[1993] OLRB REP. OCTOBER 1035
3597-92-U Southern Ontario Newspaper Guild, Applicant v. Thomson Newspapers Corporation and The Cambridge Reporter, A Division of Thomson Newspapers Corporation, Responding Party
BEFORE: Russell G. Goodfellow, Vice-Chair, and Board Members W. N. Fraser and R. R. Montague.
APPEARANCES: Kathleen Martin and Lorne Slotnick for the applicant; Stephen F. Gleave, Jim Carnaghan and Robert Wesley for the responding party.
DECISION OF THE BOARD; October 6, 1993
- This is an application under section 91 of the Labour Relations Act by the Southern Ontario Newspaper Guild. The Guild asserts that the responding party, Thomson Newspapers Corporation and The Cambridge Reporter, A Division of Thomson Newspapers Corporation, breached sections 65, 67 and 71 of the Act when it denied bonus payments to striking employees in the years 1991 and 1992. An allegation that the responding party also contravened section 81 of the Act was withdrawn at the start of the hearing.
Facts
The Cambridge Reporter is one of a family of newspapers owned by Thomson Newspapers Corporation. The Reporter is published Monday to Saturday and has a circulation of about 13,000 copies. It employs approximately 60 full-time and 30 part-time employees. The Guild represents between 40 and 50 employees in the administration, advertising, circulation and editorial departments. Persons employed in "production" are represented by another bargaining agent.
Jim Carnaghan has been the Publisher and General Manager of the Reporter since May 4,1992. He testified on behalf of the employer about the recognition bonus plan and the way it was administered both before and during his tenure. The plan was introduced in the mid-1970's. It was terminated in 1993 for financial reasons. Although there was some dispute on the evidence as to the precise terms of the plan, the Board is satisfied that they are accurately reflected in a memorandum signed on December 30, 1991 by the former publisher, Jon Butler, which states:
Recognition Bonus Plan Renewed
In extending our policy of recognizing the contributions made by the staff to the successful production of the newspaper, I am pleased to announce that the Recognition Bonus Plan will be renewed for the year of 1992.
The production of The Cambridge Reporter with the constant requirement of meeting daily press deadlines is dependent upon the co-operative effort of each member of the staff.
Each full-time employee who has completed one year of continuous service on December 31, 1992 and who is an active employee of the newspaper at that date, will be eligible to receive a cash Performance Bonus. The bonus will be 4% of basic 12 months' salary or wage based on the rate in effect at January 1, 1992, with a maximum of $500.00 for the 12-month period. Since the bonus is dependent upon regular uninterrupted production and delivery of the newspaper, the amount payable to any individual employee will be reduced by 7.5% for each day or portion thereof during which, in the judgement of management, the employee does not perform his/her assigned task in this 12-month period except where the employee:
is on authorized paid leave of absence (which includes regular vacations and paid holidays), or
is absent due to injury, covered by Workers' Compensation, or
is absent due to verified illness, where the reduction in bonus will apply to only the first two days of each absence.
- Also material is an earlier memorandum, dated January 6, 1991, from Jon Butler to six department heads at the Reporter. This memorandum states:
"The 'Recognition Bonus Plan' has been renewed for 1991 and the attached should be posted in your department.
This 'Bonus Plan' is to be monitored by you, for your employees, and it is imperative that Gerry receive documentation of any illness or late arrival of your staff.
If you feel any employee is not performing his/her task you may also reduce the bonus.
Please submit any reductions on the day of the infraction.
If you have any questions, please ask."
Mr. Carnaghan explained that the plan was available to all full-time employees except those that were covered by another plan. The bonus was paid in the year in which it was earned, usually just prior to Christmas. The purpose of the plan was to reward employees for contributions to production. Accordingly, the bonus would be reduced by 7.5 per cent for each day during which, in the judgement of management, the employee did not perform his or her assigned tasks, except in certain circumstances. In the first two circumstances listed in the December 30, 1991 memorandum there would be no reduction. In the third circumstance, that of verified illness, the reduction would be limited to the first two days of absence, for a total possible reduction of 15 per cent for each such illness.
Between November 7, 1991 and February 21, 1992 some members of the Guild bargaining unit went on a lawful strike for a first collective agreement. Others continued to work and the paper continued to be published. The striking employees did not receive recognition bonus payments for the years 1991 and 1992. The Guild submits that the employer breached the Act when it refused to pay the bonuses. It was Mr. Carnaghan's evidence that because the strike lasted for more than 13 days in each year and "strikes" did not fall within one of the listed exceptions, the bonuses had been eliminated at the rate of 7.5 per cent per day. Bonuses were received, however, by the members of the Guild bargaining unit who continued to work during the strike.
In denying the Guild's allegation that the employer had discriminated against striking employees by denying them bonus payments, Mr. Carnaghan gave examples of situations other than strikes and verified illnesses in which the bonus would be reduced. He cited:
lateness affecting production;
"mess-ups" that disrupt production;
unpaid leaves of absence; and
pregnancy leaves.
Mr. Carnaghan acknowledged, however, that an unpaid leave of absence had never been granted at the Reporter. Accordingly, the parties focused considerable attention on pregnancy leave, apparently because this was the only circumstance other than strikes in which the employer had allegedly reduced the bonus payment by 7.5 per cent per day, without interruption, over an extended period of time.
Documents were introduced and witnesses were called by both sides to establish that the employer either had or had not denied bonus payments to pregnant employees for the years in which the pregnancy leave was taken. The Board has carefully examined this evidence and sees no need to recite it in detail. Suffice it to say that the "sample group" was limited and the evidence was mixed. While it is true that a 100 per cent reduction appears generally to have been applied, the practice was not uniform. At least one employee suffered no reduction whatsoever.
Mr. Carnaghan also directed the Board's attention to an employee by the name of Crawford whose bonus was reduced by 100 per cent in 1992 for having been repeatedly sick and late for work. Crawford was not a member of the Guild bargaining unit.
Finally, Mr. Carnaghan gave evidence about the manner in which the bonus cheques were distributed in 1992. The strike had ended on February 21. The cheques were distributed about 10 months later, just prior to Christmas. Mr. Carnaghan said that he handed the bonus cheques to each employee personally, shook the recipient's hand and congratulated them for their efforts. In cross-examination, Mr. Carnaghan acknowledged that the only members of the Guild bargaining unit who had not received a bonus cheque in 1992 were those who had been on strike, and that the strike had created a division in the unit which was taking some considerable time to heal. (At the time of the hearing in this matter a first collective agreement, which the Board directed in its March 26, 1992 decision to be settled by arbitration, had yet to be achieved.) Mr. Carnaghan denied the suggestion, however, that his method of distribution, unique in the history of the Reporter, was intended to "rub the noses of the strikers in what they weren't getting". Rather, Mr. Carnaghan justified his approach as an appropriate way of recognizing the recipients' efforts and pointed out that it was consistent with the practice at the Sarnia paper from which he had recently come.
The Guild called three witnesses. Ann Watkins, an accounts payable clerk, gave evidence about a conversation which took place on the picket line in 1991 between herself, another striker and the former publisher, Jon Butler. Ms. Watkins said that the other striker asked Mr. Butler about the status of the "incentive earnings cheques" and Mr. Butler replied, "I think you people screwed yourselves when you went on strike; remember, it's a 7.5 per cent reduction for each day you're out here." Ms. Watkins then said, "No Jon, it's to a maximum of 15 per cent". That was the end of the conversation. Ms. Watkins was surprised by Mr. Butler's statement because this was the first time she had heard of any circumstance in which the recognition bonus payments would be reduced at the rate of 7.5 per cent per day over an extended period.
Ms. Watkins also testified that Dave Norris, a reporter at the paper, participated in the strike on the first day but later crossed the picket line and continued to work. Mr. Norris' 1991 bonus was unreduced. Ms. Watkins was uncertain, however, whether Mr. Norris was actually scheduled to work on the day in question.
Cathy Miehn was the second union witness. During the period of the strike she was the assistant city editor and a Guild bargaining unit chair. Ms. Miehn described a "sit-in" which took place in mid-April 1992, approximately two months after the strike had ended. Ms. Miehn was filling in for the city editor at the time. Shortly after 9 a.m. a number of bargaining unit members who had worked during the strike left their desks and congregated in the board room. They were upset with the Guild and refused to leave until they got some answers. As unit chair, Ms. Miehn was asked to speak to the group but she declined, pointing out that she was on deadline and could not discuss union business on company time. Ms. Miehn gave the names of 13 bargaining unit members who participated in the sit-in, her understanding as to their scheduled hours of work and her observations as to whether they actually worked that day. Based on Ms. Miehn's evidence and a review of the employer's records, the Board is satisfied that the individuals she identified failed to perform their assigned tasks for a substantial part of the working day. Although deductions were made from the employees' wages, their bonus payments were unreduced. Ms. Miehn also gave evidence that, as a reporter, Mr. Norris' days and hours of work would normally have included the first day of the strike when she too observed him on the picket line.
The final union witness was Mark Stewart. Mr. Stewart is a reporter at another Thomson paper, the Oshawa Times. He testified that the plan in effect at the Reporter was also available at the Times. He said that his bonus was not reduced in 1992 when he was off on union business for five days. However, Mr. Stewart acknowledged that a collective agreement is in place at the Times which contains provisions dealing with the performance of union business on company time.
Submissions
Section 65, 67 and 71 of the Act provide:
No employer or employers' organization and no person acting on behalf of an employer or employers' organization shall participate in or interfere with the formation, selection or administration of a trade union or the representation of employees by a trade union or contribute financial or other support to a trade union, but nothing in this section shall be deemed to deprive an employer of the employer's freedom to express views so long as the employer does not use coercion, intimidation, threats, promises or undue influence.
No employer, employers' organization or person acting on behalf of an employer or an employers' organization,
(a) shall refuse to employ or to continue to employ a person, or discriminate against a person in regard to employment or any term or condition of employment because the person was or is a member of a trade union or was or is exercising any other rights under this Act;
(b) shall impose any condition in a contract of employment or propose the imposition of any condition in a contract of employment that seeks to restrain an employee or a person seeking employment from becoming a member of a trade union or exercising any other rights under this Act; or
(c) shall seek by threat of dismissal, or by any other kind of threat, or by the imposition of a pecuniary or other penalty, or by any other means to compel an employee to become or refrain from becoming or to continue to be or to cease to be a member or officer or representative of a trade union or to cease to exercise any other rights under this Act.
No person, trade union or employers' organization shall seek by intimidation or coercion to compel any person to become or refrain from becoming or to continue to be or to cease to be a member of a trade union or of an employers' organization or to refrain from exercising any other rights under this Act or from performing any obligations under this Act.
The employer submits that there is no evidence of a breach of the foregoing provisions of the Act. It says that it was simply applying a policy that had been in place at the Reporter for a number of years and which provided for a reduction in bonus payments at the rate of 7.5 per cent per day for any day during which an employee did not contribute to the production of the paper. The employer argues that, under the terms of the plan, the "character" of an absence was not material, unless it fell within a defined exception. In all other circumstances, it was the fact of the absence and not the reason for it that was determinative. The employer draws an analogy to certain arbitral decisions which have held that "deemed termination" clauses in collective agreements do not offend human rights' prohibitions against discrimination on the basis of disability because they involve the application of a neutral criterion to specific facts. It was the neutral requirement of being at work and contributing to the production of the paper that led to the denial of the bonus payments in this case and not the fact that the employees' absences were because of a strike.
The employer also argues that there is no evidence of any "penalty" having been imposed within the meaning of section 67(c) of the Act because the denial of the bonus payments was not accompanied by any threats or intimidating conduct. There is also nothing in the evidence to suggest that the reduction or threat of reduction deterred anyone from exercising any rights under the Act. Indeed Ms. Watkin's evidence is to the contrary. Just as employees knew and understood that they would not receive wages and benefits while on strike, so also, the employer submits, employees knew and understood that they would not receive bonus payments tied to production.
The company relies on the following authorities: Tim Reay, [1982] OLRB Rep. Aug. 1206; Hayloft Steakhouse Limited, [1987] OLRB Rep. May 717; Canada Packers Inc., unreported arbitral decision dated August 11, 1992 (Solomatenko); Etobicoke General Hospital, unreported arbitral decision dated April 3, 1992 (Craven).
The Guild submits that the crux of the complaint is discrimination on the basis of the exercise of the right to strike and reminds the Board that the onus is on the employer to establish that the decision to deny striking employees recognition bonus payments in the years 1991 and 1992 was not motivated, in whole or in part, by anti-union considerations.
According to the union, Mr. Carnaghan's explanation for the denial of the recognition bonus payments does not measure up against the evidence of the mixed treatment of pregnant employees, the failure to withhold any bonus payments to employees who participated in the sit-in or to Dave Norris, the practice at the Oshawa Times, and the employer's prior conduct as recorded in The Cambridge Reporter, [1992] OLRB Rep. March 271. The Guild submits that there was no other circumstance in which the employer uniformly reduced employees' bonus payments by 7.5 per cent per day over an extended period, and that this is evidence of discrimination on the basis of the right to strike.
With respect to section 67(c), the Guild adds that it need not establish that employees actually returned to work because of the employer's punitive conduct. The imposition of a monetary penalty is sufficient to establish a breach. Finally, the Guild asserts that the impact of the employer's discriminatory conduct on the employees' right to strike was so predictably harmful that it ought to be presumed to have intended those consequences.
The Guild relies on the following authorities: The Barrie Examiner, [1975] OLRB Rep. Oct. 745; Re Cadillac Fairview Corp. Ltd. et al and Retail, Wholesale and Department Store Union et al (1989), 1989 CanLII 4334 (ON CA), 71 OR. (2d) 206 (C.A.); Kodak Canada Ltd. (1975), 10 LAG. (2d) 332 (Betcherman); Air Alliance Inc. (1991), 15 CLRBR (2d) 288 (C.L.R.B.).
Decision
The central issue in this case is whether the employer discriminated against employees contrary to the Act by denying them recognition bonus payments in the years 1991 and 1992.
The essence of "discrimination" is differential treatment between groups or individuals without reasonable justification and with adverse consequences. There ts no question that the striking employees were treated differently from the "non-strikers", with adverse consequences, in respect of the bonuses. The non-strikers received recognition bonus payments and the strikers did not. The issue, however, is whether there was reasonable justification for their treatment or, more accurately, whether the differential treatment was because of the exercise by employees of their right to strike? This issue is obscured, but not eliminated, by the fact that recognition bonus payments, as a form of compensation, resemble wages. Unlike wages, however, recognition bonus payments are discretionary, and it is the exercise of the employer's discretion that is central to this case.
A review of the terms of the recognition bonus plan reveals that the employer reserved to itself a wide measure of discretion in determining the circumstances in which recognition bonus payments could be made or withheld. The object of the plan, as stated by Mr. Carnaghan and reflected in the documents, was to encourage employees to contribute to the "regular uninterrupted production and delivery of the newspaper". Subject to three exceptions, the bonus would be reduced at the rate of “… 7.5 per cent for each day or portion thereof during which, in the judgement of management, the employee [did] not perform his/her associated task...". Strictly as a matter of interpretation, therefore, the employer's conduct may well have fallen within the ambit of its discretion. The issue before the Board, however, is whether that discretion was exercised in a manner calculated, in whole or in part, to discriminate against employees because of their exercise of the right to strike. This issue can only be determined based upon a review of the evidence as a whole.
The Board derives little assistance from the employer's treatment of pregnancy leave. The absence of a uniform practice by the employer in this area does not lead us to conclude that strikers were improperly singled out in the denial of 100 per cent of their recognition bonus payments. Rather, this evidence merely confirms our view as to the breadth of the discretion retained and exercised by the employer under the terms of the plan.
Much more troubling, however, is the evidence with respect to the sit-in. Less than two months after the conclusion of a bitter strike and after the Board's direction of a first collective agreement by arbitration, employees who had crossed the picket lines and continued to work during the strike withdrew their labour for a substantial part of a working day. In the absence of any evidence to the contrary, and given the acknowledged divisions in the workplace, the Board accepts Ms. Miehn's evidence that at least one of the purposes of the sit-in was to express dissatisfaction with the union and to attempt to convey the message that the Guild did not truly "represent" all of the employees in the bargaining unit.
When it came time to dispense the recognition bonus payments, however, these employees, unlike the strikers, were unaffected by their earlier work refusals. Their bonus payments were unreduced. Seeking to explain this differential treatment, the employer states that, unlike the strike, the sit-in had no real impact on production because deadlines were met and the paper went out on time - It is suggested, therefore, that it was consistent with the terms of the plan for these employees to have suffered no reduction.
This explanation is not supported by the evidence. As noted above, the bonus is said to be dependent upon "regular uninterrupted production and delivery of the newspaper". However, reductions are to be made for the non-performance of assigned tasks. There is nothing to suggest that the latter must cause the former. Indeed, the evidence is to the contrary. The January 6, 1991 memorandum makes no mention of any failure to meet deadlines or whether the paper actually goes out on time. It suggests, if it does not also make explicit, that any illness, late arrival or non-performance of an assigned task is grounds for a reduction. There is also nothing in the evidence to suggest that Crawford's latenesses or the taking of pregnancy leaves had the effect relied upon by the employer. Further, and in any event, we note that the paper continued to be published throughout the strike.
To similar effect is the evidence with respect to Dave Norris. The Board is satisfied, on a balance of probabilities, that Dave Norris participated in the strike on its first day when he was properly scheduled to work, but later returned to work for the duration of the strike. He too suffered no reduction in bonus arising out of his earlier work refusal.
What we are left with then is the fact that the employer accorded more favourable treatment to those who had crossed the picket lines or otherwise acted in opposition to the union (through the sit-in) than to the strikers in the payment of bonuses. While we recognize that there is a significant difference between a three and one half month withdrawal of labour and one which only lasted for one day or a substantial portion of a day, it is a difference in degree and not in kind. It is not sufficient to rebut the inference we draw from the evidence that the differential treatment was the product of the employer's view of the employees' exercise of their statutory rights.
Accordingly, on the basis of the evidence the Board is satisfied that the employer discriminated against employees contrary to section 67(a) of the Act when it withheld recognition bonus payments to the striking employees in the years 1991 and 1992. In coming to this conclusion, the Board has not placed any weight on the evidence with respect to the practice at the Oshawa Times. Although the Times is a member of the Thomson group, it is a separate employer operating in a different collective bargaining context. Similarly, the Board found nothing in its decision in The Cambridge Reporter, supra, to assist in the resolution of the issues in this case.
With respect to the evidence of the method of cheque distribution in 1992, the Board notes that while there is nothing wrong and perhaps much to commend Mr. Carnaghan's approach in normal times, both the times and the approach were not normal. Given the acknowledged divisions in the workplace, the approach adopted by Mr. Carnaghan suggests that there may have been more behind the employer's decision than it was prepared to admit. Given our findings on the balance of the evidence, however, we need make no determination on this point.
Finally, we wish to make clear that we neither find, nor suggest, that employers must make incentive bonus payments to striking employees. That was not the issue here. The issue was one of discretion and the way in which that discretion was administered in the circumstances. We have found that while it may have been permissible for the employer to have withheld the bonus payments to the striking employees under the strict terms of the plan, its reasons for doing so were not free of anti-union or prohibited considerations.
Accordingly, the Board hereby directs the responding party to compensate employees forthwith for the amounts they would have received had they not been on strike during the relevant periods, together with interest. The Board will remain seized to resolve any disputes as to compensation.