Ontario Labour Relations Board
[1990] OLRB Rep. July 790
3196-89-U Roger Pryor et al, Complainants v. Local 6896 of the United Steelworkers of America, Respondent v. Cliffs of Canada Limited, Intervener
BEFORE: Judith McCormack, Vice-Chair.
APPEARANCES: Roger Pryor and Darcy Reaume for the complainants; Michael Gottheil, Marcel Desjardins, Jim Bunclark and James Rae for the respondent; F. G. Hamilton and S. Bartle for the intervener.
DECISION OF THE BOARD; July 12, 1990
Decision
On the consent of the parties, the respondent's name is amended to read: "Local 6896 of the United Steelworkers of America".
This is a complaint alleging that the respondent violated section 68 of the Labour Relations Act by failing to represent the complainants in a manner that was not arbitrary, discriminatory or involving bad faith. For the most part, the facts in this matter are not in dispute.
The complainants are employees of the intervener company which operates the Sherman and Adams Mines. The complainants were actually employed at the Adams Mine, where they were represented by the respondent and covered by a collective agreement with a term from March 1st, 1988 to April 25th, 1990. Employees at the Sherman Mine were represented by a sister local with their own collective agreement.
On March 6th, 1989 the company announced the permanent closure of both mines, effective March 31st, 1990. At the same time, it also proposed a preliminary severance and benefits package for employees. A negotiating committee was then constituted from the two local union executives, with the addition of Marcel Desjardins, the union's staff representative, Leo Gerard, Regional Director of the union's District 6 and Hugh McKenzie, its Director of Research. Mr. McKenzie promptly embarked upon some preliminary research, including a survey of closure agreements in the iron ore industry. He also familiarized himself with the specific circumstances of the two locals, including the details of their collective agreements and pension plan. A series of meetings were set up between the committee and the company which took place over a period from March of 1989 to June of 1989. During these meetings, Mr. Gerard and Mr. Desjardins acted as spokespersons for the committee.
Over the course of these discussions, it became clear that the company was prepared to invest a considerable amount of money to obtain an orderly closure of the mines and to cushion the impact of the closure upon employees. In all, the company made available in excess of ten million dollars, which included surplus from the pension plan. During this period, the company also arranged for their actuary to meet with Mr. McKenzie so that the parties could jointly review the cost of a number of different benefit options, and consider the best allocation of available funds.
Throughout these meetings, the company had taken the position that they were merely consultation discussions, while the union treated them as conventional negotiations. However, because there were current collective agreements in existence at the mines, the union was not in a position to strike, and had little bargaining power. At the final meeting on June 27th, 1989, the union proposed the inclusion of a clause which would allow ratification of the agreement by employees. At that point, company representatives said that the agreement as it had developed to date was a "Cadillac plan", and that even if it was turned down by members there was no more. They told the union committee in no uncertain terms that they were not interested in any more "toing and froing" and that if the union insisted on ratification, the deal was off the table.
At that point, the union negotiating committee considered its position. Its members felt they had very little clout because they could not legally strike, and that if the proposed agreement was put to a vote of the general membership and turned down, there was not much they could do subsequently to improve its terms. They also tried to assess how far the union could push the company in these circumstances and how serious the company's threat was. In their view, the proposed agreement was a good one, and they were not prepared to risk calling the company's bluff and finding out that the deal had slipped through their fingers. In the end, they decided to sign the agreement without insisting on a ratification provision. The final agreement included a $7.6 million upgrading of the pension plan, severance pay in amounts double those provided in the Employment Standards Act, a continuation of health care benefits for a specified period of time, a "no lay-off' commitment prior to the closure date, the maintenance of employees' current wage rates in the interim regardless of the actual job performed by the employee, relocation and retraining assistance, housing subsidies, community adjustment funds, a guarantee that any mine reclamation work would be performed by bargaining unit members, and so forth. Mr. McKenzie, who has been involved in negotiating a considerable number of closure agreements, testified that it was one of the best closure agreements he had seen.
Subsequently, two meetings were set up with bargaining unit members on July 3rd to inform them of the details of the closure agreement. These meetings were announced by notices posted on the union's bulletin boards at the mines. A copy of the agreement was handed out at the meetings and the union reviewed it in detail, explaining both its terms and the pension plan provisions. Union officials also told members that the company had made a commitment to have its actuary available for a number of meetings at different locations and times to meet with employees, to describe in more detail the wind-up benefits and to answer any questions they had with respect to severance pay and pensions. These meetings were in fact held in early October, and they included extensive presentations by an actuarial consultant retained by the company, together with question periods. Prior to these meetings, employees received a preliminary statement of their benefits so that they would be in a position to ask questions about them.
The company also made arrangements to offer employees group registered savings plans and annuity purchase plans through a carrier on more favourable terms. It then scheduled group meetings and individual meetings for employees to discuss these