International Union of Operating Engineers, Local 793 v. Associated Contracting Inc., 1994 CanLII 9854

Ontario Labour Relations Board

[1994] OLRB Rep. August 951

2873-92-G International Union of Operating Engineers, Local 793, Applicant v. Associated Contracting Inc., Responding Party

BEFORE: D. L. Gee, Vice-Chair, and Board Members F. B. Reaume and G. McMenemy.

APPEARANCES: S.B.D. Wahl and M. Gallagher for the applicant; W. Thornton and T. Capobianco for the responding party.

DECISION OF THE BOARD; August 5, 1994

1. This is a referral of a grievance to the Board pursuant to section 126 of the Labour Relations Act (the "Act"). The grievance alleges a number of violations of a collective agreement between the responding party (also referred to as the "Employer" or "Contracting") and the applicant (also referred to as the "Union" or "Local 793"). Prior to the hearing the Employer raised a preliminary issue as to the arbitrability of the grievance on the basis that Local 793 had abandoned its collective agreement/bargaining rights. Hearings into this preliminary issue were held on March 9, 10 and 11 and June 6 and 7, 1994.

2. Contracting agreed to voluntarily recognize Local 793 by entering into a collective agreement on August 30, 1990. Contracting applied the collective agreement until on or about September 1, 1991 at which time it returned to operating as a non-union contractor. The present grievance was filed on November 12, 1992.

Issue

3. The issue for determination is whether, during the period from September 1, 1991 to November 12, 1992, Local 793 abandoned its bargaining rights.

4. It is Contracting's position that, given the events which transpired before the parties entered into a collective agreement and those that occurred within the following year, it is reasonable to infer an intention on Local 793's part to abandon its bargaining rights. Contracting submits that Local 793 was aware that Contracting had ceased to apply the collective agreement in September, 1991 and took no steps, until the filing of the instant grievance, to assert its bargaining rights. Contracting argues that Local 793's conduct from September, 1991 to November, 1992 is entirely consistent with an intention to abandon its bargaining rights and inconsistent with a belief on its part that it retained such rights.

5. It is Local 793's position that it has not abandoned its bargaining rights. Local 793 asserts that it was unaware that Contracting was operating within the geographic scope of its collective agreement from September, 1991 to mid-October, 1992 and was thus unaware that its agreement was not being applied. Local 793 submits that it has acted throughout in a manner designed to pursue and protect its bargaining rights and disputes Contracting's characterization of the evidence to the contrary.

Law

6. Whether or not a union has abandoned its bargaining rights is a question of fact to be resolved by the Board in the circumstances of each case (see R. Reusse Co. Ltd., [1988] OLRB Rep. May 523). The factors considered by the Board in making a determination are summarized in J. S. Mechanical, [1979] OLRB Rep. Feb. 110 at page 111 as follows:

5. In assessing the bargaining relationship between the union and the employer to determine whether or not a union has abandoned its bargaining rights, the Board considers various factors. Among other possible indicators, the Board looks to the length of the union's inactivity, whether it has made attempts to negotiate or renew a collective agreement, whether the union has sought to administer the collective agreement, whether terms and conditions of employment have been changed by the employer without objection from the union as well as whether there are any extenuating circumstances to explain an apparent failure to assert bargaining rights.

7. In the context of the construction industry the Board has accepted that a union is not expected to actively pursue its bargaining rights where there is an absence of employees who would be covered by the collective agreement (see Dravo of Canada Limited, [1977] OLRB Rep. Sept. 568 at page 572).

Findings of Fact

8. Discrepancies exist between the evidence given by Tony Capobianco, the witness called on behalf of Contracting, and the evidence given by Mike Gallagher and Vito Montagnese, the witnesses called on behalf of the Union. These discrepancies primarily relate to the contents of various conversations. The Board has considered the credibility of the witnesses according to the usual criteria, including their ability to resist the tug of self-interest in giving their testimony, their demeanour and what is reasonably probable in the circumstances. In many instances, the Board accepts the evidence of Capobianco over the evidence of Gallagher. Gallagher gave evidence in a number of respects which favoured the Union's theory of this case and which were proven through cross-examination to be inaccurate. It was apparent that Gallagher's testimony was influenced by the tug of self-interest. Where a conflict exists between the evidence of Capobianco and Montagnese, the Board has resolved the discrepancy on the basis of what is most probable in the circumstances. In a few instances the Board has rejected uncontradicted evidence of Capobianco and Gallagher. It has done so on the basis that the evidence, though uncontradicted, is nevertheless inherently improbable in the circumstances and not sufficiently credible.

9. There is little dispute with respect to the events which occurred prior to and following the filing of this grievance. The primary dispute between the parties relates, not so much to the "facts" of the case, but rather what inferences the Board should draw from the facts.

10. Tony Capobianco's father, Anthony Capobianco, operates a road building company by the name of Associated Paving Company Ltd. ("Paving"). In 1988 four additional, separate companies, each owned by one of Anthony Capobianco's children, were incorporated: Rosalucia Landscaping Inc. ("Landscaping"), owned by Rosalucia Capobianco, to engage in landscaping and snowplowing; Contracting, owned by Tony Capobianco, to engage in concrete works; The Core Group Inc. ("Core Group"), owned by Stanley Capobianco, to engage in excavation works; and Capo Contracting Inc. ("Capo"), owned by Leo Capobianco, to engage in asphalt paving works. A fifth, pre-existing company, Capobianco Management Ltd. (the "management company"), owned by Maria Capobianco, operated as a management company for the Capobianco family companies.

11. In 1988 an oral subcontracting agreement was entered into amongst Paving, Landscaping, Contracting, Core Group and Capo (the "subcontracting companies"). Pursuant to this agreement Paving bid on work, obtained contracts and was responsible for all required bonding. Once obtained, work would be subcontracted to the appropriate subcontracting company. Paving would retain a percentage of the contract price as its profit. The subcontracting arrangement made it possible for the subcontracting companies to utilize Paving's long standing reputation in the road building business. The management company would provide bookkeeping and payroll services to Paving and the subcontracting companies and receive a percentage of each contract for doing so. At this time none of the Capobianco family companies had collective bargaining relations with any trade union. From the time it began operations until it entered into contractual relations with Local 793, Contracting obtained all of its work from Paving.

12. In 1990 Contracting was engaged on a job for Fermar Paving ("Fermar"). Fermar was bound to a collective agreement with Local 183 of the Labourers International Union of North America (the "Labourers" or "Local 183"). As is typical in the construction industry, Fermar's agreement with Local 183 required Fermar to subcontract work only to companies also in contractual relations with Local 183. Local 183 approached Fermar and insisted that Contracting be removed from the job. Tony Capobianco approached Local 183 and enquired about signing a voluntary recognition agreement. Local 183 indicated that it would only enter into a voluntary recognition agreement if all of the Capobianco family companies were willing to sign. The remaining Capobianco family companies were not interested in executing a voluntary recognition agreement with Local 183 and accordingly Contracting was required to leave the Fermar job site.

13. Following the removal of Contracting from the Fermar job site, Contracting commenced work on a project at Eglinton and Plaza View (the "Kaneff Project") for Kaneff Properties Limited ("Kaneff"). The contract for this job was initially between Paving and Kaneff; however, at some point prior to August 31, 1990, this contract was ripped up and replaced with a contract between Contracting and Kaneff. Kaneff is bound to a collective agreement with Local 793 which contains the typical subcontracting clause. Local 793 approached Kaneff and indicated that there was a problem because there was a non-union contractor on the job site. Kaneffs Project Manager brought the problem to the attention of Tony Capobianco, who indicated that Contracting would be prepared to sign a collective agreement with Local 793. A meeting was set up between the Kaneff representative, representatives of Local 793 and Capobianco.

14. The meeting took place at Kaneff's offices on August 31, 1990. Mike Gallagher and Vito Montagnese attended the meeting on behalf of Local 793. A representative of Kaneff attended the first portion of the meeting. Tony Capobianco attended the meeting on behalf of Contracting. Local 793 was surprised that Tony Capobianco represented Contracting at the meeting. All of the equipment on the site (the only visible sign indicating the identity of the contractor) bore the "Associated Paving" name. Thus, Local 793 was under the impression that it was Paving doing the work. The contract between Kaneff and Contracting was produced to reassure Local 793 that Contracting in fact held the contract with Kaneff. Local 793 was not informed that the contract had initially been held by Paving.

15. Gallagher and Montagnese were informed by Capobianco that Contracting was the general contractor on the project and had subcontracted work to Paving. Capobianco indicated that Contracting was a general road building contractor. Contracting did not have equipment to do asphalt work but had equipment to do site preparation work connected to road building construction and concrete work, specifically curbs and sidewalks. Gallagher was left with the impression that Capobianco was attempting to set up a company separate from his father's, he was hoping to get work on union job sites and he wanted to do things differently than his father.

16. Approximately an hour and a half was spent going over the contents of the Independent Roadbuilders Collective Agreement. The subcontracting clause was pointed out to Capobianco and it was explained to him that this clause meant that Contracting could not subcontract work to Paving in the future. Capobianco enquired as to how he was to finish the Kaneff job as he had Paving's equipment working on site. Montagnese indicated that, because Contracting was going to be signing a voluntary recognition agreement and would be operating union in the future, Contracting would be permitted to finish the Kaneff job using Paving; however, in the future, all subcontractors must be in contractual relations with Local 793. At the end of this meeting Tony Capobianco signed a collective agreement with Local 793 on behalf of Contracting.

17. Following the meeting Gallagher made arrangements to sign up some of the operating engineers on the job site, following which they began working for Contracting but continued to operate equipment that bore the name "Associated Paving". One of the operators signed up by Gallagher was the curb machine operator by the name of Tom Rennick.

18. Capobianco then advised the Labourers that Contracting had entered into a collective agreement with Local 793. The Labourers agreed to sign a voluntary recognition agreement with Contracting.

19. Following the signing of collective agreements with the Labourers and Local 793, Contracting implemented a number of changes. Although Contracting continued to do work under the subcontracting arrangement it had with Paving, it also obtained work on its own. In addition, due to the deductions required under the collective agreements, a separate system was set up to handle Contracting's payroll. Prior to entering into the collective agreements Contracting's employees received cheques with the name "Capobianco Management Ltd." on them; after entering into the collective agreements, employees received cheques with the name "Associated Contracting Inc." on them.

20. Contracting applied the collective agreements for the balance of the 1990 road building season. Contracting did not operate from December, 1990 to approximately April, 1991. Contracting applied the collective agreements during the 1991 road building season until the end of August. Contracting employed approximately three or four equipment operators during this period of time.

21. In December, 1990, the Labourers filed a related employer application naming all of the Capobianco family companies as responding parties. Hearings were held from December, 1990 to August, 1991. The hearings were brought to an end when it was agreed that the Labourers would rip up its collective agreement with Contracting and Contracting would revert to being non-union. The Labourers agreed to this resolution because it had become apparent that it could not win the related employer application and having bargaining rights with respect to only one of the Capobianco family companies was unworkable. Local 793 was interested in the outcome of the Labourers' related employer application. Gallagher informed himself as to how the case was resolved.

22. Following resolution of the Labourers' related employer application, Contracting immediately stopped applying the Local 793 collective agreement. No further remittances or dues deductions were made. All of Contracting's employees were returned to the Capobianco Management Ltd. payroll such that their cheques henceforth bore the name "Capobianco Management Ltd." and not "Associated Contracting Inc.". One of the operating engineers, Tom Rennick, worked for a few days following Contracting's reversion to non-union status and then quit. Union dues were not deducted from Rennick's final pay cheque, he was not paid the hourly wage rate stipulated in the agreement and this cheque bore the name "Capobianco Management Ltd.".

23. Rennick subsequently contacted Gallagher to complain about his wage rate and overtime pay while employed by Contracting. Rennick met with Gallagher on September 13, 1991 and showed Gallagher his final pay cheque with stub attached. Gallagher made a copy of the cheque and stub. Gallagher noticed that Rennick had not received the proper hourly wage for his last week of work and union dues had not been deducted. Gallagher noticed the company's name on the cheque but did not attach any significance to it. Rennick advised Gallagher he had quit because he was tired of being "jerked around" with respect to his wage rate. Gallagher did not question Rennick's decision to quit as he was aware Rennick was moving to Ottawa. Rennick did not advise Gallagher that Contracting was operating non-union.

24. On October 9, 1991 Gallagher completed a grievance form on Rennick's behalf. Gallagher then contacted Capobianco to set up a meeting at the Union's offices to discuss the matter. Rennick's hours for every pay period, beginning with the pay period ending May 4 through to the pay period beginning August 17, were reviewed and a settlement figure was arrived at. Rennick's last two and possibly three pay periods are not covered by the settlement.

25. Following agreement on a settlement figure, Gallagher indicated that he would have to obtain Rennick's approval. Rennick's approval was obtained. Gallagher contacted Capobianco to make arrangements to get the settlement cheque. Gallagher and Capobianco met and Gallagher was given a cheque. The cheque bore the name "Associated Contracting Inc.". Gallagher noticed the different name on the cheque but, once again, did not attach any significance to it. Gallagher mailed the cheque to Rennick. Shortly thereafter Gallagher received a call from Rennick who indicated that the cheque had not been signed. The cheque was returned to Gallagher who set up a further meeting with Capobianco to have the cheque signed. Gallagher and Capobianco met again and Capobianco signed the cheque.

26. At no time during the course of any of the conversations which took place in connection with the Rennick grievance did Capobianco indicate that he was working non-union or did Gallagher state that Local 793's agreement remained in effect. During one of these meetings Capobianco indicated that work was slow.

27. On November 7, 1991 the Delinquency Control Officer of Local 793 sent Contracting a letter indicating that contributions for union dues and other benefits for the work month of September, 1991 had not been received ("the delinquency notice"). The letter further states "if you had no employees during this period, you are required to file a 'Nil' report...". This letter was automatically generated by the Delinquency Control Officer when remittances were not received from Contracting. Gallagher did not see this letter until the fall of 1992.

28. On November 15, 1991 Capobianco wrote to the Delinquency Control Officer as follows:

"We would like to confirm that there will be no Remittance for the month of September, October and November as there are no employees."

Capobianco did not contact Gallagher or anyone from the Union to enquire as to why he had received the delinquency notice when he was no longer applying the collective agreement. Capobianco testified that he did not make enquiries as he was "sensitive" about the situation.

29. Gallagher did not see or become aware of Capobianco's letter of November 5, 1991 until the fall of 1992. Gallagher was aware that Contracting was delinquent in October, 1991 as its name was on a delinquency list he receives each month. Contracting's name did not appear on the delinquency list for December, 1991 and January, 1992.

30. On February 6, 1992, the labour relations department of Local 793 sent Contracting a letter expressing its desire to amend the existing collective agreement ("notice to bargain"). Gallagher had no personal involvement in this letter being sent out. It was automatically generated by the Union's computer and sent as part of a general mailing.

31. After receiving the notice to bargain Capobianco telephoned Gallagher. Capobianco told Gallagher that he had received the letter and wanted to get together to discuss it. Gallagher indicated that he was going on vacation and would contact Capobianco when he returned. Capobianco testified that he did not indicate to Gallagher that Contracting was non-union because he was "sensitive" about it.

32. On August 12, 1992, Local 793 sent a letter to all of the Metropolitan Toronto Independent Roadbuilders advising them of the major changes to the MTRBA collective agreement and instructing them to implement the changes immediately. The letter indicates that a representative of Local 793 would contact them shortly "in regards to the signing of a new Collective Agreement". This letter was mailed to Contracting. Contracting did not receive the letter.

33. During the 1992 road building season all of Contracting's large projects were outside of Board Area 8. Contracting performed a number of small jobs within Board Area 8 for the City of Mississauga, the City of Etobicoke and private commercial malls, factories and shopping malls. In all cases the tender for the work was put in by Paving, the contract was awarded to Paving, all equipment on the site bore the name "Associated Paving" or no name at all, any signs on the job site said "Associated Paving", and any notices published in the Daily Commercial News indicated that Paving was awarded the contract. Capobianco did not see anyone from Local 793 on any of these job sites until October, 1992.

34. In May, 1992 Contracting and Paving returned to the Kaneff Project (the same site that Contracting was working on when it signed the voluntary recognition agreement with Local 793 in August, 1990) to finish the job. A Kaneff representative was approached by Local 793 concerning the fact that work was being done on the site non-union. Kaneff requested that Capobianco straighten the matter out. Capobianco contacted Montagnese and explained to him that there was only a few days of work left. The vast majority of the work being performed was asphalt work. Montagnese advised him that he would allow the work to be finished but no other work was to be done.

35. Montagnese agreed to let Paving finish the job because, when the collective agreement was first entered into, he had agreed that Contracting could complete the job using Paving.

36. In October, 1992, Contracting was working on a job site in Board Area 26 doing concrete work for Memme Construction ("Memme"). Gallagher was told by a representative of Memme and an inspector on site that the subcontractor on site was Paving. On the two occasions Gallagher visited the job site no one was working but he could see signs of road work being done. Gallagher and Montagnese were shown a contract by Memme naming Paving as the subcontractor. After seeing this contract Memme was advised that Local 793 did not have an agreement with Paving and that Memme was therefore in violation of the subcontracting clause in its agreement. Memme was asked to move Paving off the project. Capobianco was advised by the site superintendent that he would have to leave the job site because of a grievance filed by Local 793.

37. In mid-October, 1992, Gallagher witnessed Contracting working on two separate road repair contracts for the City of Mississauga. Gallagher recognized these two projects as being performed by Contracting because Gallagher saw Capobianco and one of the operating engineers he had signed up in August, 1990 working on the site. Gallagher noticed that work was being performed by an operating engineer who was not a member of Local 793.

38. On October 30, 1992 Local 793 filed a Request for the Appointment of a Conciliation Officer (the "request"). Gallagher specifically instructed the Union's Labour Relations Department secretary to file the request.

39. On November 5, 1992 the Union filed an Application for Certification naming all of the Capobianco family companies including "Associated Contracting Inc." as responding parties. In the title of proceedings "and/or" appears between each company name. In paragraph 10 of the application under the heading "[o]ther relevant statements" the following appears:

(i) The Applicant, if necessary, relies upon the provisions of Sections 64 and 1(4) of the Labour Relations Act R.S.O. 1990 c. L-2 as amended.

(x) Contracting and the Applicant were bound by a collective agreement which expired on April 30, 1992. Contracting has ceased to observe the provisions of this collective agreement.

40. At a meeting with a Labour Relations Officer the parties attempted to agree on the identity of the employees for the purposes of the count. The parties worked from the Schedule "A" to the responding parties' response. Only Contracting and Capo were active at the time of the application. The Schedule "A" lists the employees of Contracting under the heading "Associated Contracting Inc." and the employees of Capo under the heading "Capo Contracting Inc.". There are two employees listed as having been employed by Contracting on the application date. Neither individual was challenged by the Union.

41. Numerous days of Labour Relations Officer examinations have been held in connection with this application for certification and the matter was heard by a panel of the Board, differently constituted, on June 14, 15 and 16, 1994.

42. On November 10, 1992 Contracting's counsel wrote to the Assistant Deputy Minister of Labour objecting to the appointment of a conciliation officer on the basis that Local 793 had abandoned its bargaining rights. This letter indicates that, since April 30, 1992, "the Employer has openly performed a number of projects involving work falling within the recognition provisions of the expired collective agreement.

43. On November 12, 1992 the instant grievance was filed.

Submissions on Behalf of Contracting

44. As indicated earlier, it is argued on behalf of Contracting that a number of inferences should be drawn from the facts and that the facts, combined with such inferences, lead to the conclusion that Local 793 voluntarily abandoned its bargaining rights with Contracting. Without intending to canvass all aspects of the argument advanced on behalf of Contracting, set out below is brief summary of its submissions.

45. Proceeding chronologically, Contracting points to the fact that the Labourers abandoned its collective agreement with Contracting in August, 1991 when it became apparent that its related employer application would not succeed. Gallagher was interested in these proceedings and informed himself of their outcome. Contracting argues that it is reasonable to infer that Local 793 would also abandon its bargaining rights at this time.

46. On or about September 1, 1991, following the Labourers' abandonment of its bargaining rights, Contracting ceased applying the Local 793 collective agreement. On September 13, 1991, Rennick provided Gallagher with a copy of his final pay cheque which indicated that Rennick was not paid the hourly wage rate stipulated in the agreement and that union dues had not been deducted. Further, when Gallagher was given the settlement cheque, he was in possession of one cheque which bore the name "Associated Contracting" and one which bore the name "Capobianco Management". On this basis, Contracting argues that Gallagher was aware, in September, 1991, that Contracting was not applying the collective agreement. Gallagher's failure to do anything to ensure that the agreement was applied indicates an intention on Local 793's part to abandon its collective agreement.

47. Contracting points to the terms on which the Rennick grievance was settled as further evidence in support of abandonment. The settlement figure negotiated by Local 793 did not include compensation for lost wages or unpaid union dues for the first week in September. Contracting submits that the Board should infer from the failure to claim damages for this week that the Union was accepting that the agreement was no longer in force.

48. Contracting argues that the Board should not construe the Union's letters of November 7, 1991 and February 6, 1992, the delinquency notice and notice to bargain respectively, as efforts on the Union's part to pursue its bargaining rights as they were automatically generated and no thought went into sending them out. It is argued that Capobianco's letter of November 15, 1991 is simply a response to the wording of the Union's November 7 letter or, alternatively, irrelevant because Gallagher did not see the letter until the fall of 1992.

49. It is argued that Contracting was active throughout the 1992 road building season and did not apply the collective agreement. Contracting submits that Local 793 knew it was active and did nothing to preserve its bargaining rights. Alternatively, Contracting argues that Local 793 is required to exercise due diligence in monitoring the activities of contractors with whom it has contractual relations and, in the present case, failed to do so.

50. Contracting argues that Local 793 took steps to have Contracting removed from the Kaneff job site in May, 1992 and the Memme job site in October, 1992. The Board should infer from these two incidents that Local 793 believed Contracting to be a non-union contractor. Even if Local 793 believed the contractor on these two sites to be Paving and not Contracting, Local 793, it is submitted, believed Contracting and Paving to be related employers such that, if Local 793 believed Contracting was a union contractor, it would have viewed Paving as a union contractor as well. Local 793's actions are not consistent with such a view.

51. Contracting argues that the filing of the application for certification is completely inconsistent with an assertion on Local 793's part that it already has bargaining rights with respect to Contracting. Contracting points to the list of employees prepared for the purposes of the count which lists individuals employed by Contracting as confirmation that Local 793 is applying to represent those it now claims it already represents. The Board should conclude that, as of the filing of the application for certification, Local 793 did not believe it had bargaining rights with respect to Contracting. The only way it could have lost such rights is through abandonment.

52. A Request for the Appointment of a Conciliation Officer was made on October 30, 1992. Various letters were exchanged between counsel and the Ministry of Labour until December 1992. On May 6, 1993 the Minister of Labour advised the parties that a Conciliation Officer would be appointed. Local 793 did nothing between December 1992 and May 1993 to pursue the request. Contracting submits that it should be inferred from Local 793's inaction that it did not believe that it had bargaining rights. Had Local 793 believed it retained such rights it would have been much more vigilant in following up on its request.

Decision

53. Having considered all of the documentary and oral evidence before us it is our conclusion that Local 793 has not abandoned its bargaining rights. For reasons set out below, we have concluded that no inference should be drawn from the Labourers' abandonment of its bargaining rights in August, 1991. We do not infer from the facts that Local 793 was aware that Contracting ceased to apply the collective agreement in September, 1991 or that it acquiesced in the non-application of the agreement. It is our finding that Local 793 was reasonably unaware that Contracting was operating during the 1992 road building season. With the exception of the filing of the application for certification, throughout the period of time in question Local 793 acted as though it had bargaining rights. It pursued the Rennick grievance, sent out a delinquency notice, removed Contracting's name from the delinquency list upon being notified that Contracting had no employees, served notice to bargain, sent out the terms of the renewal MTRBA agreement, filed a "Request for the Appointment of a Conciliation Officer", and filed the instant grievance. Although the filing of an application for certification and pursuing it to a hearing before this Board can be inconsistent with an assertion of bargaining rights, given the context and timing of the application, we find, in the present case, that it is not.

54. In our view, the fact that the Labourers abandoned its bargaining rights in August, 1991, when it became apparent that its related employer application involving the Capobianco companies would not succeed, does not meaningfully assist us in determining whether Local 793 abandoned its bargaining rights. There are several factors which may have caused the Labourers and Local 793 to act differently. First, it is apparent from the Labourers' initial refusal to enter into an agreement with Contracting and the subsequent filing of the related employer application that the Labourers wanted representation rights with respect to all of the Capobianco companies or none at all. Local 183 only entered into an agreement with Contracting after Local 793 did. There is no evidence that Local 793 was of the view that, if it could not have representation rights for all of the Capobianco family companies, it did not want any. Rather, at the time Local 793 entered into an agreement with Contracting it had knowledge of at least one other Capobianco company. Local 793 was not a party to the related employer proceedings. These facts suggest that Local 793 was content to have representation rights with respect to only Contracting. Secondly, the Labourers abandoned its bargaining rights with Contracting because having bargaining rights with respect to only one of the Capobianco family companies was "unworkable". Notwithstanding that Contracting operated and applied the Local 793 collective agreement from August, 1990 until August, 1991, we heard no evidence that Local 793 found its agreement with Contracting to be unworkable. Contracting itself asserts that, during the period of time it applied the Local 793 collective agreement, it was not "related" to any other Capobianco family company. Hence, whereas the Labourers may have had cause to abandon its agreement, we are unaware of any cause for Local 793 to do so. Accordingly, we do not infer from the Labourers' abandonment of its bargaining rights that Local 793 did as well. In any event, the behaviour of the Labourers does not bind Local 793.

55. We do not infer from Gallagher's knowledge of the non-application of the collective agreement to Rennick's final pay cheque and the change in company name on the cheques that Gallagher was aware that Contracting had ceased to apply the collective agreement. With respect to the change in company name on the cheque, the evidence is that Contracting did not inform Local 793 of its payroll arrangements and reasons therefor. Absent such information, Gallagher could not have known the significance of the change in company name on the cheques. We have found that Gallagher noticed that Rennick's final pay cheque did not provide for the wage rate stipulated in the collective agreement or the deduction of union dues. We do not infer from this fact; however, that Gallagher was aware that Contracting had ceased to apply the collective agreement. Rennick was complaining to Gallagher that he had repeatedly not been paid the wage rate stipulated in the agreement back to May, 1991. The incorrect wage rate on Rennick's final pay cheque was part of a continuing problem. Further, the pay cheque in question was Rennick's final pay cheque and thus problems with this cheque may have been viewed as resulting from Rennick's resignation as opposed to being symptomatic of a company wide problem.

56. The settlement of Rennick's grievance does not include damages to compensate Rennick for his lost wages during his last week of work or the Union for union dues which were not deducted from Rennick's final pay cheque. We do not infer from the terms of this settlement that the Union was acquiescing in Contracting's non-application of the agreement. First, we do not accept that Local 793 was even aware that Contracting had ceased to apply the agreement. Absent such knowledge, Local 793 could not have acquiesced in Contracting doing so. Secondly, although it is true that Rennick's last pay period is not covered by the grievance, nor is his second and possibly third last pay period during which, according to Contracting, the collective agreement was in force. We heard no evidence as to why the settlement did not include damages for lost wages following the week beginning August 17 but note that the reason cannot be the Union's abandonment of its agreement as damages ceased at least one week prior to the alleged abandonment. Finally, we note that the settlement of grievances is often a process of compromise. A party may not be able to obtain every cent that they feel is owing if they want to resolve the matter without incurring the expense of proceeding to arbitration. We do not infer from the terms of the settlement that the Union had abandoned its bargaining rights.

57. Contracting argues that the Union's delinquency notice of November 7, 1991 and notice to bargain of February 6,1992 are not indicative of the Union pursuing its bargaining rights as they were automatically generated and mailed without any forethought. In our view, these letters are relevant as they indicate that no one within Local 793 took steps to have Contracting removed from the Union's records as a contractor bound to a collective agreement with Local 793. Had it been Local 793's intention to abandon its bargaining rights such action might have been taken.

58. Contracting submits that Capobianco's letter of November 15, 1991 in response to Local 793's delinquency notice, in which Capobianco states that there would not be remittances for the months of September, October and November "as there are no employees", is irrelevant as Gallagher did not see the letter until the fall of 1992. The fact is; however, that Capobianco's letter had the effect of removing Contracting's name from Local 793's delinquency list which Gallagher receives each month. As well, the text of the letter is inconsistent with the assertion that Capobianco believed the Union had abandoned its bargaining rights when, given the opportunity to tell the Union that Contracting was no longer bound, Capobianco created the impression that his company was still bound.

59. With respect to Contracting's assertion that the Board should infer that Local 793 knew or ought reasonably to have known that Contracting was operating during the 1992 road building season, we do not agree. The evidence clearly shows that Contracting was only engaged on smaller jobs in Board Area 8 and that in all instances the tender was put in by Paving, the contract was awarded to Paving, all equipment on site bore the name "Associated Paving" or no name and all signs on the job site said "Associated Paving". Further, Capobianco testified that he did not see anyone from Local 793 on a job site until October or November, 1992. None of the usual indicators of what jobs a contractor is working on were available to Local 793 in this case. They had no practical way of knowing that Contracting was operating.

60. Contracting submits that Local 793 was aware, or ought reasonably to have been aware, that Contracting was working on job sites, notwithstanding all the indicators that the contractor was Paving, because Capobianco and his employees were present on the site. Local 793 would have associated Capobianco with Contracting and hence known that Contracting was on site. We do not agree. First, there is no evidence that Local 793 saw Capobianco on a job site until mid-October, 1992. Second, in our view, where a contractor arranges its affairs such that none of the usual indicators that it is working exist, a union is not required to expend extraordinary effort tracking down that contractor by attending at every job site and checking the identity of those present. Such a requirement would be onerous and an inefficient use of a union's resources. We find that Local 793 was unaware until mid-October that Contracting was operating during the 1992 road building season and it was not unreasonable for Local 793 to be unaware.

61. Likewise, we do not agree with Contracting's assertion that Local 793 attempted to have Contracting removed from the Kaneff site in April, 1992 and the Memme site in November, 1992. With respect to the Kaneff site the work being performed was asphalt work which Local 793 was aware, from its earlier discussions with Capobianco, had been sub-contracted to Paving. All equipment and signage on site bore the Paving name. We accept that Local 793's complaint was with respect to Paving's presence on the site and not Contracting's. We also do not accept Contracting's argument that Local 793 viewed Contracting and Paving as related employers such that if Local 793 believed it had bargaining rights with respect to Contracting it would also have believed it had bargaining rights with respect to Paving. Local 793 did not assert that Contracting and Paving were related employers until November, 1992. There is no evidence that Local 793 was of the view that they were related employers at the time of the Kaneff incident seven months earlier.

62. In our view the incident on the Memme job site is not helpful to Contracting's case for two reasons. First, the Memme job site was located in Board Area 26. Contracting's collective agreement with Local 793 does not extend to Board Area 26. Thus, irrespective of the abandonment issue, Contracting was not a union contractor in Board Area 26 and Local 793 would have been within its rights to have Contracting removed. Secondly, based on our findings of fact set out above, it is our conclusion that Local 793 understood the contractor on site to be Paving and that it was Paving that Local 793 sought to have removed.

63. Finally, we turn to the filing of the application for certification. Although we find the filing of the application for certification with respect to Contracting troubling and agree that the filing of such an application could be construed as conduct inconsistent with the assertion that a union already holds bargaining rights, in the present case we do not view it as such. Local 793 filed its Request for the Appointment of a Conciliation Officer on October 30, 1992, six days prior to the filing of the application for certification. Hence, very shortly before the filing of the application there is a very clear assertion of bargaining rights on Local 793's behalf. In contrast to the delinquency notice and notice to bargain, the request was not automatically generated by the Union’s computer or tickler systems. Gallagher specifically requested that the request be filed.

64. Further, evidence that Local 793 believed that it already had bargaining rights with respect to Contracting is found in the filing of the instant grievance. This grievance was filed on November 12, 1992. The grievance may have resulted from Gallagher witnessing Contracting working on the City of Mississauga Road Repair Contracts in mid-October. Alternatively, the grievance may have been initiated as a result of the November 10, 1992 letter, written by Contracting's counsel to the Assistant Deputy Minister of Labour, which clearly indicates that Contracting had been active without applying the provisions of the collective agreement. Although the grievance was filed following the application for certification, the grievance is an indication that Local 793 believed that it already had bargaining rights with respect to Contracting. Accordingly, we find that the filing of the application for certification was an attempt on Local 793's part to certify the remainder of the Capobianco companies, which Local 793 was unable to distinguish from Contracting.

65. We agree with counsel for Contracting that pursuing the application for certification through days of Labour Relations Officer examinations and before a panel of the Board could be construed as inconsistent with the assertion that Local 793 already holds bargaining rights with respect to Contracting. We cannot think of anything more inconsistent with the assertion of bargaining rights than pursuing such rights before this Board. However, this conduct must be viewed in context. On November 10, 1992 Contracting advised the Minister of Labour of its view that Local 793 had abandoned its bargaining rights. Contracting maintains that position to date and that issue will not be resolved until the release of this decision. In our view, in light of Contracting's position that Local 793 had abandoned its bargaining rights, Local 793 was justified in pursuing its application for certification in order to protect its bargaining rights should Contracting's abandonment argument prevail.

66. Having regard to our findings this matter is remitted to the parties for their further consideration. The parties are directed to advise the Registrar, within 30 days of the date hereof, as to how they wish to proceed with this matter.

DECISION OF BOARD MEMBER FRED B. REAUME; August 5, 1994

1. Virtually all of the actions taken or not taken by Mr. Gallagher on behalf of the union with regard to this matter, give some credibility to the suggestion of an abandonment claim by the respondent.

2. Indeed the filing of the application for certification in early November, 1992 and his comments to Mr. Montagnese with regard to said application can only be construed that Mr. Gallagher did not feel confident at that point that he had bargaining rights with the respondent through the original Voluntary Recognition Agreement.

3. Furthermore the settlement of Mr. Rennick's grievance with Mr. Gallagher's assistance clearly failed to even consider Rennick's lost wages during his last week of work and the payment of union dues. Mr. Gallagher's evidence was that Mr. Rennick was not at all happy with his treatment by Contracting. Under these circumstances, I find it difficult to accept that Mr. Rennick did not also tell Mr. Gallagher that Contracting was operating outside the Collective Agreement. In fact, he clearly did with respect to his wage rate.

4. In spite of Mr. Rennick's complaints, Mr. Gallagher made no attempt to discuss this matter openly with Contracting or to follow up with the other Local 793 members who worked with Contracting during the time Mr. Rennick worked with Contracting.

5. Despite the apparent problems involving the Kaneff and Memme job sites in 1992, Mr. Gallagher, upon finding Contracting working non-union on the City of Mississauga road repair contracts in mid-October of 1992, takes almost a month to file the grievance. Certainly, not what one would normally expect from a union representative when such a violation has taken place with a bound company. There is no doubt in my mind that the grievance was filed as a direct result of the November 10, 1992 letter written by Contracting's legal counsel which confirms his activity outside the Collective Agreement. I believe it was filed by Mr. Gallagher following discussion of the above letter with his advisers.

6. However, overshadowing all of Mr. Gallagher's shortcomings in dealing positively with this matter is the evidence which confirms that, despite several face-to-face meetings between Gallagher and Capobianco over the entire period, there was never any clear confirmation or declaration made even orally by either party that the union no longer exercised bargaining rights with respect to Contracting.

7. In addition, I have considerable difficulty with the less than forthright practice of the respondent of constantly shielding Contracting behind the name "Associated Paving" with regard to on-site equipment identification and the exercise of commercial contracts.

8. As a result, I am hesitatingly persuaded to concur with this decision.