The Society of Ontario Hydro Professional and Administrative Employees v. Ontario Hydro, 1990 CanLII 5676

The Society of Ontario Hydro Professional and Administrative Employees v. Ontario Hydro

[1990] OLRB Rep. March 305

0354-89-U; 0367-89-M The Society of Ontario Hydro Professional and Administrative Employees, Applicant/Complainant v. Ontario Hydro, Respondent v. The Coalition to stop the certification of the Society, on behalf of certain employees, Intervenel

BEFORE: Owen V. Gray, Vice-Chair, and Board Members G. O. Shamanski and B. L. Armstrong.

APPEARANCES: James K. A. Hayes, Alda McMahon, Darlene Booth and Michael Brickell for the applicant/complainant; F. G. Hamilton and Brian Story for the respondent; A. M. Robinson, Peter Kirkby and Stewart Crampton for the intervener.

DECISION OF THE BOARD; March 2, 1990

DECISION

1. The applicant/complainant ("the Society") and the respondent ("Hydro") are signatories to a "Master Agreement" and a number of "subsidiary agreements". The Society takes the position in these proceedings that those documents together constitute a collective agreement within the meaning of the Labour Relations Act ("the Act"). In Board File 0354-89-U, it complains under section 89 of the Act that Hydro's refusal to acknowledge that it is bound to a collective agreement and its failure to honour a request that a clause of the sort contemplated by subsection 43(1) of the Act be added to that agreement constitute breaches of the Act for which the Board should grant a remedy. In Board File 0367-89-U, the Society applies under subsection 44(3) of the Act for an order modifying the arbitration provision in what it describes as the collective agreement, so as to remedy certain alleged inadequacies in that provision. This decision deals with the threshold question whether the Society and Hydro are parties to a collective agreement to which the Act applies. On that question, the respondent and intervener say that the existing agreements between Hydro and the Society do not constitute a collective agreement and that, in any event, the Society is estopped from asserting that they do.

2. The question dealt with here arose but was not dealt with in a pending application by the Society for certification for the unit of employees to whom the alleged collective agreement applies. One of the critical issues in that application was whether the Society is a "trade union" within the meaning of clause l(l)(p) of the Act. This panel of the Board heard extensive evidence in the certification application with respect to that issue and a related question whether the Society was the recipient of employer support which would preclude its certification. The panel came to the unanimous conclusion that the Society is a trade union within the meaning of clause l(l)(p) of the Act which has not been the recipient of employer support within the meaning of section 13 of the Act: Ontario Hydro, [1989] OLRB Rep. Feb. 185; 1 C.L.R.B.R. (2d) 161 (the "status decision"). Without necessarily agreeing that all of the evidence we heard in connection with those issues is relevant to the issue to be dealt with in these proceedings, the parties agreed that we could treat all of that evidence as having been heard by us in connection with these proceedings, subject to the right of any party to call additional evidence.

3. Before presenting additional evidence, however, Hydro and the intervener (whose standing to intervene in these proceedings was not challenged) raised the preliminary objection that, in view of the outstanding certification application, these proceedings constituted an abuse of process to which the Board should respond by refusing to entertain them unless and until the certification application was withdrawn or disposed of. The panel heard and unanimously rejected that argument on the first day of hearing in these proceeding. Our explanation of that ruling and of our decision on the merits begins with a review of the certification proceedings.

The Certification Application

4. In the application for certification it filed on November 6,1986, the Society asked that the Board conduct a pre-hearing representation vote. It was apparent from material filed that Hydro and the Society were parties to existing agreements which addressed the terms and conditions of employment of employees in the unit for which the application was being made. Hydro and the intervener ("the Coalition") opposed that application, but neither of them asserted a contract bar. Hydro and the Coalition also opposed the request that a pre-hearing vote be conducted.

5. Part of Hydro's argument against conducting a pre-hearing vote was that the Society already had a representational role under the existing agreements, so that delay in resolving its claim to such a role under the Act would not be as great a concern as it would ordinarily be: Ontario Hydro, [1987] OLRB Rep. Mar. 419 (the "show cause hearing") at paragraph 5. We had the Registrar solicit the parties' representations on whether the existing agreements could be other than a collective agreement if the Society were found to be a trade union. In their answers, Hydro and the Coalition took the position that the existing agreements between Hydro and the Society were not collective agreements. The Society's answer was that its agreements with Hydro did constitute a collective agreement. As we shall note later, this was the first time they had publicly taken that position. In the show cause decision, we directed that a hearing be scheduled to give the applicant the opportunity to address these concerns:

6. If the Board finds that the applicant is a certifiable trade union and if its current agreement with the respondent is a collective agreement, it appears it would follow that the applicant already has bargaining rights for employees in the unit for which it seeks certification, and no outcome of this application - and, hence, no outcome of a vote - could augment or diminish those existing bargaining rights. If, on the other hand, the applicant is not a certifiable trade union, then it can have no existing rights which are enforceable under the Labour Relations Act and no outcome of a vote could result in its having such rights. Unless the Board were to find that an employer and a union can contract out of the application to them of the Labour Relations Act and, further, that these parties actually did so without the applicant's thereby or thereafter having become uncertifiable, we have difficulty seeing how the applicant could be found to be a certifiable trade union without its existing agreement with the respondent being a collective agreement. While we have come to no firm conclusion on these points, we are led to wonder whether there is any possibility of an outcome of this application in which the results of a prehearing representation vote could have a meaningful part to play in the determination of the applicant's right to represent the employees affected by this application. We therefore doubt that we should grant the applicant's request that a pre-hearing vote be conducted.

6. The parties' representations at the show cause hearing did not dissuade us from our tentative view that a pre-hearing vote should not be conducted. We decided not to conduct a prehearing representation vote, for reasons later reduced to writing and reported at [1987] OLRB Rep. Dec. 1589 ("the pre-hearing vote decision"), where we made the following observations:

22. At the hearing directed in our show cause decision, the parties were asked whether they could foresee an outcome of this application in which we could find the applicant to be a certifiable trade union (that is, a "trade union", as defined by clause l(l)(p) of the Act, to which section 13 of the Act does not apply) without its agreement with Hydro being a collective agreement as defined by clause 1(1)(e) of the Act. The parties' answers tended to focus on the likelihood of a finding that the agreement is a collective agreement. For example, counsel for Hydro suggested that a finding that the applicant was a trade union on the application date would not necessarily mean it was a trade union when it entered into its agreement with Hydro. He observed that the Society's constitution was amended in November 1983, apparently with a view to the requirements of the Act, whereas the current Master Agreement was signed in September 1983 with effect as of July 1, 1983. Counsel for the applicant countered that it and Hydro had executed a further agreement after November 1983. This did not assist us with what we saw as the critical question, which may be restated this way: if the agreement is not a collective agreement, is there any likelihood that it does not constitute employer support within the meaning of section 13 of the Act? There was no serious challenge to the proposition that the Society receives very substantial benefits from Hydro pursuant to this agreement. Neither the Society nor any of the other parties argued with any vigour that the Society's existing agreement with Hydro might constitute neither a collective agreement nor employer support.

23. The doubt we expressed in our show cause decision remained after hearing the parties' oral representations. The applicant's position is that its agreement with Hydro is a collective agreement. That would mean it already has bargaining rights under the Labour Relations Act for the employees for whom it seeks certification. If that is so, certification can add nothing to its rights. (That is apart altogether from the question whether the existence of the agreement constitutes a bar under section 5 of the Act, an issue which has not been raised and which we are not yet in a position to assess.) Equally, dismissal of this application would not deprive it of such rights, as this is not a termination application. If the applicant is right, therefore, a representation vote would serve no useful purpose. The same is true if Hydro and the Coalition are right about the applicant's not being a certifiable trade union. Even if it "won" a vote, the Society could not be certified if it is not a certifiable trade union.

It is important to note that the observations we made in our decisions of March 17 and December 21, 1987 were not intended to be and are not dispositive of the issue before us in these proceedings. We were dealing there with the question whether to direct the conduct of a pre-hearing representation vote. The question whether the Society was a "trade union" had not yet been decided. Understandably, the factual assertions and legal arguments in support of the proposition that agreements between the Society and Hydro would not be collective agreements even if the Society was a trade union were not as fully developed at that point as they were later. In particular, as we noted in the pre-hearing vote decision, none of the participants argued with any vigour that the Society's existing agreement with Hydro might constitute neither a collective agreement nor employer support.

7. When the certification application came back on for hearing following the further processing required by section 5 of the Board's Rules of Procedure, there were a number of matters in dispute. We decided to first hear evidence and argument with respect to two questions (the "status questions"): whether the Society was a "trade union" within the meaning of the Act and whether the Society was disqualified from certification because it had received employer support within the meaning of section 13 of the Act.

8. Hydro's position is that a number of the persons "represented" by the Society under their existing agreements are persons who exercise managerial functions or are employed in a confidential capacity in matters relating to labour relations who, by clause 1(3)(b) of the Act, are deemed not to be employees for the purpose of the Act. The Coalition supports that position. The Society denies that clause 1(3)(b) applies to any of its members or to any of those whom it represents under the existing agreements. In the certification application, Hydro argued that the inclusion of such persons in the Society's membership prevented it from being a "trade union" within the meaning of clause l(l)(p) of the Act. While denying that any of its members was managerial, the Society argued in the alternative that the mere presence in its membership of managerial employees could not adversely affect either of the status questions. There was a consensus that the question whether the applicant was a "trade union" should be addressed initially on the assumption that the disputed individuals would be found "managerial" without, however, assuming the truth of any element of an allegation of employer support: see paragraphs 30 to 33 of the status decision.

9. We heard a number of days' evidence in the certification application with respect to the events of the more than 40 years during which Hydro had been dealing with the Society and its predecessors or precursors. At the conclusion of the evidence, the Society sought to argue not only that it was a "trade union" within the meaning of clause l(l)(p) to which section 13 did not apply but also that its existing agreements with Hydro together constituted a "collective agreement" within the meaning of clause 1(1)(e) of the Act. We concluded that the applicant was a "trade union as defined by clause l(l)(p) of the Act even if, as we assumed, its membership included "managerial" employees. We also found that the Society had not been the recipient of "employer support" within the meaning of the Act. We were able to come to that conclusion without deciding whether the agreements between Hydro and the Society were collective agreements within the meaning of the Act. We did not find as strong a linkage between those issues as we thought there might be at the time of the show cause and pre-hearing vote decisions.

10. As we noted in paragraph 95 of the status decision, the Society asked us to decide whether its current agreements with Hydro constituted a "collective agreement" within the meaning of the Act even if such a finding was unnecessary to our disposition of the status questions. We did not do so, for reasons which were set out in paragraphs 96 and 97 of the status decision:

96. After we had concluded in March 1987 that a pre-hearing representation vote would not be conducted, we invited the participants' representations about the order in which we should deal with the issues in dispute and the procedure we should adopt in connection with the hearing of those issues. None of the participants then chose to put the status of the existing agreements directly in issue. This was not surprising. It would not have been in the interest of the parties opposed to the Society's having bargaining rights under the Labour Relations Act to assert that the existing agreements constituted collective agreements under that Act, since that would amount to a concession that the Society already had bargaining rights under that Act. The existence of a "collective agreement" covering the employees affected by this application would leave us without jurisdiction to entertain this application (unless it could be said that it had been filed during one of the "open periods" contemplated by subsections (4), (5) and (6) of section 5 of the Act). An assertion by the applicant of a proposition which, if true, would leave the Board without jurisdiction to entertain the application might well have led to our dismissing the application without determining the correctness of the assertion. That was an obvious disincentive to the applicant's pursuing the matter in this application. Another apparent reason for the Society's not having put the status of its agreements with Hydro in issue emerged during the evidence, when we heard that the Society's executive had rejected the idea of taking a "back door" route to Labour Relations Act coverage by taking or precipitating proceedings in which it would ask the Board to find that the Society's agreements with Hydro constituted collective agreements. They preferred to establish Labour Relations Act coverage of the Society's relationship with Hydro by means of a certification application based entirely on membership evidence obtained expressly for that purpose, so that the result would be based on a direct demonstration of majority support for representation by the Society in collective bargaining under the Labour Relations Act.

97. We were surprised, therefore, when counsel for the Society raised this question again as a distinct issue which it wished to have decided in these proceedings. By that point, the simple answer to the request was that the two status questions were the only questions with which we were dealing in this phase of our hearings, and it would be inappropriate to deal with any other issue except to the extent that was necessary to resolve the two status questions. Any question whether the existing arrangement between the Society and Hydro constitutes a "collective agreement" within the meaning of the Act is complicated by the argument that the Society is estopped from asserting that those agreements constitute a collective agreement under the Labour Relations Act by reason of its having made contrary representations to its membership over a considerable period of time. There is the question whether the doctrine of estoppel can be applied in these circumstances. There is the question whether a trade union as defined in the Labour Relations Act can engage in the representation of employees covered by that Act except under the provisions of that Act. These are complex questions with which we would not want to deal unless it were absolutely necessary to the disposition of the matter before us. It has not proved necessary to do so in order to determine the status questions. Indeed, this certification application could be dealt with without ever resolving those questions.

11. The status decision was released on February 22, 1989. When the certification application came back on for hearing, counsel for the Society inquired whether it would be appropriate for it to then raise this collective agreement question for determination in that application. After he received a discouraging response, the application and complaint now before us were filed on May 5, 1989.

The Preliminary Objection

12. As we have noted, at the first day of hearing in these proceedings Hydro and the Coalition argued that these proceedings should not be entertained unless and until the certification application had been determined or was otherwise disposed of. They contended that the Board would not entertain a certification application with respect to a unit of employees for whom the applicant already had bargaining rights. Accordingly, they said, a trade union in the position of the applicant had to elect whether to seek bargaining rights through certification or assert that it already had such bargaining rights. The assertion of these inconsistent positions in parallel proceedings was, they said, an abuse of process for reasons which had to do, among other things, with the alleged duplication of resources which would result. While Hydro and the Coalition made a number of other arguments in this regard, they were really addressed to the merits of the question before us rather than to the propriety of our entertaining that question while the certification application remained outstanding.

13. The panel was not satisfied that it should either put the Society to its election as to which proceedings it would pursue or stay these proceedings. We ruled unanimously that we would hear the application and complaint on their merits. We observed in that oral ruling that "in the circumstances of this case, we do not have difficulty with the applicant, or indeed any affected person, pleading in the alternative with respect to whether the applicant already has bargaining rights." There is nothing inherently wrong or abusive about pleading in the alternative, and that is essentially what the Society was seeking to do. Had these proceedings been instituted at the same time as the certification application, they would have been listed together for hearing and heard in such a way as to prevent duplication of effort and eliminate the possibility of inconsistent results. The parties' agreement that evidence heard in the certification proceedings could be taken as heard in these proceedings eliminated duplication of effort as a serious concern. While the delay in pursuing this alternate claim created the possibility of some wasted effort in steps taken in the certification application after the determination of the status questions, that did not seem to us sufficient reason to refuse to entertain these proceedings in a timely manner.

Facts

14. The Society says that the following documents together constitute a collective agreement:

(a) the Master Agreement between the Society and Hydro dated September 20, 1983, together with the appendices thereto and the Subsidiary Agreements thereunder;

(b) the Memorandum of Understanding between the Society and Hydro dated September 13, 1983, concerning representation of "OSS" and "TS" employees;

(c) the Memorandum of Understanding between the Society and Hydro dated November 29, 1984, concerning revising the Master Agreement;

(d) the Memorandum of Understanding between the Society and Hydro dated November 29, 1984, concerning application of the Subsidiary Agreements to "OSS" and "TS" employees; and,

(e) the Memorandum of Understanding between the Society and Hydro dated March 26, 1987, concerning representation of employees on Salary Schedules 07, 08 and 09.

The parties' evidence and arguments focused on the history of the relationship between Hydro and the Society prior to their signing the 1983 Master Agreement, the documents themselves, the immediate context in which they were signed, and the Society's treatment of and representations about the documents before and after they were signed.

15. One of the arguments made by Hydro and the Coalition in these proceedings is that the inclusion of managerial employees among those covered by the agreements in question demonstrates that the agreements are not "collective agreements" within the meaning of the Act. As in the certification application, there is a consensus that the question at hand should be dealt with initially on the same assumption as was made in the certification application: that those whose "managerial status" is in dispute would be found to be managerial.

16. The relationship between Hydro and The Society prior to 1983 was addressed in paragraphs 7 through 18 of the status decision. What follows is in some ways a summary and in other ways an elaboration of what we said in that decision. Nothing we say here is intended to contradict what was said there.

17. As a result of certification by this Board on June 28, 1947, "Hydro Electric Power Commission Unit No. 1 Federation of Employee-Professional Engineers and Assistants" ("Unit 1") became the exclusive bargaining agent for "all persons engaged in the practice of engineering as that term is defined in The Professional Engineers Act, R.S.O. 1937, Chapter 237, who are in the employ of The Hydro-Electric Power Commission of Ontario [now Hydro] and who come within the definition of employee in the Regulations". It appears Hydro and Unit 1 made their first collective agreement in June 1948. In December of that year, regulations made under the Labour Relations Act, 1948 amended the previous definition of "employee" to exclude "a member of the engineering ... profession qualified to practise under the laws of Ontario and employed in that capacity." Nevertheless, Hydro and Unit 1 continued to make collective agreements covering employees in the unit for which Unit 1 had been certified. Indeed, in 1955 the recognition clause in their agreement was expanded so as to include "professional scientists" and "graduate-engineers-in-training" in the unit for which Hydro recognized Unit 1 union as "sole representative."

18. At some point in the early 1950s, Unit 1 came to be known as "The Ontario Hydro Unit, Canadian Federation of Engineers and Scientists" ("The Ontario Hydro Unit"). In late 1956, its parent body, the Canadian Federation of Engineers and Scientists, decided to dissolve. Those in attendance at a membership meeting of The Ontario Hydro Unit called and held for that purpose in November 1956 purported to adopt a new constitution along with a new name: "Society of Ontario Hydro Professional Engineers". Hydro treated the newly named organization as the bargaining agent under the collective agreement then in force between it and The Ontario Hydro Unit. In the status decision (at paragraph 43), we found that

-. the evidence is insufficient to establish that the applicant is simply a continuation of the organization which was found to be a trade union in the 1947 certification decision. ... The proceedings taken by members of the Ontario Hydro Unit in 1956 ... might only have been effective, if at all, as the creation of a new organization and not as a continuation of the existing one.

In its own literature, the Society traces its origins to the "Society of Ontario Hydro Professional Engineers" with which Hydro began dealing in 1956. In the status decision we described the various names and constitutional changes the Society claimed to have gone through since that time. For the purpose of that decision, we found it unnecessary to determine whether there was a technically satisfactory constitutional continuum between the 1956 organization, each of the subsequent "Society of ..." organizations and the applicant. For the purpose of our review here of history prior to 1983, it is sufficient to note that in that period the relevant parties behaved as though there was such a continuum. For convenience, therefore, the organization or organizations with which Hydro dealt in that period will be referred to in what follows as simply "the Society".

19. In 1958, Hydro gave the Society notice of termination of the collective agreement then in effect. Hydro expressed the view that collective bargaining was an inappropriate way to deal with employee professional engineers. In addition, Hydro felt that all professional employees were a part of and should align their interests with management (see paragraph 17 of the status decision). Although the unit then represented by the Society included employees ("professional scientists" and "graduate-engineers-in-training") who were not "professional engineers", the Society did not pursue (and may very well not have considered) the question whether Hydro had a continuing legal obligation to bargain collectively with respect to those employees. Both before and after 1958, both sides acted as though they thought that Hydro was under no legal obligation to continue bargaining collectively with the Society because professional engineers were no longer covered by the then Labour Relations Act.

20. While Hydro was willing to have periodic discussions with the Society about matters of interest to its members, it refused to enter into any further formal agreement with the Society. It wanted an informal, consultative relationship in which the Society's role would be limited to putting forward the concerns of its members as a group, without being able to represent individual members in disputes with management. That was not enough for the Society's members, and the Society's executive pressed for continued formal collective bargaining. The Society sought recognition in a formal contract providing for conciliation and arbitration of differences. The Society described what they wanted as "a voluntary agreement - not one required by law" (Presentation to The Commissioners of The Hydro-Electric Power Commission of Ontario from the Society of Ontario Hydro Professional Engineers, 1959, p. 9).

21. In 1961, representatives of Hydro and the Society signed the following "Letter of Understanding":

LETTER OF UNDERSTANDING BETWEEN THE MANAGEMENT OF ONTARIO HYDRO and THE SOCIETY OF ONTARIO HYDRO PROFESSIONAL ENGINEERS

1. Management recognizes the Society as the representative body for all professional engineers and scientists of Ontario Hydro from MP1 to MP6 inclusive who are members of the Society except those employed in a confidential capacity.

2. The mechanism by which Management and the Society meet to effect agreement is confirmed; viz, matters of mutual interest are to be referred to the Joint Society-Management Committee, to which each body appoints an equal number of representatives. The Committee may agree to discuss any item of interest to either party, and to introduce or re-open items for discussion at any time.

3. Committee agreements are to be recorded in writing, and when such agreements have received mutual approval of Management and the Society, they shall become working conditions.

4. The Society accepts as a guide to conditions of employment at this time those items in the Management Guide and those Directives so far made known to the Society as they apply to professional engineers and scientists.

5. It is the intent of Management and the Society to devise a mutually acceptable grievance procedure as soon as possible, similar to procedures now being followed. However, final stage in such procedure shall provide compulsory arbitration by a third party.

6. It is the desire and intent of Management and the Society to co-operate in the early development of a system for settling any and all points of disagreement between them. It is mutually recognized that for optimum effectiveness such a system must in general ensure for Society members treatment comparable with that enjoyed by the members of certified bargaining agents recognized by the Commission.

7. Pending the development of the system referred to in Item 6, Management undertakes not to alter working conditions of Society members without prior consultation in the Joint Society-Management Committee or with the Executive of the Society.

Hydro and the Society went on to establish a redress procedure, as contemplated by paragraph 5, and written agreements on terms and conditions of employment, as contemplated by paragraphs 2 and 3. The relationship under this first "master" agreement continued for roughly ten years.

22. In February 1971, the then Labour Relations Act was amended to delete "engineering" from the list of professions whose members were deemed not to be employees by subsection 1(3)(a) and to add provisions now found in clause 1(1)(n) and subsection 6(4) of the Act. At that point, the Society's negotiations with Hydro had reached an impasse. One of the concerns which had been expressed by Hydro was that persons with what it considered to be managerial and supervisory functions were included in the Society's membership and in the unit it represented. The Society's understanding as of March 1971 was that Hydro was not prepared to enter into a further "voluntary agreement" covering that unit and was leaving it up to the Society to take whatever benefit it could from the new provisions of the then Labour Relations Act.

23. The Society then applied to the Minister of Labour for appointment of a conciliation officer under what is now subsection 16(3) of the Act. Hydro disputed the Minister's authority to do so, and the Minister referred the question of his authority to the Board for its advice under what is now section 107 of the Act. During what we have been told was a one day hearing, the Society's General Manager acknowledged that at least 65 of its members were "managerial" and that, although those members did not have a part to play with respect to bargaining for wages or working conditions, "a potential for conflict of interest" did exist as a result of their membership. The panel hearing the matter noted that "[t]he Board over the years has refused to give status to purported trade unions on the basis that members of management are or have been involved in its organization." On that basis, it concluded that the Society was not a trade union and that, accordingly, the Minister did not have the authority to appoint a conciliation officer at its request: [1971] OLRB Rep. Aug. 501 (the "HEPCO" decision).

24. Following the 1971 decision, the Society's executive considered several options, including an application for certification and a return to the bargaining table with Hydro to seek a new "voluntary" agreement. It described the pros and cons of the certification and "voluntary agreement" alternatives this way in a news release to its members:

Alternative Pros Cons

1. Certification under the Recognition of specific, Only 500-600 members current Act smaller group for in the group; union bargaining purposes; label; legal costs to retention of some prevent too many professional identity; exclusions from the formal agreements group; limited leadership, under law (OLRA). with many of the best and most experienced leaders eliminated from the group; scientists and non-registered engineers excluded.

2. Voluntary Some normalization of An altered group, of relations with Hydro partly in keeping with Management; reopening some Management views; Discussions through informal ‘sounding board’ JSMC; retention of negotiations with conciliation Professional identify. or advisor, but no binding decisions under law; no legislative strength.

Lobbying for new legislation and affiliation with OHEU (the union which represented the majority of Hydro workers - see paragraph 14 of the status decision) were also presented as alternatives.

25. Minutes of the Joint Society Management Committee meeting of November 17, 1971, record that

As a result of the report of the Ontario Labour Relations Board the Society stated that it wishes to continue to strive for a voluntary agreement with the Commission outside the Ontario Labour Relations Act.

The ensuing discussion centred around the composition of the unit. The Society is exploring the possibility of expanding horizontally.

In June 1972, the Society conducted a survey to determine its members' views on certification. The survey showed strong support for certification if "voluntary agreement" could not be obtained.

26. At the end of 1972, Hydro and the Society entered into a new master agreement. Its provisions included these:

(1) Ontario Hydro recognizes the Society as the representative body for all professional engineers and scientists of Ontario Hydro in MP1 to MP6, FMP II to FMP 16 and Engineering Trainees who are members of the Society except those employed in a confidential capacity.

(3) Negotiations between Ontario Hydro and the Society shall take place through a Joint Society-Management Committee to which each body will appoint an equal number of representatives. Negotiations shall be conducted in good faith and both parties shall make every reasonable effort to reach agreement on matters of mutual interest as expeditiously as possible.

This master agreement went on to provide that the parties' "agreements" were to be in writing. If agreement could not be reached on salary schedule adjustments, that matter was to be referred to an arbitrator whose award would be "final and binding upon the Society and the Commission." Other matters on which the parties could not agree were to be referred to mediation by a mediator selected by the parties. If the mediator was unable to effect a settlement, he was to recommend a settlement which the parties were obliged to seriously consider but not to adopt. Hydro retained "the right to make the final decision" on those non-salary matters. This master agreement also incorporated by reference the redress procedure Hydro and the Society had worked out in 1963, under which a member's complaint about "unfair treatment" could be referred by either Hydro or the Society to third party arbitration if not first successfully resolved in its multi-step grievance procedure.

27. The Society amended its constitution in 1973 to extend eligibility for membership to all those employees in Hydro's MP and FMP classifications who were not engineers or scientists. In June 1976, Hydro signed a new master agreement with the Society which provided, among other things, that

(1) Ontario Hydro recognizes the Society as the representative body for MP1 to MP6 inclusive, FMP11 to FMP16 inclusive and staff on Salary Schedules 04 and 18, excluding those employed in a confidential capacity in matters relating to negotiations with respect to the Society or employees engaged in full-time security work, as contained in an agreed listing.

This clause has no limiting effect on any recognition clause that has been established under the Ontario Labour Relations Act.

This was the first master agreement in which the Society was recognized as "representative body" for all employees in the specified classifications, not just those who were members of the Society. It also extended that recognition beyond engineers and scientists to all employees in those classifications. Six months before the represented group was enlarged in this way, Hydro and the Society arranged to have an independent accounting firm conduct mailed ballot votes among the affected employees, to determine their wishes with respect to this proposed change. The group proposed to be added was polled separately from those already represented. In both groups, a substantial majority favoured the change.

28. In April 1983, Hydro gave notice of termination under the master agreement then in effect because the Society disagreed with its proposed changes to a subsidiary agreement on surplus staff and the parties could not agree on the method by which that disagreement would be resolved. The termination was traumatic for the Society; its executive entered into the renegotiation of the Master Agreement with reduced faith in the viability of the "voluntary agreement" option. It again spoke of certification as an option, one which it did not wish any new Master Agreement to preclude.

29. From the signing of the 1972 Master Agreement until well after the signing of the 1983 Master Agreement, both in communications between them and in communications with Society represented employees, Hydro and the Society spoke of their relationship and voluntary agreements as being outside or beyond the jurisdiction of the Labour Relations Act, and the Society spoke of an application for certification as the route it would take to get the benefit of that Act if its "voluntary relationship" with Hydro became unsatisfactory. These propositions appear frequently in the literature the Society distributed to represented employees. That they do not appear with frequency in written communications between Hydro and the Society is not surprising, as they were a well settled basis of the dealings between them.

30. The evidence before us does provide a very clear example of a written affirmation by the Society in a quite public communication with Hydro in 1979. The first page of the March/April 1979 issue of the Society News, a regular publication distributed by the Society, bears the text of "An Open Letter To Hugh Macaulay, Chairman Designate of Ontario Hydro" sent for the purpose of formally introducing the addressee to the Society. In it, the Society said this:

The relationship between Ontario Hydro and the Society is defined in a short document called "The Master Agreement." The relationship so defined is not within the jurisdiction of the Ontario Labour Relations Act but is one that has provided sufficient freedom and flexibility and, over the years sufficient benefits to both parties that it is regarded with respect and in some cases envy by other professional groups.

31. There is evidence that after Hydro gave notice of termination of the master agreement then in effect, the Society's executive considered asserting that that master agreement gave it rights under the Labour Relations Act. During the negotiation of the 1983 Master Agreement, however, it did not do or say to Hydro anything to signal any change in its belief that the Act did not apply to either the agreement or their relationship. We do not think Hydro saw or could have been expected to see such a signal in the Society's statement (in its letter of May 9, 1983) that its participation in those negotiations was "without prejudice to any present or future position the Society may take concerning the status of the Master Agreement".

32. The nature of the Master Agreement was specifically discussed during the mediation process which led to the 1983 Master Agreement. It was the uncontradicted evidence of one of Hydro's witnesses that both parties told the mediator, who was the then Chairman of this Board, that the agreement was not a collective agreement. The Society's own report on the outcome of mediation quoted its counsel as saying "... As was mentioned by myself and the mediator, there is nothing to prevent the Society during the next four years in applying for certification if the relationship with the Corporation becomes unbearable."

33. The Society had amended its constitution in 1981 to allow employees in Hydro's OSS (Office Supervisory Services) and TS (Trades Supervisory) job classifications to become members. One of the matters discussed during the 1983 negotiations was expanded recognition to include these employees in the group represented by the Society. Hydro agreed to do this on certain terms set out in the memorandum of September 13, 1983 referred to in paragraph 15(b) above, if a majority of employees in each group voted in favour of Society representation. This memorandum had many of the features of the 1983 Master Agreement, but did not provide for determination of salary matters by arbitration and had only a two year term. The parties had earlier arranged for the conduct by mail of a "representation vote", again under the scrutiny of an independent accounting firm jointly instructed by the parties. In each group, a very substantial majority of those who cast ballots favoured Society representation. The 1983 Master Agreement was signed shortly after those results were announced.

34. The provisions of the 1983 Master Agreement include the following:

MASTER AGREEMENT

BETWEEN

ONTARIO HYDRO

AND

THE SOCIETY OF ONTARIO HYDRO

PROFESSIONAL AND ADMINISTRATIVE EMPLOYEES

EFFECTIVE JULY 1, 1983

1.0 Recognition

1.1 Ontario Hydro recognizes the Society as the representative body for MP1 to MP6 inclusive, FMPII to FMPI6 inclusive and staff on Salary Schedules 04 and 18, excluding those persons primarily employed in a confidential capacity and making effective recommendations affecting the terms and conditions of employment for Society-represented staff, and employees engaged in full-time security work, in the same or similar categories to those as contained in an agreed listing.

1.2 In the event of a dispute regarding the exclusion of a person employed in a confidential capacity, the matter shall be determined by an arbitrator selected in accordance with Article 8.0 of this Agreement.

This article has no limiting effect on any recognition clause that has been established under the Ontario Labour Relations Act.

2.0 Voluntary Membership

Membership in the Society is voluntary. Ontario Hydro will provide for a voluntary check-off of membership dues for staff represented by the Society in accordance with the Recognition Article 1.0 of the Master Agreement.

3.0 Joint Society-Management Committee

Negotiations between Ontario Hydro and the Society shall take place through a Joint Society-Management Committee (JSMC) to which each body will appoint an equal number of representatives. Negotiations shall be conducted in good faith and both parties shall make every reasonable effort to reach agreement on matters of mutual interest as expeditiously as possible.

8.0 Selection of Mediators and Arbitrators

Mediators and arbitrators will be selected from a panel of mutually acceptable persons and the costs of using them will be shared equally by Ontario Hydro and the Society.

9.0 Redress Procedure and Criteria for Agreements

The provisions of the Redress Procedure set out in Appendix D, and Criteria for Agreements set out in Appendix E of this agreement shall apply as if set forth in full herein.

10.0 Duration of Agreement

This Agreement shall come into effect on July 1, 1983, and shall remain in effect until July 1, 1987 and thereafter from year to year unless terminated by written notice by either party not less than six months prior to July 1, 1987 or the anniversary date. In the event that either party desires to amend but not terminate the Master Agreement, it must notify the other party in writing not less than two months prior to the anniversary date.

"L.R. Greenhotz" "Milan Nastich" President President Society of Ontario Ontario Hydro Hydro Management and

Professional Staff*

September 20, 1983

Date

*Name subsequently changed to The Society of Ontario Hydro Professional and Administrative Employees

35. As with previous master agreements, this agreement provides a framework for negotiations during its term with respect to changes in the terms and conditions of employment of those in the represented group. Mechanisms are provided for the resolution of differences on certain matters when they are not settled by negotiation. A wide range of matters may be the subject of mediation. If salary schedule adjustments and other directly related items (like overtime, shift allowances, compensation for working 12 hour shifts, travel time, for example) remain in dispute following mediation, Article 7.1 provides that

7.1 ...either party may, by notice in writing to the other, require that the dispute be referred to an arbitrator.

and also that

The arbitrator's decision shall be final and binding upon the Society and Ontario Hydro and shall be for a period of one year from the effective date of the award unless otherwise mutually agreed between the parties.

When the unresolved difference involves making a change to the provisions of a subsidiary agreement to be effective during the unexpired term of that agreement, the provisions remain unchanged. When the unresolved difference involves making a change to the provisions of a subsidiary agreement (other than one settled by interest arbitration) to be effective when its present term expires, Article 7.3 provides that

7.3…

(b) If Ontario Hydro accepts the mediator's recommendations and the Society rejects the mediator's recommendations, Ontario Hydro shall retain the right to implement changes to the terms and conditions as recommended by the mediator and such changed terms and conditions will be deemed to constitute a subsidiary agreement between the parties.

(c) If both parties reject the mediator's recommendations, or Ontario Hydro rejects such recommendations and the Society accepts such recommendations, Ontario Hydro retains the right, subject to Article 7.3(d), to implement changes to the terms and conditions set out in the expired subsidiary agreement.

(d) The Society shall have the right to apply to the mediator, upon notice in writing to Ontario Hydro, for an order extending the expired subsidiary agreement which is the subject matter of the mediator's recommendations referred to in Article 7.3(c). The mediator shall grant an extension for a period of two years from the date of expiry of such subsidiary agreement. In the event of extenuating circumstances, Ontario Hydro may, upon written notice to the Society, apply to the mediator to make such amendments to the extended subsidiary agreement as he/she considers fair and equitable. The mediator shall consider submissions from both Ontario Hydro and the Society before rendering a decision.

Any order of a mediator to amend an/or extend an existing subsidiary agreement is binding upon both parties for such two-year period unless changed by mutual consent. Upon the expiry of such extension to a subsidiary agreement ordered by a mediator, Ontario Hydro shall be free to implement changes to such terms and conditions set out in the expired subsidiary agreement and such terms and conditions shall be deemed to constitute a subsidiary agreement between the parties.

36. The existing subsidiary agreements referred to in Article 4.2 covered such subjects as "Housing Assistance Plan", "Moving Expenses", "Vacations", "Statutory Holidays and Floating Statutory Holidays", "Funeral Leave", "Maternity/Adoption Leave", "Attendance at Court", "Extended Health Benefits", "Dental Plan", "Long Term Disability Plan", "Sick Leave Plan", "Pension Plan", "Life Insurance", "Advertising of Vacancies", and "Performance Appraisal Feedback and Advanced Warning of Reduced Performance Pay Standing."

37. The 1983 Master Agreement, like earlier master agreements, provides a Redress Procedure for dealing with grievances by Society represented employees. This involves consideration of the grievance at three Steps by increasingly higher-level representatives of the Society and Hydro. A grievance which is not resolved in the grievance procedure (other than one relating to the interpretation or application of the Performance Pay Plan or a job evaluation plan) may be referred to arbitration by the Society. Article 10 of the Redress Procedure provides that

Power of an Arbitrator

10.1 An arbitrator shall consider such matters of interpretation, application and administration of policy and practice as are specifically referred to him and shall consider only such evidence as is presented to him by representatives of Ontario Hydro or the Society.

10.2 The arbitrator shall have the power to settle or decide such matters as are referred to him in any way he deems fair and reasonable, and his decision shall be final and binding.

38. In the September 1983 issue of The Society News the lead article spoke about the ratification and signing of the new Master Agreement. It observed that

there are some who continue to argue that ... it was time to put the relationship on a strong legal footing. Still, there can be no doubt that a majority of the membership wants to give the new voluntary agreement a try before opting for a totally new form of relationship. Yet, it is clear that the formal endorsement of these agreements does not mean that all is as it once was. Rather, it means that the two parties have agreed on a new set of rules on which to try to rebuild a relationship outside the Labour Relations Act.

The new agreement is very much a sober, legalistic contract written for the times.... We are no longer working with an illusionary gentlemen's agreement.

If the process is found to be unworkable and the relationship breaks down, the Executive will return to the certification alternative. So that this is a clear alternative within the next four years, amendments to the Constitution are being prepared to send out to the membership for acceptance. ... These amendments will reflect the new Master Agreement, especially recognition of OSS and TS staff, in addition to ensuring that our Constitution is not an obstacle if, in future, the Society membership provides a mandate to certify.

39. The proposed constitutional amendments were sent out. They included a change of the organization's name to its present one, a change in the language of the objects of the organization to expressly empower the Society to serve as "the collective bargaining agent" for member employees with Hydro and changes to its membership provisions to eliminate the Associate Member category and expressly exclude from eligibility for membership "those employees who are exercising managerial functions, or employed in a confidential capacity to such a degree that the Society and Ontario Hydro have agreed to exclude such employees from Society representation, in addition to any employee that the Ontario Labour Relations Board may deem to be excluded from the protection of the Ontario Labour Relations Act." In further explanatory material, the Society's executive said one of their reasons for proposing the amendments was that "it is considered prudent at this time to remove any obvious impediments to recognition as a bargaining unit under the Labour Relations Act, should the members ever endorse an application in the future." It is apparent from the context that "application" meant "certification application

40. The proposed constitutional amendments were duly made, with effect as of November 1983. During the early 1980s, Hydro had been discouraging those on its Executive Salary Roll from maintaining Associate membership in the Society. In 1982, Hydro had stopped honouring the requests of ESR Associate Members that their dues in the Society be paid by payroll deduction. Those few on the Executive Salary Roll who remained Associate Members when the constitution of the Society was amended in 1983 were advised by the Society that their membership was terminated because they were no longer eligible for membership.

41. In late 1984, Hydro and the Society signed a further memorandum of understanding with respect to the OSS and TS staff. This had the effect of including them in the recognition clause of the Master agreement. Coverage by that agreement and all subsidiary agreements was extended to them for all purposes save interest arbitration, which was not to be available to settle salary differences for OSS and TS staff in the 1985 salary negotiations.

42. In 1985, difficulties the Society had with the 1983 Master Agreement, including a dispute over whether the arbitrability of complaints about certain actions by Hydro was itself a matter which could be determined by an arbitrator under the Redress Procedure, led to an exchange of proposals for amendment of the Master Agreement. Among the Society's proposals were: amendment of the opening words of the recognition article to read "Ontario Hydro recognizes the Society as the representative body and sole bargaining agent for" employees in the described categories, addition of a clause empowering arbitrators to decide disputes with respect to their jurisdiction and addition of clauses incorporating or implementing provisions similar to subsections (4), (6), (8), (9), (10) and (11) of section 44 of the Act with respect to arbitrators' jurisdiction and enforcement of their decisions. Among Hydro's proposals were articles which described the Society's representation and its "voluntary relationship" with Hydro as being "outside of the Ontario Labour Relations Act." None of these proposals was agreed to. The Society's executive decided to canvas the certification option with the membership again.

43. In the fall of 1985, the Society conducted a referendum on the certification option. A majority of those who cast ballots favoured pursuing that option. In January 1986, the Society began collecting membership evidence for use in a certification application. Literature circulated by the Society to members and potential members during this "card signing" or "organizing campaign" compared the situation under the "Voluntary Agreement" with the results of certification. The clear message of that literature was that the Society's rights under and in respect of the voluntary agreement were different from and inferior to those it would enjoy if the parties' collective negotiations and resulting agreements were governed by the Act. The possibility of asserting that the Master Agreement and related documents together constituted a collective agreement under the Act had been discussed by the executive again in 1985, but was not mentioned to the membership before the referendum or during the organizing campaign which followed it.

44. As we have already noted, the first time the Society first publicly took the position that it already had a collective agreement was in March 1987, after we raised the question during deliberations on the Society's request that a pre-hearing vote be taken. If they were not otherwise aware of this, the affected employees would have learned of it in mid-1987 from a special edition of The Society News. The first page carries the President's message. Speaking of the events of his first year in office, he made these observations:

…..I would like to review the options we considered before applying for certification. We considered two approaches to getting our collective bargaining rights confirmed under the Labour Relations Act: voluntary recognition and certification. While we already felt we met the criteria for voluntary recognition, a sign-up campaign was seen to have the advantage of involving every member in the decision. We were also concerned that if the Board did not agree with us - that we already have voluntary recognition under the Act - the option of certification should still be there. The fact that the Board has recently chosen on its own initiative to focus on the prerequisites for voluntary recognition is a positive development in my view, and one which could save us time and money in the long run.

45. Hydro and the Society have continued to deal with each other under the Master and Subsidiary Agreements since March 1987, when the Society first asserted that they are collective agreements. While it was too late then to give the six month's notice of termination contemplated by the Master Agreement so as to terminate the agreement as of the 1987 anniversary date, Hydro did not give notice to terminate as of the 1988 or 1989 anniversary dates. One of Hydro's witnesses in these proceedings said that the Society did not behave in bargaining as though they thought they had a collective agreement; furthermore, he said, Hydro thought the statutory freeze resulting from the Society's certification application prevented it from terminating the Master Agreement.

Decision

46. The many points raised in the very thorough arguments of counsel for the parties addressed two main questions:

Can the doctrine of estoppel be applied so as to prevent the Society from asserting that the subject documents constitute a collective agreement and, if so, do the facts warrant the application of that principle?

Do the subject documents satisfy the express requirements of clause 1(1)(e) of the Act as well as any requirements which may be implied from the language of that clause and other provisions of the Act?

If the answer to the first question is that the Society can be and is estopped from claiming that the subject documents constitute a collective agreement, then it is unnecessary to answer the second question.

47. The threshold question with respect to the estoppel issue is whether the doctrine of estoppel can apply to prevent an assertion that an agreement is a collective agreement under the Act. The Society argues that the rights it asserts are statutory rights under a remedial statute which it cannot be estopped from asserting. Even if it had expressly agreed with Hydro that the subject documents would not constitute a collective agreement under the Act, the Society says, such an agreement would not preclude our finding that they do constitute a collective agreement under the Act.

48. In Ontario Human Rights Commission et al. v. Borough of Etobicoke, 1982 CanLII 15 (SCC), [1982] 2 S.C.R. 202, 132 D.L.R. (3d) 14, the Supreme Court of Canada considered whether it was an answer to a complaint about age discrimination under the Ontario Human Rights Code that the alleged discriminatory action was expressly permitted by employer's collective agreement with the union which represented the complainants. The Court dealt with this at pp. 213 and 214 [pp. 23 and 24 D.L.R.] of its judgment:

While this submission is that the condition, being in a collective agreement, should be considered a bona fide occupational qualification and requirement, in my opinion to give it effect would be to permit the parties to contract out of the provisions of the Ontario Human Rights Code.

Although the Code contains no explicit restriction on such contracting out, it is nevertheless a public statute and it constitutes public policy in Ontario as appears from a reading of the statute itself and as declared in the preamble. It is clear from the authorities, both in Canada and in England, that parties are not competent to contract themselves out of the provisions of such enactments and that contracts having such effect are void, as contrary to public policy. In Halsbury's Laws of England, 3rd ed., vol. 36, p. 444, para. 673, the following appears:

673. Waiver of statutory rights. Individuals for whose benefit statutory duties have been imposed may by contract waive their right to the performance of those duties, unless to do so would be contrary to public policy or to the provisions or general policy of the statute imposing the particular duty or the duties are imposed in the public interest.

And in the fourth edition of the same work the following is to be found in vol. 9, p. 289, para. 421:

421. Contracting out. As a general rule, any person can enter into a binding contract to waive the benefits conferred on him by an Act of Parliament, or, as it is said, can contract himself out of the Act, unless it can be shown that it would be contrary to public policy to allow such an agreement. Statutory conditions may, however, be imposed in such terms that they cannot be waived by agreement; and, in certain circumstances, it is expressly provided that any such agreement shall be void.

By way of example of an exception to the general rule, an agreement between an employer and employee whereby the latter agrees to waive a statutory duty imposed on the former in the interests of safety is generally not binding on the employee.

English authority expressing this principle is to be found in Equitable Life Ass'ce Society of United States v. Reed, [1914] A.C. 587. The question of the enforcement of a contract contrary to public policy is generally dealt with by Duff C.J.C. in Re Millar, 1937 CanLII 10 (SCC), [1938] 1 D.L.R. 65, [1938] S.C.R. 1, where reference is made to Fender v. Mildmay, [1937] 3 All E.R. 402, and other authorities. Examples of the application of the principle are such cases as R. v. Roma, 1942 CanLII 251 (BC SC), [1943] 1 D.L.R. 238, 78 C.C.C. 340, [1942] 3 W.W.R. 525; Outen v. Stewart and Grant et al, 1932 CanLII 453 (MB KB), [1932] 3 W.W.R. 193, 40 Man. R. 557, and Dunn v. Malone(1903), 6 O.L.R. 484. The Ontario Human Rights Code has been enacted by the Legislature of the Province of Ontario for the benefit of the community at large and of its individual members and clearly falls within that category of enactment which may not be waived or varied by private contract; therefore this argument cannot receive effect.

If an express waiver of or agreement not to assert statutory rights would not prevent a party from asserting them, then there should be no estoppel based on other behaviour of the party. The question, then, is whether the rights asserted here are the sort which can be waived by contract or otherwise.

49. The Society says that the Labour Relations Act is a remedial statute like the Human Rights Code. It imposes a framework for collective bargaining to further the public interest expressed in the preamble to the Act. Its provisions are intended to address the obvious inequality between individual employees and their employers. The Society says "it would be ironical [sic] if private ordering were permitted to supplant legislation enacted to remedy the historical inadequacy of private ordering."

50. It is well established that an employer and trade union cannot contract out of the application to them of the requirement that there be no strikes or lock-outs during the term of their collective agreement. An employer who has agreed at the bargaining table that its employees need not cross another union's picket line may nevertheless insist that they do so, as the Board observed in Toronto Transit Commission, [1984] OLRB Rep. Dec. 1781:

13. In both King Paving, [1976] OLRB Rep. June 291 and Associated Freezers of Canada Limited, [1972] OLRB Rep. May 445, there was a concerted refusal by employees to cross picket lines set up by another union. In both cases, the respondent employees pointed to a clause in their collective agreement which expressly allowed them to refuse. In other words, in both cases there was not just an established employer practice, but an express and purportedly binding contractural statement as to the parties' rights in the very circumstances under review. But in each case the Board said - to put the matter colloquially - "you cannot contract out of the Act". The "no-strike ban" is imposed by statute as a matter of public policy, not the private convenience of the parties. It admits of no exceptions. Any private arrangement which attempts to circumvent or avoid the thrust of the Act is void. I do not see how the parties' practice can stand on a higher footing than an express clause in their collective agreement; but even in the latter case, the Board has clearly found such clauses to be void.

See also Pigott Construction Company Limited, [1969] OLRB Rep. June 399; Hutchison Mechanical Installations, [1973] OLRB Rep. May 240; Nelson Crushed Stone, [1977] OLRB Rep 713; and, Empress Graphics Inc., [1989] OLRB Rep. June 587; 3 C.L.R.B.R. (2d) 141.

51. Having regard to the Board's jurisprudence with respect to strikes, the Society argues that "if ... one cannot contract out of a portion of the Act, a fortiori one cannot contract out of all of it." It notes that the apparent mutual intention of parties to a collective agreement to restrict access to arbitration of certain matters has not prevented the Board from applying subsection 44(2): American Motors (Canada) Limited, [1973] OLRB Rep. Apr. 211; jud. rev, denied Oct. 1, 1973 (Ont. Div. Ct.), appeal dismissed (1974) 1974 CanLII 710 (ON CA), 3 O.R. (2d) 528 (Ont. C.A.). It says that the Act is concerned not just with the regulation of strike and lock-out activity but also with protection of freedom of association and of the right to organize and bargain collectively. It submits that there is a public interest in those matters just as there is in freedom from discrimination. Bearing in mind section 50 of the Act, which provides that a collective agreement is binding on the parties to it, the Society submits it would be contrary to the language and spirit of the Act to permit parties who have objectively brought themselves within the terms of the Act to contract out of it.

52. Hydro and the Coalition argue that this is not so much a matter of parties "contracting out" of the statute as of parties choosing not to "contract in." The Society says that "this distinction is one only of semantics which serves merely to deflect attention from the central concern: if the parties have in fact entered [into] an agreement which satisfies the definition of a collective agreement, does the Act apply regardless of what might be said to have been their intention?"

53. It seems to us that the question here is not whether the parties can "contract out of' the Act in its entirety. If that were the question, the answer would be a simple no. That is because there is at least one respect in which they cannot "contract out of the Act": they cannot contract out of the prohibition against untimely strikes and lock-outs. It does not follow, however, that there can be no respect in which the operation of the Act may be affected by agreement, waiver or estoppel.

54. Section 50 is a perfect example of a provision which is so affected. It is now well established that in appropriate circumstances one party to a collective agreement may be estopped by its words or conduct from enforcing an obligation imposed by the agreement on the other party, even though section 50 makes that obligation binding. Subject to the constraints of sections 15, 60 and 68, furthermore, the scope of the bargaining unit for which statutory bargaining rights have been granted by the Board under the Act can subsequently be altered by agreement of the employer and trade union. A trade union's words or conduct may also effect an abandonment or waiver of its statutory bargaining rights.

55. There are some respects, then, in which the application of the Act can be waived, by agreement or otherwise. There are other respects in which it cannot. To determine whether the application of the Act can be waived in the respect with which we are concerned here, we have to consider whether in that respect the application of the Act involves the protection or advancement of the public interest.

56. We agree that the respects in which the application of the Act cannot be waived go beyond the strike and lock-out provisions. We agree that employees' access to the practice and procedure of collective bargaining contemplated by the preamble to the Act is a matter of public interest addressed by the Act. An agreement other than a collective agreement which purported to restrict that access, by requiring or restricting employees' membership or participation in a trade union or unions, for example, might well be contrary to the public interest and unenforceable as a waiver of statutory rights. That is not the sort of agreement with which we are dealing here.

57. A trade union does not have a statutory right to an employer's "voluntary recognition"; that phrase would be a contradiction in terms if it were otherwise. If the employer of employees who wish to have a trade union represent them declines to treat that trade union as their exclusive bargaining agent under the Act, the trade union may apply for certification. An agreement which is not treated as a collective agreement would not bar an application for certification by either the trade union party to it or by some other trade union; employees would remain free to enter into collective bargaining under the Act through a trade union chosen by the majority.

58. The public interest does not seem to us to require that an agreement between an employer and a trade union be treated as a collective agreement under the Act if the parties to it expressly agree that it should not be so treated. We are satisfied, therefore, that the doctrine of estoppel can be applied so as to prevent the Society from asserting that the subject documents constitute a collective agreement under the Act, if the circumstances warrant application of that principle.

59. Hydro relies on the following formulation of the doctrine of estoppel by Lord Denning in Amalgamated Investment & Property Co. Ltd., v. Texas Commerce Int'l Bank Ltd., [1981] 3 W.L.R. 565 , [1982] Q.B. 84 (C.A.):

When the parties to a transaction proceed on the basis of an underlying assumption -- either of fact or of law -- whether due to misrepresentation or mistake makes no difference -- on which they have conducted the dealings between them -- neither of them will be allowed to go back on that assumption when it would be unfair and unjust to allow him to do so. If one of them does seek to go back on it, the courts will give the other such remedy as the equity of the case demands.

Hydro says that both parties proceeded on the underlying assumption that their agreement would not be subject to the Act. If it had thought the Master Agreement it was being asked to sign in 1983 would be treated as a collective agreement under the Act, it would not have signed it, would not have enlarged the scope of matters on which there could be interest arbitration, would not have enlarged the scope of matters on which it agreed to consult with the Society and would not have enlarged recognition to include the OSS and TS employees. The Coalition says there are employees who would not have joined Ontario Hydro if they thought that they would be covered by a collective agreement under the Act. Its counsel asks rhetorically how the affected employees could have known when the one year limitation period began to run on their right under section 60 to challenge the union's entitlement to represent them under the Act.

60. The formulation of the doctrine of estoppel on which Hydro relies certainly seems to apply to the facts of this case. In the dealings between them up to and including the making of the 1983 Master Agreement, both Hydro and the Society proceeded on an underlying assumption that such an agreement would not be a collective agreement under the Labour Relations Act. It would be unfair and unjust to permit the Society now to go back on that assumption, because that would retroactively give the agreement a character which would have led Hydro to refuse to sign it had that characterization been applied at the time.

61. It may be that Lord Denning's formulation of the doctrine of estoppel in Amalgamated Investment & Property Co. Ltd., v. Texas Commerce Int'l Bank Ltd., supra, is broader than the doctrine recognized in Ontario. It makes no express reference to the "essential features" referred to in Re Tudale Explorations Ltd. and Bruce et al. (1978), 1978 CanLII 1471 (ON HCJ), 88 D.L,R. (3d) 584 (Ont. Div. Ct.) at 588: "an unambiguous representation which was intended to be acted upon and indeed was acted upon."

62. The Society argues that Hydro had its own legal advisers at all material times, and that Hydro relied on those advisers and not on earlier statements by the Society about the legal status of past agreements in determining what it would do in 1983. The Society made no representation during 1983 negotiations on that subject, it says. Moreover, the two years between the Society's mid 1987 assertion that the subject documents constitute a collective agreement and the mid 1989 filing of these proceedings was sufficient, it submits, to bring any detrimental reliance and any estoppel to an end.

63. In this case, the Society's words and past conduct conveyed two representations to Hydro: that the "voluntary agreement" it sought in 1983 would once again be an agreement outside the Act, and that if it wanted bargaining rights under the Act it would seek them in a certification application. When it made those representations, it knew that Hydro had no intention of entering into an agreement which gave the Society bargaining rights under the Act. It knew or ought to have known that Hydro would rely on its representations in those circumstances. Foreseeably, Hydro did act on those representations, and the Society must be taken to have intended that natural consequence of its conduct. It is fair to say that Hydro was not relying on the Society for legal advice. Hydro was relying on the Society's attitude, not its acumen. The significance of the Society's representations about the legal character of the agreement to be made was not that they might be correct but simply that they represented the Society's position.

64. We are satisfied that the features essential to the application of the doctrine of estoppel are made out. There remains the question whether the passage of time since March 1987 has brought the estoppel to an end.

65. The Society's certification application triggered a "freeze" under subsection 79(2) of the Act, which prohibited changes to employees' rates of pay, terms and conditions of employment or other rights, privileges or duties of Hydro or the employees affected by the application. While the "freeze" required that the terms and conditions applicable to affected employees continue unchanged, it is not entirely clear that it prevented Hydro from terminating the Master Agreement itself in accordance with its terms. Assuming (without deciding) that the freeze did not prohibit termination, the fact that Hydro did not do so does not assist the Society on this issue. The estoppel which arose from the Society's representations about the 1983 Master Agreement continues in effect as long as that agreement does. In choosing not to bring that agreement to an end, Hydro did not enter into a new agreement with the Society, it simply continued to honour the existing one.

66. We find that the Society is estopped from claiming that the 1983 Master Agreement and subsidiary agreements constitute a collective agreement under the Act. The question whether the subject documents do constitute a collective agreement is academic, and need not be answered.

67. This application and complaint are dismissed.