[1990] OLRB Rep. February 163
1653-89-U Retail Wholesale and Department Store Union, AFL-CIO-CLC, Complainant v. Hydon Holdings Ltd. c.o.b. as Hy's Steak House, Respondent
BEFORE: Owen V. Gray, Vice-Chair, and Board Members W. A. Correll and K. Davies.
APPEARANCES: Sean McGee, Harry Ghadban, Robert McKay, Howard Poon and Fernando Cagigal for the complainant; B. Carroll and Roger Moss-Norbury for the respondent.
DECISION OF THE BOARD; February 20, 1990
1The title of this proceeding is amended to describe the respondent as: "Hydon Holdings Ltd. c.o.b. as Hy's Steak House".
2This is a complaint under section 89 of the Labour Relations Act ("Act"). As originally filed, the complaint alleged
(a) that the respondent terminated the employment of Howard Poon, contrary to sections 64, 66(a), (b) and (c), 70 and 79 of the Act;
(b) that the respondent changed its policy with respect to the persons authorized to give relief from the general requirement to contribute to a "tip pool", contrary to section 79 of the Act; and,
(c) that the respondent introduced a new policy curtailing the opportunity of servers to obtain gratuities in excess of 15% in certain cases, contrary to section 79 of the Act.
During argument, counsel for the complainant abandoned the allegation concerning the respondent's policy on "tip pool" relief. This decision deals with the other two allegations.
3The respondent operates restaurants in several Canadian cities. Its restaurant in Ottawa was the subject of an organizing campaign by the complainant in August of 1988. The leading employee organizers were Howard Poon and Fernando Cagigal. On March 15, 1989, the complainant was certified as exclusive bargaining agent for a full-time unit and a part-time unit of employees of the respondent. The events complained of occurred in September 1989. The parties were still bargaining for their first collective agreement and no conciliation officer had been appointed; accordingly, the "freeze" imposed by subsection 79(1) was then in effect.
4In late 1987 or early 1988, the respondent instituted a practice that when a customer reserved a table for nine or more persons, he or she would be asked up to agree in advance to the payment of a 15% gratuity. This practice grew out of the respondent's experience that large groups sometimes failed to leave a tip or left a tip which was quite inadequate in relation to the amount of work performed by the servers. When the customer making the reservation agreed to the suggestion that there be a gratuity in the amount of 15%, a note to that effect would be written in the book in which reservations were recorded. When a server had a large party to serve, he or she would know from that book whether the customer making the reservation had agreed in advance to pay a 15% gratuity. If such an agreement was noted, the server would calculate the 15% and draw the amount to the customer's attention when presenting the bill. That much of the policy was clear to everyone from the beginning.
5Most of the customers of Hy's restaurant in Ottawa, particularly those in large groups, pay their bills by credit card. Standard credit card slips or vouchers have four boxes in which amounts may be filled in. The top box is labelled "Merchandise/Services" on an American Express voucher, "Services" on a Master Card voucher and "Amount" on a Visa voucher. The box below that is labelled "Tax". The box below that is labelled "Tips/Misc." (American Express), "Tip" (Master Card) or "Tips" (Visa). The bottom-most box is labelled "Total" on American Express and Master Card slips; on a Visa voucher the only label is "$ CDN."
6When a server presenting the restaurant's bill is told by the customer that he or she wishes to pay by credit card, the server uses the customer's card to imprint a credit card voucher. When there has been no advance agreement on the amount of a tip, the process by which the voucher is completed at the respondent's restaurant was well settled. The server would write the amount owing to the restaurant for food, drink and tax in the top box. The voucher would then be presented to the customer with the three other boxes still blank. The customer would fill in the amount of the tip in the third box, place the total in the bottom box and sign the voucher.
7It is not apparent that any particular instructions were given to servers about completing credit card vouchers for customers paying the bill for large groups when there has been advance agreement on gratuities. The restaurant's management expected servers to continue to place the amount of the restaurant's bill for food and drink and tax in the top box and, in addition, place an amount equal to 15% of the bill for food and drink in the "Tip" box. The voucher would then be presented to the customer and the transaction would proceed in the usual way. Some servers handled those transactions that way. After handling some transactions that way, however, other servers began taking a different approach. Those servers, including Mr. Poon, began adding the 15% gratuity to the amount owed to the restaurant for food, drink and tax and putting the total in the top box on the credit voucher. That way, the "Tip" box was left blank. When vouchers prepared this way were placed before customers, some of them added a further amount in the "Tip" box.
8The restaurant's management was not aware that servers were doing this until August 1989. The first discovery appears to have resulted from curiosity about the high level of tips apparently being earned by some servers. The restaurant's management was able to contact a number of customers who had inserted amounts in the "Tip" box after a server had included a pre-agreed 15% gratuity in the amount placed in the top box. A number of such customers said they had not intended to tip more than 15% and had not understood that a 15% gratuity had been included in the amount placed in the top box on the credit card voucher which had been presented to them. The restaurant reimbursed the customers who said they had been misled. Mr. Poon was the server in six such instances.
9On or about September 15, 1989, the respondent posted a notice to "all servers and bar staff' that
It is Forbidden to add any gratuity to the first box of credit card vouchers. This box must contain only amounts due from the Remamco billing. Tips may be put in the "Tip" box ONLY.
"Remamco" refers to the computer system in use in the subject restaurant. All customer orders are keyed into that system; the bill presented to a customer is a bill generated by that computer system, showing the amount due for food and drink and the amount of tax payable.
10The complainant does not object to the respondent's practice of seeking advance agreement on a 15% gratuity. What it objects to, on the servers' behalf, is that this new requirement with respect to the completion of credit card vouchers prevents or discourages customers who have agreed in advance to a 15% gratuity from giving servers an even larger gratuity if they wish. They say this is a change which violates the freeze imposed by subsection 79(1) of the Act. We do not agree.
11We are not persuaded that the employer has required servers to insert a 15% gratuity in the "Tip" box when there has been advance agreement on gratuities. While the server may do so, he or she is not obliged to do so. The server has the option of leaving that box blank, so that the customer can fill it in. The prohibition is against including a 15% gratuity in the amount inserted in the top box on the credit card voucher. Even if the instruction in the September 15th notice was new, it does not have the effect complained of.
12Further, and in any event, we are not persuaded that the instruction violates the statutory "freeze." While it can fairly be said that the instructions given on September 15th were not expressly given before the statutory freeze came into effect, management never gave servers any reason to suppose that they could include a gratuity in the amount they inserted to the top box of a credit card voucher. The freeze under section 79 prohibits the employer from altering "the rates of wages or any other term or condition of employment or any right, privilege or duty, of the employer, trade union or the employees" except with the consent of the trade union. The complainant does not suggest that it was ever a term or condition of employment of servers that they could include a gratuity in the amount they inserted in the top box on a credit card voucher. Even if the prohibition expressed in the September 15, 1989 notice could not reasonably be implied from the instructions which servers had been given before the freeze came into effect, there is certainly no evidence to support the proposition that adding gratuities to the amount in the top box on a credit card voucher was in any sense a "right" or "privilege" of servers before the freeze came into effect.
13His inclusion of gratuities in the top box on credit card vouchers was not the sole or even the primary reason given by the respondent for terminating Howard Poon's employment in September 1989. During the investigation of credit card transactions with reference to that practice, the respondent discovered a credit card voucher which had been physically altered by Mr. Poon after the customer had signed it. The bill for drink and services to this customer had come to $179.00. Mr. Poon had placed that amount in the top box of a credit card voucher and presented it to the customer. The customer inserted the figure "20" in the "Tip" box and then wrote "$299.00" immediately below that. Seeing that $179.00 plus $20.00 only added up to $199.00, Mr. Poon added a "1" in front of the "20". He did this without reference to the customer, who had left, and without telling anyone in the restaurant's management what he had done. The very high resulting tip attracted the respondent's attention. As a result of inquiries through the credit card institution, the respondent was able to obtain a photocopy of the customer's copy of the credit card slip. That document clearly showed that the amount originally written in the "Tip" box was "20.00". The general manager of the subject restaurant, Mr. Roger Moss-Norbury, felt this amounted to theft by Mr. Poon from a customer. He says it was this dishonest act which led to his decision to terminate Mr. Poon's employment.
14In its complaint, the complainant alleged that "it is common knowledge to the employees of the respondent that corrections are made, through various methods, to incomplete or incorrect credit card vouchers." The respondent's uncontradicted evidence is that no one other than the bookkeeper is allowed to alter a credit card voucher in any way. The bookkeeper will check the addition of amounts on a credit card voucher and make corrections to the benefit of the customer if there has been some miscalculation. The corrections are made in such a way as to alert the credit card institution to the variation. The respondent's evidence is that servers are specifically instructed that they are not to alter credit card vouchers in any way and that, moreover, this instruction is standard in the restaurant industry. Mr. Poon's evidence to the contrary stands alone. Indeed, his co-organizer, Mr. Cagigal, testified that it would improper for any server to alter a credit card voucher after it had been signed by the customer. We are satisfied Mr. Poon had no reason to suppose he could alter a credit card voucher after the customer had signed it.
15When Mr. Moss-Norbury confronted Mr. Poon with the credit card voucher in question, Mr. Poon admitted having altered it. He said he did so because he thought that was what the customer wanted. When he testified before us, Mr. Poon offered some reasons as to why that might have been the customer's intention. It is not apparent that he offered those reasons to Mr. Moss-Norbury at the time. In his testimony before us, however, Mr. Poon also acknowledged that he had been in some doubt about the customer's intention at the time he made the change. He maintained he did not think there was anything wrong with his having resolved that doubt in his own favour to the extent of $100.00, so as to give himself a $120.00 tip on a $179.00 bill. As a result of the conversation he had with Mr. Poon about the alteration of this voucher, Mr. Moss-Norbury came to the conclusion that Mr. Poon had acted dishonestly. We do not have difficulty imagining his having come to that conclusion, having heard Mr. Poon testify before us that he still did not think he had done anything wrong.
16The complainant says that "anti-union animus" played some part in the decision to terminate Mr. Poon. It points to Mr. Moss-Norbury's candid and not particularly surprising acknowledgement that he had not been happy to learn in September 1988 that a union had organized the restaurant he ran. If only as a result of the certification hearings before the Board, Mr. Moss-Norbury had been aware of Mr. Poon's involvement in the organizing campaign for many months before the termination.
17Mr. Moss-Norbury reports to Mr. Aisenstat, who resides in Vancouver. He testified that he discussed his decision to terminate Mr. Poon with Mr. Aisenstat before implementing it. Mr. Poon testified that after the organizing campaign began in 1988, he received a telephone call from Greg Kennedy. Mr. Kennedy was a former employee of Hy's restaurant in Edmonton, where Mr. Poon had worked before moving to Ottawa and joining the staff of the Hy's restaurant there. According to Mr. Poon, Mr. Kennedy told him that Mr. Aisenstat was very concerned about the organizing at the Ottawa restaurant and that he would be prepared to meet with Mr. Poon to discuss whatever problems had led to it. Mr. Kennedy suggested that benefits available to employees of other Hy's Restaurants might be extended to employees at the Ottawa restaurant if that was the problem. Mr. Poon told Mr. Kennedy that he did not wish to meet.
18Mr. Poon also testified about a chance meeting with Mr. Aisenstat in an Edmonton bar some time after the certification. Mr. Poon says the conversation turned to the union's certification. He says at one point Mr. Aisenstat said "what can be done can be undone" and at another point said "well, we're stuck with it. We'll try it for a year; if we don't like it, we can talk about it", or words to that effect.
19Neither the alleged conversation with Mr. Kennedy nor the alleged chance meeting with the Mr. Aisenstat in Edmonton was the subject of any complaint to the Board at the time they occurred, nor was either of them particularized in this complaint. Counsel for the respondent did not object to our receiving evidence about them. When counsel for the complainant invited us to draw an adverse inference from the fact that Mr. Aisenstat had not testified, however, counsel for the respondent objected to that. He observed that nothing in the material filed by the complainant gave the respondent any notice that behaviour by Mr. Aisenstat would be in question in this proceeding. In the circumstances, he argued, it would be understandable that he would not have been brought to the hearing to answer allegations first made only at that hearing.
20We agree that nothing in the complaint would have given the respondent notice that any action or decision of Mr. Aisenstat was in issue. The only person identified by the complaint as having acted in the manner complained of was Mr. Moss-Norbury. The impression left by the language of the complaint is that Mr. Moss-Norbury's decision to terminate Mr. Poon was its focus. Indeed, it is the respondent's position that while Mr. Moss-Norbury did speak to Mr. Aisenstat about the proposed termination before it was carried out, the decision to terminate Mr. Poon was taken by Mr. Moss-Norbury for the reasons he gave, and was not the result of any instruction by Mr. Aisenstat. The respondent does not argue that failure to particularize the allegations against Mr. Aisenstat should result in our ignoring the evidence in support of those allegations. Its position is simply that no adverse inference should be drawn from the failure to call Mr. Aisenstat as a witness in these circumstances. We agree.
21Although the complaint as drafted alleges that the respondent breached section 79 when it terminated Mr. Poon, no specific argument was advanced to support the proposition that the termination somehow violated the statutory "freeze" imposed by that section. Argument focused on the proposition that Mr. Poon's union activities had something to do with the respondent's decision to terminate his employment.
22Interference with or reaction to the exercise of statutory rights under the Labour Relations Act need not be the sole or even the predominant reason for an employer's action before that action will constitute a violation of the Act. In complaints of this type, subsection 89(5) imposes on the employer the burden of proving that it did not violate the Act. The standard of proof required is proof on a balance of probabilities, not proof beyond a reasonable doubt.
23The issue in this case is whether the respondent's decision to terminate Mr. Poon's employment was in any way motivated by his involvement in union activities. The issue is not whether the respondent had just cause to terminate his employment, although questions of that sort can have some relevance. As the Board observed in Pop Shoppe (Toronto) Limited, [1976] OLRB Rep. June 299:
- In cases such as these the Board is very often required to render a determination based on inferential reasoning. An employer does not normally incriminate himself and yet the real reason or reasons for the employer's actions lie within his knowledge. The Board, therefore, in assessing the employer's explanation must look to all of the circumstances which surround the alleged unlawful acts including the existence of trade union activity and the employer's knowledge of it, unusual or atypical conduct by the employer following upon his knowledge of trade union activity, previous anti union conduct and any other "peculiarities". (See National Automatic Vending Co. Ltd. case 63 CLLC 16,278). If, having regard to the circumstantial evidence, the Board cannot satisfy itself that the employer acted without anti union motivation, the Board must find that the employer has violated the Act. These determinations, however, are most difficult and require an incisive examination of all the evidence. Not only must the Board "see through" the legitimate reasons which often co-exist with the unlawful, but at the same time the Board must be capable of distinguishing between the unlawful and the unfair. The Board cannot find, and neither should it automatically infer, that an employer who has engaged in conduct which is unfair has violated the Act even if the unfair treatment is coincidental with an organizing campaign. However, because of the nature of the proceedings and the frequent requirement for inferential reasoning the Board would be delinquent if it did not consider, for purposes of drawing an adverse inference, unfair treatment during an organizing campaign of itself or in conjunction with the other circumstantial evidence. The Board, therefore, must be acutely sensitive to all of the circumstances and must not be unduly swayed by either the co-existence of unfair treatment or by the co-existence of legitimate reasons for the employer's conduct in determining if The Labour Relations Act has been violated.
24Except to the extent alleged in these proceedings, there is no evidence or allegation that the respondent has discriminated against any employees as a result of their union activity or otherwise acted improperly before during or in the lengthy period since the organizing campaign. Except to the extent dictated by the Labour Relations Act, Mr. Moss-Norbury's behaviour toward Mr. Poon and other union supporters remained unchanged until the discoveries in August of 1989. Mr. Cagigal, another key organizer, testified that his personal relationship with Mr. Moss-Norbury had actually improved, for reasons which had nothing to do with anyone's union activity. Mr. Poon was on the union's bargaining committee when discharged. He remains on the committee. The respondent has not objected to that. There is no allegation that the respondent has been bargaining otherwise than in good faith either before or after the discharge of Mr. Poon.
25When an employer discharges a key employee organizer after an organizing campaign, it is natural to wonder whether the campaign had something to do with the discharge, even if the discharge is said to be for some unrelated reason. Even when the reason offered appears to be a sufficient or just cause for discharge, it would be an unusual case in which the dispassionate observer was left with no doubt at all about whether union activity had played some part in the motivation of the employer. As we have already observed, however, the employer is not required to persuaded us of its innocence beyond any reasonable doubt. The standard of proof is proof on a balance of probabilities. We are persuaded, on a balance of probabilities, that the reasons given by the respondent for terminating Mr. Poon's employment are the only reasons for that termination.
26Accordingly, this complaint is dismissed.