Ontario Public Service Employees Union v. The Crown in Right of Ontario

[1994] OLRB Rep April 341

4196-93-M Ontario Public Service Employees Union, Applicant v. The Crown in Right of Ontario (as represented by the Ontario Ministry of Agriculture and Food) and Ontario Swine Improvement Ontario Incorporated and Beef Improvement Ontario Incorporated, Responding Parties v. Group of Employees

BEFORE: G. T. Surdykowski, Vice-Chair, and Board Members W. H. Wightman and R. R. Montague.

APPEARANCES: David Wright and Bob Patrick for the applicant; Stephen Patterson and Rob Scouller for Ontario Ministry of Agriculture and Food; Patty Murray for Ontario Swine Improvement Ontario Incorporated and Beef Improvement Ontario Incorporated; Larry Ouimet for Ontario Dairy Herd; John Lawrence for Beef Improvement Ontario; J. Paul McGill for a group of employees.

DECISION OF THE BOARD; April 28, 1994

1. This is an application for interim relief under section 92.1(1) of the Labour Relations Act which provides that:

92.1-(1) On application in a pending or intended proceeding, the Board may grant such interim orders, including interim relief, as it considers appropriate on such terms as the Board considers appropriate.

The application was heard on April 7,1994.

2. This application was filed at the same time as the application, under section 91 of the Act, in Board File No. 4195-93-U (the "main application").

3. In the main application, the applicant trade union alleges that the responding parties have violated section 81(1) of the Labour Relations Act by altering the pension plan provided to certain employees represented by the applicant trade union. Commonly known as a statutory "freeze" provision, section 81(1) of the Labour Relations Act provides that:

81.-(1) Where notice has been given under section 14 or section 54 and no collective agreement is in operation, no employer shall, except with the consent of the trade union, alter the rates of wages or any other term or condition of employment or any right, privilege or duty, of the employer, the trade union or the employees, and no trade union shall, except with the consent of the employer, alter any term or condition of employment or any right, privilege or duty of the employer, the trade union or the employees,

(a) until the Minister has appointed a conciliation officer or a mediator under this Act, and,

(i) seven days have elapsed after the Minister has released to the parties the report of a conciliation board or mediator, or

(ii) fourteen days have elapsed after the Minister has released to the parties a notice that he or she does not consider it advisable to

appoint a conciliation board,

as the case may be; or

(b) until the right of the trade union to represent the employees has been terminated.

whichever occurs first.

4. In the main application, the applicant seeks the following relief:

SCHEDULE A

1. A declaration that the Respondent Beef Improvement Ontario Incorporated has violated section 81(1) of the Act in failing to provide bargaining unit employees with a pension plan equivalent to the Public Service Pension Plan;

2. A declaration that the Respondent Ontario Swine Improvement Incorporated has violated section 81(1) of the Act in failing to provide bargaining unit employees with a pension plan equivalent to the Public Service Pension Plan;

3. An order that the Respondent Beef Improvement Ontario Incorporated immediately provide to its bargaining unit employees a pension plan equivalent to the Public Service Pension Plan;

4. An order that the Respondent Ontario Swine Improvement Incorporated immediately provide to its bargaining unit employees a pension plan equivalent to the Public Service Pension Plan;

5. An order that the Respondent Beef Improvement Ontario Incorporated fully compensate, with interest, its bargaining unit employees for any losses suffered by those employees from the date the Respondent assumed responsibility for the beef improvement program as a result of the failure of Beef Improvement Ontario Incorporated to provide a pension plane equivalent to the Public Service Pension Plan;

6. An order that the Respondent Ontario Swine Improvement Incorporated fully compensate, with interest, its bargaining unit employees for any losses suffered by those employees from the date the Respondent assumed responsibility for the swine improvement program as a result of the failure of Ontario Swine Improvement Incorporated to provide a pension plan equivalent to the Public Service Pension Plan;

7. Such other relief as the Applicant may request and the Board may allow.

8. In this proceeding, the applicant seeks the following interim orders:

SCHEDULE A

The Applicant requests that the Board make the following interim orders with respect to this

Application:

1. An order that the Respondent Ontario Swine Improvement Incorporated provide to its bargaining unit employees a pension plan which is equivalent to the Public Service Pension plan effective from the date of this Application and continuing until the Board disposes of the Applicant's Application under section 91 of the Act alleging a violation by the Respondent of section 81(1) of the Act and until any remedy awarded by the Board pursuant to that Application is fully implemented;

2. An order that the Respondent Beef Improvement Ontario Incorporated provide to is bargaining unit employees a pension plan which is equivalent to the Public service Pension Plan effective from the date that the beef improvement program is transferred to the Respondent by the Ministry of Agriculture and Food and continuing until the Board disposes of the Applicant's Application under section 91 of the Act alleging a violation by the Respondent of section 81(1) of the Act and until any remedy awarded by the Board pursuant to that Application is fully implemented.

The applicant submits that this interim relief should be granted to prevent harm to individual affected employees as follows:

The first type of harm which would result from the denial of this request for interim relief is that which flows from the employees' loss of the right to claim a disability pension in the event of becoming either physically or mentally incapable of performing their job duties under the pension plans offered by BIO and OSI. If a situation did arise whereby an OSI of BIO employee becomes incapacitated within the meaning of the Public Service Pension Plan while a decision from the Board was pending on the main application was pending, it is submitted that the harm that would result if no interim relief had been ordered would in fact be irreparable. As set out in the declaration of Heather Gavin, in such circumstances the affected employee would be unable to claim the benefit of a disability pension and would have to wait until s/he was entitled to a retirement pension in order to claim any pension benefits. While there can be no certainty that such a situation will arise, there can also be no certainty that it will not.

The applicant also asserts that it will suffer a collective bargaining harm if interim relief is not granted as follows:

The second type of harm which would result from not granting interim relief is the harm that would be caused by requiring the Applicant to choose between bargaining from a starting point of a lessor pension than the Public Service Pension Plan, or delaying collective bargaining unit such time as the Board issues a decision on the main Application.

6. At the hearing, a group of employees sought to intervene in this proceeding. Their representative indicated that the employees wished to participate in the hearing in order to address the Board with respect to how they have been dealt with by the applicant and the bringing of this and the main application, and also with respect to the merits of the application. The applicant opposed this intervention.

7. Upon hearing the representations of the parties, the Board ruled, orally, that the group of employees did not have standing to participate in this proceeding. This is not a fair representation or other like proceeding, and the dealings between the employees and the applicant are not relevant to it. Further, section 81(1) of the Act is a provision which relates to collective bargaining, the parties to which are the employers and the applicant trade union. As such, and as the words of section 81(1) themselves suggest, the only proper or necessary parties are the employers and the applicant. Accordingly, the Board dismissed the intervention of the group of employees.

8. In opposing the application for interim relief, the responding parties argued that it should be dismissed because:

(a) the applicant had accepted the alteration of the pension plan and is therefor estopped from seeking the relief requested;

(b) the applicant delayed in:

(i) filing this and the main application or in

(ii) pursuing this application;

(c) there was no demonstrable danger of any potential significant harm;

(d) further, or in the alternative to (c), the balance of harm weighs against granting interim relied.

9. (The Board notes that the applicant sought to introduce additional materials with respect to the estoppel argument. The responding parties objected. Upon hearing from the parties in that respect, the Board ruled that it would not admit additional materials. In this case, the applicant had had ample opportunity to file additional materials with the Board prior to the hearing but had not done so. Accordingly, the Board found it appropriate to deal with the application on the basis of the materials filed prior to the hearing, although the Board also noted that it appeared from the submtssions of the parties that the documentary record with respect to the estoppel issue was incomplete).

10. The estoppel argument was not pursued with any real vigour. It is apparent that the estoppel materials before the Board are incomplete. Further, and in any event, what materials are before the Board in that respect do not provide a sufficient basis for the Board to find an estoppel. Indeed, counsel for the Crown conceded that the evidence in that respect is insufficient.

11. Nor is the Board persuaded that this application should be dismissed on the basis of delay. Certainly, applications for interim relief should generally be filed and pursued with dispatch and diligence. However, the Board's approach to "delay" in such matters cannot be a mechanical one. Consequently, what constitutes inordinate delay in one case will not necessarily constitute inordinate delay in another. In every case, the Board must consider the circumstances.

12. In this case, the parties disagreed on the length of the "delay". At most, the applicant delayed some two months in filing this and the main application. However, delay in a collective bargaining context is not generally measured from the first day an issue is raised between the parties. The nature of the collective bargaining process is such that it would be inappropriate and counter-productive to expect the parties to run to the Board immediately upon some issue arising during negotiations. On the contrary, it is appropriate to expect that parties will try to work out their collective bargaining differences between themselves before coming to the Board with an application alleging that there has been a breach of the section 81(1) statutory freeze. Accordingly, the delay in filing this case is at most a month, which in the circumstances is not excessive.

13. Further, this matter was first scheduled to be heard on March 11, 1994. That hearing was adjourned on consent, apparently because of some problems in the delivery of documents to one or more of the responding parties and to enable the responding parties to file their responses. Although the applicant did not specifically request that the matter be rescheduled for hearing until March 24, 1994, it appears that it was under the impression that the matter was going to be rescheduled by the Board in due course without such a request. In any case, the Board is satisfied that any delay in proceeding with this matter which can be attributed to the applicant should not cause the Board to dismiss this application. (However, this situation should serve as a reminder to parties that they should always make clear the nature of and basis for any adjournment request or agreement so that such "misunderstandings" might be avoided. At the very least, parties should indicate to the Board when or in what manner they wish an adjourned proceeding to be rescheduled. We do not mean to suggest that the Board will necessarily be bound by any agreements between the parties in that respect, but the Board will certainly take the parties agreements or wishes into account.)

14. Turning to the "threshold" and "balance of harm" issues, the Board finds it appropriate to review the purpose and effect of section 81(1) of the Act.

15. Section 81 is a strict liability provision in that an employer or trade union need not be improperly motivated for its actions to be in breach of it (see Beaver Electronics Ltd., [1974] OLRB Rep. March 120, Kodak Canada Ltd., [1977] OLRB Rep. Aug. 517). Commonly referred to as a "freeze" provision, section 81(1) of the Labour Relations Act prohibits both an employer and the trade union which represents that employer's employees from altering anything which affects the employment of those employees after an appropriate notice to bargain has been given, unless its collective bargaining partner consents. The purpose of these provisions is to provide a stable point of departure for collective bargaining, thereby facilitating the collective bargaining process, by maintaining the working conditions and circumstances in place when the freeze is triggered. This serves to provide a fixed, though not necessarily static, basis for collective bargaining and operates to preclude the unilateral alteration of any bargainable aspect of the employment status quo which might give one party an advantage in negotiations.

16. Although the "freeze" label has stuck, it may be somewhat of a misnomer. The words of section 81(1) of the Act might be read to mean that there can be no change in anything which affects employment during the specified period. However, the Board has interpreted this provision as operating to preserve the pattern of employment which exists when it comes into effect, rather than specific terms, conditions or other circumstances of employment. Consequently, both the employer and the trade union continue to be entitled to operate within the parameters of the established pattern of employment. (see, for example, Simpsons Limited, [1985] OLRB Rep. April 594, Mohawk Hospital Services Inc., (1993] OLRB Rep. Sept. 873).

17. The Board has taken a flexible, and purposive labour relations approach to the statutory freeze under the Labour Relations Act. Further, and as the language of section 81(1) itself suggests, there is nothing wrong or even unusual with an employer and trade union negotiating with respect to matters which are subject to the statutory freeze.

18. It is common ground between the parties that the responding employers Ontario Swine Improvement Ontario Incorporated ("OSI") and Beef Improvement Ontario Incorporated ("BIO") are successor employers for labour relations purposes, that the applicant has given them written notice to bargain under section 54(1) of the Labour Relations Act, and that section 81(1) applies. OSI and BIO concede that the pension plan they have put in place for the employees represented by the applicant who are affected by this application is different from the pension plan in place prior to the transfer from the Crown to OSI and BIO respectively, and that the current plan is not equivalent to that previous plan. Consequently, there appears to have been a change in the pension plan which constitutes an alteration of a condition of employment within the meaning of section 81(1) of the Act.

19. On the basis of the materials before the Board, and for purposes of this interim application, the Board is not satisfied that the applicant trade union has consented or agreed to this change in working conditions.

20. The Board is satisfied that the applicant has demonstrated an arguable case for the relief sought in the main application (J. C. V.R. Packaging Inc., [1993] OLRB Rep. Nov. 1145, Loeb Highland, [1993] OLRB Rep. March 197). (The Board notes that none of the responding parties took issue with the applicability of this threshold test in this interim application).

21. It was also common ground between the parties that in determining whether this is an appropriate case for interim relief, the Board should balance the harm that would be suffered by the applicant if interim relief is not granted against the harm which would be suffered by the responding employers if interim relief is granted.

22. The Board agrees with the responding parties that the harm to individual employees asserted by the applicant is remote and highly speculative. There is no indication that any affected employee has been adversely affected in a manner which cannot be adequately addressed in the main application. The Board is satisfied that it is not appropriate to grant the interim relief sought on that basis.

23. The other harm asserted by the applicant is a collective bargaining harm. In the Board's view, it is not accurate to say that the applicant is seeking to gain an advantage in collective bargaining through this interim proceeding. On the contrary, the applicant seeks to have the collective bargaining positions of the parties restored to what they were at the time of the transfer from the Crown to OSI and BIG respectively. That is what section 81(1) is all about; namely, providing a period during which there is a fixed and stable point of departure for collective bargaining. The scheme of the Labour Relations Act recognizes that a change in the terms, conditions or other circumstances of employment by one party can cause harm to collective bargaining position of the other party to a collective bargaining relationship. This is a significant labour relations harm.

24. The responding parties OSI and BIG submitted that this sort of collective bargaining harm need not be addressed in an interim proceeding and that collective bargaining can proceed, on other issues, pending the disposition of the main application. The Board does not agree. It is true that collective bargaining can take many routes, and that some items can often be bargained before and sometimes without reference to others. However, in the big picture, the starting point for bargaining can have a significant impact on what is given or taken in one area which can in turn affect what is given or taken in other areas. The statutory freeze is just that and it addresses situations which readily lend themselves to interim relief.

25. OSI and BIG also submit that they both face undue financial hardship and suffer financial harm which "could not be undone, regardless of the outcome of the main application", if interim relief is granted.

26. That may well be. However, it was (and is) within the power of OSI and BIG to move the collective bargaining process along and end the statutory freeze of the pattern of employment. It does not appear that either has tried to do so. Further, OSI and BIG are the architects of the situation. They are the ones who decided to put into place a pension plan which they concede is not equivalent to the previous one, over what appears to the Board on the basis of the materials filed, to be the objections of the applicant. Further, there is nothing in the materials before the Board which substantiates counsel's assertion of the extent of the financial harm which OSI and BIG are likely to suffer if interim relief is granted.

27. Finally, the responding party submitted that the Board should not grant interim relief which is tantamount to a final disposition of the main application. The Board has said that it is appropriate to proceed carefully in circumstances where interim relief may be tantamount to a disposition of the main application. However, the Board has not said, nor would it be correct to say, that interim relief is never appropriate in such circumstances. In any event, we do not agree that granting interim relief herein will amount to a final disposition of the main application. The responding parties may be able to establish an estoppel in the main application, or there may be other factors present in the main application (including the continued existence of this statutory freeze) which will lead to a different result and a vacating of an interim order.

28. In the result, the Board is satisfied that the balance of harm favours the applicant. The Board is further satisfied that interim relief should be granted.

29. The Board therefor orders that the responding parties Gntario Swine Improvement Gntario Incorporated and Beef Improvement Gntario Incorporated forthwith provide to bargaining unit employees represented by the applicant a pension plan equivalent to the Public Service Pension Plan, pending the disposition of the application in Board File No. 4195-93-U or other order of the Board.