complainant; M. Farson, M. MacKiliop and H. Maeots for the respondent; D. Davidson and J. Hogan for the objectors.
DECISION OF K. G. O'NEIL, VICE-CHAIR AND BOARD MEMBER D. G. WOZNIAK; May 15, 1989
1This is a complaint under section 89 of the Act that the respondent company has breached section 64, 66, 70 and 79 of the Act, with an accompanying request for certification pursuant to section 8 in the related, continuing certification application.
2The Board has issued three decisions related to this certification application and prior related section 89 complaints as follows:
March 31, 1988 - concerning the voluntariness of a petition in opposition to the union.
July 7, 1988 - concerning four section 89 complaints of lay-off and demotion for union activity. (Files 2435-87-U; 2787-87-U; 2788-87-U; 2789-87-U).
January 5, 1989 - concerning the community of interest of the company's Belleville service employees.
3The applicant union applied for certification on November 23, 1987 thus triggering the freeze provisions in section 79(2). The "freeze" was still in effect at the time of the hearing of this matter. This complaint concerns an allegation that the company has failed to give its usual annual increase, following the settlement of the company's unionized operation in Ottawa. The union says that to give the increase would have been the "business as usual" approach proper under the freeze provisions as interpreted by the Board. The company agrees that there was a pattern of annual wage increases but disagrees as to how it should be described. The company describes the pattern as that the Kingston raises follow the raises in other comparable units. Prior to 1987 the rate at Ottawa was bargained with the rest of the unionized locations in Ontario. The unionized Ottawa and non-unionized Kingston plants were the only two plants managed out of Ottawa. After 1987 two things changed; Ottawa no longer bargains jointly with the rest of the province and the company has acquired two new plants within the Ottawa region, Renfrew which is unionized and Cornwall which is not. As of the date of the hearing, no raises had been implemented in either non-unionized plant, Cornwall or Kingston. The Ottawa contract was signed in October 1988 but the Renfrew contract was not ratified until late February 1989, and had not been signed at the time of the hearing of this complaint. The company maintains that at the time of the complaint, filed in December 1988, after the Ottawa settlement, but before the Renfrew one, there was no pattern established which would dictate that a raise should have been given by that date. The company argues that no distinction has been made between the non-union plant with a certification application and that without; the same factors have been applied.
4The company also points to the fact that at least on one occasion before 1987 the raise was not "sorted out" until February because the matter had to go to the Anti-Inflation Board (A.I.B.). In every case, including that one, retroactivity was paid back until July and there is no intention to deviate from that this year. When the raise is ascertained it will be retroactive to July. Therefore the company takes the position that there was no violation in the company's failure to implement a raise by the date of the complaint.
5The company also characterized the certification application as a change to the status quo to the extent the company had never had to grant the Kingston employees an increase only to have them be entitled to bargain for more money after it, as would be the result if the union is certified. However, the company says that now that the Renfrew negotiations are concluded, it is able to come to a decision as to an increase retroactive to the traditional anniversary date but will await the outcome of the Board's decision before acting on this.
6The application for certification under section 8 was not set out in the initial complaint filed in December, 1988, the complaint centring on the allegation of breach of section 79(2), the "freeze" provisions. It was made in correspondence after the Board's January 5, 1989 decision on the community of interest issue in the certification application, which resulted in the Board's ordering a representation vote. The company argues that the effect of the union's section 8 application is a request for reconsideration of the decision to order a vote at the end of the community of interest decision. The company submits that the Board should not undertake such a reconsideration, because although the Board has the jurisdiction to do so, it does not ordinarily exercise the power to reconsider unless there is reliance on evidence which could not reasonably have been foreseen in the original hearing. In general the company takes the position that it would require much more flagrant conduct than that present in this case to warrant certification without a vote under section 8.
7Mr. Davidson on behalf of the objecting employees submitted that it was very important to the employees to have a representation vote so that this matter does not just become a fight between the union and the employer without the wishes of the employees being addressed. He submits it would be the democratic thing to do for the Board to order a vote to allow the employees the right to express their opinion with a minimum of pressure in a secret ballot.
8In argument the union emphasized that as far as the employees were concerned benefits would flow retroactively to Kingston after the Ottawa contract was signed. It maintained that the changes in the system that occurred as a result of the acquisitions of 1987 fall short of evidence of a plan adopted before the certification application which would justify treating Kingston differently than before, which it says would be necessary in order to avoid a finding of a breach of the freeze provisions. It maintains that the acquisitions themselves are not evidence of a long range plan or any determination that Kingston would have to wait for the new plants to settle before a wage increase would be given. Up until the date of the certification application these employees would normally receive the Ottawa increases directly after the settlement.
9The union further argues that section 64 was breached by the company's sending a penalty message, i.e. "if you choose to be represented by a union you will not get your annual increase at the time you usually do", and that the Kingston employees have been discriminated against contrary to section 66 because they chose to join the union. It characterizes the company's holding the benefits and advances which would normally have come their way as a pecuniary penalty to them for the certification drive. It also says the company has taken direct action against members of the bargaining unit which constitutes intimidation so that they might not continue to be represented by the applicant contrary to section 70. However, its argument relied most heavily on a breach of section 79(2), submitting that the evidence is clear that the wage-rates were directly tied to Ottawa. The union says that management's linking of the failure to give the increase directly to the application for certification in the conversation set out below shows the company's true intent and the fact that its correspondence with the union does not mention the plants at Renfrew or Uxbridge indicates that the new acquisitions were not the real reason for the change in procedure.
10The union submits that the contravention of the Act is clear as argued above and that this results in a situation where the true wishes of the employees will not be obtained in a secret ballot vote because of the chilling effect of the activities of management. The union argues that the employees' economic security is jeopardized by the failure to implement the Ottawa wage increase and that this is why section 8 should be applied. Further the union argues that there is sufficient support for collective bargaining.
11We will first deal with the "freeze" provisions. The Board's jurisprudence in this area has developed a purposive interpretation of section 79 so that an employer is not prohibited from making any change in wages while the freeze is in effect; it is prohibited from making changes that would be a departure from "business as usual" or the "reasonable expectations" of the employees. This purposive interpretation of the statute has been supported in a large number of decisions. In Anderson's City Farm Valu-Mart, [1987] OLRB Rep. Jan. 1, for example, the Board said as follows at paragraph 6 and 7:
The jurisprudence pursuant to section 79 of the Act makes clear that the purpose of this freeze provision is to preserve a defined and understood status quo during this period with the overall objective of facilitating a stable environment within which parties can concentrate on meaningful collective bargaining. Although it is not easy in every case to identify what this defined and understood status quo entails, particularly where there has been no prior collective agreement or where the contentious event is a first occurrence, recourse can always be had to the language of section 79 with this purposive interpretation in aid. The development by the Board of flexible interpretive tools such as the “reasonable expectations" and "business as usual" tests are evolutionary illustrations of a long-standing practice of construing the section in a way which acknowledges the sanctity of its purpose, recognizes the limits of ability to be categorical, and authorizes a singular determination in every case based on existing jurisprudence but dependent on the factual variables before the panel. In other words, the integrity of the status quo will not be permitted to be violated, but respect will be paid to the possibility that it is not every change which violates this integrity.
If one views the section as intending to freeze a status quo, then one must assess the impact of the change on the range of expectations expected to be frozen during this period. From the union's point of view, does the change interfere with its reasonably expected representation rights and duties or with its ability to execute them? From the employees' point of view, does the change interfere with terms, conditions, rights duties or privileges of employment previously enjoyed and reasonably expected to continue. And from the employer's point of view, does the change interfere with any of his or her rights, privileges or duties reasonably arising out of a pre-existing pattern of management in the particular business?
Similarly, in Forintek Canada Corp. [1986] Apr. OLRB Rep. 453, the Board said the following at paragraphs 38 and 39:
The purpose of the "statutory freeze" imposed by section 79 is to maintain the prior pattern of the employment relationship in its entirety while the parties are negotiating for a collective agreement. This ensures that they will have a fixed basis from which to begin negotiations and prevents unilateral alterations in the status quo which might give one party an unfair advantage either from the point of view of bargaining or of propaganda. Reference to the purpose of section 79 is important because the application of its language to particular fact situations is not always a simple task. The status quo of an employment relationship may include the recognized prospect of change. The interpretive problem this creates is most easily illustrated by the apparent dilemma of an employer considering whether he should or should not implement during the freeze a wage increase which he would otherwise have given because he had made a promise to do so before the events which triggered the freeze: Whatever he does will alter either the wage rate or a pre-existing right to a wage increase. Another less immediately obvious tension in the statutory language is that created by the simultaneous preservation of pre-existing wage rates and other terms and conditions of employment on the one hand and pre-existing employer rights and privileges on the other. In a first contract situation, those pre-existing employer rights and privileges might be said to include the right or privilege to make unilateral changes in pre-existing wage rates and other terms and conditions of employment, but if the section were interpreted as preserving all such managements rights it would be rendered meaningless. See Sunnycrest Nursing Home, supra, at paragraph 44; and, J. M. Schneider Inc., [1984] OLRB Rep. Apr. 609 at paragraph 21.
- These and other difficulties with the literal meaning of the words of the section have led the Board to adopt a purposive "business as before" interpretation of section 79, which requires that an employer continue to run its operation according to the pattern established before the circumstances giving rise to the freeze occurred: Spar Aerospace Products Limited [1978] OLRB Rep. Sept. 859. The elements of the prior pattern are ascertained from the perspective of employees - a pre-freeze decision to alter wage rates or working conditions may not be implemented unilaterally during the freeze period unless the decision was also communicated to employees before the events which triggered the freeze: Carleton University, [1978] OLRB Rep. Feb. 184; LePatro de'Ottawa, [1983] OLRB Rep. Feb. 244. Indeed, the importance of the employees' perspective to a purposive analysis of section 79 underlies the recent evolution of the "business as usual" approach into the "reasonable expectations of employees" test applied in Simpsons Limited, [1985] OLRB Rep. April 594.
12The practice of the employer in managing the operation was intended to be incorporated in the "reasonable expectations of employees" test, Simpsons Limited, supra, at paragraph 33. It is therefore necessary to determine what the pattern prior to the freeze was and whether or not it has been altered as seen from the point of view of the reasonable expectations of the employees. We therefore turn to the evidence. We heard testimony from Bob Hill, former Executive Secretary of the Soft Drink Workers' Board, which is affiliated with the applicant union, and three workers from the Kingston plant on behalf of the union and H. Maeots on behalf of the company.
13It is common ground that until 1987 the negotiations with Coca-Cola's Ontario unionized plants were done jointly, resulting in one standard agreement for the province. At these joint negotiations the General Manager in charge of Ottawa and Kingston was usually present. The Ottawa collective agreement was negotiated in these joint negotiations until 1988 when Ottawa was not part of them, for reasons that were not explained in evidence. Nor was there evidence concerning the timing of any post-freeze joint negotiations. However, Mr. Hill testified that the Ottawa collective agreement negotiated in 1988 was basically similar to the other Coke collective agreements. Mr. Hill said that Kingston's wage rates were identical to the rest of Ontario before the freeze. In every year since 1975 after the contract was negotiated for Ontario, the Kingston people were given the same increase retroactive back to the effective date of the collective agreement. He said, there was "no difference in Kingston than any other location."
14At a meeting in mid-September 1988 of the sales employees in Kingston one of the employees asked Mr. Rider, the Kingston Manager, about adjustments in wages and when they would be forthcoming. Mr. Rider did not answer the question but asked if Mr. Balfour, one of the salesmen, would come into his office and he could explain it to him so that Mr. Balfour in turn could explain it to the others. Mr. Balfour and another employee went to Mr. Rider's office where they were told that because of the union organizing drive the raise could not be given because the increase might be interpreted as a bribe. Mr. Balfour reported this back to 12 to 15 drivers and warehouse employees who asked him about it.
15When the employees in Kingston heard that the Ottawa collective agreement had been signed October 13, 1988 and that they had not yet received their increases, an employee contacted the union. Union counsel then wrote to the employer relating the conversation between Mr. Balfour and Mr. Rider, indicating that although the union had not been asked to consent to the alteration of wage rates, they were willing to do so. He requested an immediate adjustment to wages retroactive to July 1988. This produced the following reply from Mr. H. Maeots, the company's Area Human Resources Manager, Central and Western Canada for the last 12 years.
"I am writing in response to your letter to Bob Rider dated November 21, 1988. The company acknowledges your consent to and request for an adjustment in wages following increases negotiated recently in some other bargaining units. As you may know, over the years the company has generally attempted to maintain comparable wage rates between unionized and non-unionized locations in near proximity. Such attempts, however, have not amounted to a commitment from the employer or a condition of employment.
Since a certification application is now pending at the Kingston location, the matter of wage rates may soon be the subject of collective bargaining. Your request for a wage raise before negotiations commence is essentially an attempt to raise the point of departure for bargaining to a level much higher than the level from which other bargaining units negotiated their current rates. Such a significant monetary advantage over other units of employees would represent a marked departure from the status quo that the company is not willing to make."
16Mr. Maeots explained the wording "comparable wage rates between unionized and non-unionized locations in near proximity" as there not being just one pattern setting agreement anymore. The Ottawa Region which, had formerly only one comparison - Ottawa, now contains Renfrew and Uxbridge (unionized plants), as well as Cornwall and Kingston (both non-unionized).
17Mr. Hill indicated that attendance at union meetings that he had called in Kingston had steadily declined since July of 1988. Notice of meetings is given by word of mouth. At the July, 1988 meeting 12 employees showed up, at the December meeting, seven, and at the January meeting six. Almost everyone had turned out at the first meeting in October 1987. There was another one two weeks later at which 75% of those who attended the first one came. Otherwise, there had been small group meetings during the organizing campaign.
18Mr. Hill was not aware that the Renfrew contract had been signed a week before the hearing of this complaint. The workers at the Renfrew plant have been represented by a bargaining agent (not the applicant) since 1978, before the acquisition by the respondent and was never part of joint negotiations. There was no evidence as to when Renfrew settled in previous years under the prior ownership or with what relationship to the provincial pattern of negotiations between these parties. He could not swear whether the Renfrew agreement had any bearing on Kingston's rates prior to this round of bargaining. He was aware that there would have been several sets of negotiations rather than one provincial one during this round of negotiations and that the Uxbridge plant had signed a collective agreement. In answer to counsel's question whether it was his understanding that the July date was the effective date and the implementation date was anywhere from October to February, he responded "it may be." Mr. Hill said that in the past the Uxbridge wages and benefits did bear a relationship to the adjustment of wages and benefits at Kingston, but did not detail that relationship.
19David Balfour, who had the conversation with Mr. Rider set out above, was a driver at the Coca-Cola plant in Kingston until December 29, 1988. He testified that the Kingston increases in wages and benefits had been tied to the Ottawa plant, that "whatever they got we got." He thought they were retroactive to the signing of the Ottawa agreement. Other evidence indicated they were retroactive to approximately the anniversary date of the agreement, in July. Similar testimony about his understanding of the wage increase was given by another driver, Mr. George Kincaid, who had worked in the Kingston plant for 19 years. However, he had read the Ottawa contract two or three times because "we always were not sure what we were getting." Mr. Balfour told him that Mr. Rider "was not too up on labour relations" but felt that a wage increase would be interpreted as a bribe - that the company would be saying they did not want the union if they gave the increase; Mr. Kincaid explained this to others. He said the subject of the wage increase became the topic of heated discussion in the plant with people becoming divided for and against the union about it. Mr. Brian Seymour, a warehouseman for more than five years, also was of the view that Kingston would receive whatever Ottawa got as a wage increase. He had heard little discussion of the increase in the warehouse.
20Mr. Maeots testified on behalf of the company that there were nine plants in Ontario up until 1987. After 1987 there were 21 plants in Ontario because of an aggressive acquisition program. Of the nine plants prior to 1987, eight were unionized, Kingston being the only exception. Mr. Hill testified there were seven unionized plants, but nothing turns on the discrepancy. Up until that time there were 12 bargaining units in eight locations all of which were bargained jointly at the same negotiating table. Since 1987, 15 of the 21 plants are unionized, including the eight owned prior to 1987. The company now deals with three unions, 20 separate agreements and seven sets of negotiations.
21Mr. Maeots testified that in the past, the wages and benefits at Kingston had been substantially the same as those of Ottawa but not identical, there being variations in the wages in some classifications. He said that the manner in which the company arrived at the increases for Kingston was that it looked at the general economic situation but the heaviest factor was Ottawa and the joint settlement there. The company tried to maintain comparable wage and benefit packages. What has changed is that there are now more factors in the formula.
22Kingston is directed by the same management team as Ottawa. In the past year the company has acquired plants in Renfrew and Cornwall which are also directed by the Ottawa team and serve as distribution points for Ottawa production. In October, 1988 when the company had concluded the Ottawa negotiations it was facing expiration of the contract in Uxbridge one month later and the Renfrew contract two months later. Mr. Maeots said the question arose as to what Kingston's rate should be now that there were three comparable outfits, one settled and one not, rather than the one, Ottawa, prior to this time. He said that when they had just nine plants and 12 agreements they used Ottawa as the bench mark because Kingston was part of the Ottawa operation, with the same management team, and was geographically the closest. Cornwall, the recently acquired non-union plant, has also had its increase delayed pending the resolution of the Renfrew contract. Mr. Maeots said he anticipates the Kingston increase to be retroactive to July, whenever it is established. He testified that the implementation and the effective date at Kingston had been different in negotiating years. Where a multiple year contract has been negotiated the company knows in advance when the increase is coming and is able to implement on the exact July anniversary date. Mr. Maeots produced memos implementing the wage increases back to 1978 in the negotiating years. In 1978 the increase was implemented on February 13, 1978 retroactive to July 28, 1977. The employees had been advised in January, 1978 that the union contracts had been signed but had to be submitted to the A.I.B. and that the wage rates would be adjusted once the A.I.B. had given a ruling. The suggested outline of announcement to employees in January 1978 concluded with this sentence:
Thus you will continue to enjoy exactly the same wages and benefits as all other locations without, of course, the deduction of $3.50 per week for union dues.
The increase was implemented in February, 1978 retroactive to July 28, 1977 despite the fact that the A.I.B. had not produced a ruling as yet. The covering memo attached to the rate increase sheets ends with a suggested Outline of Announcement as follows:
As a matter of interest these new wage rates match those of the union contracts which have been submitted to the AIB., so you can be sure your rates will be at least equal to, if not better than the rates paid in the other plants.
There was no evidence that that announcement was not made or that what was communicated to the employees referred only to the Ottawa plant.
23The 1979 rates were implemented on October 29, 1979 retroactive to July 30, 1979. In 1980 a non-negotiating year, the increase date was July 28, 1980. In 1983 the increase was implemented as of November 7, 1988, retroactive to July 25. The November 7, 1983 wage implementation memo says: "This schedule follows the terms of the recent union settlement in Ontario." In 1985, the increase was effective July 29, 1985. For the years not mentioned, the Board was provided with no information as to dates, other than the general statement that the increases were always retroactive to July.
24The reasonable expectation of the Kingston employees is that the pattern of wage increases previously in place would continue. That pattern did not involve the application of an Ottawa rate determined in isolation, although employees were used to referring to it as the Ottawa rate, as the Ottawa plant was the participant in the provincial process which fell within the local management area. As described by the union's witness, Mr. Hill, the Kingston rates were the same as the rest of Ontario. This corroborates the company's evidence, as set out long before the current certification drive, in the 1978-1983, implementation memos, that the pattern of wage increases prior to the freeze involved the whole provincial picture of which Ottawa was only a part. The fact that people among both management and employees referred to this as the Ottawa rate does not determine the matter. The evidence is clear that prior to the "freeze" the Ottawa rate was the provincial rate. We do not think that the fact that there were more elements in the provincial picture, or that Ottawa's rate was no longer determined at the same time as the rest of the province detracts from the provincial nature of the rate to which they were entitled. When one asks what the reasonable (i.e. containing an objective component) expectations of the employees at the Kingston plant, as opposed to a subjective expectation, the evidence does not support a more precise description than the following: the Kingston employees could reasonably expect an annual increase retroactive to July which followed the provincial pattern as established by negotiations in Ontario unionized plants, to be implemented when that information was available. The evidence that there were some deviations from the provincial pattern in some classifications was uncontradicted and therefore also forms part of the pre-freeze pattern. The evidence did not support a finding that timing was crucial in the pre-freeze pattern or that the "Ottawa rate" was separable from the "provincial rate". Indeed, to sever the Ottawa rate from the provincial pattern that it was a part of before the freeze period would itself be a change to the status quo. We find that the combined "business as usual", and "reasonable expectations" test results in the conclusion that the Kingston employees are now entitled to the implementation of an adjustment to wages and/or benefits which follows the provincial pattern, the last element of which was put into place with the conclusion of the Renfrew collective agreement the week before the hearing. We do not find that the company was in breach of the "freeze provisions" set out in section 79(2) at any time up to the hearing of this matter as the final agreement in the provincial picture had not yet been signed. Failure to implement wage increases following the provincial pattern in the near future would very likely result in a different characterization of the matter.
25Was the failure to implement the wage increase a breach of sections 64, 66 or 70? Haying considered all the evidence, we are of the view that it does not support the allegation that the statements of Mr. Rider and Mr. Maeots, nor the position taken by them in regards to the pay increase, were motivated by anti-union animus nor that the pay increase constituted intimidatory practices or punishment to the employees for pursuing certification. The linkage by Maeots of the reluctance to give the wage increase to bargaining strategy did not show anti-union animus in itself, and in all the circumstances amounts to an affirmation that the company would be bargaining with the union on these matters. It did disclose a lack of understanding of the necessity to implement the prior pattern of wage increases, but this was not established to be illegally motivated. Nor did the evidence establish interference with the representation of the employees by the trade union contrary to section 64. The evidence of declining attendance at the union meetings was entirely equivocal. It showed variable attendance long before the wage increase issue arose. The fact that some employees blamed the union for the failure to implement the wage increase, does not in the circumstances show anti-union motivation but rather appears to be a misunderstanding that could have been cleared up by explanation of the union's willingness to agree to the increases. As well, Mr. Rider's remarks could equally be interpreted as exhibiting a desire to avoid contravening the Act. (For an example of a union argument in not dissimilar circumstances that a pay increase amounted to a bribe or a device to convince employees they did not need a union, see Scarborough Centenary [1969] OLRB Rep. Jan. 1049). Accordingly the complaint is dismissed in regards to sections 64, 66(a) & (c) and section 70.
26An application for certification pursuant to section 8 cannot succeed unless violation of the Act has occurred so that the true wishes of the employees are not likely to be ascertained and there is membership support adequate for certification. Having found no violation of the Act in the conduct complained of, the first condition for the application of section 8 has not been met and this aspect of the complaint is dismissed as well.
27In summary then, we find that the employer had not breached the freeze provisions of the Act in failing to implement a salary increase up until the time of hearing, but that it is a reasonable expectation of the employees that they will receive the provincial pattern in the near future retroactive to July, 1988.
28As the section 8 application is dismissed, the ballots cast in the representation vote which took place as previously ordered in the Board's decision of January 5, 1989 may now be counted. This matter is referred to the Registrar.
29The complaint is dismissed.
DECISION OF BOARD MEMBER HUGH PEACOCK; May 15, 1989
I wish to make the following comments on the decision of the majority.
My colleagues do not find (paragraph 24) that the company was in breach of the "freeze" provisions set out in section 79 (2) at any time prior to the hearing of this matter as the final agreement in the provincial picture had not been signed.
I disagree to the extent that the employer was not, in my opinion, entitled to withhold a wage and benefit adjustment well beyond what formerly had been the time frame within which the "provincial" settlement terms had been applied to the non-unionized Kingston employees. I also disagree as to the result of the section 8 application.
The first question here is whether the employer's decision not to adjust Kingston employees' wages and benefits until the Renfrew settlement terms completed "the provincial" picture altered a pre-existing right protected by section 79 (2). That right was grounded in a long history of bargaining and settlements between Coca-Cola and the U.F.C.W. The majority describes this history in paragraph 13. The majority goes on to find, however, that the employees' expectations of raises tied to the Ottawa settlement were subjective in nature and therefore of less account than the objective components put in evidence by the employer which tied the adjustments to a provincial bargaining result.
Almost all of the evidence respecting the provincial scope of the employer's consideration of what Kingston should receive was in a form that could not likely be known to employees at that location - until the November 1988 exchange of correspondence between the union and the company. For the period prior to the onset of the freeze, there was no evidence before us that the employees ever heard the expressions "broad picture" or "provincial pattern" or that the words of the November 7, 1983 memo were read out to them. Indeed, three of the four documents were for management's eyes only being headed in capital letters "Private & Confidential" or "Strictly Private & Confidential" (Exhibit 4b). However, to quote from the Forintek decision, supra, "The elements of the prior pattern are ascertained from the perspective of employees..." (my emphasis). Also in Le Patro d'Ottawa [1983] OLRB Rep. Feb. 244, at paragraph 5, the knowledge of employees, the Board has held, must be taken into account:
The Board has consistently required that a firm decision to substantially change terms and conditions of employment or the privileges of employees must be communicated to the employees prior to the onset of the freeze period. (Carleton University, (1978] OLRB Rep. Feb. 184; Lennox & Addington Hospital, [1978] OLRB Rep. Sept. 843; Ottawa General Hospital, [1981] OLRB Rep. Oct. 1461.) The Board recognizes that for the freeze period to operate effectively it must be in relation to rights and privileges which are known to both the employer and the employees. As the Board noted in the Carleton University case, a decision taken before the freeze but known only to the employer could be revoked or altered during the freeze, prior to any communication to the employees, so that neither the employees nor their union, nor for that matter the Board, could effectively enforce the freeze provisions with any certainty. For that reason, in the interest of preserving stability in the employment relationship during the freeze period the Board has interpreted the freeze as applying to the rights and privileges of all parties as they were known to them at the time of the notice triggering the freeze.
[my emphasis]
This is not to say the employees' view must prevail. On the other hand, the employee-witnesses could not be held to be mistaken about the past pattern of adjustments to terms and conditions of employment. David Balfour testified that throughout his more than 13 years employment the increases he received were "tied to the Ottawa plant. Whatever they got, we got". Mr. George Kincaid testified that the event that triggered the Kingston raises was the signing of the Ottawa contract. "We got exactly what they got", he said. He added that he had read the Ottawa contract 2 or 3 times "because we weren't always sure of what we were getting". Mr. Brian Seymour also referred to the Ottawa relationship in his evidence. Clearly there was a course of conduct on the part of the employer giving form to a perception on which employees based their expectations.
If it knew of the Kingston employees' misperception, there is no evidence that the employer ever corrected the impression that the Ottawa rate was really a "provincial" rate, that what the Kingston employees were receiving was the result of a pattern, generally speaking, tied not to the Ottawa settlement but to the broader provincial settlement. The closest we came to a disclosure of the employer's past wage policy for Kingston is the following statement in Mr. Maeot's letter:
As you may know, over the years the company has generally attempted to maintain comparable wage rates between unionized and non-unionized locations in near proximity. Such attempts, however, have not amounted to a commitment from the employer or a condition of employment.
The phrase "locations in near proximity", given Mr. Maeot's direct evidence, clearly points to Ottawa. There is no mention in the letter of the Company's 1987 acquisitions programme or the pending negotiations at Renfrew. Other than Mr. Maeot's evidence given at the hearing, nothing shows why the employer had felt it necessary to wait until the result of the Renfrew negotiations was known before deciding how to apply the completed provincial settlement terms to Kingston. The Board did not hear why the result of bargaining in Renfrew was of such weight that it would affect the determination not just of the timing, but of the degree to which Kingston employees would share in the Ottawa or Renfrew or province-wide settlement terms. At the hearing, Mr. Maeots testified that "once we concluded Ottawa in October and faced expirations at Uxbridge and Renfrew, then the question became, What should the Kingston rates be?". We do not know the date that question first arose. When asked, "At what point in time could you first put your mind to the Kingston increases", Mr. Maeots replied, "Last week when I was first advised of the Renfrew settlement". It is obvious, nevertheless, that a prior decision had been taken not to apply the increases of the Ottawa settlement of October 13, 1988 to Kingston employees. That decision, if it was known in September, was not conveyed by Mr. Rider; he offered another reason to which I shall return for not passing on the Ottawa increases.
The Board is called on to weigh the evidence brought by the employer as to its pre-freeze wage policy as against the employees' evidence of their perception of the employer's conduct. In a pre-bargaining relationship governed by section 79, it is not open to the employer to justify the alteration of a long-established method of wage adjustments by pointing to a new business factor (Renfrew) in front of the Board, having withheld that rationale from employees. The wait for the Renfrew result is not like the delayed Kingston increase of 1978 pending A.I.B. approval. Then, all locations were subject to A.I.B.. approval and delay of implementation pending that approval. The Board has refined the analysis of the "freeze" provisions of the Act to encompass "the reasonable expectations" test (Simpsons Limited, supra). It follows that the importance of the employees' perspective must be given greater weight as against the employer's reasons for the change, especially when those reasons were never communicated to the employees or to the trade union in advance of the freeze.
1 find on the evidence that:
a) there was a well-entrenched method of adjusting wages and benefits of Kingston employees;
b) the business-as-usual practice was to adjust Kingston terms and conditions in accordance with the Ottawa settlement and from the perspective of employees they had a reasonable and objective expectation that the October, 1988 Ottawa terms of settlement would be applied to them, as before;
c) the employer's suspension of an adjustment for Kingston pending the outcome of Renfrew negotiations was not part of the pattern prior to the onset of the freeze in November or December, 1987; and
d) if it was, the employer's policy was not communicated to Kingston employees prior to the onset of the freeze so as to bring an end to their reliance on what they perceived to be the traditional pattern.
I must go on to find that the employer breached the provisions of section 66 and 70 by its behaviour over the freeze issue. Rather than conveying a clear rationale to its employees about its view of the freeze provision, it instead in effect signaled employees that the cost of sorting out the unionization issue would be a delay of wage increases well beyond the normal time frame. It is hard to credit that the company only put its mind to the Kingston adjustment after the Ottawa settlement had been reached in mid-October. Mr. Rider's "bribery" rationale for withholding increases was delivered in mid-September. It is unlikely that he was indicating a negative response without authority from at least the regional management in Ottawa.
The result for the trade union was a sharp falling off of participation in its activity, as measured by the turn-out at the meetings described by Mr. Hill. With the passing of time and the chilling effect of the employer's withholding of anticipated wage increases, the interest of employees in collective bargaining, I accept, was severely damaged. The application for certification was filed in November, 1987 or 15 months prior to the date of hearing into these issues. The adage, labour relations delayed are labour relations denied, derives from circumstances such as these. Acknowledging that it took some months to sort out other matters associated with the certification prior to the October, 1988 settlements, I do not view the passing of time in isolation. Delay, however caused, always favours the employer's interest. Section 8 decision-making should not encompass only the worst manifestations of employer retaliation against employees for the exercise of their rights such as dismissals. Denial of an anticipated wage increase is a powerful reminder of the employer's capacity to retaliate and I regard such action in the context of this case as having an adverse effect on employees' ability to express theis true wishes through the secrecy of the ballot box. It is well known that demoralization deters voters from making an informed choice and often deters them from going to the polls at all. In a workplace setting, the result sought by the employer is achieved by disillusioned employees voting against the union.
I find that the employer's alteration of the terms and conditions of employment was in contravention of sections 66 and 70. Section 8 should be invoked to certify the applicant because the true wishes of employees are not likely to be ascertained by a vote. The trade union, which filed evidence of membership on behalf on not less than 45 per cent of the employees of the respondent, (per the Board's decision of January 5, 1989) clearly has membership support adequate for the purposes of collective bargaining.