Local 865, International Union of Operating Engineers v. Canadian Pacific Forest Products Limited, 1990 CanLII 5820

[1990] OLRB Rep. May 492

0474-88-U Local 865, International Union of Operating Engineers, Complainant v. Canadian Pacific Forest Products Limited, Respondent

BEFORE: G. T. Surdykowski, Vice-Chair, and Board Members M. Rozenberg and H. Kobryn.

APPEARANCES: W. Dubinsky and R. Gallant for the complainant; F. J. W. Bickford, Frank Wirtz and E. G. Gibbons for the respondent.

DECISION OF G. T. SURDYKOWSKI, VICE-CHAIR, AND BOARD MEMBER M. ROZENBERG; May 10, 1990

1. By decision dated June 13, 1989, the Board found that the respondent had breached section 15 of the Labour Relations Act in that it had failed to bargain in good faith when, in the course of collective bargaining between the parties, it failed to disclose to the complainant trade union its intention to shut down one of its turbines.

2. In argument, the complainant trade union had suggested that one remedial alternative available to the Board in this case was to remit the issue of remedy to the parties. In the circumstances, including the state of the evidence before the Board with respect to remedy, and our belief that labour relations matters are better resolved without litigation if possible, the Board accepted the complainant's suggestion and remitted the question of remedy to the parties. The Board did of course remain seized with the question of remedy. The Board also indicated that a Labour Relations Officer would be made available to the parties to assist them if they wished and that the Board would schedule a hearing with respect to the issue of remedy on the request of either party. Accordingly, either party could have requested a hearing at any time (see paragraphs 22 and 23 of the June 13, 1989 decision herein).

3. By letter dated September 25, 1989, the complainant asked for the assistance of a Labour Relations Officer and one was duly appointed. The parties were unable to resolve the matter between themselves even with the Officer's assistance. However, neither party requested a hearing until the complainant did so by letter dated January 31, 1990 (received by the Board on February 5, 1990). Upon receipt of that request, the Registrar scheduled a hearing.

4. At that hearing, held on April 11, 1990, the Board heard the evidence and representations of the parties with respect to the issue of the appropriate remedy in this matter.

5. At that hearing, only monetary remedies were requested by the complainant. The complainant seeks:

(a) compensation for all losses suffered by the bargaining unit employees affected by the respondent's breach of the Act;

(b) compensation to the shift engineers who have had "extra duties" since the shut down of turbine #1;

(c) compensation to the complainant for the "expenses" it itself incurred as a result of respondent's conduct;

(d) interest on all damages awarded.

The complainant's claim for damages for affected bargaining unit employees includes the wages which the complainant asserts they lost and the opportunities they are said to have lost for increased wages. The complainant described its expenses claim as one relating to damages for the loss of an opportunity to do something for the affected bargaining unit employees had it known of the respondent's intention to shut down turbine #1. The complainant stressed that it was not seeking its "legal costs" of the proceeding, but rather the expenses it incurred in attempting "to right the wrong" which had been done.

6. This is not the first time the Board has had to grapple with a difficult problem while fashioning an appropriate remedy for a breach of the duty to bargain in good faith where that breach consists of a failure to disclose pertinent information in collective bargaining (see, for example, Devilbiss (Canada) Limited, [1976] OLRB Rep. March 49, Inglis Limited, [1977] OLRB Rep. March 128, Radio Shack (Canada) Limited, [1979] OLRB Rep. Dec. 1220; application for judicial review dismissed in Re Tandy Electronics Ltd. and United Steelworkers of America et. al., 1980 CanLII 1738 (ON HCJ), 30 O.R. (2d) 29 (Div. Ct.); leave to appeal to Court of Appeal denied at 30 O.R. (2d) 29n; Westinghouse Canada Limited, [1980] OLRB Rep. Apr. 577; application for judicial review dismissed 80 CLLC ¶14,062 (Div. Ct.); Sunnycrest Nursing Homes Limited, [19821 OLRB Rep. Feb. 261; Consolidated Bathurst Packaging Ltd., [1983] OLRB Rep. Sept. 1411; [1983] OLRB Dec. 1995 (reconsideration); [1984] OLRB Rep. March 422 (remedy); application for judicial review allowed 1985 CanLII 2157 (ON HCJ), 51 O.R. (2d) 481 (Div. Ct.); appeal of Divisional Court decision allowed 1986 CanLII 2498 (ON CA), 56 O.R. (2d) 513 (Court of Appeal); appeal of Court of Appeal decision dismissed by the Supreme Court of Canada on March 15, 1990 [now reported at [1990] OLRB Rep. March 369]; Forintek Canada Corp., [1986] OLRB Rep. Apr. 453). In approaching such cases, the Board has recognized that a right which is not backed by an effective remedy has little meaning. Accordingly, the loss of opportunity to bargain for a benefit has long been recognized by the Board to be a loss which is compensable in damages. However, the Board has also recognized that its remedies must fit the circumstances of the particular case before it and must be compensatory not punitive. Such remedies must be fashioned having regard to the labour relations principles which underlie the Labour Relations Act. In that respect, the Board has not found it appropriate to impose or change terms in collective agreements under the guise of compensation (see, for example, Forintek Canada Corp., supra, at paragraph 56) because the right being addressed in such cases is not the right to a particular collective agreement but rather the right to bargain in pursuit of one.

7. The purpose of a remedy in this context is to put the aggrieved party (in this case the complainant trade union and the affected bargaining unit employees) in the position it would have been in but for the wrongful conduct found by the Board. In this case, that wrongful conduct is not the actual shutting down of turbine #1 but rather the respondent's failure to advise the complainant in a timely manner of its intention to do so. The nature of the breach of the obligation to bargain in good faith which the Board has found the respondent guilty of in this case necessarily requires the Board to engage in some speculation in terms of the damages claimed by the complainant. That speculation must, however, be as informed as possible.

8. It is often difficult to assess damages in cases like this one, but a wrongdoer cannot be relieved from paying damages just because they are difficult to assess. Consequently, although an aggrieved party must prove its damages on the balance of probabilities, the nature of "loss of opportunity" cases dictates that it be given the benefit of the doubt in that respect. However, that does not relieve an aggrieved party from the responsibility of calling sufficient evidence to establish the opportunity it lost and the damages it asserts resulted there from. It must demonstrate a reasonable probability that it could have obtained the benefit for which it seeks compensation but for the respondent's misconduct. A mere chance of a benefit will entitle an aggrieved party to only nominal damages at most. And, as the Board and the Divisional Court observed in Radio Shack, supra, damages will be reduced in proportion to the contingencies to achieving the benefit claimed in the absence of the wrongful conduct (see also Burlington Northern Air Freight (Canada) Ltd., [1987] OLRB Rep. Aug. 1064).

9. In this case, the complainant trade union asserts that had it been aware of the respondent's intention to shut down turbine #1 in the steam plant and eliminate the turbine operator positions associated with that machinery, it would have negotiated additional responsibilities for that classification in order to retain the positions in it. It asserts that its negotiating committee would not have recommended acceptance of the collective agreement now in effect and that there would likely have been a strike. The complainant points out that the respondent has realized substantial savings as a result of eliminating the turbine operator positions and asks the Board to take that into account in assessing damages. The complainant provided the Board with summaries of the losses suffered by individual bargaining unit employees (but offered little else in that respect). The complainant asserts that the shift engineer in the steam plant has had to perform additional duties with respect to the turbine still operating in the steam plant (which duties had previously been performed by a turbine operator.) The complainant seeks to have the Board compensate the shift engineer(s) for this. By implication, the complainant asserts that it would have bargained an increase in wages for this shift engineer position had it had the opportunity to do so.

10. There is no doubt that the shut down of turbine #1 in the steam plant has affected both the complainant and a number of the bargaining unit employees of the respondent it represents. However, the misconduct found by the Board is not the shutting down of turbine #1 but the failure of the respondent to advise the complainant of its intention to do so. It is that failure which resulted in the complainant's loss of opportunity to negotiate with respect to the impact of the shut down. The complainant is entitled to compensation only for those damages which resulted from the wrong done, not from the shut down of turbine #1.

11. When the respondent first advised the complainant that turbine #1 would be shut down and the turbine operator positions eliminated, it indicated that it considered this to be "elimination of equipment" or "downsizing" and not technological change within the meaning of article 25 of the collective agreement between the parties. Subsequently, and although it did not specifically say that it did consider the shut down to constitute technological change, it directed that it would treat, and did treat, it as though it were technological change.

12. For what it is worth, the shut down of turbine #1 was not, in our view, technological change within the meaning of article 25 of the collective agreement or the ordinary meaning of that term. That, however, is not particularly significant. More significant, in our view, is the fact that the respondent treated it as technological change for the purpose of lessening the impact on the persons who were employed as turbine operators. In our view, this is substantially similar to what occurred in 1985 when the respondent took an evaporator in the recovery plant out of service. The evaporator shut down occurred in the context of a change from a closed to an open-ended system in which salt was no longer being recovered from the production process. The positions associated with the evaporator were eliminated and the persons occupying them were treated in accordance with the technological change provisions in the collective agreement. In our view, that was no more a real technological change than the shut down of turbine #1 was. What is significant is that it was, with the concurrence of the complainant, treated as such for purposes of easing the impact of the elimination of the equipment on the employees whose positions had been eliminated.

13. We reject the complainant's suggestion that there is a significant distinction to be drawn between the shut down of the evaporator and the shut down of turbine #1. While it may be that none of the job functions associated with the former remained while some of the job functions carried out by a turbine operator are now carried out by the shift engineer, the fact is that in both cases the positions associated with the equipment were entirely eliminated.

14. Moreover, the evidence fails to establish that the turbine operator "skills outline" which the complainant presented to the Board reflects the "extra" functions which a shift engineer must now perform. Other evidence suggests that while the turbine shut downs, start-ups, etc. formerly performed by a turbine operator are now the responsibility of the shift engineer, these activities are not performed as often as before, and when they are done, the first helper, the first fireman, second helper or utility man assist the shift engineer. It is now also a part of the first fireman's duties to assist the shift engineer in operating the PRV and desuperheater control systems and by monitoring the alarms added to the steam distribution panel with respect to turbine #3 after turbine #1 was shut down. The Board did not have the benefit of the testimony of any shift engineer which would probably have been the best evidence of how the duties and responsibilities of that position have changed since the shut down of turbine #1.

15. Further, there is no evidence to suggest that it is more likely than not that the complainant would have been able to persuade the respondent to retain any of the four turbine operator positions had it had an opportunity to negotiate that item in the collective bargaining which led to the collective agreement presently in effect. The respondent has not given any indication of any willingness to do that. We note that the respondent had been operating four to five people short of its full time complement for the complainant's bargaining unit prior to the shut down of turbine #1. (And we observe that had the shut down occurred in the context of the full complement, layoffs, in accordance with article 6 of the collective agreement, would have been necessary.) With the elimination of the four turbine operators, and the consequent bumping down in accordance with article 6 of the collective agreement, the (reduced) complement is now, in effect, apparently full. We also note that in the recovery plant, a shift engineer looks after two turbines, not just one, without any turbine operators. Nor is there sufficient evidence before the Board to establish that it is more probable than not that the complainant could have obtained compensation for bargaining unit employees affected by the shut down of turbine #1 beyond that which has already been paid by the respondent, or at all.

16. There is no evidence to suggest that it is more likely than not that the complainant could have negotiated a higher wage rate for the shift engineers. The evidence shows that the complainant was unsuccessful in obtaining a similar wage adjustment for the shift engineer in the recovery plant when there were responsibilities added to that position as a result of an increase in that plant's size. There is nothing before the Board to suggest that the complainant would have been any more successful on behalf of the shift engineers in the steam plant.

17. In coming to our conclusions herein we have considered all of the evidence before the Board in this proceeding. In our view, the degree of the benefit realized by the respondent from the shut down of turbine #1 is irrelevant to the question of what damages were suffered by the complainant or the bargaining unit employees it represents. And, while it may well be that there would have been a strike had the information which should have been disclosed with respect to the shut down of turbine #1 been disclosed, there is insufficient evidence before the Board to establish that this would likely have induced the respondent to either retain the turbine operator positions, or pay any employees associated there with increased compensation, either in wages or otherwise. Further, a strike would have had a negative economic impact on the employees engaging in it as well as, potentially at least, on the respondent. In contrast with the situation in Consolidated Bathurst Packaging Ltd., supra, there is no evidence before the Board in this case of what negative impact, if any, a strike by the complainant would have had on the respondent in this case. Nor is there any evidence of how much bargaining unit support there would likely have been for a lengthy or any strike.

18. With respect to the complainant's request for compensation for expenses, we first observe that there is no indication or even suggestion that there was any anti-union motive for the respondent's decision to shut down turbine #1 and eliminate the turbine operator positions. All of the evidence, including that adduced by the complainant, suggests that the shut down and position elimination were motivated solely by economic considerations. Nor is there any evidence that there was any anti-union motive for the respondent's breach of its obligation to bargain in good faith in this case.

19. There is no evidence before the Board which even suggests that the complainant has or is likely to incur any organizing or like costs as a result of the respondent's breach of the Act. The evidence which is before the Board with respect to the expenses head of damages is wholly unsatisfactory. The complainant claims compensation for twenty-eight days on each of which it asserts it paid between two and six persons $20.00 per hour for eight hours with respect to this matter. There is no evidence of which people these were, why they or any of them were necessary participants, or that all persons for whom damages are claimed in this respect were necessarily occupied for all eight hours of each such day with the matter before the Board. On the contrary, the evidence suggests that several of the meetings for which the complainant seeks damages did not take eight hours or were not occupied solely with the matter before the Board or both. Indeed, the evidence is that a meeting on one of the days for which the complainant claims damages (March 25, 1988) was cancelled because a union representative didn't attend!

20. Further, although the complainant says it is not seeking its "legal costs", it seeks compensation for the attendance at Board hearings of four persons on six days each and for the attendance of two persons on one other day. With respect to those latter two people, it claims an entire day of travel (by air) to Toronto and an entire day of travel (by air) back to Thunder Bay. The complainant also claims damages for the return air fares, and hotel and meal expenses for those two persons (which claim is not supported by any documentation or other evidence other than a dollar amounts in the complainant's summary of expenses). Other damages are claimed for attendance at settlement meetings.

21. First, it does not take a day to travel either to or from Thunder Bay by air. Second, salaries or other payments made to union representatives with respect to attendances at Board hearings or settlement meetings with respect to matters before the Board, or with respect to meetings to prepare for proceedings before the Board are different in nature from the negotiating or other like "loss of opportunity" expenses. In Burlington Northern Air Freight (Canada) Ltd., supra (at paragraphs 23-25) the Board reviewed its practice with respect to legal costs and like expenses as follows:

23. In Academy of Medicine, [1977] OLRB Rep. Dec. 783, at paragraph 48, the Board, as part of a "make whole order", directed the employer to reimburse the union involved in those proceedings for "all reasonable organizational, bargaining, legal and other expenses associated with its efforts to acquire and pursue its statutory rights", including "the costs of proceedings before the Board". In that case, the employer had closed its Call Answering Service Division in order to "rid itself, once and for all, of the union and its supporters's (see paragraphs 29 to 34). The British Columbia Labour Relations Board adopted a similar approach in Kidd Brothers Produce, [1976] 2 Can. LRBR 304. However, in Radio Shack, [1979] OLRB Rep. Dec. 1220 (in part (d)(i) of paragraph 125), the Board declined to award legal costs in the context of proceedings involving a pervasive pattern of unfair labour practices, including violations of what are now sections 15, 64, 66, 67 and 70 of the Act. In doing so the Board wrote:

We have decided against awarding the Complainant its legal costs in this matter. The Board is hesitant to pursue this line of compensation because of the possibility that the denial of legal costs to those parties who successfully defend against complaints may be misunderstood and perceived as unfair. This policy may be reviewed by the Board from time to time.

Since then, the Board has been asked on a number of occasions to review and alter that policy (see, for example, Angelo Ritrovato, [1986] OLRB Rep. Oct. 1401; Omstead Foods Limited, [1986] OLRB Rep. Aug. 1120; Jean Liebman, [1986] OLRB Rep. June 753; Luciano D'Alessandro, [1985] OLRB Rep. Dec. 1708; Gerald Lecuyer, [1985] OLRB Rep. July 1099 and [1987] OLRB Rep. April 529; John Glykis, [1985] OLRB Rep. March 420; and Comstock Funeral Home, [1981] OLRB Rep. Dec. 1755. On each such occasion, the Board has declined to do so on the basis of labour relations policy considerations, including those articulated as follows in Silknit Limited, [1983] OLRB Rep. Nov. 1913:

8. We are not entirely unsympathetic to the complainant's concern, for we recognize that a party may well have to expend substantial sums in connection with proceedings under the Labour Relations Act. Moreover, there is something to be said for the argument that if one can obtain costs upon the vindication of private law rights, the measure of compensation for the successful assertion of public rights guaranteed by statute should be no less generous. However, there are a number of difficulties with this superficially attractive proposition. In the first place, costs are not dealt with explicitly in the statute, with the result that it is arguable that the Board has no jurisdiction to award costs except as a part of the compensation award flowing from a finding of a statutory violation. Thus, there may be no authority to compensate a party respondent which has successfully resisted or defended against a claim. And how should one deal with a situation in which, from a practical or legal stand point, success is divided? The law of costs in the civil process is both technical and complex, and there are good policy reasons why it should not be readily imported into a law of collective bargaining which has survived without it for forty years and which the laymen who operate within the system and regularly appear before the Board have some difficulty understanding as it is. Finally, while it is tempting to suggest that flagrant or egregious violations of the statute should result in a "make whole" remedy in which the aggrieved party is compensated for the costs of the proceedings, it is much less clear how one would distinguish an "ordinary" violation of the statute from a "flagrant" one or a frivolous assertion from one which is arguable but ultimately rejected. It is one thing to suggest that a serious breach of the Labour Relations Act may trigger special remedial considerations or call for ingenuity in fashioning the appropriate remedy; it is quite another to suggest that an "ordinary" breach of the Act yields one level of compensation while a "serious" one warrants a higher level of compensation. Such an approach would begin to look "penal" rather than "compensatory" (and see sections 96-99 of the Act which are expressly penal in character).

We respectfully agree with that reasoning, and having carefully considered the submissions of counsel concerning this matter, we are not persuaded that in the circumstances of the instant case we should depart from the Board's well-established practice of declining to award legal costs.

24. There is also a dispute between the Union and the Company concerning whether the Union should be compensated for the remuneration paid to Doug Grey (the President of Local 91) and Joe Bigeau (the Vice-President of Local 91 and an International Organizer assigned to that local) during the time they spent at negotiation sessions with the respondent, and at Board hearings in relation to these three complaints, the Union's application under section 40a for a direction that a first collective agreement be settled by arbitration (File No. 0819-86-FC), and the subsequent arbitration of the collective agreement (File No. 1223-86-FCA). It is the position of counsel for the complainants that those salary expenses are Union losses resulting from the respondent's unlawful acts and omissions. The Union also seeks compensation equal to the salary, transportation, and accommodation expenses incurred in having Richard Weatherdon, an I.T.U. International Representative, in attendance at some of the bargaining sessions. The respondent opposes all of those payments. It is the respondent's position that there was not an inordinate number of negotiating sessions, and that some negotiating progress was made at them. The respondent further contends that the salary paid to Union officials for time spent at Board hearings is one of the Union's costs of doing business, and should not be a head of damages. In this regard, counsel for the respondent also notes that the proceedings culminated in a collective agreement arbitrated by the Board pursuant to a legislative provision which was not available in previous cases.

25. We are of the view that salaries paid to Union officials while in attendance at Board hearings are analogous to legal fees incurred in respect of such proceedings, and that the reasons set forth above for denying the reimbursement of legal fees are equally applicable to such salary expenses. The same is true of salaries paid to Union officials and Union clerical staff for the time which they devoted to assembling materials for use in these proceedings and in the first contract arbitration proceedings. Negotiating costs, on the other hand, may be compensable in some circumstances (see, for example, part (d) of the order contained in paragraph 125 of Radio Shack, [1979] OLRB Rep. Dec. 1220). In the instant case, some of the time spent at the negotiating sessions was wasted in dealing with proposals for which the respondent had no plausible business justification and in relation to which the respondent was engaging in "surface bargaining" (see paragraph 115 of the Decision for examples of such proposals). Other time was wasted discussing relatively trivial matters which would likely have been quickly resolved if the respondent had been bargaining in good faith and making every reasonable effort to make a collective agreement. However, some time was also wasted due to the lateness, non-availability, or lack of preparedness of Union representatives (see, for example, paragraphs 56, 82, and 110 of the Decision). Moreover, many of the provisions ultimately included in the arbitrated collective agreement (in accordance with section 40a(17) of the Act) were agreed upon through bargaining which occurred at the negotiation sessions. Having regard to all of the circumstances, we have concluded that the respondent must compensate the Union for half of the reasonable negotiating expenses incurred by the Union in respect of collective bargaining with the respondent, including half of the salaries paid to Messrs. Grey, Bigeau, and Weatherdon in respect of time spent at bargaining sessions.

22. We agree. We are not persuaded that this is an appropriate case in which to award compensation for legal or like expenses. Even if we were persuaded that it is appropriate as a matter of principle, the complainant has failed to present sufficient evidence to prove any of the damages which it has labelled and claimed as "expenses".

23. In the result, the Board is not satisfied that the complainant has proved any of the damages which it claimed in this proceeding or that any remedy other than a declaration is necessary or appropriate.

24. In coming to our conclusions, we are mindful of our finding (at paragraph 18 of our June 13, 1989 decision herein), that the evidence suggests that the respondent purposely tried to keep its decision to shut down turbine #1 from the complainant until a collective agreement had been reached. There is insufficient evidence before the Board, however, for us to be satisfied that this should give rise to any compensatory or other relief beyond that which has already been given.

25. The Board therefore declares that the respondent breached section 15 of the Labour Relations Act and that it failed to bargain in good faith when, in the course of collective bargaining between the parties, it failed to disclose to the complainant its intention to shut down turbine #1.

DECISION OF BOARD MEMBER H. KOBRYN; May 10, 1990

1. I cannot agree with the majority because the respondent did breach section 15 of the Labour Relations Act and it also failed to bargain in good faith when in the course of collective bargaining between the parties. The respondent did fail to disclose to the complainant its intention to shut down turbine #1. I would have awarded to the complainant compensatory relief as outlined in the complainant's exhibits as follows:

EXHIBIT #1 - List of bargaining unit employees and the amounts owed as of June 1, 1988.

EXHIBIT #2- Wage loss by turbine operators.

EXHIBIT #3 - Loss of wages by those effected by the (bumping down) of the operators.

EXHIBIT #4 - Lost opportunity for increased wages by members of the bargaining unit as a result of vacation time taken by four operators.