[1995] OLRB Rep. February 158
1989-91-G United Brotherhood of Carpenters and Joiners of America Local Union 785, Applicant v. Robertson Yates Corporation Limited, Responding Party v. Labourers' International Union of North America, Ontario Provincial District Council, Intervenor
BEFORE: Robert Herman, Vice-Chair, and Board Members W. N. Fraser and H. Kobryn.
APPEARANCES: N. L. Jesin and J. Gross for the applicant; Walter Thornton and Jim Thompson for the responding party; John Moszynski and Tony Cornacchia for the intervenor.
DECISION OF THE BOARD; February 9, 1995
This is an application filed pursuant to the provisions of section 126 of the Labour Relations Act.
The grievance alleges a breach of the "sub-contracting" clause of the collective agreement between Carpenters, Local 785 and Robertson Yates Corporation Limited ("RYCO"). This application was earlier deferred to a jurisdictional dispute (Board File No. 3183-91-JD), and the Board issued a decision in that matter on October 14, 1994, in which it directed that "RYCO shall assign to the Carpenters all fabrication, installation and dismantling of bulkheads in Board Area No. 6 in the ICI sector."
Since the work in question had not in fact been performed by carpenters pursuant to their collective agreement with RYCO, the instant section 126 application was brought back on for consideration, with the Carpenters claiming damages for the breach of their agreement.
The Board is asked to consider in what circumstances it will award damages in a section 126 application, consequent upon a finding in a jurisdictional dispute that the grieving union should have received the work but did not.
At the commencement of the hearing, the Labourers appeared and sought standing. The Labourers had originally performed the work in dispute. They had participated in the jurisdictional dispute, and now sought standing in this application, in order to address whether the agreement had been breached, and if so, the issue of damages.
The Board orally ruled that standing would not be granted to the Labourers. In the Board's view, the Labourers had no right to participate. As the Board had already determined the correct assignment in the jurisdictional complaint, the matter was now a collective agreement issue, solely between the parties to the collective agreement. The Labourers are neither a party to nor bound by the collective agreement in question. Further, given the full participation of RYCO in this application, and the position that RYCO was apparently taking (that no damages should be awarded), it did not appear likely that the Labourers' participation would assist the Board in any meaningful respect. Accordingly, the Board ruled that the Labourers would not be granted standing.
At that stage, the Labourers withdrew from the proceedings, and the matter continued without their presence.
The dispute between the parties is over the issue of whether damages should be awarded. If the Board should conclude that damages are warranted, it is agreed that they are approximately six thousand dollars. The grievance and jurisdictional dispute arose because of a contest over the correct work assignment between two unions, both of which had collective agreements with RYCO, the general contractor. Each agreement requires RYCO to sublet to contractors which have agreements with the Carpenters or the Labourers, as the case may be. RYCO sublet the work to a contractor which only had a collective agreement with the Labourers. RYCO asserts that no damages ought to be awarded by the Board, notwithstanding any technical breach of the collective agreement between it and Carpenters 785. It submits that its subcontract decision was reasonable in the circumstances. The Carpenters ask that damages be awarded, to reflect the Board's decision that the work should have been assigned to carpenters.
Some general background is helpful. This is an issue which arises regularly in work assignment disputes between two or more unions. In the construction industry, bargaining rights and work jurisdictions described in collective agreements often do not define exclusive bodies of work. Agreements of two or more unions may encompass specific work, and different agreements may require given work to be assigned to a particular union's members. Both unions may have claims to the work.
It is common for a union which claims entitlement to particular work to file a grievance, and thereafter a section 126 application, in order to assert its rights to the particular work, just as it is common for the competing union to assert its claim to the same work. Unless the parties settle, these claims are resolved through a jurisdictional complaint or dispute before this Board. And that is what has occurred here. What has not been so common, however, is the relisting of the section 126 application after the Board has determined the correct assignment, in order for the grieving union to assert a claim for damages in light of the incorrect assignment (as confirmed by the Board through its decision in the jurisdictional dispute).
There appears to be only a single decision of the Board on point. In a decision dated August 29, 1994 (unreported, Board File Nos. 0068-91-G, 0122-91-G, 1381-91-G, 1096-93-G, referred to as Sayers & Associates), the Board had to consider the circumstances in which damages would be awarded in a section 126 application, after a jurisdictional complaint direction had been made. This issue was considered by a panel whose members all have a construction background. As this previous decision of the Board has not been reported, we quote extensively from it:
In particular, it would be unwarranted in all of the circumstances of these applications to award damages in the form of compensation for lost wages, or a lost opportunity for the members of Sheet Metal Locals 30 and 392 to earn wages, because the employers had assigned the work to members of the U.A. Locals 46 and 463. The procedural circumstances are set out in paragraphs 3 through 6 of the decision in Sayers & Associates, supra, quoted above beginning at page 4 of this decision. The sense of the difficult operational circumstances in which the employers made their assignments to the U.A. locals instead of the Sheet Metal locals can be gained from paragraphs 9 and 10 of the decision in Sayers & Associates.
Finally, with respect to the applicants' claim that Decision No. 2 revives an unused INA and will have a disrupting effect on established and appropriate practices respecting assignment of the work in dispute. The material before the Board relating to past practice in each of the three Board areas reveals a variable practice amongst the employers bound to collective agreements with both the U.A. and the Sheet Metal Workers. In Board area #8, the dominant practice has been to assign the work in dispute to U.A. Local 46, although a relatively significant amount of work has been assigned to the Sheet Metal Workers Local 30 or on some sort of composite crew basis to both trade[s]. In Board area #11, the assignment practice has favoured assignment to a crew composed of members of U.A. Local 463 and Sheet Metal Workers Local 392, while in Board area #12, it has favoured U.A. Local 463, although there has been some practice of assigning it to a crew composed of its members and those of Local 269.
It is not unusual in work assignment complaints to find variable past practice within a Board area. It is less surprising in these complaints because, in each of them, the two trade unions have relied on the INA to claim assignment of work in dispute to their members on the basis that the INA grants them trade jurisdiction over the work. Clearly, both trade union parties to each complaint have acknowledged that the INA covers the work in dispute, but they differ as to which trade gains jurisdiction from its application. Some of the material before the Board shows that difference to have been a significant factor in work assignment disputes between the two trades in Board area #8 in recent years. The significant number of assignments to composite crews in Board areas #8 and #11, and to a lesser extent in Board area #12, relative to the number of exclusive assignments to either a U.A. or Sheet Metal Workers local, also points to the existence of the same dispute at other times in the three Board areas. In the Board's experience, while there might be a number of reasons why composite crews might be used to perform particular work, one of the most common ones is to avoid or resolve work jurisdiction disputes, particularly when the disputing trade unions are bound to a trade agreement and disagree about its interpretation and application to the work.
It may be readily inferred from those circumstances that it has not been unusual for employers performing this work in Board Areas 8 and 11 to have assigned it in face of competing claims from the two unions and variable past practice indicators of how the work had been assigned by other employers in the areas. The evidence about how the employers made their assignments to U.A. Locals 46 and 463 and the evidence of area and employer past practice which was before the Board in the work assignment complaints is evidence for these applications by the agreement of the parties. That evidence reveals that English and Mould's assignment of the work was to U.A. Local 46 and was consistent with the dominant past practice in Board area 8; Sayers and Associates' assignment was to crews composed of equal numbers of members of U.A. Local 46 and Sheet Metal Local 30, consistent with Sayers' practice and that of some other employers; and, Stark's assignment was to U.A. Local 463, in keeping with the employer's consistent past practice in Board area 11. There is no evidence which suggests that any of the assignments was made in an arbitrary manner or without proper consideration of the criteria commonly applied in the construction industry when making work assignments. In fact, it may be inferred reasonably from the materials and other evidence before the Board that the employers' assignments were made rationally in the circumstances, even though the Board found in Kora Mechanical Inc., supra, that the proper assignments were to Sheet Metal Locals 30 and 392.
Conflicting claims to work jurisdiction are a fact of life for employers in the unionized construction industry, particularly for employers like Sayers and Associates, Stark and English and Mould who are bound, together with the competing trade unions, to provincial agreements and who employ their members. Contractors make work assignment decisions in a variety of situations, such as when they are bidding for work; when pre-job mark-up meetings are held for the purpose of informing the trade unions (and considering their responses) about whose members will perform particular packages of work on a project; and, during the execution of jobs when one trade union perceives that "its work" is being done by members of another trade union.
When a conflict arises between trade unions about an employer's assignment of particular work, the employer does not have the luxury of unlimited time in which to consider the relative merits of the competing claims before making the assignment. Therefore, when employers in circumstances such as were present here make their best decision, but on challenge under section 93 of the Act are found to have made the "wrong" assignment, the appropriate remedy is a direction to "correct" the assignment; in other words, direct the employer to assign the work to the members of the trade union which the Board found to have the better claim to the work.
That has been the Board's usual remedy in section 93 applications whenever it has concluded that an employer has assigned work to members of one trade union, trade or craft when it should have assigned it to members of another trade union, trade or craft. When that happens to an employer in circumstances like those present with these applications, where the employer considered the relevant factors and made a reasonable assignment (albeit one found by this Board to be incorrect), the employer should not then be subject to damages for lost wages because its incorrect assignment has put it in apparent breach of hiring hall, sub-contracting, or other work protection provisions of a collective agreement to which the employer is bound. That would result in the employer having to pay twice for the same work because of a contest between two trade unions over which one's members should do the work, and in a context where the assignment was reasonably made and the work in question was covered by both collective agreements.
The Board recognizes fully that paying twice for the same work is the natural consequence befalling the employer who attempts to circumvent its collective agreement obligations by hiring outside the hiring hall provisions or subcontracting contrary to the requirements of the agreement and is found in breach of the collective agreement. Such provisions are there to prevent employers from avoiding their obligations to pay the wages, benefits and other terms of a collective agreement. Therefore, when an employer knowingly or carelessly breaches those protections and, as a result, members of the union lose wages or opportunities to earn wages, damages in the form of compensation for the losses are appropriate even though the damages represent a second payment for the work done in breach of the collective agreement.
Those are materially different circumstances than where an employer has rationally considered the relative merits of competing claims for the disputed work, decided that it should be assigned to the members of one disputing union instead of another one, and then later is found by a tribunal, like the Board, which adjudicates such disputes to have made the wrong assignment. In the latter circumstances, it would not be in the long term labour relations and economic interests of construction industry employers, trade unions and their members to require employers to pay twice for work performed during incorrect assignments.
The Board is not overlooking the fact that members of the trade union to whom the work should have been assigned, and who were available to do the work, have lost an opportunity to earn wages as a result of the incorrect assignment. It well may seem something of a hollow victory for the "winning" union and its members to be told that the work should have been assigned to them, and then not be redressed for lost wages. However, the successful union and its members do benefit from the precedent setting nature of the award respecting future assignments by that employer of the same kind of work in the same Board area. It also has precedential value respecting other employers when assigning the same work in circumstances which are materially similar.
One of the major problems for construction industry unions during the decade or more prior to the recent amendments to section 93 of the Act and the Board's Rules of Procedure applicable to work assignment disputes has been the substantial length of time it has usually taken to hear and decide an application. It was rare, if ever, that an application was decided before the disputed work was completed. Therefore, when a union succeeded in having a work assignment changed in favour of its members, they did not get to do the work on the project where the dispute had arisen. This situation has been improved substantially because of the expedited procedures currently available under the Act and the Board's Rules of Procedure applicable to work assignment complaints. The Board is responding quickly in resolving work jurisdiction disputes brought under that section. This means that parties to timely applications can expect normally to get a resolution to a dispute while the work is still being performed. Therefore, if the Board alters an assignment, there will be work for the beneficiaries of the assignment to perform. Therefore, when the Board decides to correct an employer's assignment, a Board direction that the employer forthwith make the correct assignment is the appropriate way to remedy the "incorrect" assignment. Conversely, it would be an inappropriate remedy and not in the best interests of labour relations in the construction industry to award damages under a grievance which alleges that the employer's "incorrect" assignment had resulted in breaches of the collective agreement of the "winning" trade union.
That is not to say, however, that there could be no circumstances in which damages in the form of compensation for lost wages and/or relief in the form of cease and desist and other declarations would be appropriate remedies where an employer makes an incorrect assignment. Such remedies might well be appropriate where an employer acts arbitrarily in making an assignment, or disregards established area practice, and/or ignores or fails to properly consider other commonly accepted criteria for making work assignments, and is found to have breached a collective agreement because of the incorrect assignment.
It was for these reasons that the Board, in exercising its arbitral discretion to fashion remedies, including an award of damages in the form of compensation for lost wages, concluded that it would not grant the remedies sought in the four applications even were the Board to assume, without finding, that the employer in each instance had breached the provincial agreement between the Sheet Metal Workers' International Association and the Sheet Metal Workers' International Association Ontario Sheet Metal Workers' Conference and the Ontario Sheet Metal and Air Handling Group to which they and Sheet Metal Locals 30 and 392 are bound. In the result, these applications are dismissed.
Before concluding these matters, the Board is constrained to make some observations. It is conventional wisdom in the unionized construction industry in Ontario that, when a union successfully challenges an employer's work assignment before a tribunal established to decide such matters, and the employer corrects the assignment pursuant to a direction of a tribunal established to decide such matters, the successful union does not then seek damages by means of a grievance alleging breaches of its collective agreement binding on the employer arising out of the incorrect assignment. The Board is unaware of any instance where, after it has directed an employer to alter a work assignment, the trade union which gained the assignment for its members made a successful claim for damages or any other remedy, or even where it has filed or pursued a grievance under section 126 of the Act, other than these applications. Nor did any of the parties refer the Board to any specific or general authority supporting an award of damages or other remedies in a grievance pursued after a successful challenge to a work assignment.
[emphasis added]
As the emphasized portions illustrate, the Board in Sayers & Associates described the approach in numerous ways, but to the same general effect. Unless there is evidence which suggests that the employer made the assignments in an arbitrary or otherwise unreasonable fashion, damages will not be a remedy granted by the Board in the arbitration proceedings.
The applicant questions whether this approach is appropriate. Even if the Board follows Sayers, the applicant suggests three reasons why damages should nevertheless be awarded here. First, the applicant asserts that the Board ought not require the union to establish exceptional circumstances in order to obtain damages. Rather, the Board ought to conclude that damages usually would flow, absent an affirmative demonstration by the employer that it acted reasonably in all the circumstances. Thus, the applicant submits, even on the test articulated by the Board in Sayers, the onus ought to be upon the employer to establish why damages ought not to be awarded.
Second, the applicant argues that to conclude otherwise would amount to denial of jurisdiction, for the Board would be establishing a general rule by which it declined to award damages even though there had been a breach of the collective agreement.
Third, on the particular facts, the applicant asserts that the employer did act unreasonably in not ensuring that the work was performed by members of Carpenters, Local 785. In this regard, the applicant relies upon Article 19 of the Provincial Collective Agreement, which sets up a scheme for the establishment of local area work practice.
Pursuant to Article 19.02, "the determination of established local area work practice under 19.01 will be placed before a committee for decision ... A subsequent assignment in violation of a committee's decision shall be considered a violation of this Agreement and subject to grievance and arbitration." Carpenters Local 785 relies upon a particular local area work practice which was determined pursuant to the provisions of Article 19.01 and 19.02, and which, in the Carpenters' submissions, made clear that Carpenters' were entitled to the work here.
Specifically, the Carpenters rely upon the clauses in the local area work practice which
indicate that the following should be exclusively assigned to its members:
Job site fabrication of forms to receive concrete.
Installation of all forms to receive concrete.
The building and setting of all bulkheads and centres.
There was a clear and unambiguous practice that bulkheads ought to be assigned to members of the Carpenters in the Board Area in question, and there was a local area practice which had been established under the mechanism for this in the collective agreement. In the face of this, submit the Carpenters, RYCO acted unreasonably in subbing the work to a sub-contractor which had no contractual relationship with the Carpenters.
Decision
We agree with the approach taken by the Board in Sayers & Associates. As a general proposition, where the general contractor or employer is bound to conflicting collective agreements, each containing an obligation to sub-let the work to employers with a contractual relationship with the union (or some equivalent or analogous requirement), absent a demonstration by the grieving union that the general contractor or employer acted unreasonably in all the circumstances, the Board will not likely grant any damages by way of remedy in the section 126 application.
Unlike the long, expensive, and convoluted practice that previously existed, the current jurisdictional dispute process at the Board is relatively quick and efficient. Parties are required to file their jurisdictional dispute materials quickly, and the Board convenes a consultation shortly thereafter. In many cases, parties can obtain a decision from the Board before the work has commenced, or before it has been completed. Unions will often be able to obtain a work assignment direction fast enough to still recover actual work for their members.
This will not always be possible. There will be occasions where the Board's decision in the jurisdictional dispute is given after the work is completed. Even then, there is good reason not to routinely award damages for the incorrect assignment.
The purpose of the jurisdictional dispute provisions, to which a section 126 application of this nature is an adjunct, is to determine the correct work assignment, in a context in which the unions and the assigning contractor or employer have legitimate and reasonable dispute over the appropriate assignment. The Board is therefore called upon to exercise its powers under section 93 and to determine the "correct" assignment. The process is designed to provide the parties with a quick answer, where there may be well-founded but competing claims to what is "correct", claims not amenable to resolution under section 126 of the Act, but claims needing Board intervention. It would be counterproductive to thereafter penalize contractors or employers who made reasonable assignments in the particular circumstances, even if those assignments nevertheless turned out to be "incorrect".
Jurisdictional complaints, and related section 126 applications, should together comprise a mechanism that will reduce the incidence of work assignment disputes and the delays and obstructions to construction in the province. If damages were awarded for assignments reasonably made, the ability of contractors and unions to inexpensively resolve assignment disputes amongst themselves would be seriously impeded.
While there is an initial attraction to the view that a breach of the collective agreement involving the use of non-members of the union, that occurs because of an incorrect assignment to another union, ought to result in a remedy that includes damages, this approach misconceives the character of the dispute, and its tripartite nature. This analysis rests upon the assumption that entitlement to work flows from the union's craft status or specific language in the collective agreement, neither of which is strictly true.
The reality is that contractors and employers are regularly bound to collective agreements with different trades, each of which cover work of a particular sort, binding the contractors or employers to assign particular work to both unions. The requirements are often irreconcilable. And the reality is that these collective agreements are negotiated in a context where the bargaining parties are fully aware of this when the agreements are settled. The parties are under no apprehension that the granting of subcontracting protection in these areas of overlap of work jurisdiction will necessarily guarantee a union the work. They both realize that there may still be valid claims to the work by competing unions.
Ultimately, it is the work assignment decision a that determines which union is entitled to the work. It is not ordinarily the collective agreement which secures the work, regardless of its clauses. Damages ought not to flow, therefore, simply because the assignment was made contrary to a particular clause in the collective agreement.
Contractors or employers must decide which union to use. Often the decision will be clear. Equally, because of the nature of the industry, and the changing practice in it over the years, assignment decisions can be difficult. There may only be fine distinctions justifying one assignment over the other, and very plausible reasons for either.
Damages should be restricted to those circumstances in which the Board concludes that a contractor/employer did not act reasonably, not those circumstances in which an employer reasonably was wrong.
And there will no doubt be occasions when the Board might award damages; for example, where an employer wrongfully declines to hold a mark-up meeting, where the employer assigns contrary to generally accepted practice or to Board decisions indicating the correct methodology or assignment, or when the Board is not satisfied the assignment was made in a bona fide manner or for a bona fide purpose. This does not purport to be an exhaustive list.
The materials filed in a jurisdictional complaint generally set out the process by which the work came to be assigned. These materials usually describe the factors considered by the contractor/employer in assigning as it did. These facts are rarely in dispute. Unions which wish to establish, in the section 126 application, that contractors/employers acted unreasonably in their assignment will therefore commonly have knowledge of what took place, and will be able to focus on any aspects of the process or result they allege to be deficient.
If the contractor/employer must prove reasonableness in every section 126 application, there will likely be litigation in most applications. This would be expensive, and unnecessary in a great many cases. If, on the other hand, the union has to demonstrate unreasonableness by the contractor/employer, the only cases litigated will be those where there was some good reason to believe that damages might issue, where the union had some grounds for believing a contractor/employer acted unreasonably. For this reason, we prefer the latter approach.
We return now to the Carpenters argument that the local area work practice clearly covers the assignment in question, and demonstrates that RYCO acted unreasonably in the circumstances. In our view, the local area work practice does not establish this.
The work here was the fabrication, installation and dismantling of bulkheads that were required for the proper installation of a superfiat concrete floor. It is common ground that there is no prior decision of the Board with respect to this type of floor. In its decision in the jurisdictional complaint, the Board did not give particular weight to this local area work practice, since it was a practice not binding upon the competing union, the Labourers'. A local area work practice established under a bipartisan collective agreement, with no input or binding effect upon a competing union, is of limited utility in assisting an employer or contractor in determining the correct assignment, at least where the employer or contractor is bound by competing collective agreement claims for the work. The contractor is still in the same position, bound by irreconcilable collective agreement demands by different unions. The local area work practice does not clarify for the employer or contractor which of two competing unions, with two competing collective agreements, ought to be assigned the work.
In the circumstances, the union has not demonstrated that RYCO acted unreasonably, and damages are not warranted.
Our decision not to award damages here is not a denial of jurisdiction. In our view, the Board has a general discretion with respect to appropriate remedial relief in section 126 applications. This is a discretion that the Board has exercised for many decades, albeit in other contexts. For example, the Board has considered the timeliness of a section 126 application, and dismissed it where it was brought too late. It has applied the doctrine of estoppel, to conclude that a remedy otherwise appropriate ought not to issue. Similarly here, we have considered it appropriate in the particular circumstances to decline to make an award for damages. At the same time, and as noted above, there will no doubt be circumstances in which damages are appropriate.
Finally, if the applicant is correct in its assertion that, as a matter of law, the Board must award damages whenever the Board determines that the correct assignment was to members of the grieving union (and that union's collective agreement requires that its members be used for the work), then the Board would no doubt take this factor into account in the jurisdictional complaint itself. Knowing that overturning an assignment would necessarily mean awarding damages might well lead the Board to decline to interfere with the assignment, to make its decision prospective in effect, or to issue other equitable declaratory relief.
For these reasons, this application is dismissed.