[1994] OLRB Rep. July 838
2348-93-G; 3808-93-G International Union of Operating Engineers, Local 793, Applicant v. Elirpa Construction and Materials Limited, Responding Party v. Metropolitan Toronto Sewer and Watermain Contractors Association, Interested Party
BEFORE: K. G. O'Neil, Vice-Chair, and Board Members J. A. Ronson and G. McMenemy.
APPEARANCES: In Board File No. 2348-93-G L. Steinberg and R. Kennedy for the applicant; C. E. Humphrey, A. Renton and M. Aprile for the responding party; Richard Charney for the interested party.
DECISION OF K. G. O'NEIL, VICE-CHAIR, AND BOARD MEMBER J. A. RONSON; July 29, 1994
These are referrals of construction industry grievances to arbitration under section 126 of the Labour Relations Act. By decision dated April 27, 1994 [now reported at [1994] OLRB Rep. April 372], the Board decided that the applicant, referred to below as the union or Local 793, had not abandoned its bargaining rights in the road building sector. This decision deals with the second issue underlying these grievances, i.e., the effect of what is known as a "cross-over clause" on an employer who is not a member of the accredited employer organization who has negotiated it.
The April 27, 1994 decision set out at some length the arguments of the parties and the facts in Board File No. 2348-93-G. We will refer to them in more summary form here. That decision also invited submissions from the Toronto Sewer and Watermain Association, (which will be referred to as the Association below). The thrust of the submissions which the Board received from the Association are set out below.
Local 793 obtained bargaining rights for employees of the responding party ("Elirpa")on January 31, 1986 in the industrial, commercial and institutional ("ICI") sector and all other sectors of the construction industry in Board Area No. 8. Elirpa has worked in both the sewers and watermain and roads sectors throughout the relevant time period. No collective agreement had been entered into by the parties in the roads sector at the time of the hearing of these matters. Nonetheless, the union says the employer must pay union rates for roads work because of a crossover clause in a sewers and watermain collective agreement to which the parties are bound. Union counsel says the effect of the cross-over clause is to incorporate the road builders collective agreement by reference into the sewer and watermain agreement.
The parties became bound by the collective agreement between the Metropolitan Toronto Sewer and Watermain Contractors Association and the union ("the sewer and watermain agreement") following a 1989 accreditation order. See Metropolitan Toronto Sewer and Watermain Contractors Association, [1989] OLRB Rep. Dec. 1226. The employer takes the position that the authority given to the accredited association, of which Elirpa is not a member, is only to bargain on behalf of Elirpa within the sector and geographical area for which it was granted accreditation. Thus it resists the application of the cross-over clause to the roads sector.
The cross-over clause in issue, section 15.5 of the sewer and watermain agreement, provides as follows:
15.5 If an Employer covered by this Agreement engages in work other than Sewer and Water-main construction, and such other work comes within the purview of the existing Collective Agreement between the Union and The Metropolitan Toronto Road Builders' Association, the rates of pay and conditions of work of that Agreement shall apply. Similarly, if an Employer covered by this Agreement engages in work generally recognized as heavy construction (overpasses, bridges, etc.), the rates and conditions prevailing in the Collective Agreement between the Union and the Operating Engineers Employer Bargaining Agency shall apply. It is further recognized that on all subway construction for the T.T.C., GO Transit or other public transportation systems, the rates and conditions of the Agreement between the Union and the Operating Engineers Employer Bargaining Agency shall apply.
The accredited association clearly has the right to bargain for Elirpa in the sewer and watermain sector, pursuant to the 1989 accreditation order. The union argues that once the Association has the authority to bargain on behalf of Elirpa, whatever it negotiates binds the company. It cannot pick and choose portions of the collective agreement. The Union also referred to Re. International Association of Heat and Frost Insulators, 1993 CanLII 9383 (NS SC), 103 DLR (4th) 401 (N.S.C.A.). The union's fundamental argument is that the Ontario legislation is framed in broad terms, without any restrictions oil what kind of agreement can be reached, and it would be inconsistent with the scheme of the Act to accept the employer's proposition.
Union counsel argued the wording of section 131 (2) is key as it says the employers are bound as if the agreement was made by them. Union counsel says this prevents the Board from finding that certain terms of the collective agreement do not bind Elirpa. Counsel observes that one of the reasons for the whole scheme is to avoid whipsawing tactics in dealing with employers who are competitors. They all get the same deal, members or not, in counsel's submission. This is the purpose of section 133 which prohibits individual bargaining. If Elirpa does not feel that the Association is representing it properly it can apply under section 134.
Further, counsel says that the cross-over clause makes good labour relations sense because it is very hard in some circumstances to distinguish road building from sewer and water-main work, which are very often done together. Since the union represents people doing both kinds of work, it is sensible to avoid disputes over which it is, which the cross-over clause achieves. As well, argues the union, it makes sense for employers because they do not have to spend the time to distinguish whether it is roads or sewer work and they do not, have to maintain two crews. Counsel referred to Frank Plastina Investments Limited, [1986] OLRB Rep June 720, and CDC Contracting, [1982] OLRB Rep. Nov. 1589, as Board cases which indicate the importance of crossover clauses in the construction industry.
Employer counsel, by contrast, underlines the very specific scope of the bargaining rights given to the Association. The company's position is that whatever the Association may be able to negotiate on behalf of its members, when it comes to those parties who are bound by operation of law, the bargaining unit description sets the limits of their jurisdiction. All the Association got was the right to negotiate for a sector and a geographic area; all the other rights still belong to the individual employer. There is simply no mechanism, says counsel, by which the Association can expand on the limited authority it has.
Employer counsel refers to Beckett Elevator Company Limited, [1982] OLRB Rep. Sept. 1244 to argue that a party can not bargain more authority than the statute gives. The employer refers to section 128(2) which defines the unit of employers as employers within a sector. The whole scheme has to be read subject to the particular geographic area and sector for which the rights are granted in the first place, argues employer counsel. Counsel for Elirpa urges the ICI model; a party may become bound to the provincial agreement in the ICI sector, but not in other sectors.
Ii. Counsel for Elirpa submits that problems are created in coherently applying the scheme if the union is right that unlimited bargaining rights flow with an accreditation order. He turns to section 133 which prohibits individual bargaining, and queries how that fits with unlimited scope for bargaining in the Association. Counsel asks if 133(1) means that the employer is prohibited from negotiating what he pays for road building or TT'C work. Or what about 133(2)? Counsel asks if this means Elirpa cannot work on roads if there is a strike in the sewers and watermains sector.
Employer counsel says that the Association has two roles; one as a statutorily accredited agency, and the other as a consensual association of its members. It bargained this collective agreement in both roles. Employer counsel says that the Association can do whatever it wants on behalf of its own members. However, because accreditation is an extraordinary mechanism which takes away bargaining rights that belong to the employer, but only in a specific sector, it should be very strictly and narrowly construed for non-members. Counsel argues that when operating within the sewers and watermain sector, the Association is acting as accredited employer, but outside that sector, it is not and can only act on behalf of members.
Employer counsel cites Sandercock Construction, [1984] OLRB Rep. April 653 for the proposition that the Association has no right to affect what Elirpa has to pay for road building. In answering the union's criticism that what the company is proposing would lead to separate deals for members and non-members, counsel says the only way to prevent this would be to have accreditation across several sectors.
In reply, counsel for the union says that there is a problem with the clear boundaries theme in the employer's argument. It breaks down completely the moment he says that the Association can do this kind of bargaining for its members. The union says its point is that to the extent that the scheme needs clean lines, the clean lines should be that there are no special provisions for members as opposed to non-members.
Union counsel rejects the employer's characterization of the accreditation scheme as extraordinary, saying it is no more extraordinary than certification. The scope of the unit in both situations is an administrative convenience. Counsel submits there is nothing in the accreditation provisions whatsoever that limits the authority of the Association in the manner suggested by the employer.
Counsel distinguishes Beckett Elevator, cited above, by saying that the Board focused on the words of what is now section 145(a) "but only", which applies to provincial designations in the ICI sector whereas there is no similar limiting language in section 130 applicable to accreditation in other sectors.
Responding to employer counsel's concerns about the coherent application of the scheme, union counsel says that if there is no accreditation in roads, jurisdictional conflict may be caused, but the parties are not thrown into involuntary breach. Section 133(2) does not necessarily mean that the employer cannot do road work during a strike in the sewers and watermain sector because of the operation of 15.5.
The submissions of the Metropolitan Toronto Sewer and Watermain Contractors Association adopted and supported the submissions of the trade union. It was the Association's submission that Elirpa was bound to the collective agreement between the union and the Metropolitan Toronto Road Builders Association by virtue of the cross-over clause set out above. In the Association's submissions, Elirpa is bound to the road building agreement for roads work, and that all work on the projects in dispute pertaining to storm sewers, sanitary sewers, watermains and related appurtenances continues to be covered by the Association's accreditation order and the sewer and watermain collective agreement with the applicant trade union.
In response to the Association's submission, counsel for Elirpa wrote to say that, if binding, the only result of a cross-over clause should be to incorporate by reference the pay and conditions of the road builders agreement into the sewer and watermain agreement, rather than bind the employer as a party to that agreement. Counsel referred to Sandercock Construction, cited above, for that proposition.
The most relevant of the statutory provisions referred to in argument are as follows:
Where a trade union or council of trade unions has been certified or has been granted voluntary recognition as the bargaining agent for a unit of employees of more than one employer in the construction industry or where a trade union or council of trade unions has entered into collective agreements with more than one employer covering a unit of employees in the construction industry, an employers' organization may apply to the Board to be accredited as the bargaining agent for all employers in a particular sector of the industry and in the geographic area described in the said certificates, voluntary recognition documents or collective agreements, as the case may be.
128.-(1) Upon an application for accreditation, the Board shall determine the unit of employers that is appropriate for collective bargaining in a particular geographic area and sector, but the Board need not confine the unit to one geographic area or sector but may, if it considers it advisable, combine areas or sectors or both or parts thereof.
(2) The unit of employers shall comprise all employers as defined in section 119 in the geographic area and sector determined by the Board to be appropriate.
129.-(2) If the Board is satisfied,
(a) that a majority of the employers in clause (1)(a) is represented by the employers' organization; and
(b) that such majority of employers employed a majority of the employees in clause (1)(c),
the Board, subject to subsection (3), shall accredit the employers' organization as the bargaining agent of the employers in the unit of employers and for the other employers for whose employees the trade union or council of trade unions may, after the date of the making of the application, obtain bargaining rights through certification or voluntary recognition in the appropriate geographic area and sector.
130.-(1) Upon accreditation, all rights, duties and obligations under this Act of employers for whom the accredited employers' organization is or becomes the bargaining agent apply with necessary modifications to the accredited employers' organization.
(2) Upon accreditation, any collective agreement in operation between the trade union or council of trade unions and any employer in clause 129 (1) (a) is binding on the parties thereto only for the remainder of the term of operation of the agreement, regardless of any provision therein respecting its renewal.
(3) When any collective agreement mentioned in subsection (2) ceases to operate, the employer shall thereupon be bound by any collective agreement then in existence between the trade union or council of trade unions and the accredited employers' organization or subsequently entered into by the said parties.
131.-(2) A collective agreement between an accredited employers' organization and a trade union or council of trade unions is, subject to and for the purposes of this Act, binding upon the accredited employers' organization and the trade union or council of trade unions, as the case may be, and upon each employer in the unit of employers represented by the accredited employers' organization at the time the agreement was entered into and upon the other employers that may subsequently be bound by the said agreement, as if it was made between each of the employers and the trade union or council of trade unions and, if any such employer ceases to be represented by the accredited employers' organization during the term of operation of the agreement, the employer shall, for the remainder of the term of operation of the agreement, be deemed to be a party to a like agreement with the trade union or council of trade unions.
133.-(1) No trade union or council of trade unions that has bargaining rights for employees of employers represented by an accredited employers' organization and no such employer or person acting on behalf of such employer, trade union or council of trade unions shall, so long as the accredited employers' organization continues to be entitled to represent the employers in a unit of employers, bargain with each other with respect to such employees or enter into a collective agreement designed or intended to be binding upon such employees and if any such agreement is entered into it is void.
(2) No trade union or council of trade unions that has bargaining rights for employees of employers represented by an accredited employers' organization and no such employer or person acting on behalf of the employer, trade union or council of trade unions shall, so long as the accredited employers' organization continues to be entitled to represent the employers in a unit of employers, enter into any agreement or understanding, oral or written, that provides for the supply of employees during a legal strike or lock-out, and if any such agreement or understanding is entered into it is void and no such trade union or council of trade unions or person shall supply such employees to the employer.
(2.1) Subsection (2) does not apply with respect to an agreement permitted under section 73.2 (use of replacement workers).
(3) Subject to sections 73.1 and 73.2, an employer who is represented by an accredited employers' organization may continue or attempt to continue the employer's operations during a strike or lock-out involving employees of employers represented by the accredited employers' organization.
An accredited employers' organization, so long as it continues to be entitled to represent employers in a unit of employers, shall not act in a manner that is arbitrary, discriminatory or in bad faith in the representation of any of the employers in the unit, whether members of the accredited employers' organization or not.
Where an employer bargaining agency has been designated under section 141 or accredited under section 143 to represent a provincial unit of employers,
(a) all rights, duties and obligations under this Act of employers for which it bargains shall vest in the employer bargaining agency, but only for the purpose of conducting bargaining and concluding a provincial agreement.
[emphasis added]
As the able arguments of counsel demonstrate, the statute lends some support to both sides of the question before us. Having weighed the submissions carefully, the Board is of the view that the employer's interpretation of the statutory provisions is the preferable one. We have considered the accreditation scheme as a whole and its place within the construction industry provisions of the Act. It is clear that the legislature intended accreditation orders to be attached to a sector and geographical area, in the interest of more orderly collective bargaining where statutory conditions are met. It is analogous, but not identical, to the scheme in the ICI sector which forms the basis for provincial bargaining in that sector. In considering that scheme, the Board has consistently held that the sectoral lines drawn in the statute govern, unless bargaining rights outside those sectoral lines have been assigned or given by some other means. The Board has made this point in a number of fact situations. See Beckett Elevator, cited above, where the Board found the bargaining rights which flow from the statute did not bring with them, to non-members, the consensual internal grievance process of members. In London Sand-blasting & Painting Limited, [1982] OLRB Rep. Sept. 1322, where the Board found that an employer was a member of an organization bargaining consensually beyond the statute's sectoral designation, it was bound. Where an employer had not become a member or otherwise assigned its bargaining rights to an association, as in Fred Jantz Masonry Construction Company Limited, [1981] OLRB Rep. Sept. 1229, it was only bound to the extent of the statute's compulsion.
We have carefully considered whether the difference in statutory language between the ICI scheme and the accreditation sections applicable to other sectors warrants a different approach. It is true that section 145(a), applicable to the ICI scheme, is clearer in its limiting effect because of the inclusion of the words "but only" which do not appear in the accreditation sections. Nonetheless, sections 127 to 134 read as a whole make it clear that the imposition of rights by law was intended to relate to the sector and geographic area set out in the accreditation order. The wording of section 131(2) which makes the collective agreement entered into by the Association binding upon the employer as if it had entered into it itself is also qualified by the wording "subject to and for the purposes of this Act". We are persuaded that the purpose of the Act in the accreditation sections was to impose a scheme based on sectoral bargaining, and that it did not contemplate the imposition by operation of law of rights beyond the sectors set out. The practical implication is that, as a non-member, Elirpa is not bound by the agreement made by the Association for other than the geographic area and sector for which it was accredited. Accordingly, it is our finding that Article 15.5 of the sewer and watermain collective agreement is not applicable to Elirpa in the road building sector.
The parties are directed to advise the Board whether there remain any matters needing determination. If so, they will be listed for hearing.
DECISION OF BOARD MEMBER G. MCMENEMY; July 29, 1994
I respectfully dissent from the majority decision.
As illustrated in paragraph 21 of the majority decision, the statute lends some support to both sides of the question, and I favour the case put forth by the applicant as the side with the stronger set of facts.
The question to be answered concerning Article 15.5 (the cross over clause) is not a question of the union obtaining bargaining rights or a collective agreement in another sector, it is a question of making this part of the construction industry compete on a level playing field.
The applicant makes no claim that Article 15.5 gives them bargaining rights (or a collective agreement) for the road sector, their claim is that Article 15.5 dictates what Elirpa or any other contractor will pay their employees when they do road work in Board Area 8.
The submissions received from the Sewer & Watermain Contractors Association states that Article 15.5 binds Elirpa to the Road Builders Agreement, which I, supported by a letter from counsel for the responding party (dated May 12, 1994), do not agree with. As stated earlier, this is not a question of bargaining rights and collective agreements, it is a question of labour relations stability.
The letter from counsel for the responding party dated May 12, 1994 goes on to state that the effect of Article 15.5 is that if it applies to a party it does not bind a party to an agreement (Road Builders Agreement in this case), but rather to require it to pay wage rates and apply this condition of the referred to agreement pursuant to its obligations under the watermain agreement. That alternative argument put forth by the responding party is the correct argument in this case, in my opinion.
To illustrate this argument, counsel directs the Board to the case of Sandercock Construction 1976 Limited, (1984) O.L.R.B. Rep. April 653 paragraph 9 and 10 for support of this position.
As stated earlier, this case is a case dealing with labour relations stability in a very competitive sector of the construction industry, and not the acquiring of bargaining rights and binding a party to a collective agreement. As such, I would have found Elirpa to be bound to the cross over clause (Article 15.5) of the collective agreement, in respect of rates of pay and conditions of work, when performing work in the road building industry.