Ontario Labour Relations Board

[1993] OLRB Rep. June 535

0956-92-G National Elevator and Escalator Association, Applicant V. I.U.E.C., and its Locals 50, 90 and 96, Responding Party

BEFORE: Roman Stoykewych, Vice-Chair, and Board Members W. N. Fraser and H. Kobryn.

APPEARANCES: R. Ross Dunsmore, Morgan Bronwen and Andrew Reistetter for the applicant; P. E. Verrege for the responding party.

DECISION OF THE BOARD; June 9, 1993

I. This is an application under section 126 of the Labour Relations Act, in which the employer, the National Elevator and Escalator Association, seeks declaratory relief with respect to the interpretation of the provisions of the Declaration of Trust of the Canadian Elevator Industry Pension Fund (hereinafter "Declaration of Trust") and the Plan of Benefits of the Canadian Eleva­tor Industry Pension Plan (hereinafter "Pension Plan"). The provisions of Article 126(1) of the Act are as follows:

Despite the grievance and arbitration provisions in a collective agreement or deemed to be included in a collective agreement under section 45, a party to a collective agreement between an employer or employers' organization and a trade union or council of trade unions may refer a grievance concerning the interpretation, application, administration or alleged violation of the agreement, including any question as to whether a matter is arbitrable, to the Board for final and binding determination.

2. In its grievance dated June 23, 1992, it is asserted by the employer that under the terms of the Declaration of Trust pursuant to which the Pension Plan is administered, no contributions are to be accepted from an employer unless and until that employer becomes a party to a collective agreement between the parties. The trade union contests the jurisdiction of this Board to adjudi­cate upon this matter. It is its position in this respect that the subject matter of the grievance is not properly within this Board's territorial jurisdiction since, it claims, all matters relevant to the col­lective bargaining relationship giving rise to the grievance transpired in Nova Scotia.

3. In order to appreciate the nature of the disagreement between the parties and the objection taken to our jurisdiction, it is useful to review some of the institutional and contractual arrangements developed by the parties in their many years of collective bargaining. Throughout the 1950's and early 1960's the parties, the International Union of Elevator Constructors and the National Elevator and Escalator Association, had bargained collectively at the national level and had concluded a series of collective agreements concerning the various terms and conditions of employment on that basis. Emerging from this national arrangement was a contributory Pension Plan which was, in turn, to be administered by a Pension Trust. The Board of the Trust was com­posed of equal numbers of representatives, of the union and the employer's association, and in practice, the bargaining committees of the two parties to collective bargaining generally overlap­ped with the membership of the Board of Trustees. Although the nation-wide bargaining structure broke down in 1967, and thereafter provincial agreements were concluded, both the Pension Plan

and the Pension Trust continued to operate at the national level. Thus, issues relating to the administration of the Pension Plan, although they are implemented through the various provincial arrangements between the employer and the trade union, continue to be determined at the national level by a single Board of Trustees.

4. Certainly at the outset, the circumstances giving rise to the present application had their origin in the province of Nova Scotia, and in particular, with respect to the collective bargaining relationships entered into by North East Elevator Ltd. (hereinafter referred to as "North East"). North East, a company engaged in elevator construction, operates exclusively in the province of Nova Scotia. In 1988, North East became a member of the National Elevator and Escalator Asso­ciation by virtue of its entry into a collective agreement with the trade union. On that basis, remit­tances on behalf of the employees of North East were accepted by the Trustees of the Pension Plan as contributions to the Pension Fund. However, by 1992, the collective agreement between it and the trade union lapsed, and as a result, North East ceased to be a member of the National Elevator and Escalator Association. Nevertheless, North East continued to make remittances to the Pension Fund with respect to its employees. The present dispute concerns contributions of that sort, and more particularly, whether the Trustees are authorized to accept remittances from a non-member employer with respect to its employees.

5. The matter first came to a head at a meeting of the Trustees of the Plan on May 19, 1992 held in Toronto. At first, the specific issue of the status of North East and its ability to make remittances to the Plan was raised and discussed. However, no agreement could be obtained as to the manner in which it was to be disposed and as a result, the issue was tabled. Thereafter, how­ever, the more generic issue of whether contributions would be accepted from non-member employers was raised by the management representatives. The Minutes of that meeting record that the employer representatives advanced the following resolution:

RESOLVED: THAT until such a time as an Employer becomes a party to a valid Collective Agreement as required by the Trust Agreement, the Trust will not accept any contributions from that employer.

That resolution as well was discussed, a vote was taken which resulted in a tie, and the Board members then agreed to have the issue arbitrated. Although no consensus upon a specific arbitra­tor was reached, it was nonetheless agreed that the disputed matter would be referred to the Office of Arbitration of the Ontario Ministry of Labour for the purpose of having an arbitrator appointed. The applicant duly filed a grievance pursuant to the collective agreement operative in Ontario, and then referred the matter to the Board pursuant to the provisions of section 126. As indicated earlier, the trade union takes the position that the Board lacks jurisdiction to hear the present matter on the grounds that all the events giving rise to it occurred in Nova Scotia, that the employer does not operate in Ontario, and that the employer does not employ any Ontario employees.

6. In Ontario, the collective bargaining relationship between the parties is regulated by the terms of the "Ontario Provincial Agreement". Article 17.01 of that agreement provides for the establishment of the Pension Trust, with a composition as set out above, and makes provision for a pension fund to be known as the "Canadian Elevator Industry Pension Plan". Article 17.02 of the Ontario collective agreement reads as follows:

The Board of Trustees shall have full authority and discretion to adopt the Declaration of Trust and Plan of Pension Benefits which shall be part of the collective Agreement and binding on all the parties signatory to this agreement.

7. The Declaration of Trust, in turn, sets out the various obligations and powers of the Trustees to administer the Pension Fund and the manner in which those determinations are to be made. Of considerable significance here are the dispute resolution provisions set out in Article VIII, Section 1 of the Declaration of Trust:

In the event the Trustees cannot decide any matter (including the adoption of rules and regula­tions and amendments to the Plan) or resolve any dispute because of a tie vote, or in the event decisions cannot be made because of a lack of a quorum at two successive meetings of the Trust­ees, then and in either such events the Trustees shall submit such matter to arbitration in accor­dance with the terms of the Collective Agreements.

8. The definition of "Collective Agreements" is set out in Article I Section 1 of the Decla­ration of Trust:

The term "Collective Agreements" as used herein shall mean the agreements covering the terms and conditions of employment in force from time to time between the Union and the Employ­ers.

9. It is on this basis that the employer argues that both the Declaration of Trust and the Pension Plan form part of the collective agreement between the parties in as much as those docu­ments have been incorporated by reference into the collective agreement. The Board has little dif­ficulty in accepting this proposition, as it is clear from the arbitral caselaw that a collective agree­ment may be comprised of more than one document, and that "ancillary documents" such as pension plans and health and welfare benefit schemes are enforceable under the terms of a collec­tive agreement when the parties so provide, whether expressly or by implication. [Re Ontario Paper Co. Ltd., (1987) 1987 CanLII 8743 (ON LA), 32 L.A.C. (3d) 346 (Solomatenko); Re Nova Scotia Civil Service Commis­sion and Nova Scotia Government Employees Association, (1980), 1980 CanLII 4030 (NS LA), 24 L.A.C. (2d) 319 (Christie)] The present collective agreement expressly provides that the Pension Plan and Declaration of Trust documents, setting out the substance and the administrative procedure of the pension scheme in place between the parties, are part of the collective agreement between them, and then, in the Trust document, makes provision for the arbitration of differences arising in the administra­tion of the plans through the arbitration provisions in the various collective agreements. In that general respect, then, we find that issues concerning the administration of the pension plan are arbitrable under the terms of the various collective agreements between the parties.

10. Nevertheless, the resolution of the incorporation issue does not determine the more dif­ficult question of whether it would be appropriate for the matter to be determined under the provi­sions of the Ontario, rather than the Nova Scotia collective agreement. According to counsel for the employer, the parties are compelled to have the matter determined in Ontario as a result of the operation of the provisions of the Trust Agreement that set out the Province of Ontario as the "situs" of the Trust. Article XII, Section 3 of the Trust Declaration states:

This Declaration of Trust is accepted by the Trustees in the City of Toronto in the Province of Ontario and such place shall be deemed the situs of the Trust Fund created hereunder. All ques­tions pertaining to the validity, construction and administration shall be determined in accor­dance with the laws of the Province of Ontario and the laws of Canada applicable therein.

11. It is urged upon us by counsel for the employer that the issue of acceptance of remit­tances constitutes a "question pertaining to validity, construction and administration" of the Pen­sion Plan, and that accordingly, that matter should be determined according to the laws of Ontario. It is the further assertion of counsel that the situs provision has the additional effect of requiring the matter to be disposed of according to the provisions of the Ontario collective agree­ment. We cannot agree that the situs provision of the Trust document has a jurisdiction-granting effect for purposes of determining the arbitrability of grievances. As indicated above, in the docu­ments that comprise the collective agreement, the parties have expressly set out a scheme pursuant to which differences concerning the interpretation and administration of the Pension Plan are to be arbitrated. Although we accept that decision-making with respect to the Fund operates at a national level, the Trust Declaration provides that matters concerning the administration of the Pension Fund that cannot be resolved by the Board are to be dealt with by submitting the matters to arbitration under the provisions of the various "collective agreements", which are further defined in the plural in Article I, Section One of the Trust Agreement.

12. The employer's interpretation of the situs provision, by contrast, would render the plu­ral language used in the agreement meaningless, since it would necessarily imply that by designat­ing Ontario as the situs of the Trust Fund, the parties intended all matters concerning the adminis­tration and interpretation of the Pension Plan in dispute between them, irrespective of their origin, to be arbitrated under the provisions of the Ontario collective agreement. Moreover, such a result would not be congruent with sensible labour relations since it would require that any dispute, no matter how closely linked it may be with the specific circumstances of a given province, would be heard in Ontario. In our view, it is much more likely that the situs provisions were agreed upon by the parties in order to identify the location of the trust for such matters as taxation and trust administration. Additionally it may be that these provisions would require arbitrators in provinces other than Ontario to apply the substantive law of Ontario in the course of their construction of the terms of the Pension Plan, (a matter which we expressly decline to decide). Nevertheless, we do not understand those provisions to override the clear language of the agreement which contem­plates the referral of grievances to a plurality of provincial fora. Thus, the situs provisions of the Trust agreement do not compel the parties to have this matter adjudicated under the provisions of the Ontario collective agreement and accordingly, are of no assistance to the employer in establish­ing the jurisdiction of this Board to hear this matter.

13. The employer also argues that the matter is one that is properly before this Board in light of the steps the Trustees have taken to have the matter heard in the Ontario jurisdiction dur­ing the consideration of the matter at the May 19, 1992 meeting of the Board of Trustees of the Pension Plan. In effect, the employer argues that the trade union has attorned to the Ontario juris­diction. In particular, it is stressed that the parties have agreed to have the matter arbitrated, and in so doing, chose to have it arbitrated in Ontario under the aegis of the Ministry of Labour's Office of Arbitration. In addition, it is noted that the motion proposed by the employer represen­tatives that gave rise to the present grievance was not one which addressed the specific circum­stances of North East, nor did it entail a ruling as to North East's status to make contributions under the Plan, as would be entailed by a determination with respect to the earlier motion advanced by the employer representatives. Rather, the issue was characterized by the parties in the minutes as a discussion of a "general matter". Bearing in mind those considerations, we were urged to take jurisdiction over the matter.

14. The Board is cognisant that, as a general rule, parties are unable to grant to an arbitra­tion panel jurisdiction under a collective agreement that it otherwise would not possess through the expedient of a collateral agreement. In our view, the steps taken at the May 19 meeting do not pos­sess most of the requisite formal characteristics of a collective agreement that would empower an arbitration panel to hear the matter. To mention a single example, the arrangement to have the matter heard in Ontario was made by the Trustees of the Plan, not by the parties themselves. In that respect, the agreement to arbitrate in Ontario cannot be understood even notionally as an "amendment" to the collective agreement that would authorize the parties to proceed in Ontario. Accordingly, standing alone, the agreement to arbitrate in Ontario cannot grant this Board juris­diction to hear the matter since, of necessity, the jurisdiction of an arbitration panel must arise from the terms of the collective agreement.

15. Notwithstanding this finding, we are of the view that the present collective agreement itself contemplates the parties possessing the power to agree to a forum and that, in the present cir­cumstances, the parties have utilized that power pursuant to the provisions of the collective agree­ment. In this respect it is important to note that the grievance is in the form of a "policy" matter, in which the issue to be determined is the appropriateness of a rule of general application through­out the country. Although originating in the specific circumstances of a collective bargaining rela­tionship in Nova Scotia, the Board is of the view that in re-framing the issue in general terms, the Trustees have converted the matter to one of rule-making, a matter over which they have ample contractual authority. For example, in Article IV Section 3 of the Declaration of Trust, the Trust­ees are granted the general power to "establish such rules and regulations necessary to the effectu­ation of the purposes of this Declaration of Trust and not inconsistent with the terms hereof'. As indicated above, Article VIII Section One of the Declaration of Trust expressly contemplates a referral to arbitration under collective agreements of issues relating to the "adoption of rules and regulations and amendments to the Plan" in circumstances where no agreement can be reached by the Trustees.

16. Nevertheless, the referral provision gives no direction with respect to which agreement a particular matter is to be referred. In our view, given that the Declaration of Trust expressly con­templates the arbitration of general rule-making issues that, in their very nature do not attach spe­cifically to a single province, and given that no direction is provided as to where such matters are to be heard, it is reasonable to imply a power in the Trustees to choose their forum of convenience. To imply otherwise would entail a finding that there is no jurisdiction to hear policy issues, or that they are compelled to be heard in a particular province. Neither of these alternate assumptions, as explained above, are tenable under the terms of this agreement. Accordingly, we find that the Trustees exercised their contractual power to determine the jurisdiction in which the grievance was to be arbitrated by agreeing to have the matter referred to the Ontario Ministry of Labour's Office of Arbitration for adjudication.

17. Finally, it is necessary to consider whether the arbitration provisions of the Ontario col­lective agreement authorize the hearing of the matter. That is to say, although we have found that the parties have granted the Trustees a power to choose their collective agreement in cases of pol­icy grievances, nonetheless in order for the matter to be arbitrable, the collective agreement cho­sen must itself provide the arbitration panel sufficient contractual authority to hear such griev­ances. The Board is satisfied that there is ample jurisdiction in this respect. Article 14.01 of the Ontario collective agreement provides no restrictions on the hearing of policy grievances, and indeed, in article 14.01, grievances are described expansively as "any difference or dispute regard­ing the application or interpretation of this collective agreement". In this respect, the arbitral case-law is clear that policy grievances will be limited only where there is specific language proscribing such matters. [Weston Bakeries Ltd., (1970), 1970 CanLII 1647 (ON LA), 21 L.A.C. 308 (Weiler)] Accordingly, we find that the terms of the Ontario collective agreement empower an arbitration panel to hear policy griev­ances such as the grievance presently before the Board.

18. In the result, for reasons expressed above, we find that the grievance dated June 23, 1992 may be heard under the provisions of the Ontario collective agreement between the parties, and accordingly, that this Board has the jurisdiction to determine the issue raised in it.

19. Although the trade union took the position at the hearing that the Board lacked the contractual authority to deal with the present matter, it agreed that were we to find that we were possessed of jurisdiction, it would not contest the merits of the grievance. Indeed, the representa­tive for the trade union conceded that the interpretation proposed by the Employer is correct. For this reason, it is unnecessary to review in detail the merits of that position. Accordingly, bearing in mind the agreement of the parties, the Board finds that under the terms of the Declaration of Trust and the Pension Plan that forms part of the collective agreement between the parties, the Board of Trustees is not required to accept contributions to the Pension Fund on behalf of employees by employers that are not parties to a valid collective agreement.