[1991] OLRB Rep. January 103
1530-90-U The Canadian Union of Public Employees and its Local Union 1140, C.L.C., Complainant v. The Corporation of the City of Timmins - Golden Manor Home for the Aged, Respondent
BEFORE: Janice Johnston, Vice-Chair, and Board Members W. H. Wightman and B. L. Armstrong.
APPEARANCES: Orval Turcotte for the complainant; Joe Torlone and G. B. Chevrette for the respondent.
DECISION OF VICE-CHAIR, JANICE JOHNSTON AND BOARD MEMBER W. H. WIGHTMAN; January 8, 1991
- File No. 1530-90-U is a complaint filed pursuant to section 89 of the Labour Relations Act ("the Act") alleging a violation of section 15 of the Act. Section 15 states:
- The parties shall meet within fifteen days from the giving of the notice or within such further period as the parties agree upon and they shall bargain in good faith and make every reasonable effort to make a collective agreement.
The Canadian Union of Public Employees, Local Union 1140 C.L.C. ("CUPE" or the "union") took the position that The Corporation of the City of Timmins Golden Manor - Home for the Aged (the "employer") has bargained in bad faith contrary to section 15 of the Act.
The essential facts are not in dispute. The parties are currently in the process of negotiating a collective agreement. The previous collective agreement expired December 31, 1989, and the union wrote to Mr. Chevrette, the CAO of the City of Timmins, on October 3,1989 advising him that they wished to commence negotiations. The parties met, exchanged proposals and the negotiations continued. In June, 1990 a conciliation officer was named and the parties and the officer met on August 2, 1990.
In order to understand the basis of the union's complaint it is also necessary to provide some history and review events occurring simultaneously with the current negotiations. In March, 1986 the parties received the award of a rights arbitrator C. William Dunn dealing with an interpretation of the collective agreement pertaining to an employees right to accumulate vacation credits while absent on Workers' Compensation. Arbitrator Dunn found that an employee was entitled to accumulate vacation credits which on the facts in this case resulted in an employee receiving vacation pay as well as full salary for a period of 19 months. The relevant language in the collective agreement existing at that time was:
ARTICLE #20 -- VACATIONS
20.01 That permanent employees shall be eligible for vacation with pay on the following basis:
Less than one (1) year -- In accordance with The Hours of Work and Vacation with Pay Act.
After one (1) year - Two (2) weeks.
After four (4) years - Three (3) weeks.
After seven (7) years - Four (4) weeks.
After twenty (20) years - Five (5) weeks.
20.02 That if a paid holiday falls or is observed during an employee's vacation for each holiday, in addition to his regular vacation time he shall be granted an additional day's vacation with pay.
20.03 Annual Vacation
Where two or more employees from the same classification request the same dates, seniority shall govern. All requests shall be made at least three (3) weeks in advance.
As a result of this award, the employer sought to amend the language in the next negotiations for a renewal of the collective agreement. The parties were unable to agree and the matter was decided by an interest award issued by R. D. Joyce dated June 19, 1986.
In dealing with article 20.01 the arbitrator stated:
Article 20.01 - Vacation Pay
The Employer's proposal would provide for a new requirement in the collective agreement:
"Vacation with pay is an earned benefit and any absence (other than for approved vacation) in excess of thirty (30) calendar days in a calendar year shall result in vacation credits being pro-rated."
The Employer states its case as follows:
"During 1984 and 1985 a maintenance employee at the Golden Manor was absent for some 19 months while on WCB. Upon his return to work in November of 1985, the employee grieved that the City owed him 38 days vacation with pay for the time he was off work for 19 months, notwithstanding the fact that he had received full salary during his absence.
"The City refused to pay on the grounds that vacation with pay is a component of annual salary and should not be in addition to annual salary. The maintenance employee grieved the City's decision and at arbitration the Arbitrator did not agree with our position and allowed the grievance with the result that we are obliged to pay the grievor 38 days' pay, which is in addition to his annual salary.
"The Employer has filed for judicial review and the matter is currently before the courts."
The Union takes the position that this Board should not interfere with either a third party rights award or an application for Judicial Review which is currently before the Courts.
This interest Board gives every assurance that it has no intention of attempting to interfere with any decision or appeal; any change which this Board would contemplate would, at the earliest, be effective from the date of this award and would have no effect on any earlier events. That being the case we now turn to an examination as to whether such a change is appropriate.
Without commenting on the possible interpretations of the present provision, the Board has reviewed the vacation Articles of The St. Mary's General Hospital agreement, as well as the Timmins Nursing Home (Extendicare) agreement. In both cases it appears to this Board that those agreements provide for vacation reduction for absences in one form or another, either via a formula or by the application of percentage of earned pay. In those cases it would not be possible to receive income, for example, of 56 weeks' pay for any 52-week period.
It is the opinion of the Board that it is not unreasonable to have vacation pay relate to time worked in some manner. At the same time it is reasonable to recognize that an employee absent due to paid illness and Workers' Compensation should not suffer loss of vacation earnings, nor should that employee receive higher compensation from the combination of sick pay/W.C.B./regular earnings than he/she would have had he/she been regularly at work.
The Board awards: An employee's vacation entitlement shall be proportionately reduced for unpaid absences in excess of thirty (30) cumulative days during the period of qualifying the employee for vacation. Absences due to paid sick leave and Workers' Compensation shall be excluded from such calculation except that in no case will an employee be credited for periods of absence which would result in greater annual compensation than he/she would have received had he/she worked normal hours throughout the year.
Mr. Joe Torlone the Director of Social and Family Services was called by the employer to give evidence. He testified that from mid - 1976 till it was challenged by a grievance in August 1990, the employer pro-rated employee's vacation credits for any absence in excess of 30 days, except paid vacation. This pro-ration is calculated by the personnel department and a list showing the employees name and vacation entitlement is sent to the operating divisions. Mr. Torlone made it clear that this pro-ration of vacation credits is not restricted based on the reason for the absence and occurs whenever an employee has been absent for more than thirty days.
On June 11, 1990 a grievance was filed by CUPE on behalf of Ms. Philomene Lefebvre stating:
management has violated the collective agreement under Article 20 Clause 20:02 and any other Clause.
and requesting that:
my proper amount of holidays be credited.
This grievance proceeded to arbitration and the decision of Arbitrator Jolliffe dated August 28, 1990 found the employer to be in violation of Article 20.02. The existing Article 20.02 (in accordance with the Joyce award) states:
20.02 An employee's vacation entitlement shall be proportionately reduced for unpaid absences in excess of thirty (30) cumulative days during the period of qualifying the employee for vacation. Absences due to paid sick leave and Workers' compensation shall be excluded from such calculation except that in no case will an employee be credited for periods of absence which would result in greater annual compensation than he/she would have received had he/she worked normal hours throughout the year. Vacation credits shall not be prorated in the event of an approved maternity leave of absence effective upon the date of signing this agreement
Arbitrator Jolliffe in interpreting this language stated:
…….Whatever the stated position of the City at the interest arbitration procedure, in my view, the present language of the collective agreement excludes proportionate reduction for Workers' Compensation Board approved absences from the workplace unless it can be shown that an employee~ in being credited for a period of such absences would receive greater annual compensation than he/she would have received had he/she worked her normal yearly hours.
- On September 4, 1990 the employer sent the following letter to the union:
I have just received Arbitrator Jolliffe's award which allows Philomene Lefebvre's grievance on accumulated vacation credits.
The purpose of this letter is to put you on notice that in light of Arbitrator Jolliffe's award, we are tabling the following contract amendment request to provide for vacation to be an earned benefit:
Vacation with pay is an earned benefit and any absence (other than for approved vacation) in excess of thirty (30) calendar days in a calendar year shall result in vacation credits being pro rated.
This letter was written on the first working day following the employers receipt of the Jolliffe award. The parties agree that at no time prior to this letter was Article 20.02 ever raised by either party as an Article to be amended. Neither party in it's proposals ever raised or mentioned Article 20.02 prior to this letter by the employer.
The parties met with a conciliation officer on August 2, 1990. A "no board" report was issued on August 10, 1990. The parties have applied for the appointment of an arbitrator pursuant to the Hospital Labour Disputes Arbitration Act, however as of the date of the hearing in this matter, November 22, 1990, no one had been appointed.
The issue therefore to be decided by this Board is whether the raising of a new proposal by the employer after lengthy negotiations and a "no board" report has been issued constitutes bad faith bargaining. The union took the position that they were unaware of any violation of Article 20.02 prior to the Lefebvre grievance. They maintained that the language was clear and that they did not realize the employer was not following it. They dispute whether in fact the employer was violating the language before the Lefebvre grievance. The union also submitted that the employer should not be allowed to table new items after conciliation has taken place and a request for the appointment of an arbitrator initiated. The union maintained that it did not want the employer to establish the practice of introducing last minute proposals. They requested that the Board direct that the employer does not have the right to submit amendments with regard to Article 20.02 before the interest arbitrator.
The employer took the position that there has been a long standing disagreement between the parties with regard to the practice of pro rata vacation reductions and that the employer has sought to amend the collective agreement to meet its needs since the Dunn award. Mr. Chevrette on behalf of the employer indicated that even if the union was not aware of the manner in which they had interpreted the Joyce award the employees were and had not complained (prior to Lefebvre). The employer therefore had no reason to raise an issue regarding Article 20.02 until it received the Jolliffe award. The employer submitted that immediately upon receipt of the award they put the union on notice that they would be seeking an amendment to this Article. Mr. Chevrette admitted that the negotiations were well under way at the time of the Jolliffe award and that at no time prior to this had either party made a request to amend Article 20.02. He indicated however that the Jolliffe award came as a surprise and that they could not be viewed as "sitting in the bushes" with regard to the request to amend Article 20.02. He indicated that the amendment he is seeking reflects the way the employer has administered the pro rata reduction of vacation in the past. Had the employer realized that there was a problem with their interpretation he indicated they would have tabled a proposal to amend the language of the collective agreement. Mr. Chevrette admitted that in normal circumstances the tabling of late proposals should not be permitted and that had it been unrelated to the Jolliffe award he too would have found the employers actions worthy of a section 89 complaint. Mr. Chevrette submitted that the facts before the Board cannot support a finding of bad faith bargaining or unfair labour practice. He requested that the Board so find and that the Board not prevent the request for an amendment to Article 20.02 from proceeding before an interest arbitrator.
The purpose and extent of the duty under section 15 to bargain in good faith and make every reasonable effort to make a collective agreement has been canvassed in many previous Board decisions. In many instances the Board has dealt with an attempt by one party to repudiate that a collective agreement has been concluded and introduce new terms and conditions. As was stated by the Board in Le Droit, [1988] OLRB Rep. April 412 at page 414:
…….The Board's jurisprudence clearly indicates that where, in circumstances such as these, the parties have bargained for and agreed to all the terms of a collective agreement, it is a violation of section 15 for the company to resile from that agreement. (Corporation of the City of Thunder Bay, [1983] OLRB Rep. Oct. 1722; Coulter Copper & Brass Limited, [1981] OLRB Rep. May 519; Selinger Wood Limited, [1980] OLRB Rep. Nov. 1688; Graphic Centre (Ontario) Inc., [1976] OLRB Rep. May 221; Municipality of Casimir, Jennings & Appleby, [1978] OLRB Rep. June 507; Fotomat Canada Limited, [1981] OLRB Rep. Feb. 145; Treco Machine & Tool Limited, [1982] OLRB Rep. Dec. 1954; Saville Food Products, Inc., [1986] OLRB Rep. Apr. 522; Sparton of Canada Limited, [1985] OLRB Rep. Sept. 1420.)
- On the facts in this case neither party is asserting that a collective agreement has been concluded. The parties are in fact seeking the appointment of an arbitrator pursuant to the Hospital Labour Disputes Arbitration Act so that they may resolve all outstanding items. In dealing with an employer who changed its final offer after a lengthy strike and after it had been accepted by the union the Board stated in Wilson Automobile (Belleville) Ltd., [1980] OLRB Rep. July 1136:
- We start with the long held view of this Board that "the parties are best able to fashion the law which is to govern the workplace and that the terms of an agreement are most acceptable when the parties who live under them have played the primary role in their enactment." (See the DeVilbiss (Canada) Ltd. case, [1976] OLRB Rep. March 49 at para. 13) This Board recognizes the concept of voluntarism as relied upon by the respondent company. As a general proposition a party is free to take whatever position best satisfied its self interest providing it maintains the intention of concluding a collective agreement. The difficult cases arise where a party tables a position which it maintains is legitimately in its self interest but which the other side maintains is destructive of the process or designed to avoid a collective agreement and to undermine the trade union. In the Pine Ridge District Health Unit case, [1977] OLRB Rep. Feb. 65 the Board noted:
"Collective bargaining does not take place in a vacuum or in a period where time and events are frozen. Generally, as in this case, it occurs over an extended period of time against a fluid backdrop of events. A party may thus come to reshape its view of its own best interests from one point in time to another and so wish to change its position at the bargaining table. The party opposite cannot be taken to be unaware of the increasing likelihood of that happening with the passing of each successive day and week. The old caution, "Take it before I change my mind" reflects a widely accepted bargaining precept that has its proper application in collective bargaining..."
(See also Toronto Jewellery Manufacturers' Association [1979] OLRB Rep. July 719).
However, the Board's views as expressed in the Pine Ridge District Health Unit case, supra, cannot be taken as a carte blanche to alter one's bargaining position at any time and for any reason. Clearly, an alteration of position designed to wreck the critical decision-making framework necessary for collective bargaining [sic] would be contrary to section 14 of the Act. (See the Graphic Centre (Ontario) Inc. case, [1976] OLRB Rep. May 221.) Similarly, the move to a position tailor-made for rejection would betray an intention not to conclude a collective agreement contrary to the duty imposed by section 14 of the Act. It follows, therefore, that while the parties may govern themselves by self-interest and may alter bargaining positions in response to changes in relevant conditions, a party which alters its bargaining position may leave itself open to the allegation that it is bargaining in bad faith. It falls to the Board in these cases to examine the evidence in light of the labour relations dynamics and draw the appropriate inferences.
Although the Board in the above case reached the conclusion that the employer had contravened section 15 (it was then section 14) the reasoning outlined is helpful in our situation.
At no time was it alleged before us that the employer was attempting to thwart the collective bargaining process, or avoid a collective agreement, or to undermine the trade union. The union is seeking a finding of bad faith bargaining. Based on the facts before us we cannot reach such a conclusion. While we do not condone what the employer has done in this case, because of the uncertainty it could cause in future negotiations, neither can we find it to constitute a breach of section 15 of the Act. Collective bargaining is at its heart a process whereby both parties seek to maximize their position and get a "good deal". To say that at some point in time before the conclusion of the bargaining process that the parties are "locked in" to one set of proposals would impose an unduly rigid framework on the process. The actions of the employer in tabling a request to amend Article 20.02 while perhaps not wise in light of the future relationship, do not constitute a violation of section 15.
For all of the above reasons this complaint is dismissed.
DECISION OF BOARD MEMBER B. L. ARMSTRONG; January 8, 1991
I have read the decision of the majority and with respect I am unable to agree with the decision. While I do not disagree with the facts as presented by the majority, for the purposes of my dissent a few facts should be re-stated.
In June, 1990 a grievance was filed by the union on behalf of the employees. The grievance challenged management's interpretation of article 20.02 of the Collective Agreement. The arbitrator's award was dated August 28, 1990.
The parties had been collective bargaining prior to the filing of the grievance and a Conciliation Officer met with the parties on August 2, 1990. A "No Board" report was issued on August 10, 1990. The parties applied for the appointment of an arbitrator pursuant to the Hospital Labour Disputes Arbitration Act.
It is important to note that the settlement of a collective bargaining dispute under Hospital Labour Disputes Arbitration Act is the substitution for a strike/lockout.
The role of an interest arbitrator is to substitute his judgement for the collective agreement which the parties would negotiate while subject to the experience of a strike of lockout. The collective agreement which the interest arbitrator imposes on the parties is to replicate those working conditions which the parties would agree to if they had the right to strike and/or lockout.
Unfortunately, almost all available evidence suggest compulsory arbitration systems reduce the likelihood that the parties in fact would be able to reach an agreement at the bargaining table. In addition, compulsory interests arbitration lengthens the time between expiry of a collective agreement and the completion of a new negotiated or imposed collective agreement.
One of the reasons interest arbitration produces a lower rate of settlement is because it produces a lower cost of disagreement than does a strike.
I cannot imagine an employer, shortly before the date on which the union could strike or the employer could lock out, introducing a demand for a concession from the union. I do not believe that any employer would either lockout or withstand a strike over the issue of vacation accrual while on Workers' Compensation.
I say this knowing that the issue of accruing vacation and pension credits while on Workers Compensation is an issue that has been raised in both the private and public sectors with the prevailing position that an employee on Workers' Compensation does accrue such credits.
It should also be noted that the parties have resorted to interest arbitration on at least two other occasions. This, of course, is an example of the so called "Narcotic" effect: under interest arbitration, negotiators become accustomed to and rely on arbitration as a way of settling their disputes; they become addicted to interest arbitration.
Given the above background, it is useful to ask the following question: Why did the employer not raise the issue during collective bargaining when the union made it aware in June, 1990 that it disagreed with the employer's interpretation of the Collective Agreement?
The issue has been succinctly summarized by Vice Chair Bendel in "Good Faith Bargaining in Ontario", University of Toronto Law Journal volume 30, #1, 1980:
One of the elements of a rational process of persuasion is the requirement that all items intended to be raised by either party be put into dispute in the early stages of negotiation.
There are sound labour relations reasons for requiring that a party raise all issues early in the negotiations and not wait until the last minute to "up the ante."
The Board had the opportunity to examine the very issue of raising issues at the last minute in Geographic Centre ("Ontario") Incorporated, [1976] OLRB Rep. May 221. In that case, the union had accepted the company's offer and the Collective Agreement was to be signed. However, the union lodged a grievance regarding the employer's action which was independent of Collective Bargaining. The employer would not sign the Collective Agreement unless the union dropped the grievance. The Board stated at Paragraph 20:
the requirements for open and rational discussion of all the issues in dispute stems from the fact the collective bargaining is an essence an exercise in decision making. The parties make hard decisions as to the content and timing of their offers and counter offers as they attempt to conclude an agreement... conduct by one of the parties to the process which inhibits or undermines the decision making capability of the other is conduct which is contrary to the requirement to bargain in good faith and make every effort to reach a Collective Agreement.
At paragraph 21, the Board stated:
the decision making capability of the parties depends upon not only a full and open discussion of the items which are in dispute but also upon an awareness that the scope of the dispute is limited to those items which has been put into dispute in the early stages of the bargaining process. Decision making does not take place in a vacuum. The parties set the parameters with their early exchange of proposals thereby establishing the framework within which they negotiate. A party which holds back on an item or number of items and then attempts to introduce these matters into the negotiations as the process nears completion, effectually destroys the decision making framework. A party cannot rationally or properly consider its bargaining position in the absence of absolute certainty that the full extent of the dispute has been revealed. The tabling of additional demands after a dispute has been defined must, in the absence of compelling evidence which would justify such a course, be construed as a violation of the duty to bargain in bad faith.
The employer and the union have conducted collective negotiations and are now at the point where they are submitting their outstanding issues to an interest arbitrator. Any concessions the union has made during Collective Bargaining have not been made in a vacuum; on the contrary, there has been give and take throughout the negotiations and union's concessions had been made with regard to the entire Collective Agreement package.
The employer's introduction of a new demand at this stage of collective bargaining undermines the entire negotiations up to this point. It is trite labour relations that any attempt to undermine the collective bargaining between the parties is bargaining in bad faith.
The employer is not without any recourse in this situation. If the employer wishes to reduce cost from compensable injuries in the workplace, the employer can insure to the best of its abilities that no employees go off on Workers' Compensation by providing a safe workplace.
I am forced to conclude that when the employer demands a concession regarding an issue which arose between the parties during collective bargaining, it is bad faith bargaining to demand that concession after conciliation and immediately prior to the appointment of interest arbitrator.
For the above reasons, I am unable to agree with the majority of the Board.