[1993] OLRB Rep. November 1125
0874-93-M; 3583-92-R; 3584-92-R London and District Service Workers' Union, Local 220, Applicant v. Charterways Transportation Limited (at Kitchener, Ontario), Responding Party; National Automobile, Aerospace and Agricultural Implement Workers Union of Canada (CAW-Canada) and its Local 222, Applicant v. Charterways Transportation Ltd. (Ajax) and the Corporation of the Town of Ajax, Responding Parties
BEFORE: Robert Herman, Vice-Chair, and Board Members R. W. Pirrie and J. Redshaw.
APPEARANCES: L. N. Gottheil, Gord Vickers, Simon Threlkeld and Susan Collins for CAW Local 222; L. Steinberg, B. Quistgaard and Paul Middleton for London and District Service Workers' Union, Local 220; Thomas A. Stefanik, Bill Heslop and Don Dewar for Charterways Transportation Limited; Richard J. Charney, Rick Parisotto and Terry Barnett for The Corporation of the Town of Ajax;
DECISION OF THE BOARD; November 9, 1993
Background
- Board File No. 0874-93-M is a referral to the Board by the Minister pursuant to section
109 of the Labour Relations Act. The applicant union, London and District Service Workers' Union, Local 220 had requested the appointment of a conciliation officer with respect to its negotiations with the employer, Charterways Transportation Ltd. On March 4, 1993 the Minister appointed a conciliation officer to confer with the parties and endeavour to effect a collective agreement. On April 15, 1993, Charterways raised an objection to the Minister's authority to appoint a conciliation officer, asserting that its business was a federal undertaking and therefore not subject to the jurisdiction of the Labour Relations Act. The Minister thereupon referred the following question to the Board for its advice:
Do the labour relations between the parties fall within federal or provincial jurisdiction?
Around the same time, CAW-Canada and its Local 222 filed applications before the Board pursuant to sections 1(4) and 64 of the Labour Relations Act (Board File Nos. 3583-92-R and 3584-92-R), naming as responding parties both Charterways and The Corporation of the Town of Ajax. In those proceedings, Charterways raised a constitutional objection to the jurisdiction of this Board, similar in nature to the objection it raised with the Minister, referred to above. The parties in those proceedings subsequently agreed to place the constitutional issue before the instant panel, and to be bound by the decision reached by this panel in that respect. For this reason, although the constitutional question initially came before this panel by way of Reference from the Minister, the style of cause reflects all three proceedings.
Charterways is a company which carries on business in Ontario in two major areas:
first, it provides various bus services to towns or communities, or to customers within those towns or communities, and second, it provides freight, warehousing and cartage operations. It is only the bus services which are in question in the instant proceeding. The bus services include school bus operations, which are provided for various Boards of Education, a few municipal transit operations provided for towns or municipalities, and charter bus services provided on request on an "as needed" basis. The bus services are provided at twenty-three branches, each based in a different town or municipality in the province.
A number of different bargaining agents represent bargaining units at different branches. Not all branches have unions. The different branches have not before now conducted their labour relations under a common jurisdiction. Some branches have been treated as under federal jurisdiction and some as under provincial. Recently, Charterways concluded that this patchwork approach was inefficient and unduly expensive. Charterways was of the view that its bus services, including extra-provincial charters, were a single undertaking, and because of the extra-provincial charters, was constitutionally federal in nature. It therefore concluded that all branches properly fell under federal jurisdiction, and it asked the bargaining agents of bargaining units that had historically conducted matters under provincial jurisdiction to agree henceforth to be covered by federal labour legislation. Both the London and District Service Workers and the CAW refused.
Both unions argue that their branches constitute separate and distinct undertakings, in the constitutional sense, and fall under provincial jurisdiction. Additionally, the CAW argues that the Ajax Transit operation itself ought to be considered a separate undertaking, even if the entire Ajax Charterways operation is not. If the individual branch at Ajax or Kitchener is a separate undertaking (or if Ajax Transit is a separate undertaking), then the nature of the activities of the branch (or of Ajax Transit) are not such as to oust provincial jurisdiction. The unions assert that the extra-provincial bus activity emanating from these two locations is minimal and irregular at best.
The Facts
As noted, there are approximately twenty-three branches of Charterways in different communities or towns across Ontario. All branches are administered and coordinated from Charterways' headquarters in London, Ontario, by its "Bus Division", which is responsible for all of Charterways' school bus, transit and charter operations.
Each branch offers school bus services to the local Boards of Education. Charterways sells to Boards a package under which it provides vehicles and drivers to perform the "to and fro" regular daily school bus activities.
Currently, only two of the branches, Orangeville and Cobourg, provide on contract the local transit service for the town. Until late 1992 or early 1993, transit service was also contracted for and provided by Charterways in Ajax. The Ajax Transit service contract was not renewed by the Town of Ajax, and the Town itself took over the service.
Charterways branches all offer charter services, intra or interprovincial in nature, on an "on request" basis. Not surprisingly, there are large number of requests for charters at some locations (the larger Metropolitan areas) and fewer requests in smaller communities. Similarly, requests for cross-border or extra-provincial charters are significantly greater in border communities such as Windsor, Sarnia, St. Catharines, or Ottawa, and substantially fewer in communities not located near the provincial border. In the 1991-92 and 1992-93 fiscal years, there were in total approximately seven extra-provincial charters requested and conducted from Kitchener, and two from Ajax. Charter revenue represents approximately ten per cent of the total revenue of Charter-ways in Ontario, and extra-provincial charter revenue represents approximately one per cent of the total. In the two prior years, fifteen out of twenty-three branches conducted at least some extra-provincial charters.
Each branch is run locally by a manager (the titles of this position vary), but the head office in London sets all major policies and makes almost all major decisions. Contracts with Boards of Education for school bus services and transit contracts with municipalities are negotiated and approved by headquarters. Each branch has its own budget, covering all types of bus services provided, but this budget is set for each branch by head office. Employees at all branches are paid through a centralized payroll service. The local branch issues invoices and bills local customers, and collects on those invoices. Each branch has a bank account for the receipt of such funds, but at the end of each business day all funds are transferred automatically to headquarters. For purposes of expenditure~ all capital expenditures of any note have to be approved and authorized by head office. Local managers have credit cards for the purchase of certain things, such as fuel, parts and so on. However, credit card statements are forwarded to head office for payment by head office.
With respect to labour relations matters, except for day-to-day decisions, policies are coordinated on a province-wide basis by head office. All negotiations for collective agreements are supervised by and conducted by head office, even though the agreements encompass only single branches or parts thereof. While local managers participate in negotiations for their branch, final decisions are made by headquarters. The local manager is responsible for hiring bargaining unit employees, and for day-to-day disciplinary matters. However, before discharging any employee, headquarters must approve. Headquarters personnel take over grievances from the third stage of the grievance procedure on, including the decision as to whether the matter goes to arbitration. Driver training and safety procedures are coordinated and run by headquarters.
Day-to-day operations of each branch are largely conducted on an autonomous basis, subject to the matters noted above. Each branch is run by a local manager. Each branch has a contract to provide local school bus services. Each branch is equipped to provide charter services, both within the province and crossing the border, as each branch has drivers and vehicles licensed to operate beyond the boundaries of the province. School bus and transit service decisions involving schedules, routes, the day-to-day working schedules of employees, and so on, are all made at the local level. Customers for charter trips or bus rentals will phone the local branch of Charterways and arrange to rent a Charter.
There is limited interaction between branches. There is some transfer or exchange of school buses between branches, though none of transit buses (different types of vehicles are generally used by Charterways to provide these two kinds of bus services). There is some regular transfer or movement of local managers between branches. There is limited exchange of parts between branches.
Focusing on the Ajax municipal transit operation, Charterways provided the buses and drivers. The transit operation was run out of a city-owned transit facility. Transit buses were only used for transit purposes, and not for school bus activities in Ajax. The Charterways' transit drivers wore Town of Ajax uniforms, and drove (Charterways) buses that were identified as Town of Ajax municipal transit buses in conformity with schedules, routes, and fares set by the Town of Ajax. Most of the transit drivers were full time transit drivers. Approximately ten per cent of the school bus drivers (who were part-time employees) also drove for the transit operations, usually on Saturdays or to replace full-time transit drivers on sick or vacation leave.
In Ajax, school buses were used for charters, and were driven by school bus drivers. As noted, cross-border charters emanating from Ajax were limited, consisting of only two in the last two years.
Turning to Kitchener, there was no transit operation run by Charterways in Kitchener. The predominant activity was the provision of school bus services to the local Boards of Education. There was some charter activity, including four to seven cross-border charters in the last two years. As with Ajax, school buses were used for these charters, and the school bus drivers drove the charters.
Decision
Local 220 and CAW and its Local 222 argue that the bargaining units which they respectively represent fall under provincial labour law jurisdiction. They assert that each branch is a separate undertaking, within the constitutional sense, and that the activities of the particular branch are not of such a nature as to oust the presumptive provincial jurisdiction. Neither union argued that the charter services provided by Charterways constituted a distinct undertaking, separate from the transit and/or school bus activities. It was therefore not argued that the different services provided constituted different undertakings. Rather, it was submitted that each of the Kitchener branch and the Ajax branch, (or Ajax Transit operation) constituted separate and distinct undertakings.
The parties agree that the cross-border charter activity engaged in by Charterways across the province is of a regular and continuous nature. In effect, the unions acknowledged that Charterways would fall under federal labour relations jurisdiction if the Board concludes that the undertaking in question is all of the bus services of Charterways in Ontario, across all branches. In turn, Charterways agrees, if the Board reaches the opposite conclusion and concludes that each branch constitutes a separate undertaking for constitutional purposes, that the two branches would at the present time each fall within provincial jurisdiction.
The appropriate legal approach is not in dispute. In Central Western Railway Corporation v. United Transportation Union et al, (1990) 1990 CanLII 30 (SCC), 76 D.L.R. (4th) 1 (S.C.C.), the Court wrote as follows, at page 8 therein:
"There are two ways in which Central Western may be found to fall within federal jurisdiction and thus be subject to the Canada Labour Code. First, it may be seen as an interprovincial railway and therefore come under s.92(1O)(a) as a federal work or undertaking. Second, if the appellant can be properly viewed as integral to an existing federal work or undertaking it would be subject to federal jurisdiction under s.92(1O)(a). For clarity, I should point out that these two approaches, though not unrelated, are distinct from one another. For the former, the emphasis must be on determining whether the railway is itself an interprovincial work or undertaking. Under the latter, however, jurisdiction is dependent upon a finding that regulation of the subject-matter in question is integral to a core federal work or undertaking."
As the Court noted, though related, these two approaches are distinct. Here, the initial question we must answer involves determining the nature of the undertaking. Once the undertaking has been defined, we can consider whether it is itself a federal work or undertaking (the first approach), or if not, whether it is integral to another federal work or undertaking (the second approach). If the undertaking is found to be province wide, beyond the individual branch, the parties effectively agree that the company falls under federal jurisdiction. We only arrive at the second question if we determine that the undertaking or work is the operation of a single branch (or the Ajax Transit system). In that event, the parties effectively agree that the branch is under provincial jurisdiction.
We were referred to a number of cases by the parties. Many of the cases are of little assistance however, in addressing our initial question, which is to determine the nature of the business, as those cases consider the second question or approach, whether some matter that is not itself federal in nature is so intricately related to a core federal work or undertaking that it is infused with the federal regulatory power.
Is each branch a separate undertaking? It is true that the branches run day-to-day operations on a relatively autonomous fashion, and that at this operational level, there is relatively little, if any, meaningful interaction between the branches, or between the individual branch and headquarters in London. Nevertheless, we cannot conclude that each branch, more specifically Kitchener and Ajax, constitute separate federal works or undertakings, within the constitutional sense.
All the branches, including the two in question, are engaged in the same basic undertaking, which is to provide a variety of bus services to local customers. In essence, each branch is simply the local geographical terminal at which this same bundle of services is provided or is available upon request. Each branch is the local depot at which the same bus services are offered to the local customer base.
This bundle of services is coordinated and run by Charterways on a province-wide basis. Charterways headquarters negotiates and signs the contracts under which all the services are provided. It negotiates the individual collective agreements with the various bargaining units. It coordinates and exercises decision-making with respect to discharges of employees and it makes the decisions on whether labour relations grievances go to arbitration. Budgets for each branch are set by headquarters. All funds are transferred at end of each business day to headquarters. Headquarters pays the bills, including the credit card invoices. Headquarters performs all these functions centrally for all branches.
A branch could not survive and operate without the continued supervisory and directory role played by headquarters. This is true both for each branch, and for the Ajax Transit system. Functionally speaking, the Ajax Transit operation represents a contract Charterways has at the time, performed by its Ajax branch. That branch continues without that contract. It is still part of the province-wide string of local offices of Charterways.
Again, many of the cases placed before us are of little assistance. Local 220 relies upon Val Nord Bus Lines Limited et al, (1990) 14 C.L.R.B.R (2d) 132. However, that case arises in a context in which there was a core federal undertaking, and the issue was whether another undertaking was integrally related to the core federal undertaking. Here, we have concluded that the federal undertaking consists of Charterways bus operations across the province, and not only in one branch. For Val Nord to be on point, we would have had to conclude that a branch is itself a separate undertaking.
The CAW relies upon the "Empress Hotel" decision (C.P.R. v. A.-G. B.C., 1949 CanLII 278 (UK JCPC), [1950] 1 D.L.R. 721 (J.C.P.C.) In that case, the Court decided that a hotel operated by a railway was a separate undertaking from the federal core undertaking, the railway system. As such, the Empress Hotel fell under provincial labour regulation. If it was asserted before us that the charter operations were a severable and distinct undertaking from the other bus services offered across the province by Charterways, then this decision would be more on point. That decision considers whether a separate service or operation, or undertaking for constitutional purposes (the hotel operation by the railroad) was integrally related to the federal railway undertaking. Here, the argument is that all services issued at the local geographical depot, including the charter services, constitute a separate undertaking.
To the extent the courts have charged adjudicative bodies to take a functional and practical view in determining the nature of the core undertaking we note that the effect of acceding to the unions' argument that each of the twenty-three branches constitutes a separate undertaking would lead to impractical results. Since the extra-provincial activity at any particular branch would fluctuate, depending on the frequency of extra-provincial charters at any point in time, and since regular and continuous extra-provincial charters would cause an undertaking to fall under federal jurisdiction, branches could flip flop between federal and provincial jurisdictions, depending on the extent of the extra-provincial charter activity at any point in time. Any time the level and frequency of this activity meaningfully changed~ a party could again raise the constitutional issue. The branch could be federal one month, provincial the next. Charters are operated on an "on request" basis, and one can reasonably expect their volume and timing to fluctuate significantly.
Accordingly, it is our view that the core undertaking here is the bus services offered by Charterways across the province, and provided through the local branches. We do not find that each branch constitutes a separate undertaking, within the constitutional sense. It follows that the alternative position of the CAW, that the Ajax Transit operation constitutes a separate undertaking, cannot prevail.
As noted, the parties effectively agree that this finding is dispositive of the issue before us, and that Charterways would therefore fall under federal jurisdiction. In the result, our response to the Minister's question is that, in our view, the labour relations between the parties fall within federal jurisdiction.