[1995] OLRB Rep. August 1082

1501-95-G; 1531-95-U; 1602-95-U The Carpenters Employer Bargaining Agency ("EBA"), Applicant v. The Ontario Provincial Council, United Brotherhood of Carpenters and Joiners of America ("OPC") and Drywall Acoustic Lathing and Insulation, Local 675 ("Local 675"), Responding Parties v. Doug Bickle, Henry Bickle, Roy Williamson, Victor DaSilva, Ivo Bodlovic and workers listed in appendix A and other relevant workers, Intervenor; Interior Systems Contractors Association of Ontario ("ISCA"), Applicant v. Drywall Acoustic Lathing and Insulation, Local 675 ("Local 675"), Responding Party v. Doug Bickle, Henry Bickle, Roy Williamson, Victor DaSilva, Ivo Bodlovic and workers listed in appendix A and other relevant workers, Intervenor; Doug Bickle, Henry Bickle, Roy Williamson, Victor DaSilva, Ivo Bodlovic and workers listed in appendix A and other relevant workers ("objecting employees"), Applicants v. Drywall Acoustic Lathing and Insulation, Local 675 ("Local 675"), The Ontario Provincial Council, United Brotherhood of Carpenters and Joiners of America ("OPC"), United Brotherhood of Carpenters and Joiners of America (the "International"), Helmut Redermeier and Collin Weller and Jim Smith, Responding Parties

BEFORE: R. O. MacDowell, Alternate Chair.

APPEARANCES: Joseph Liberman for ISCA; Bruce Binning for the Provincial Employer Bargain­ing Agency; Norm Jesin for Carpenters Local 675 and Carpenters' Ontario Provincial Council; Martin Rosenbaum and David Conn for the objecting employees.

DECISION OF THE BOARD; August 15, 1995

I

Introduction

1. These are related applications brought against the union under sections 91 and 126 of the Labour Relations Act.

2. In order to make this decision easier to read, I will refer to the parties in the "shorthand way" that they commonly refer to each other. Local 675 of the United Brotherhood of Carpenters and Joiners of America will be referred to simply as "Local 675"; the Interior Systems Contractors Association of Ontario will be referred to as "ISCA"; the Acoustical Association of Ontario will be referred to as "AAO"; the Ontario Provincial Council of the United Brotherhood of Carpen­ters and Joiners of America will be referred to as "the OPC"; the Labourers International Union Local 183 will be referred to as "Local 183" or "the Labourers"; and so on.

3. It is apparent from their behaviour that the employees affected by this proceeding may not understand either the legal framework that governs their situation, or the collective bargaining context within which their rights must be determined. While I have tried not to burden this deci­sion with a lot of quotes from the cases referred to in argument, I do think it is necessary to discuss the collective bargaining environment in some detail.

II

The Proceedings Leading up to the Present Case

4. This case came on for hearing on an expedited basis because of the uncertainty and unrest that currently prevails in certain parts of the construction industry. It is, in fact, the third Board proceeding involving these parties. All three cases arose from an unsettled situation in the drywall industry, where there is a dispute about whether recent negotiations have produced new and binding collective agreements.

The First Unlawful Strike Application

5. In Board File No. 0191-95-U ISCA complained that employees were engaging in unlaw­ful strikes and that union officials were encouraging that unlawful conduct. After hearing the par­ties' evidence and representations, the Board found that employees were indeed striking unlaw­fully. The Board issued a "cease and desist direction" - taking the trouble to explain to employees that no strikes or picketing were lawful at this time.

6. The Board noted that employees cannot strike while a collective agreement is in force; nor can employees strike after a collective agreement is expired, until the compulsory conciliation process has been concluded. The Board observed that if there was some legal controversy between the parties, it had to be resolved in accordance with the procedures set out in the Labour Relations Act.

The Second Unlawful Strike Application

7. The Board's cease and desist direction was not the end of the problem. On July 14, 1995 ISCA complained that the unlawful strikes were still continuing - despite the Board's earlier direc­tion. ISCA submitted that the employees knew that they were breaking the law and were ignoring the Board's order. ISCA submitted that the strikes were being organized by a few instigators who were pursuing their own political agenda.

8. ISCA submitted that the only way to end the disruption was to prosecute the individuals causing it. Section 98 of the Act provides that unions and employees engaging in an unlawful strike may be liable for fines of up to $2,000.00 a day for individuals and $20,000.00 a day for trade unions; moreover the Board had pointed that out in the first decision that it had issued. ISCA sought the Board's consent to prosecute.

9. However, as it turned out, the Board did not have to proceed with the consent to prose­cute application. The matter was settled on terms set out in more detail in its decision of July 20, 1995.

10. Among those settlement terms was an undertaking by all parties (including the object­ing employees) to put their legal positions before the Board as soon as possible. The parties agreed that if there was some dispute about the way that the union was behaving, or whether there was a valid collective agreement in place, that dispute should be put before the Board for determination. The parties (including the objecting employees) acknowledged that strike activity was unlawful at this time.

11. It was not clear how quickly the case could be completed. The parties said that the issues were novel and complex. Everyone wanted a full opportunity to call evidence and cross-ex­amine witnesses. However it was understood that, pending the Board's determination, there would be no more illegal conduct.

12. The parties initially estimated that it would take three days to hear their case. Ulti­mately it took eight days. Argument was completed on the evening of August 8, 1995.

13. I will examine the facts surrounding the dispute in some detail below. First, it may be useful to briefly describe the legal framework that governs construction industry collective bargain­ing.

14. It is clear that the institutional parties (ISCA and the union) are quite familiar with the collective bargaining scene. These parties understand the pressures in the market-place, the terms of their various collective agreements, and their rights and obligations under the Labour Relations Act.

15. However, it is equally clear that the rank and file union members may not understand

either the law or the relevant collective bargaining history. Accordingly, it may be worth a brief digression to sketch in some of the background to the latest round of bargaining. Unless one understands the collective bargaining environment, one will not understand what this dispute is really about.

III

The Collective Bargaining Framework: How Negotiations are conducted in the ICI and Residential Sectors of the Construction Industry

16. Since 1978 collective bargaining in the industrial, commercial and institutional sector (ICI) of the construction industry has been conducted on a province-wide basis. But that is not a voluntary arrangement. In 1977, the Labour Relations Act was amended so as to require province­wide bargaining, by trade, through provincial employer and employee bargaining agencies desig­nated by the Minister of Labour.

17. The designated provincial bargaining agencies are the "key players" in the ICI sector. Local bargaining is strictly prohibited unless the provincial bargaining agencies agree to permit it, and confirm the results (see section 148 of the Act). Without agreement at the provincial level, local arrangements are null and void.

18. The general framework for bargaining can be described quite simply.

19. On the "employer side" of the bargaining table, there is a designated provincial bargain­ing agency (which I will call the "EBA"). The EBA typically consists of one or more employer associations. Each employer association is made up of a number of employers sharing common business interests. The EBA is an umbrella group that is designated to bargain for unionized employers on a province-wide basis.

20. On the "union side" of the bargaining table is the designated provincial bargaining agency which is usually a council of unions. It too is an umbrella organization that includes or rep­resents geographic locals, district councils, and, sometimes, the parent union.

21. Every three years, the designated provincial bargaining agencies - union and employer -negotiate a new collective agreement. That agreement covers the unionized employers and employees in their trade group (carpenters and carpentry contractors, electricians and electrical contractors, bricklayers and masonry contractors etc.). The collective agreement applies to the ICI sector and covers the whole Province of Ontario.

22. The provincial agencies that do the bargaining have an independent existence, that is rooted in the statute and the Minister's designation. The designated agencies are distinct from their component parts. The provincial bargaining agencies owe their constituents a "duty of fair repre­sentation" (see section 154 of the Act), which reinforces the impression that they are truly inde­pendent actors.

23. Local 675 (Toronto) is only one of the local unions that is covered by the ICI collective agreement. Local 675 is represented in ICI bargaining by the Carpenters' Ontario Provincial Coun­cil-"the OPC". So are the other carpenters' branches across the province. The OPC speaks for all of them.

24. Since 1978, then, ICI bargaining has taken place at the provincial level. For each trade, the bargaining has resulted in an Ontario-wide agreement, covering all workers in that trade. But of course, the local construction scene is different in various parts of the province. And not all members of the trade union do the same kind of work. These geographic and industrial variations have to be reflected in the terms of the provincial agreement.

25. In other words: the bargaining and collective agreement are provincial in scope, and are the responsibility of the designated provincial bargaining agencies. But the actual terms of the col­lective agreement have to be adapted to reflect local circumstances and different working arrange­ments. The provincial collective agreement is a mosaic of inter-related parts, each applying to a particular locality and/or a particular segment of the construction industry where members of the carpenters' union work.

26. The carpenters' provincial collective agreement reflects that complexity. It is almost 300 pages long, and is colour-coded so that the reader can find the terms that apply to his particular part of the industry.

27. The provincial ICI agreement begins by identifying the parties who have bargained it (the designated provincial bargaining agencies) and the agreement's overall purpose:

AGREEMENT

BETWEEN

LABOUR RELATIONS BUREAU OF THE ONTARIO

GENERAL CONTRACTORS ASSOCIATION

ACOUSTICAL ASSOCIATION OF ONTARIO

RESILIENT FLOORING CONTRACTORS

ASSOCIATION OF ONTARIO

CAULKING CONTRACTORS ASSOCIATION OF ONTARIO

INDUSTRIAL CONTRACTORS ASSOCIATION OF CANADA

INDUSTRIAL SYSTEMS CONTRACTORS ASSOCIATION OF ONTARIO

(hereinafter called the "Carpenters Employer Bargaining Agency" ERA)

AND

THE ONTARIO PROVINCIAL COUNCIL of the United Brotherhood of Carpenters and Joiners of America on behalf of the following affiliated bargaining agents:

(1) The Carpenters District Council of Toronto and Vicinity,

(2) Lake Ontario District Council,

(3) Western Ontario District Council,

(4) Ontario Acoustical and Drywall District Council,

(5) United Brotherhood of Carpenters and Joiners of America; and the following Local Unions: 18, 27, 93, 249, 397, 446, 494, 572, 675, 785, 1071, 1256, 1316, 1450, 1669, 1946, 1988, 2041, 2050, 2222, 2451, a d 2486, of the United Brotherhood of Carpen­ters and Joiners of America; and any Local Union or District Council subsequently chartered in Ontario.

(hereinafter referred to as the Union")

ARTICLE 1 - PURPOSE

Whereas the EBA is a designated employer bargaining agency and as such represents employers for whom the Union has bargaining rights for the purpose of entering into a Collective Agree­ment with the Union, and

Whereas the Union is an employee designated bargaining agency for employees represented by District Councils and Local Unions chartered by the United Brotherhood of Carpenters and Joiners of America and the said international for the purpose of entering into a collective agree­ment with the EBA, and

Whereas the EBA and the Union are desirous of establishing a collective bargaining agreement in order to promote uniform standards for all employees covered by the Collective Agreement and to promote an atmosphere of peace and harmony among the EBA, the Union, the Employ­ers, District Councils, Local Unions and employees and to provide for the peaceful settlement of all disputes and grievances that may arise.

28. The opening words of the ICI agreement identify the designated bargaining agencies, the "EBA" and "the OPC" and their component parts that are bound by the agreement. The rest of the agreement settles the terms that apply to the segments of the construction industry in which members of the carpenters' union are employed.

29. The "master portion" of the agreement (the white pages 1-60) consists of general terms that generally apply to all of the employers and employees bound by the agreement. (I say "gener­ally" because the appendixes sometimes modify the "master language"). The blue pages (61-167) contain schedules of wages and conditions for "general carpentry" work, in local geographic areas where the union has local branches (for example: Local 785 Cambridge, Local 18 Hamilton and Niagara, Local 249 Kingston, Local 93 Ottawa, etc.). There is also a "Caulking Appendix" (the pink pages 226-234), a Resilient Floor Workers' Appendix (green pages 235-274), and an "Acous­tic and Drywall Appendix" (yellow pages 168-335) which set out the terms applicable to those parts of the industry.

30. The "Acoustic and Drywall Appendix" applies to employers and employees who do that kind of work. Like the other appendices, it is negotiated by or on behalf of the provincial bar­gaining agencies (the EBA and the OPC).

31. However, for practical purposes the "employer side" that is bound by the appendix consists of the contractor members of AAO and ISCA - who also have an important influence on what the appendix contains. On the "union side" the appendix binds carpenters locals 785, 18, 249, 1316, 2041, 1256, 1988, 446, 2466, 675, 494, the Lake Ontario District Council (Peterborough, Oshawa, Belleville, Cobourg. And, of course, it also binds the members of these union locals who do drywall installation and acoustical ceilings.

32. The Labour Relations Act contemplates that there must be a three year provincial col­lective agreement. There can be no strikes or lock-outs while the 3-year agreement is in place. And, once the 3-year agreement is signed, neither party can insist on amending it.

33. On the other hand, it is not unusual for the bargaining parties to amend an existing col­lective agreement. The Labour Relations Act contemplates that this can be done, providing that the bargaining parties are in agreement (see section 53(5) of the Act). The Act specifies the dura­tion of a collective agreement and prohibits early termination, but it allows the parties to adjust particular terms to meet their mutual needs.

34. It is sometimes sensible to renegotiate portions of the agreement if economic conditions change. That is particularly so in the construction industry, where the market is volatile, where contractors obtain work by competitive bidding, and where there is often stiff competition from non-union companies. It makes sense for the parties to keep unionized companies competitive, because if they are not competitive, the contractors will be out of business and their employees will be out of a job.

35. The carpenters' provincial collective agreement specifically contemplates the possibility of amendment, either on the provincial level, or in a segment of the industry, or in a local area. The provincial agreement has "built in" flexibility. Article 28 of the agreement reads as follows:

ARTICLE 28- AMENDING

28.01 The terms and conditions of this Collective Agreement may be changed or amended by written agreement between the EBA and the OPC.

28.02 Any changes or amendments agreed to by local employer associations or trade associations and local unions or district councils shall not be effective unless and until such change or amend­ment has die written agreement of both the OPC and the ERA. Any change or amendment shall only be effective in the geographic area involved.

36. Article 28 stipulates that in order for there to be a valid amendment to the agreement, the provincial bargaining agencies must both agree in writing. In other words, any amendment to the provincial ICI agreement requires the consent of the parties who negotiated the agreement tn the first place. But apart from that, the collective agreement provides no guidance as to the form, the timing, or the circumstances in which that consent may be sought, or granted or withheld. All it says is that there cannot be an amendment unless the provincial agencies agree to it.

37. I should perhaps repeat here that Article 28 deals with variations that are made, by mutual consent, during the life of the ICI collective agreement. Such amendments do not bring the ICI agreement to an early end. There still can be no strike or lock-out to force the other party to agree to changes of this kind. Nor is there any statutory obligation to "bargain" about mid-term amendments. If such discussions occur, it is because the parties believe that it is in their interest to negotiate.

38. The situation in the residential sector is a little different.

39. In the residential sector, there is no comprehensive compulsory provincial scheme, as there is in the ICI sector. Collective bargaining need not take place on the provincial level or produce a province-wide agreement. Nevertheless, even outside the ICI it is not uncommon for employer associations and trade unions to enter into extended area agreements and those agree­ments may be provincial in scope.

40. ISCA and Local 675 are an example of that. ISCA and Local 675 have a province-wide "residential" agreement pertaining to the installation of drywall, acoustic panelling, lathing and insulation in the residential sector of the construction industry.

41. ISCA is an accredited employer association (see sections 127-136 of the Act) represent­ing unionized contractors who operate in the drywall lathing and acoustical ceiling business. Local 675 represents a majority of the drywall workers who are employed by the members of ISCA (and AAO). Every two or three years ISCA and Local 675 negotiate a province-wide residential agree­ment. They have been doing that since 1978. The most recent residential agreement ran from June 2, 1992 until April 30, 1995.

42. The ICI agreement and the residential drywall agreement are both provincial in scope. The term of the 3-year residential agreement parallels the term of the 3-year ICI agreement. In fact, the most recent residential agreement terminated on the same date as the ICI agreement. That is not a coincidence.

43. Many of the drywall contractors who belong to ISCA operate in both the ICI and resi­dential sectors of the construction industry. Their employees can work in either sector, or move back and forth. The employees are doing the same work regardless of what sector the project is in.

44. It therefore makes sense for residential and ICI bargaining to move in tandem. The negotiated wage rates are related. The sectors are different; but the drywall business involves the same unionized companies, the same local union, the same union members, and the same kind of work. That is why the union and the contractors have always bargaining the ICI and residential agreements together.

45. I have referred to the employers as "contractors", because that is the way that they usu­ally describe themselves. However, that is also the way that they do business. They enter into ''contracts'' to do the drywall work on projects controlled by builders or general contractors.

46. The builders are the ultimate source of the work, for the drywall contractors and for the employees who work for those contractors. It is the builder who decides which drywall contractor will be on the job site. That selection can be made on the basis of competitive bidding, or because the builder favours particular drywall companies that it has dealt with in the past, or because the builder has arrangements with a particular union that require it to direct work in a particular way. And, of course, the builder is concerned about cost, and ensuring that the work it has subcon­tracted will be done on time, and without undue disruption. The builders take that into account when they decide what contractor to engage.

47. Work can be steered to a contractor for a variety of reasons. But ultimately it is the builder who makes that decision. That means that both the drywall contractors and the carpenters' union must be sensitive to what the builders need. If the builders are not happy, the work will go elsewhere. The carpenters' union does not "own" the work.

48. I make this observation because some of the objecting employees seem to believe that they are somehow "entitled" to do drywall work on a particular builder's project simply because they have done that kind of work before. They seem to believe that there is no relationship between their wage rates (over $30.00 an hour) and the availability of work. They seem to believe that wildcat strikes that disrupt a work site will have no effect on the builders' appetite to have them back. They seem to believe that if they go on a lawful strike, no one else will do the work.

49. They are wrong on all counts.

50. It is also important to appreciate that the contractors organized by the carpenters union are not the only players in the market-place. There are a number of non-union contractors who can also bid for available work, and their costs may be well below those of unionized companies. In addition, in recent months Labourers Local 183 has shown an interest in organizing in the drywall industry - displacing the carpenters union wherever it can.

51. Companies unionized by the carpenters now face serious non-union competition, as well as competition from companies unionized by Local 183. To put the matter another way: dry­wall workers represented by the carpenters union now face competition from non-union workers (who may be prepared to work for a lower wage rate) and from members of Labourers Local 183 -especially if Local 183 can offer other advantages to builders or persuade the builders to deal with Local 183 or companies unionized by Local 183. (For an example of one such "top down" arrange­ment, diverting work to a particular union, see the situation discussed by the Board in Metropolitan Apartment Builders' Association, [1978] OLRB Rep. Nov. 1022; affd 1979 CanLII 1762 (ON HCJ), 24 O.R. 2d 394 (Divisional Court)).

52. And, in recent times, the construction industry has been slow. There has not been enough work to go around.

IV

What this case is about

53. It is fairly easily to summarize what this case is about.

The Employers Complaint

54. ISCA contends that for the last several months, it has been bargaining with the union with a view to amending the ICI agreement, and settling a new residential agreement. Both sectors were "on the table".

55. ISCA submits that in late June 1995, there was a general settlement. ISCA says, that the settlement did two of the things:

56. it revised some of the provisions of the existing (1995-98) collective agreement in the ICI sector;

57. it established a new collective agreement covering the residential sec­tor.

58. ISCA submits that, in ICI and residential, the union made wage concessions in return for strong "policing language" that would ensure that contractors adhered to the negotiated terms of the collective agreement (a serious problem in recent years). The wage concessions were signifi­cant. But so were the new penalties to prevent contractors from "cheating" on the wage rates. "Cheating" has been a growing problem in recent years. (see below)

59. The employers maintain that there are now binding collective agreements covering both the ICI and residential sectors of the construction industry: the ICI agreement as amended by the June settlement, and a new residential agreement that was also created by that settlement. It fol­lows that there can be no strike or lock-out in either sector until 1998. The revised wage package will remain in effect for at least 9-12 months until negotiated "wage reopener" provisions are trig­gered. A reopener was also part of the settlement.

60. The employers seek a Board decision confirming their legal and collective bargaining position.

61. In the section 126 application the employers seek a declaration that the ICI agreement has been properly amended and is binding upon the union and its members.

62. In the section 91 complaint the employers allege that the union is breaching its "duty to bargain in good faith", because it is failing to execute a residential agreement along the lines that have already been agreed upon.

The Employees' Complaint

61. In response to the proposed wage rollback contained in the alleged settlement, employ­ees have engaged in widespread unlawful strikes. That is what triggered the applications that I referred to above. However, in these proceedings, the objecting employees also challenge the legal basis for what ISCA says has happened. The objecting employees challenge both the conduct of their union and the validity of the alleged settlement.

62. Briefly put, the objecting employees argue that the persons bargaining on behalf of the

union had no authority to enter into the June settlement. They argue that concluding a settlement without reference to the union membership was contrary to the union's "duty of fair representa­tion". They also argue that the settlement flows from a "trusteeship" over Local 675 that was con­trary to section 138.5 of the Act, because it was imposed by the parent union without just cause. And they assert that, in all the circumstances, there was either no settlement at all, or that the Board should set the settlement aside.

63. Local 675 and the OPC both deny that there has been any breach of the duty of fair rep­resentation. Local 675 and the OPC also deny that there is anything wrong with the trusteeship that was imposed on Local 675 by its parent international union. In their submission, the Trustee­ship was imposed for cause and the settlement was bargained in good faith, with due regard for economic realities (even if the employees may have difficulty understanding that).

64. However, like the objecting employees, the OPC and Local 675 argue that there was no binding settlement in June 1995, and thus no valid amendment to the ICI agreement and no new agreement in the residential sector. Accordingly, the union and the objecting employees agree on the result - even though they urge the Board to get there in different ways.

65. The OPC claims that Local 675 is not the provincial bargaining agency and therefore had no authority to amend the ICI agreement or bind the OPC to do so. The OPC further claims that the ICI component of the June settlement was properly rejected when the OPC found out about it and considered its terms. The OPC submits therefore, that, insofar as the IC! sector is concerned, there has been no valid amendment to the 1995-98 ICI collective agreement. There has been no mutual agreement as required by Article 28. In the OPC's submission, the ICI agreement and the ICI wages remain the same as they were before - and will stay that way unless there is mutual written agreement to change them.

66. Insofar as the residential sector is concerned, Local 675 submits that there is no agree­ment either. Local 675 maintains that throughout the bargaining, everyone understood that there would be one "package deal" that established uniform rates for employees working in ICJ and residential. That is the way that bargaining has been conducted for years. The wage rates were linked, and were intended to move together. Once the ICI portion of the settlement was rejected by the OPC, the entire package falls, because the employers always understood and insisted upon a "package deal".

67. In summary, then, this case requires an examination of the events preceding and follow­ing the controversial June "settlement", in order to decide:

68. whether the parties have or have not effectively amended the ICI agreement;

69. whether the parties have or have not effectively established a new collective agreement in the residential sector which Local 675 can be compelled to execute;

70. whether the union has or has not breached its duty of fair representa­tion; and if it has, what remedy should flow from such breach; and

71. whether a trusteeship over Local 675 was properly imposed and, what remedy, if any should be given concerning the trusteeship.

V

Credibility

68. Many of the facts in this case are not controversial - although the parties have quite dif­ferent views about their significance. However, to the extent that 1 have had to resolve disputed facts, or prefer the testimony of one witness over another, I have taken into account such factors as: the demeanour of the witnesses when giving their evidence; the clarity, consistency, and overall plausibility of that testimony when compared to the other oral and documentary evidence and sub­jected to the test of cross-examination; the ability of the witnesses to resist the tug of self-interest when framing their answers or to candidly concede facts contrary to their interest; and what seems most probable in all the circumstances. On that basis, I am troubled by some of the testimony of Doug Bickle for the objecting employees, and Rick LeCompte for the OPC.

69. Now, of course, quite a bit of the evidence involved what was said or done in negotia­tion or union meetings, where many persons were in attendance, and much was discussed; more­over the debate spilled over from one meeting to another. One cannot expect an untrained witness to recall details which were not particularly significant at the time. In those circumstances, incon­sistencies or contrary recollections are almost inevitable, and I am satisfied that some of the differ­ences between the witnesses stem from a simple failure of memory, a disposition to "hear what one wants to hear", or a natural inclination to recast one's recollections in light of what one believes the situation "should be".

70. On the other hand, Mr. Bickle's memory was unusually selective — suggesting that he was either not being complete candid with the Board, or that he did not understand the signifi­cance of what was going on around him.

71. It is difficult to believe that Mr. Bickle worked in the drywall industry for 22 years with­out knowing whether the contractors who employed him were unionized. Yet that is what he said. It is difficult to believe that he did not know how long his brother had been a member of Local 675 (only a few months) and he was quite evasive on that point. It is difficult to believe that he did not know that the ongoing bargaining with the contractors involved both ICI and residential, when that matter was raised at several union meetings where Mr. Bickle said he was in attendance. It is diffi­cult to accept that he did not know about the ongoing Local 183 raids until the end of March, or that those matters were not a serious concern at general member meetings, or that he did not understand the risk that a Local 675 strike might prompt contractors and builders to drift to Local 183. The minutes of the union meeting suggest that all of those items were canvassed regularly between February and June, because they were of serious concern to the membership. The minutes are substantially confirmed by the testimony of Helmut Redermeier the business manager of Local 675, and Roy Williamson another union member.

72. Similarly, Mr. LeCompte was not particularly forthcoming when cross-examined on whether the proposed ICI amendments that the OPC rejected were similar to changes that had earlier been approved. Nor was he very forthcoming when asked about the "real" reasons for the OPC's position.

73. In the result, I do not think that these troubling aspects of the testimony affect all of the witnesses' testimony or many of the findings of fact. But I have had to take that into account when deciding what happened and why people acted as they did. For completeness, though, I should record that I found Messrs. Thomson, Laird, Muso and Williamson to be forthright and credible witnesses — even though their evidence did not always coincide. For the most part, their answers were clear, unequivocal, prompt and confident; and I am satisfied that they were doing their best to recall what had happened and when.

VI

74. With that background then, I will turn to the events that led up to the "settlement" that is here under review. Those events involve both union meetings were employer representatives were not in attendance, and collective bargaining meetings where the objecting employees were not present. They also include the raid by Labourers' Local 183, which became a growing concern for Local 675 and the contractors in the weeks preceding the settlement.

75. It will be convenient to review those events in chronological order~ beginning in mid-

VII

The Events Leading Up to the Challenged June Settlement

The Port Severn Accord

76. The most recent ICI and residential agreements were scheduled to expire at the same time on April 30, 1995. But neither the union nor the contractors welcomed the prospect of a new round of ICI bargaining with its inherent uncertainties and the possibility of a province-wide strike.

77. By 1994 the construction boom of the 1980's was a distant memory. The demand for new construction was weak, and apparently worsening. Jobs were scarce and there was fierce com­petition for the available work. Contractors were suffering, and many union members were out of work. It was not the best time to be negotiating a new ICI provincial collective agreement.

78. The situation was no better in the drywall segment of the industry. As much as 30 per cent of the market was now occupied by non-union companies — up significantly from previous years. It was increasingly difficult for unionized contractors to win competitive bids. The residen­tial market was shaky. From the contractors' perspective, it was no time for uncertainty or a work stoppage that might only benefit the non-union competition.

79. In order to meet these concerns, in early 1994 the EBA and the OPC entered into nego­tiations with a view to the early renewal of the ICI agreement. The objective was to have the 1995-98 ICI agreement fall immediately into place, without a strike, when the 1992-95 ICI agreement expired on April 30, 1995. The result of these discussions was the so-called "Port Severn Agree­ment".

80. The Port Severn Agreement was described by Jim Thomson of the EBA as a "new era of bargaining and co-operation" that was intended to overcome the difficulties then faced by the unionized sector of the industry. The Port Severn accord was concluded in June 1994 and eventu­ally ratified by the union and its Locals in November 1994. However, that ratification was neither quick nor easy. Half of the union locals initially rejected the "status quo" features of the agree­ment. Those Locals were uncomfortable with an agreement which, among other things, seemed to virtually freeze wages for 3 1/2 years.

81. The details of the Port Severn Accord [Exhibit 3] need not be set out here. It suffices to note that it involved very small ICI wage increases, together with ongoing discussions that could result in further agreements or arbitration if the parties could not agree. It was a flexible formula permitting ongoing negotiations at various levels, but limiting the number of items that could ulti­mately be submitted to arbitration. If there was no further agreement the status quo would be maintained. The arbitrator was not permitted to lower wages below the level in the 1992-95 collec­tive agreement.

82. In effect, the Port Severn Accord combined three more years of industrial peace with ongoing negotiations and (among other things) an arbitrable wage re-opener so that wage rates could be adjusted upwards to reflect changes in the construction market. Those ongoing discus­sions could include changes to the master portion of the agreement, changes to the appendices, or changes to the specific sub-divisions and schedules pertaining to drywall rates and conditions in local areas where the carpenters had local union branches (for example Local 785 Cambridge, Local 18 Hamilton-Niagara, Local 2041 Ottawa, Local 675 Toronto etc.). The Port Severn Agree­ment itself did not involve any wage concessions although that was a possible result of local bar­gaining if all of the parties were agreeable.

The ISCA - Local 675 Bargaining: ICI and Residential

83. The negotiations between ISCA and Local 675 took place in the shadow of the Port Severn Accord. According to Jim Thomson, the EBA permits its constituent associations complete freedom to negotiate the terms of "their" appendices. Mr. Thomson is secretary of the EBA and general manager of the Labour Relations Bureau of the Ontario General Contractors' Association.

84. On the employer's side, therefore, the EBA is largely a "rubber stamp". The EBA is prepared to approve what its constituent employer associations believe to be sensible for their seg­ment of the industry.

85. In this case, the constituent employer associations were ISCA and AAO. Between them, these two associations represent unionized drywall contractors who deal with the carpenter's union (and perhaps other unions as well). It is ISCA and AAO that actually represented the con­tractors when bargaining began for new terms in the drywall industry. The items to be discussed included the Local 675 schedule of wages, special conditions, and benefits, and the apportionment of the wage total among the various trust and welfare funds operated on behalf of employees. The purpose of those discussions was to produce agreed-upon amendments to be plugged into the framework 1995-98 ICI agreement that had been put in place by the Port Severn Accord.

86. So far, I have been speaking only about the ICI bargaining process and aspects of the ICI collective agreement. However that is not the whole picture.

87. As I have already mentioned, the distinction between ICI and residential is a little arti­ficial in the drywall business. Unionized drywall contractors bid on jobs and do work in both ICI and residential (i.e. they enter into sub-contracts with builders who do ICI and residential con­struction projects). Similarly, drywall installers work in the ICI and residential sectors, and may move back and forth from one project to another. There is really only one "drywall industry" —that is split into "union" and "non-union" contractor groups, and is now being sub-divided again into unionized contractors who deal with Local 675 or contractors who deal with Labourers Local 183.

88. That is why it is customary to bargain the ICI and the residential agreements together, and to make sure that the wages in the ICI agreement congruent with the wages in residential. It makes no sense to have different rates, and according to Hugh Laird of ISCA, there would be "chaos in the industry" if there were different ICI rates. The union and "Local 675 contractors" must also take into account what "non-union companies" and "Local 183 companies" are doing. Local 675 wage rates cannot be "out of line" in comparison with the competition; because if they are, the Local 675 contractors and the Local 675 members will get no work.

89. The evidence establishes that the ICI and residential drywall negotiations have been conducted together since at least 1978. ISCA is the main player on the employer's side, represent­ing about 85 companies. It is also an important constituent in the provincial EBA, which ultimately controls employer bargaining in the ICI sector.

90. In addition, ISCA has been "accredited" as the representative of companies in Ontario in the residential sector, who have collective bargaining relations with Local 675 (see sections 136-137 of the Labour Relations Act, together with the accreditation order dated April 27, 1984.) In residential, ISCA is an important player in its own right.

91. Local 675 (Toronto) is an influential Ontario Local and thus a component bound by the bargaining conducted by the OPC. The OPC represents a number of Ontario local unions in ICI bargaining (again see the first page of the ICI agreement). However Local 675 is the dominant player in its own right for the purposes of bargaining in the residential sector. Local 675 is the bar­gaining party to the provincial residential agreement that expired on April 30, 1995.

The Bargaining: February - June 1995

92. In early 1995 ISCA representatives met with representatives of Local 675 to discuss changes to the Local 675 portion of the ICI drywall appendix as well as the terms of a new residen­tial agreement. The employers wanted a "package deal" for both sectors. The negotiations pro­ceeded on that basis.

93. The employers were represented in bargaining by Hugh Laird, Bob McKean (Manager of ISCA) and Joe Liberman (counsel), together with miscellaneous individual contractors who attended bargaining meetings from time to time. Between January 1995 and the end of March 1995, the unions' principal spokesman was Gus Simone, the Business Manger of Local 675.

94. The negotiations took place in a context of a growing contractor concerns about the state of the market and their ability to compete at prevailing wage rates. Slack demand and grow­ing non-union competition put the viability of their businesses in jeopardy, and promoted many companies to ignore the collective agreement altogether. Increasingly, companies were striking "deals" with employees at lesser wage rates, in order to facilitate making a lower bid. With lower wage rates, contractors could make a lower bid and get the work. At the collective agreement rates, contractors were finding it hard to compete. And when one Local 675 contractor lost out to another, the losers began to suspect that the lower bidder had a "private deal" with employees that paid wage rates lower than those in the collective agreement.

95. Violations of the collective agreement were widespread and were being routinely con­doned by employees, who were only willing to take lower rates if the alternative was no work at all. Moreover, these practices were difficult to detect and counteract. Employees and contractors were co-operating to produce false documentation that made it a hard to check the adequacy of payments for work done (for example: "straight cheques" paid to employees without deductions or an hourly breakdown, giving employees 40 hours pay for 48 hours work, etc.).

96. Without solid proof or accurate documentation, it was difficult to enforce the terms of the agreement or prove that there had been a violation. And under the Labour Relations Act the onus is on the union to prove that a breach of contract has occurred, and to prove the amount owing to the aggrieved employee - assuming the employee was prepared to grieve at all. The problem was aggravated by the volume of employee grievances (each of which required its own pro­ceeding before the Labour Relations Board) and the fact that many of the workers did not speak English.

97. In other words, in the face of deteriorating market demand and non-union competition a large number of employers and union members were prepared to strike individual bargains and work on terms inferior to those prescribed in the collective agreements. To put the matter another way: the state of the labour market was signalling that the wage rates probably should be below those set out in the current agreements. It is hard to maintain the negotiated rate if workers are prepared to work for less.

98. In the face of such pressures the collective agreement was beginning to unravel. For, of course, once a few companies began to undercut the rates to preserve their businesses or get a competitive edge, there was growing pressure for all contractors to do the same. Once a few employees agreed to work below the contract rates in order to get work, other employees were encouraged to do likewise. Union solidarity was being sorely strained. But so was the fabric of the employer association, which, after all, was composed of competitors who expected that banding together for collective bargaining purposes would ensure a level playing field for labour costs.

99. Between January and March 1995 there were a number of bargaining meetings to exam­ine these problems and explore ways of modifying the existing agreements (ICI and residential) to accommodate these business realities. But there was no agreement reached.

100. Sometime in February, Gus Simone seemed amenable to a settlement formula that would include wage concessions in return for tough "policing language" that would compel con­tractors to comply with the agreement and would impose stiff penalties if they stepped out of line. This formula was to be embodied in both the ICI and residential agreements, and would be accom­panied by parallel penalties for union members who were working below the negotiated rates. Simone was prepared to lower the rates to secure the work, provided that the contractors actually paid the rates that were agreed upon. The trade-off for wage concessions was effective policing lan­guage.

101. However by the end of March, the parties had not settled the magnitude of any wage concessions nor the form of the policing mechanism. There was an understanding of what a settle­ment might look like in general terms, but there was no agreement on the details.

102. In particular, there was, at that time, no suggestion that there would be major wage cuts in the Toronto area — let alone the the 30 per cent rollback that the companies later demanded. And, at that point, members of the AAO were much less enthusiastic about a "policing mecha­nism" than members of ISCA. There was no policing language at all in the 1992-95 lCI agreement.

103. By about mid-March 1995, local union politics and inter-union rivalry began to intrude on the bargaining. Gus Simone defected to Labourers' Local 183 which was then beginning to "raid" Local 675 (although Simone's defection was not confirmed until late in the month). Claudio Mazzotta, President of Local 675, also defected to the Labourers'. So did several Local 675 busi­ness agents. And a considerable number of Local 675 members also joined the Labourers' union.

104. The identities of employees signing with Local 183 are protected by section 113 of the Labour Relations Act. But there is not doubt that whatever Local 675 members may be telling Local 675 officials, quite a number of them have decided that their interests would better served by Labourers' Local 183. Local 183 has filed 9 or 10 certification applications, affecting some of the largest drywall companies that now deal with Local 675. In each case, Local 183 asserts that a majority of employees now want Local 183 to represent them.

105. On March 17, 1995, Local 675 conducted its regularly membership meeting. Mazzotta was present as was Simone, who was supposedly "on vacation" at the time. However, since Mazzotta resigned at the end of the meeting, it seems pretty clear that both he and Simone had cast their lot with the Labourers' some time before that.

106. It was at the March 27 meeting that Doug Bickle was selected to be on the "residential bargaining committee" for the residential agreement. It is not quite clear what that "bargaining committee" was supposed to do, because it had never existed before, Simone departed shortly thereafter, and the "committee" did not actually engage in any bargaining for some time. The Local by-laws do not require a consultative body of this kind.

107. Doug Bickle testified that on March 27 he was "elected" by the members of the Local who attended the meeting. But, in fact, there was no vote taken. Bickle was "nominated" by some unidentified union member(s) and Simone approved of the selection with the comment "If that's what the members want ...".

108. At this point, Mr. Bickle had been a member of the carpenters union for only three months, and on his own testimony, had attended only one general membership meeting. Mr. Bickle had no prior experience bargaining a collective agreement. He had no prior experience in the unionized sector of the construction industry. And if his testimony is to be believed, he has lit­tle understanding of the way in which bargaining has been conducted or the realities of the current bargaining environment.

109. It appears that the March 27 meeting was Simone's last official action before he and Mazzotta went over to the Labourers' union to assist Local 183's raid on Local 675.

110. Under the Labour Relations Act, employees are entitled to change unions (i.e. one union can displace another) during the last two months of a collective agreement. Since the carpen­ters' residential and ICI collective agreements both expired on April 1995, "the raiding period" was March and April 1995 and could be extended if there was no replacement agreement negoti­ated. The raiding period parallels the period for negotiating a new collective agreement.

111. As I have already mentioned Labourers' Local 183 has filed applications to displace Local 675 at nine drywall companies, including some of the largest ones. The labourers have mounted similar raids in respect of drywall tapers (represented by the painters' union). Local 183 is moving on a broad front to establish one dominant union in the drywall industry.

112. The Labourers' campaign requires Local 183 to persuade members of other unions to join 183. However there are also allegations that Local 183 elicited the support of the employers, who were supposedly told that it would be in their interest to deal with a single union with close connections to the builders. In all likelihood, the defection of Simone and Mazzotta will assist the Labourers' campaign.

113. The Labourers' raid is not the focus of the present proceeding. But it is clear that Local

675 was under serious attack and that the raid would influence the course of bargaining. The ongoing bargaining with ISCA was already difficult. The contractors were demanding concessions in order to secure their access to work.

However the Labourers' raid added another dimension to the problem. A strike by Local 675 could now prompt builders to switch to either non-union contractors or Local 183 contractors, who could ensure that drywall work continued without interruption. Builders could have their work done "union" without having Local 675 on their job sites. Helmut Redermeier, a long-time Local 675 official, thought that a strike would "play into Simone's hands".

114. Helmut Redermeier has been a business agent of Local 675 for 17 years, and has been hiring hall dispatcher from time to time. After the imposition of the trusteeship on March 29, 1995, Trustee Jim Smith appointed Redermeier as Acting Business Manager of the Local. It was what Redermeier's describes as a "friendly supervision". The parent union did not involve itself in the day to day affairs of the local. Redermeier was instructed to carry on "business as usual" -although, as he understood it, the trusteeship suspended the regular functioning of the local union, so that he was no longer obliged to adhere strictly to the local by-laws.

115. One of the functions that Redermeier assumed was the ongoing renegotiation of the ICI and residential agreements. That is a function that the business manager has under the local by­laws. Redermeier was assisted by Collin Weller, the secretary-treasurer of Local 675.

116. Weller and Redermeier took over where Simone had left off. However, by late March 1995, the contractors' position had hardened. They were still prepared to consider adding stringent "policing language" to both the ICI and residential agreements. But in return, they wanted signifi­cant wage cuts, which extended into the Toronto area where the majority of Local 675 members work. The contractors maintained that the market situation was continuing to deteriorate and that their businesses were not competitive at the prevailing agreement rates.

117. On April 10, 1995 the members of ISCA had a meeting on short notice to consider the ramifications of the Labourers' raid, and the potential impact on their dealings with Local 675. Their discussion is accurately summarized in the minutes of the meeting:

The chairman opened the meeting by explaining that this meeting had been called on such short notice, due to all the rumours presently existing, due to the fact that the business manager and two business agents of Local 675 had moved to the Labourers Union, along with three business agents from Local 27. It was suggested that the Labourers Union planned a raid on the members of Local 675. The question was asked if any members knew of their employees being approached by the Labourers Union.

There followed a general discussion about the market conditions existing, most members were convinced that prices were getting worse in recent months, and non union competition increas­ing. The suggestion was made that it might be a good time for an approach to both unions Local 675 and 1891 for a roll back in wages for Toronto and surrounding areas.

Finally a motion was duly made seconded and carried unanimously that the Association inform both Local 675 and [painters'] 1891 that at the end of the current collective agreements we would be seeking a reduction of thirty per cent in all monetary wage items across the board for the Toronto area and vicinity.

There followed more discussion some members feeling that a thirty per cent reduction was not realistic, but generally it was concluded that this figure truly reflected the marketplace and was was happening out there.

118. The employer members of ISCA also considered the incidence of "cheating" to which I have already referred. They concluded that the existing policing language in the residential agreement simply wasn't working. They voted to scrap it on ten days notice — as they were entitled to do.

119. As of the end of April there was no policing language in place. But there was a willing­ness to have better language in both the residential and ICI agreements, if the union would agree to concessions.

120. Between April and mid-June Weller and Redermeier were the chief spokesmen for Local 675. The members of the committee struck by Simone on March 27 had no involvement.

121. There were bargaining meetings on April 13, May 27, June 5 and June 15. But there there no agreement. The employers were insisting on major wage concessions in return for a strict enforcement mechanism; and while Local 675 was anxious to obtain a policing language, it was not prepared to agree to a thirty per cent wage cut.

122. Local 675 was also attempting to assess the threat from Local 183. The defection of Simone and Mazzotta was likely to facilitate Local 183's approach to both Local 675 members and Local 675 contractors. The nine certification applications suggested that Local 183 had "signed up" a number of Local 675 members. Local 675 urged its members to resist the promises of Local 183, which had made no secret of its intention to "take over" the drywall industry.

123. Mr. Bickle was not present for the bargaining sessions prior to June 21. Nor did he seek to attend — despite his appointment to the "negotiating committee" some weeks earlier.

124. The EBA and the OPC were not involved in the bargaining even though the negotia­tions related to both the ICI and residential agreements. Throughout this period, Mr. Redermeier never said that he was representing or spoke for the OPC. However, he did say that he had the authority from Jim Smith to sign a deal on behalf of Local 675 covering both the ICI and residen­tial sectors of the industry.

125. I should note that while Jim Smith was trustee over Local 675, he had no authority with respect to other Ontario Locals. Nor did the trusteeship or Mr. Smith's role as trustee have any­thing to do with the provincial bargaining agency. Mr. Smith does not speak for the OPC, and, in fact, played no role in the bargaining. Whether or not the International Union could tinker with the provincial bargaining scheme through the device of a "trusteeship", there is no evidence that it intended to do so.

126. On June 21 and June 23, there were further negotiation meetings. The parties' positions were very much the same. This time, though, Mr. Bickle was in attendance.

127. Mr. Bickle's presence did not contribute to either the tone or the progress of the bar­gaining. He insisted that he was only there to discuss the residential sector (which was where he worked) and he got into a shouting match with several of the contractors, who pointed out — quite correctly — that for the last five months the parties had been discussing a package deal in both ICI and residential. They did not welcome the presence of someone who seemed completely ill-in­formed, and had recently helped to organize the unlawful strikes.

128. Mr. Bickle was unsympathetic to the employers' concerns about competition, the deter­iorating market, the growing non-union threat, or the consequences of a possible strike. He thought this was just a bargaining tactic. He was either unaware or did not appreciate the signifi­cance of the "policing language" that had been under discussion for some time - which is a bit sur­prising given Mr. Bickle's complaints about the the number of outstanding grievances. The whole purpose of the policing language was to ensure compliance with the agreement so that grievances would be unnecessary.

129. Mr. Bickle's focus was the proposed wage rollback, which he maintained the members would never accept. By June 23, Mr. Bickle had reached the conclusion that a strike would be the best way to promote the members' interests. He admitted in the course of cross-examination that all he ever really wanted was a lawful strike. That was his objective.

130. In the course of the hearing, much was made about the employer's angry reaction to Mr. Bickle's presence at the bargaining table. However, I do not think that there was anything sin­ister about that. A hostile reaction was almost inevitable in the circumstances. Mr. Bickle had no knowledge of the unionized employers' situation or the economics of the unionized sector of the construction industry. He had worked non-union for twenty-two years. Had only been a union member for three months. He had virtually no experience in collective bargaining and no experi­ence of construction industry bargaining. His manner was abrasive, and he seemed to be rejecting the framework for discussion that had been pursued by both parties for some time.

131. It is hardly surprising that the employers had an adverse reaction when Mr. Bickle was parachuted unexpectedly into the bargaining, dismissed their concerns out of hand, and rejected the basis on which negotiations had preceded for the previous five months.

132. Mr. Bickle's presence at the bargaining table was not likely to lead to a accommoda­tion. It was more likely to lead to a strike.

133. On the other hand, it must have been clear to the contractors that, if Mr. Bickle was representative of the rank and file membership, there was great resistance to any wage conces­sions.

134. Mr. Redermeier testified that that was one of the reasons why he had brought Mr. Bickle along. He wanted to expose some union members to "what he was up against". But, at the same, he also wanted to show the employers the difficulty that he was having restraining the rank and file membership or persuading them that concessions were necessary.

135. In the course of the discussions Mr. Redermeier advised the contractors that, as things then stood, if he put the proposed wage cuts before the membership for their acceptance, he would be "laughed out of the hall". Redermeier had little appetite for that - despite the contractors' insis­tence that he take their proposals to the members, explain the situation, and see if the members would accept it.

136. As of June 23, 1995, there was no agreement for either the ICI amendments or the new residential agreement. If anything, the presence of Mr. Bickle made a settlement more remote than ever.

137. While collective bargaining was going on, the officials of Local 675 were consulting the membership, to advise them what was happening at the bargaining table and to discuss the impact of the Local 183 raids. There were local executive meetings on April 18, May 16 and June 20. There were general membership meetings on April 1, April 12, May 29 and June 26.

138. Over the course of these meetings, there was considerable discussion about the tactics of Local 183, the threat of non-union competition, the deteriorating construction market, and the risk that a strike would prompt builders to direct work to non-union or "Local 183 companies". There was also a considerable discussion about the ongoing "cheating" by contractors and union members alike. There were quite a number of grievances that would have to be taken as applica­tions to the Ontario Labour Relations Board. Mr. Redermeier advised the members that they should insist on the contract rates, and retain the work records so that grievances could be pursued as necessary.

139. It was clear to Mr. Redermeier that quite a number of union members were willing to work below the contract rates, making it very hard for him to insist that those rates should be maintained - despite the members' supposed resistance to wage concessions. At the May 29 meet­ing Mr. Redermeier conducted a poll to see how many workers were being paid the contract piece­work rate. No one stood up. A few workers indicated that they were being paid 15% less. It appeared that others might be working for even less. Mr. Redermeier wondered how he could argue against concessions when the members were obviously willing to work for much less than the rates stipulated in the agreement.

140. Similarly, while members were openly expressly their support for Local 675, it was clear that a significant number of them had secretly signed on with the Labourers. From Redermeier' s perspective, there was a big gap between what the members were saying, what they were doing, and what was realistically attainable at the bargaining table.

141. At the union meeting of May 29, there was a heated discussion about the proposed roll­backs, the volume of grievances and the continuing erosion of collective agreement standards. Redermeier advised the members that the bargaining parties were still far apart. There had been no agreement to any concessions, and the next step was to seek conciliation, so that employees would be in a position to engage in a lawful strike (in residential only - the ICI agreement was still in place so no ICI strike was possible).

142. At the same time, Redermeier reiterated that there were serious problems in the indus­try, and he warned that a strike could prompt the builders to channel work to Local 183 - in which case the members "could kiss the work and Local 675 goodbye". Redermeier also warned that Local 183 was pursuing direct agreements with builders that would channel work away from Local 675 contractors. A strike would merely encourage builders to enter into arrangements of that kind. If builders entered into a restrictive contracting arrangement with Local 183, Local 675 contractors would be excluded from the job sites.

143. These were not unreasonable fears. The Labourers have done such things before, and there may not be anything illegal about such tactics. However, as of May 29, the membership of Local 675 was left with the impression that:

(1) there was no agreement between the parties and no agreement likely in the near future;

(2) there would be further negotiations with the contractors and further consultations with the membership before any agreement was reached; and

(3) that the next steps involve an application for conciliation (to put the local in a lawful strike position), and a strike vote.

144. On May 30 and June 1 there were widespread unlawful strikes in response to the con­tractors' proposed wage rollback. Redermeier feared that the unlawful work stoppages alone would prompt builders to re-direct the flow of work, or prompt Local 675 contractors to seek their own accommodations with Local 183. Redermeier also knew that Simone had long-standing personal relationships with the Local 675 contractors, which Redermeier expected would now be employed to encourage the contractors to favour Local 183. The unlawful strikes were not helping the situation. As Redermeier put it "my lips were brown trying to persuade contractors to stay with us".

145. Redermeier promised the striking members that if they would go back to work, he would go on bargaining and seek a no-board report from the Minister of Labour (which must be obtained before a lawful strike can occur - see section 74 of the Act).

146. On June 26, 1995 there was another membership meeting which, by all accounts, was noisy and turbulent. The rollbacks that had been suggested by the contractors were raised once again, and rejected by the members with a resounding "no" from the floor. There was obvious frustration and a number of angry flare-ups.

147. On June 26, Redermeier assured those present that there would be no settlement with­out first going back to the membership for their approval. He said he would try to have a concilia­tion officer available for the next round of bargaining, so that the statutory requirement for a strike would be met. He also told the members that Mr. Bickle would be there at the next meeting - to the obvious approval of the members who gave a resounding cheer at the point. Redermeier indi­cated that there would be more membership meetings and that it would be necessary to arrange for a strike vote as soon as possible.

148. There was no indication that a settlement was imminent or that he was prepared to accept the wage concessions that had previously been rejected.

149. I might pause at this point to observe that the Labour Relations Act does not require that there be a ratification vote before there can be a valid collective agreement. The Act merely says that if there is such vote, it must conducted by secret ballot on reasonable notice (see section 74). In the ICI sector there are some special voting procedures that must be followed before a new collective agreement can be approved or rejected (see section 152 of the Act). But those provisions have no application in this case, because what was in issue were amendments to the existing 1995-98 ICI agreement.

150. Ratification votes are a common feature of the labour relations scene. But the statute does not expressly require them. In fact, in some circumstances, a trade union may be entitled to sign a collective agreement even though a majority of employees have rejected it (see the situation discussed by the Board in K-Mart Distribution Centre, [1981] OLRB Rep. Oct. 1421).

151. Nor was Local 675 required to take Mr. Bickle back to the bargaining table. Indeed there were good reasons why Mr. Bickle should not be there, given his inexperience and the prob­lems that arose at the two meetings that he did attend. His selection in March was, to say the least, problematic. He had taken no part in the bargaining between March and the end of June. He had no bargaining experience to speak of, and he had only bee a member of the union for 3 months. For 22 years he had worked for the non-union competition. And his stubborn demand for a strike was not likely to prompt a settlement without one.

152. Nevertheless, I am satisfied that by June 6, Mr. Redermeier had assured the members of Local 675 that: there would be no settlement without further consultation and ratification by them, that Mr. Bickle would be involved in the next bargaining session, that he would apply for conciliation, and that he would arrange for a strike vote.

153. At the end of the June 26th meeting told Bickle that he would be informed when the next bargaining session was scheduled. But Redermeier did not do that.

154. The next bargaining meeting took place two days later on Wednesday June 28, 1995. There was a further meeting the following day, June 29th. At those meetings, Redermeier, Weller and the representatives of ISCA concluded the "settlement" which is at issue in these proceedings.

155. No one advised Bickle or the members of Local 675 that further meetings would take place that week. No one told the members that the local officials were suddenly prepared to sign a settlement that included significant wage concessions (thirty per cent) in return for strict policing language. There was no further consultation with the members at all, and no ratification vote. Nor did Redermeier and Weller seek the assistance of a conciliation officer or arrange for a strike vote as they had said they would.

156. On June 28th, Redermeier and Hugh Laird signed a document [Exhibit 11] entitled "Memorandum of Settlement ... between United Brotherhood of Carpenters and Joiners of Amer­ica ... and ... Interior Systems Contractors Association ...". The settlement encompassed eco­nomic terms and working conditions, hours of work, the withdrawal of an outstanding unfair labour practice complaint, an arrangement for dealing with outstanding grievances, and a provision allowing employers to "name hire" workers in Local 675's jurisdiction (i.e. allowing the contrac­tors to select the particular workers that they wished to employ).

157. The June 28th settlement is clearly intended to apply in both the ICI and the residential sectors of the construction industry. It contains this preamble:

"It is agreed by the parties hereto that the Collective Agreement between them in the Residen­tial Sector of the Construction Industry expired April 30, 1995 and the Appendix for Local 675 in the ICI sector shall be amended as follows.."

158. The settlement is made "subject to the parties finalizing all delinquency and collection items no later than July 7, 1995 effective July 15, 1995 the following rates shall apply ...". This was a reference to the "policing language" to which I have already referred, which had apparently been substantially settled by June 15, 1995. One of the problems with the "policing language" was its potential collision with the Board's approach to "penalty clauses" in collective agreements - an approach which the negotiating parties were worried would undermine a sensible arrangement, necessary to preserve collective bargaining.

159. In the course of the discussions, in May or June Mr. Redermeier was asked whether he had authority to conclude a settlement without going back to the members or seeking further ratifi­cation. He indicated that he did. Mr. Redermeier testified that, as far as he was concerned, there was a "deal" on June 28. No ratification was necessary. Ratification was not an issue on June 28. The evidence is that when the settlement was signed the bargaining parties were elated and broke out a bottle of brandy to celebrate.

160. The next day, the parties met once again and concluded another (unsigned) document entitled "Memorandum of Agreement". It too is between "United Brotherhood of Carpenters and Joiners of America Local 675 (the union) ... and ... Interior Systems Contractors Association of Ontario (ISCA)". The June 29 agreement expands the one from the day before, and begins with this preamble:

"It is agreed by the parties hereto that the Collective Agreement between them in the Residen­tial Sector of the Construction Industry expired April 30, 1995, and subject to the Agreement Acoustical Association of Ontario, the Appendix for Local 675 in the ICI sector provincial agreement shall be amended as follows"

It is not subject to ratification or review by anyone else.

161. The June 29 document, although unsigned, contains a number of further changes to wages and working conditions in the ICI and residential sectors, including the establishment of a "joint labour management clause". I am told, that this is a reference to the "policing language" that the parties had substantially agreed to a couple of weeks before. The document notes that a four-page attachment representing their understanding of the "policing language" is to be consid­ered part of the memorandum.

162. The parties were in a hurry to deliver this document to Mr. Smith, Trustee of local 675, who was leaving for Ireland the following day. The parties wanted to obtain Mr. Smith's signature before he departed. Mr. Smith did not sign the document.

163. I am satisfied that as of Friday, June 30, 1995, all of the persons at the bargaining table (Laird, McKean and Liberman for the Contractors; Redermeier and Weller for Local 675) thought that they had a full and final settlement applicable in the ICI sector for Local 675's jurisdictional area, and applicable in the residential sector province-wide.

The Events Between June 4 and July 12, 1995

164. Rick LeCompte is the Secretary-Treasurer of the Carpenters Bargaining Conference ("CBC"), the division of the OPC that is directly concerned with the contents of the Provincial Agreement. LeCompte confirmed the outline of the Port Severn Accord, but also confirmed that its ratification had been quite difficult. He pointed out that half of the Local Unions had been opposed to it - including Local 675.

165. Some of the Locals were unenthusiastic about the Port Severn Accord because it was, essentially, a continuation of the status quo for an additional three years. There were a number of outstanding bargaining issues, and it was not at all clear that voluntary discussion or the limited arbitration arrangements would resolve them.

166. Among the other irritants in 1994, was what the parties described as the "mobility prob­lem": the extent to which contractors could bring their own workers with them when they worked on jobs outside their usual geographic market. If employers from outside a local area could bring in their own workers, there would be less work for local members in their home area. If companies were mobile, it was important that locally negotiated wage schedules be congruent, or the contrac­tors would play one local off against the other. Port Severn did not resolve that concern.

167. LeCompte testified that he knew that there were ongoing negotiations between ISCA and Local 675. That was contemplated by the Port Severn Agreement, and was confirmed by some discussions he had with Gus Simone in early 1995. However, LeCompte did not know what the parties were negotiating about, nor their intention to seek what might be regarded as very signifi­cant changes to the ICI Agreement in the Toronto area.

168. As I have already noted, Local 675 has never been authorized to speak on behalf of the OPC, and Redermeier was never told that he could do that. Nor did Redermeier ever tell ISCA representatives that he could speak on behalf of or bind the OPC (although that seems to have been ISCA's assumption). LeCompte testified that between February and June he had no conver­sations with Local 675 canvassing the ongoing local discussions.

169. LeCompte learned of the proposed settlement late on Friday, June 30 - that is, just before the Canada Day long weekend. Between June 30 and July 4 he had some difficulty contact­ing representatives of the CBC/OPC. Those members that he contacted were not enthusiastic about the proposed deal.

170. One member of the OPC suggested that a significant wage cut for Local 675 might aggravate the "mobility problem", and that if the ISCA proposals were to be acceptable, there would have to be some additional language to address that question. Whether this was genuine concern about mobility or a desire to exchange the OPC's agreement for further concessions, I need not decide. It suffices to say that, at that point, the OPC was not prepared to "rubber stamp" the agreement struck between ISCA and Local 675.

171. On July 4 and July 5 LeCompte (on behalf of the CBC/OPC) confirmed that the OPC was rejecting the proposed amendments, insofar as they affected the ICI sector. The OPC's rea­sons are not set out in LeCompte's communications and were initially said to involve the procedures adopted, and the way in which the documents purported to affect the ICI and residen­tial sectors.

172. I am satisfied that LeCompte was dissembling at this stage. Later, though, the OPC amplified its concerns, including: the size of the wage cuts; the form of the name hiring proposal which the parties intended to insert into the ICI Agreement; the form of the policing language; the potential impact on the mobility issue; and, perhaps most important, the fact that the memoran­dum had not been ratified by the membership.

173. There is nothing obviously unreasonable about any of these concerns - even though they were not articulated immediately. And by July 6, LeCompte would have been well aware that Local 675 was facing a membership revolt. There had already been unlawful strikes about the "possibility" of concessions, yet the settlement made them a reality - and without even a vote of the members. That was hardly likely to strengthen a union already under assault from Local 183.

174. Article 28 has been in the Collective Agreement for many years. But there are no estab­lished procedures for securing agreement under Article 28. Nor has the practice been uniform.

175. On August 31, 1994 Local 1946 (London) negotiated a settlement with the London and District Construction Association. That settlement was to amend quite a number of terms of the Local Schedule for London in the Provincial Collective Agreement. I am told that the settlement involved a significant wage cut.

176. The Employers' Provincial Bargaining Agency approved the London memorandum by signing it on or about September 15, 1994. However the OPC refused to approve the memoran­dum, and issued a notice to that effect dated September 12, 1994. The OPC gave no reasons for its objection or for its refusal to give its written agreement.

177. Thereafter, there were further efforts to resurrect the deal. But when those failed, the memorandum lapsed. No one suggested that the OPC was required to "rubber stamp" the local settlement, even though the local bargaining parties were in agreement with it.

178. On the other hand, under Article 28, the OPC has also approved quite a number of changes that were negotiated locally - including changes that involved significant wage cuts. The Kingston Local negotiated a 15 per cent wage cut, that was later approved by the OPC. Local 1316 a London Drywall Local - negotiated an $8.00 reduction which was likewise approved by the OPC. In both cases, the Local bargaining parties concluded that the Local construction market was weak, and a reduction in wages was necessary in order to meet non-union competition.

179. LeCompte described Article 28 as a "hardship" or an "enabling clause", that permitted wage adjustments so that union members would continue to get work. Wage adjustments for that purpose had been granted on a number of occasions. However, LeCompte testified that he was unaware of any major concessions that had not been ratified by the union members affected.

180. On the evening of Wednesday, July 5, ISCA held a meeting of its contractor members. The purpose of the meeting was to discuss the memorandum of settlement that had been con­cluded the previous Friday. The minutes of that meeting read, in part, as follows:

The memorandum with local 675 was distributed to the members present. Joe Liberman explained that in return for the union lowing wage rates by some thirty per cent we had to give the union language which would allow them to seriously penalize any contractors who did not abide by the collective agreement. Joe Liberman gave the members present an explanation of the penalties involved. There followed a general discussion about the memorandum, the chair­man informed the meeting about the many meetings which had taken place with the union, and he thought that the memorandum was the best possible deal we could get.

Finally a motion was duly made seconded and carried unanimously that the memorandum dated 28 June 1995 be ratified.

Joe Liberman asked the membership about our position if the memorandum was challenged and turned down in the ICI sector, it was the consensus of the meeting that our position had always been that our offer applied to both residential and ICI sectors, and if it was challenged and turned down in one sector, then we did not have a deal.

(emphasis added)

181. On July 6, LeCompte came to Toronto to attend a meeting with ISCA scheduled for that evening. Earlier on that day, he met a large number of angry union members who were milling around the union hall. In the circumstances, he could not have been in any doubt that the pro­posed settlement was a "problem".

182. On July 6, LeCompte and other representatives of the union met with representatives of ISCA to see if there was some way to resolve the controversy. LeCompte suggested that the par­ties needed a few weeks to consider their positions. He suggested that the parties had to be "more creative", that they had to make the [wage cuts] more palatable, that they needed "time to reflect", and that the package had to be refashioned so that the union could "sell it" to its mem­bers. By this time, of course, the union was clearly concerned about the level of employee unrest, which had already blossomed into unlawful strikes and threatened to fuel the Local 183 raid.

183. In accordance with the decision of its members the night before, ISCA maintained that there was one package deal for both ICI and residential. ISCA was unwilling to discuss residential alone or to back down on across-the-board cuts in both sectors. The union representatives replied that, in that case, there was "no deal".

184. The parties agreed to come back for further discussions in about a week. But as contrac­tor Sgotto put it, "if you come back asking for more money ... forget it".

185. The parties met again on July 12. The union had further proposals which, it said, might be more palatable and appropriate. But the ISCA representatives again refused to negotiate, maintaining that they already had a deal for both sectors. On July 12, ISCA's position once more was that it was "all or nothing". ISCA was not prepared to negotiate changes to the agreed-upon memorandum, nor separate provisions for ICI and residential. As before, the union replied that, in that case, there was no agreement.

186. On July 12, Jim Thomson, on behalf of the EBA wrote to the OPC requesting its for­mal agreement under Article 28 of the Collective Agreement. The OPC continued to refuse. ISCA and the EBA commenced these proceedings on July 14.

187. The EBA claims under section 126 of the Act that the OPC is required to execute the agreement that was agreed to at the Local level, and that from July 15 onwards the ICI terms pre­vailing in Toronto are those settled on June 28-29. On the section 91 branch of the claim, ISCA contends that Local 675 is bargaining in bad faith when it refuses to sign a residential agreement based on the June 28-29 settlement. ISCA argues, in the alternative, that there is at least an agree­ment in the residential sector.

188. I might note, in passing, that in their arguments before the Board the parties are taking different positions than they took in bargaining up to and including July 12. Until July 12 the employers were maintaining that they had an "all or nothing" deal, that applied to both ICI and residential. The union said that there was no deal at all in the ICI, but there might be a binding res­idential agreement.

189. Before the Board, however, ISCA argued, in the alternative, that it had an agreement in a residential sector even if there was no agreement in the ICI sector. The unions argued that because the bargaining was intertwined, there is no deal at all in either sector.

DECISION

Has there been a valid amendment to the ICI agreement?

190. On this branch of the case, I must decide whether the OPC was in breach of the ICI agreement, when it refused to extend the "written agreement" contemplated by Article 28. In the contractors' submission, the OPC should either be deemed to have given its consent to the pro­posed ICI amendments, or the Board should direct the OPC to give the "written agreement" required by Article 28. The contractors maintain that, in all the circumstances, the OPC is not enti­tled to withhold its agreement.

191. I do not think that any of those propositions are sustainable, having regard to the statu­tory scheme, the collective bargaining background, and the language of Article 28 itself.

192. I find first of all that Mr. Redermeier was not authorized to speak for or bind the pro­vincial bargaining agency - the OPC. He was not an officer of the OPC, he was not the agent of the OPC, and no one from the OPC suggested that Redermeier was its spokesman. Nor could that be reasonably inferred from Redermeier's temporary appointment as business manager of Local 675.

193. No doubt Mr. Redermeier was entitled to involve himself in the residential negotiations in which Local 675 was engaged, and those negotiations could encompass parallel ICI changes. That is the way things seem to have been done in the past. But the OPC never gave Redermeier advance authorization for absolutely anything Local 675 might be disposed to agree to, nor did Mr. Redermeier say that he had such authority, nor did the OPC ever suggest to the EBA that Mr. Redermeier had "carte blanche" in the ICI sector, or that the OPC would "rubber stamp" any ICI changes agreed to locally.

194. It is understandable that the ISCA representatives thought that the OPC would go along with any deal that was negotiated locally. That is the way the employer organization itself oper­ates, and Mr. Redermeier probably did say that he expected the OPC to approve the settlement. After all, local negotiations were contemplated by the Port Severn Agreement, and for the drywall industry, the ICI and residential agreements had always been negotiated together in order to main­tain comparable wage rates regardless of sector. That had been the past practice, and there was no reason for the employers to expect that it would not continue. Redermeier had the authority to set­tle the residential rates, and there was every reason to expect that the residential and ICI rates would move together as they had done in past.

195. But more than that, the settlement was a reasonable one - at least from the contractor's perspective - and it was developed within the framework (wage concessions for policing language) that had been under discussion for some months. There were concessions on both sides, that the negotiators honestly considered necessary to meet the competition and stabilize the unionized part of the drywall industry.

196. Mr. Redermeier thought that the wage concessions were unpalatable but were neces­sary and realistic given the current market situation; moreover the policy language was an essential tool that would be added to ICI agreement for the first time. The policing language would compel contractors to adhere to the agreement, and stem the tide of grievances. From Redermeier's per­spective, it was a sensible trade-off.

197. There might be disagreement about that assessment. But it is certainly a plausible one. And it is one that the contractors thought the OPC would also accept.

198. I am satisfied therefore that the employers honestly and reasonably believed that the

OPC would be amenable to the proposed package. But the contractors' belief does not make it so.

Nor is it easy to transform their expectations - however reasonable - into a binding obligation on

the OPC's part.

199. As I have already noted, the legislation gives the provincial bargaining agencies a unique and exclusive status with respect to ICI bargaining. It makes local bargaining unlawful, and local arrangements "null and void" unless the provincial bargaining agencies actually agree to them. (See section 148 of the Act, and the discussion in, for example, Sikora Mechanical Ltd., [1982] OLRB Rep. June 941). In that context, there is little room for notions like "holding out" or "ostensible authority" drawn from common or commercial law - particularly when the "holding out", if any, is done by a local group.

200. It is evident that for ICI construction, the legislature has created a complex regulatory framework that has little in common with "ordinary" collective bargaining in industrial situations, let alone common or commercial law contract formation. Within that framework the provincial bargaining agencies have a pivotal and exclusive role which cannot be usurped by local bargaining groups. Against that background, its seems to me that for local bargaining to result in changes to the ICI agreement, the bargainers must have the actual authority of the provincial bargaining agen­cies, or obtain their consent after the fact, or, alternatively at the very least, the provincial bargain­ing agencies must have clearly indicated in advance that they were prepared to abandon their statu­tory veto and be bound by the results of whatever might be bargained locally. I do not think that one should readily infer that a local group speaks for the provincial bargaining agency, or that the endorsement of the provincial bargaining agency is routine or automatic. To do so would under­mine its exclusive status in the statutory scheme.

201. In any event, the language of Article 28 is both completely consistent with the statutory scheme and provides a complete answer to the problem arising in this case: it preserves the exclusive authority of the provincial bargaining agencies to agree to ICI amendments, or not, in accor­dance with their own assessment of the desirability of such changes. Indeed, Article 28 makes it clear that the consent of the bargaining agencies is not something that should be inferred. Article 28.01 and article 28.01 both require the "written agreement" of the provincial bargaining agencies.

202. There is no written agreement from the OPC in this case.

203. The employers argue that although Article 28 does not expressly say so, there is an implied undertaking that written agreement will not be "unreasonably withheld". The employers invoke what they describe as the "doctrine of reasonable contract interpretation" or, as they put it, the "implied obligation to act reasonably". The contractors rely upon cases such as: International Nickel Company and USWA Local 6500 (1977) 1977 CanLII 2938 (ON LA), 14 L.A.C. 2d 13; Council of Printing Industries of Canada 83 CLLC ¶14,050 (C.A.); and the obiter comments of the Court in Re CUPE Local 43 and Municipality of Metropolitan Toronto (1990) 1990 CanLII 6974 (ON CA), 74 O.R. 2d 239).

204. The contractors acknowledge that the OPC has a discretion under Article 28. But the contractors maintain that the OPC must exercise that discretion in a manner that is neither "arbi­trary, discriminatory, or in bad faith". The contractors assert that the OPC has not met that stan­dard.

205. The employers maintain that there is no reasonable basis for the OPC to reject a sensi­ble settlement. Indeed, the employers say that the OPC has routinely endorsed changes under Article 28, and has even agreed to significant wage concessions - for example for Kingston Local 649 and for London Drywall Local 1316. There is nothing extraordinary about the June 28-29 set­tlement.

206. In the employers' submission, there was no reasonable basis for the OPC to reject the proposed ICI changes. The OPC's behaviour was arbitrary, in bad faith, and contrary to the pur­pose of Article 28 - which the employers say was to facilitate economic adjustments to a changing market-place. In their submission, Mr. LeCompte's protests about the "form" of the settlement documents were a complete sham, because the OPC refused to endorse the changes even when they were put in the form that the OPC requested. In the employers' submission, Mr. LeCompte was acting in bad faith.

207. There are a number of difficulties with the employer's proposition - even assuming, as I do, that Mr. LeCompte was not totally candid with the employers when he responded to their request for the OPC's agreement to the proposed amendments.

208. In the first place, the "implied duty of reasonableness" remains somewhat controver­sial. Many arbitrators remain reluctant to imply material, yet unwritten terms, when a collective only exists only by a reason of the statute, and the statute itself requires that a collective agreement be "in writing". That is particularly so when most collective agreements have language similar to Article 23.07 of the ICI agreement. Article 23.07 reads:

"An arbitration board shall have no power to add to or subtract from or modify any of the terms of this agreement nor shall it give any decision inconsistent with the terms and provisions of this agreement."

209. In the face of language such as that, and in the circumstances of this case, it is not easy to "imply" words that are not there - particularly since the agreement was negotiated by sophisti­cated parties who are quite capable writing up the terms of their bargain. If the parties had intended to say "such agreement shall not be unreasonably refused", they could easily have done so. But they did not.

210. An implied obligation to agree to reasonable amendments seems quite inconsistent with the thrust of article 23.07; and it is difficult to accept that the parties had some shared understand­ing that each would have to agree to what an outside arbitrator judges to be reasonable.

211. In any event, "the duty to act reasonably" has seldom been asserted as an unwritten, independent, and free-standing obligation, qualifying the terms to which the bargaining parties have expressly agreed. Usually, it is only an interpretive device, used to resolve an apparent clash of rights found in different sections of the agreement. Reasonableness can be gleaned from the contractual context: arbitrators assume that the parties could not have intended that one negoti­ated right would gobble up another, or that the existence of a discretion in one part of the agree­ment meant that it could be exercised in a manner entirely unrelated to the purpose for which it was granted or to subvert the purpose of some other clause.

212. The "implied duty to be reasonable" cases, almost all involve the interpretation of existing clauses in a collective agreement, which may sometimes clash or point in different direc­tions. None of the cases that I was referred to, involved adding new language to or amending a col­lective agreement. Certainly none of the cases that I was referred to suggest that a party is obliged to amend the collective agreement in a particular way just because it might be reasonable to do so (leaving aside the fact that what might seem reasonable to one party might not seem reasonable to someone else, or might involve a concession from which the other party might want something in return). And none of the cases involved requirements such as those found in section 148 of the Labour Relations Act, which makes Local bargaining illegal without the consent of the provincial agency. Article 28 describes a context that is more like bargaining than the administration of a set­tled collective agreement.

213. It is one thing to "imply" an obligation to be "reasonable" when, say, an employer is exercising a discretion to classify employees (the issue in Council of Printing Industries). It is quite another to "imply" an obligation to be reasonable in agreeing to local bargaining which is prohib­ited by law and would therefore be illegal without such agreement.

214. I do not think that Article 28 imposes any obligation on provincial bargaining agencies to agree to "reasonable", changes to the collective agreement or, in this sense, to act "reasonably" in deciding whether to amend the agreement, or endorse an amendment proposed by others. Nor does an arbitrator have any authority to compel a provincial bargaining agency to agree to some­thing that the arbitrator thinks is "reasonable" and "should" be agreed to. However, in deference to the argument made by counsel (and mindful that the parties will have to reopen discussions), I think I should say something about the "reasons” advanced by the union for refusing to endorse the June settlement. Are they really so "unreasonable" as the employers maintain, or so indicative of "bad faith"?

215. To answer that question, I think that one has to remember that a trade union is not just a vehicle to negotiate workers' wages, responding to the dictates of an impersonal market-place. A trade union is also a political organization which must, to some extent, reflect sectional interests, local expectations, and pressures from its employee members. A trade union may not operate strictly by the balance sheet, and may not be able to respond solely or immediately to the economic needs of the employers with whom it negotiates - even when a positive response seems to be called for (as it seems to be in this case).

216. A trade union operates in the market-place and must, in the long run, take economic realities into account. But, unlike a business, a trade union is not driven solely by economics.

217. It seems to me, therefore, that even if there is some implied legal obligation to act reasonably (which I do not think there is under Article 28), in the negotiating context envisaged by Article 28 the union is entitled to take into account its own agenda, just as the employers are enti­tled to pursue theirs. Indeed, counsel for the EBA conceded that in applying Article 28, there is more to the EBA's "review" than a simple comparison of the master language and local proposals to ensure that there was no conflict in the wording. The provincial EBA, has broader economic and collective bargaining interests that have to be considered - even though, as in this case, the EBA is prepared to defer to its local constituency.

218. Mr. LeCompte might have served the OPC better by being more candid with ISCA and the EBA about his reasons for questioning the proposed ICI amendments. But that does not mean that his reasons for rejecting them were illegitimate or unreasonable; moreover I think that those reasons (the "real reasons") can be ascertained from both his testimony and the general situation in which the OPC found itself.

219. On its face, the Port Severn Agreement does not contemplate significant wage cuts, nor is the arbitrator entitled to impose any even if the contract reopener portion of the agreement is triggered. On its face, the Port Severn Agreement maintains the status quo, authorizes further dis­cussions, and limits the number of things that can be changed. No employee reading that document would expect that it would result in massive wage rollbacks. And it must be remembered that the Port Severn Agreement was only ratified with considerable difficulty. It was opposed by half the local unions in Ontario, including Local 675.

220. It is true that wage cuts are a possible consequence of local negotiations undertaken under the Port Severn Agreement, or that wage cuts could flow from the application of Article 28, which was not changed by the Port Severn Agreement. It is also true that the OPC has sometimes authorized wage concessions where it seemed sensible to do so to protect work opportunities, and where the employees had ratified the proposed rollbacks. However that does not mean that the OPC is obliged to sanction significant wage cuts for Local 675 - particularly over the objection of the members of that Local. Nor does it mean that the OPC's reservations in that regard are "un­reasonable", or "arbitrary" or a sign of "bad faith". It is a very large leap from "bad judgement" (from the contractors' point of view) to "bad faith".

221. From the OPC's perspective, the deal posed a number of problems.

222. There were significant wage cuts which seemed inconsistent with the spirit of the Port Severn arrangement and which, if given in Toronto, might prompt a demand for across-the-board cuts elsewhere in the province (employer counsel suggested that this was the "real reason" for the OPC's reluctance). There had been no ratification by the Local 675 employees concerned, and, more to the point, those employees were in open revolt, having already engaged in unlawful strikes to oppose the very cuts that the OPC was being asked to endorse. There was a concern (although not perhaps a serious one) about the "mobility" issue and the name hire aspects of the deal. And, of course, the proposed wage rollback and resulting employee opposition were occurring at the same time that the Labourers' Union was trying to persuade the employees that their interests would be better served by joining Local 183.

223. It seems to that these were reasonable considerations for the OPC to take into account, and that by mid-July, the OPC had either articulated those reasons or the EBA had deduced what they were. Litigation is not the best forum for communication, but the legal challenge did prompt the OPC to elaborate why it was troubled by the proposed wage cuts.

224. Accordingly, even if there were some implied obligation under Article 28 to "act rea­sonably" (which, I repeat, I do not think there is), I would find that the OPC has met that obligation. It is not required to agree to an amendment just because the local bargainers have done so or the EBA demands it - even if the proposed amendments seem "reasonable" from the EBA's or an outsider's objective point of view. Nor has an arbitrator any role in this exercise.

225. I conclude therefore that there was no breach of Article 28 of the collective agreement by the OPC, nor is there an obligation in this case to give the "written agreement" required by Arti­cle 28 before locally negotiated amendments can become effective.

226. There is, therefore, no valid ICI amendment either rolling back wages or introducing policing language, or implementing any other parts of the "settlement" negotiated on June 28-29.

227. Insofar as the June 28-29 settlement purported to deal with ICI items, it is of no force and effect.

228. I want to make it clear that in finding that there was no valid ICI amendment, I do not wish to be taken as suggesting that the amendments themselves are unreasonable, or that, from an economic point of view, they do not make sense. The evidence suggests that the proposed conces­sions and trade offs may well be sensible, and may well be necessary if Local 675 contractors are to withstand the threat of union and non-union competitors. Such changes may even be necessary for the long-term health of Local 675. But those are judgements that the OPC must make, in consulta­tion with Local 675. I do not think that it is obliged to agree to the proposed settlement or that the OPC's agreement can be deemed or compelled by an arbitrator.

229. The OPC has not given its written agreement to the proposed changes, nor am I per­suaded that the terms of the agreement require it to do so. Those amendments are, therefore, of no effect.

Is there a binding collective agreement in the residential sector?

230. If the ICI amendments are ineffective because the OPC did not approve them, is there nevertheless a binding provincial agreement in the residential sector? Or, to put the matter in the framework of the employers' section 91 complaint: are the parties in complete agreement and has a residential deal been completely finalized, so that neither party could now resile from it without breaching the section 15 duty to bargain in good faith? In particular, should the Board apply sec­tion 15 of the Act, find a breach by Local 675, and direct that Local 675 execute an agreement encompassing those portions of the June 28-29 settlement applicable in the residential sector?

231. In considering this situation, I think that it is important to take into account both the formal requirements necessary to constitute a collective agreement, and the collective bargaining realities of the situation - including the parties' shared intentions and expectations. And, from that perspective, it is abundantly clear that no one ever thought that six months of bargaining for inter­related amendments in ICI and residential would result in a residential agreement only.

232. I do not think that there is any doubt about Mr. Redermeier's authority to negotiate a residential agreement on behalf of Local 675, or to sign the settlement reached on June 28 (al­though Redermeier wrote on the document that he was signing on behalf of the Trustee, Jim Smith). Mr. Redermeier had the ostensible authority to act on behalf of the Trustee, and, as busi­ness manager of Local 675 (albeit in an acting capacity) he had the authority pursuant to both the Local By-laws and established practice to engage in collective bargaining. In fact, except for the objecting employees, no one seriously argues that Mr. Redermeier did not have that authority. As late as July 5, the union's staff lawyer was acknowledging that the agreement could be binding in residential, even if the ICI amendments failed; moreover, if the Trustee intended to repudiate Mr.

Redermeier's authority to sign the June 28 document, one would have expected him to give evi­dence to that effect. But he did not.

233. The objecting employees claim that Mr. Redermeier did not have authority because at a June 26 union meeting, employees had rejected concessions, or because Mr. Bickle was not present for the settlement discussions, or because the trusteeship was invalid in some way. How­ever I do not accept those submissions, some of which are dealt with in more detail below. Mr. Redermeier's behaviour may have triggered a breach of section 69 of the Act. But that does not mean that he did not have the authority to negotiate a residential agreement on behalf of Local 675.

234. Nor am I persuaded that the employers were somehow complicit in a violation of sec­tion 69, or should have known that Redermeier was acting contrary to the wishes of some employ­ees, or was wilfully blind to a potential "defect" when Redermeier was prepared to sign an agree­ment that was not expressly subject to employee ratification.

235. Employee ratification is not required by the Labour Relations Act, or by the union con­stitution; and Mr. Redermeier did not say or suggest that a settlement would have to be subject to ratification by the membership. At the meeting of Friday, June 23, the contractors had urged Mr. Redermeier to take their proposal back to the membership, to explain it, and to see if the members would accept it. The contractors knew that there was a membership meeting scheduled for the fol­lowing Monday. When Mr. Redermeier returned to the bargaining table on Wednesday and seemed amenable to agreement, there was no reason for the contractors to question him any fur­ther than they did.

236. Mr. Redermeier had already indicated on several occasions that he had the authority to sign an agreement and did not have seek membership ratification (because he and the employers both then believed that the trusteeship suspended established procedures). On June 28, employee ratification was simply not an issue. Mr. Redermeier also thought that OPC approval would be vir­tually automatic.

237. The June 29 portion of the settlement is more problematic, because no one from the trade union has ever signed that document, even though it was obviously an integral part of the deal - extending and elaborating upon the terms of settlement, and incorporating the "policing lan­guage" which, the day before, had been made subject to review and clarification by the union's staff lawyer. At that point, the contractors must have recognized that even Mr. Redermeier was having doubts about his authority, since he was not prepared to "sign off' on his own, and the par­ties had to scramble to get the documents over to Mr. Smith for his approval, prior to Mr. Smith's departure for Ireland.

238. But Mr. Smith never did approve or sign the document of June 29. Neither did anyone else on behalf of Local 675.

239. Nor do I think that the review by the union's staff lawyer was quite so routine or "pro­forma" as counsel for the contractors suggests.

240. The policing language was a critical feature of the bargain. It was the trade off for the wage concessions, and had, in fact, been fiercely resisted by the AAO in the early rounds of bar­gaining. Without the policing language there could be no settlement from the union's point of view.

241. On May 27, when the outlines of the deal were beginning to take shape, the contractors' representatives pointed out that the Ontario Labour Relations Board "might not accept" or enforce the "penalties" contemplated by the policing mechanism, even if the parties agreed they were nec­essary to maintain the integrity of the collective agreement. (Some recent OLRB decisions suggest that the Board may not give effect to "penalty clauses" even though they have been negotiated by sophisticated provincial bargaining agencies as part of the provincial collective agreement and have institutional purposes, wholly unrelated to a nineteenth century common law context where "pen­alty clauses" were frowned upon). In the circumstances, it is not surprising that Mr. Redermeier wanted his lawyer to review those proposals, and there is no dispute that such review never took place.

242. But there is a more fundamental reason for concluding that there is no residential agreement.

243. I find that even if the formal requirements for a collective agreement have been met, the focus of the bargaining has always been a single package of changes for both the ICI and resi­dential sectors. There has never been any common intention to have a "stand alone" residential agreement, either on June 28-29 or in the two meetings held later, when the proposed settlement seemed to be coming apart.

244. It might have been possible to retrieve the residential portion of the settlement, if the parties (but especially the contractors) had been willing to reject the linkage with ICI, to divide up the settlement, to separate out the items pertaining to the residential sector, and to embody those items in a stand alone collective agreement. As late as July 6, there was some willingness on the part of Local 675 to do that, and they approached the contractors with that objective in mind.

245. But the employers were unresponsive. They took the position that they already had a package deal, that it applied in both ICI and residential, and that they were not going to contem­plate an independent residential collective agreement. Nor was this position surprising or at all unreasonable given the history of these negotiations, or, the way that negotiations had been con­ducted in past years. There were valid business reasons for wanting congruent terms in the ICI and residential agreements. There were valid business reasons why differential wage rates made little sense. It is entirely understandable that the contractors would say, in effect, there must be one deal for both sectors or there can be no deal at all.

246. The contractors' alternative legal position in this proceeding, is that if the proposed ICI amendments are inoperative, there is nevertheless a binding agreement in the residential sector. However, I find that there was never any common or shared intention to enter into a separate, "stand alone" residential agreement, consisting of the residential changes settled on June 28-29.

247. I conclude, therefore, that there is no subsisting residential drywall agreement and that Local 675 has no obligation under section 15 of the Act to execute an agreement along those lines in accordance with the residential items (only) of the June 29-30 "settlement".

248. I am not particularly sanguine about this result, which will have the effect of sending the parties back to the bargaining table at a particularly difficult time. Moreover, there is a very good argument that the June 28-29 is a reasonable comprise, given the unsettled state of the construction industry. But I cannot conclude that such settlement was ever intended to produce a "stand alone" residential agreement.

249. One of the casualties of this case may be the good relationship that the union and the employers have had, since the negotiation of the Port Severn Accord in 1994. However, having considered the evidence the parties' representations, I conclude that there has been no valid and

binding amendments to the ICI collective agreement and there has been no effective renewal of the residential agreement. If the parties wish to accomplish those objectives, they must return to the bargaining table.

Did Local 675 breach its duty of fair representation?

250. Section 69 of the Labour Relations Act reads as follows:

251. A trade union or council of trade unions, so long as it continues to be entitled to represent employees in a bargaining unit, shall not act in a manner that is arbitrary, discriminatory or in bad faith in the representation of any of the employees in the unit, whether or not members of the trade union or of any constituent union of the council of trade unions, as the case may be.

252. There is no real dispute that the duty of fair representation owed to employees is just as relevant to the negotiation of a collective agreement as it is during the operation of such agree­ment. But the context is quite different, and that must be taken into account when the union's con­duct is being assessed. In Ford Motor Company v. Huffman, [1953] 345 U.S. 330, the United States Supreme Court put it this way:

"The bargaining representative, whoever it may be, is responsible to and owes complete loyalty to, the interests of all whom it represents. ... Inevitably, differences arise in the manner and degree to which the terms of any negotiated agreement affect individual employees and classes of employees. The mere existence of such differences does not make them invalid. The com­plete satisfaction of all who are represented is hardly to be expected. A wide range of reason­ableness must be allowed a statutory bargaining representative in serving the unit it represents. subject always to complete good faith and honesty of purpose in exercise of its discretion."

252. Collective bargaining is not like adjudicating a legal dispute or even weighing competing interpretations of a contract. It is a tactical and strategic exercise, where politics and pressure are intertwined, and the resort to economic sanctions (a strike or lock-out) is much more overt and abrupt than in most business dealings. In order to bargain effectively, a union has to nurture employee grievances and solidarity, just in case a strike becomes necessary. The union has to "talk tough" and encourage enthusiasm for a "fight". Yet at the same time, the union must contain employee militancy that is getting out of hand or unlikely to achieve concrete gains.

253. In achieving a settlement without a strike, some employee disappointment may be almost inevitable. A compromise often requires that something be given up in exchange for what is gained. Moreover, a union is obliged to promote the employees' interests not just cater to their expectations, as the Board observed in Diamond Z Association, [1975] OLRB Rep. Oct. 791:

"Achieving this mutual accommodation [a settlement] requires the unfettered discretion of the representatives of the parties to explore all avenues of accommodation without the intervention of this Board in setting standards of conduct that may be characterized as an unwarranted intru­sion in their private affairs. We are of the view that the representative trade union despite its obligation to employees in complying with the duty of fair representation, must necessarily have a "free hand" in setting strategies that will best forward employees' interests, irrespective of their expectations".

The Board has usually resisted the temptation to second guess the union's tactics, or to impose the Board's own notions of what a "fair" settlement might look like.

254. The union's task is particularly difficult when the employees have unrealistic expecta­tions or do not fully appreciate the economic realities of the market-place or, as here, seem pre­pared to disregard the law. What seems "fair" to employees is not always reasonably attainable. Yet a responsible trade union will not lightly drag its members into a strike unless there is a reasonable prospect of achieving some concrete advantage. The union must weigh the utility of strike even when the alternative is an agreement that employees may find unsatisfactory.

255. Section 69 does not require trade unions to consult their members at every step of the bargaining process, nor, generally speaking, does it dictate that their consultations will occur at any particular stage or in any particular form. There must be some form of consultation at some stage, (Manor Cleaners Ltd., [1983] OLRB Rep. June 929; Cuddy Food Products Ltd., [1988] Rep. Dec. 1211), but beyond that, the union is largely left to conduct bargaining in accordance with its own procedures and tactical judgement.

256. The statute does not require that there be a strike or ratification vote - although many unions conduct such referenda - and the union is not necessarily obliged to call a strike simply because the employee support one, or to reject an agreement merely because employees have done so. (See K-Mart Distribution Centre, [1981] OLRB Rep. Oct. 1421). A union is entitled a fairly wide latitude. The ultimate remedy for disgruntled employees is not litigation, but the rejec­tion of the union altogether or its replacement by a rival organization. If a majority remains dissat­isfied, it can oust the union at the appropriate time. The employees' ultimate remedy is at the bal­lot box.

257. That said, all of the cases presume that the union will be acting in good faith in its deal­ings with employees - even when those employees are dissatisfied, or are themselves acting unrea­sonably, or they do not appreciate the reasons for the union's decision. Thus, in Ford Motor Company, above, the Court made its concession to union flexibility expressly conditional upon "complete good faith and honesty of purpose". In Diamond Z Association, above, the Board said:

“…..An employee is entitled to be represented by his trade union with candour and with honesty in connection with the disposition of his concerns. A trade union that declines upon proof thereof to satisfy these simply employee expectations will be liable to pay the penalties contem­plated by remedial provision of the Labour Relations Act.... We do not intend by raising this question to prescribe a standard of conduct that could be construed to interfere with the internal procedures of a trade union. A union may have adopted its own procedures, whether governed by regulations contained in its constitution or by past practice, for communicating business matters to its constituents. ... What the Board is con­cerned about in measure the conduct of union representatives during the negotiation process, is whether the employees affected have been treated honestly and in good faith. The adequacy of the settlement and the formal processes adopted in order to arrive at an accommodation are not necessarily an issue. What is an issue is whether the trade union by its conduct has acted fairly in the interest of employees in dealing with the employer with, respect to their terms and conditions of employment…..”

258. In the instant case, there is no doubt that when Mr. Redermeier concluded the settle­ment of June 28-29, he thought that he was acting in what he believes to be the best interests of the members - even if those members did not appreciate it. There was no personal gain involved. Mr. Redermeier was responding to the situation as he saw it. In recent weeks, the membership had been ignoring the law and acting more like an unruly mob than a disciplined union organization; moreover there seemed to be little understanding of the economics of the situation, the Labourers' threat, or the potential ramifications of a strike. The members (Mr. Bickle being an example) seemed intent on a strike regardless of the law and regardless of the consequences. Yet many of the same employees who were publicly protesting "concessions", were privately working for less than the contract rate.

259. Without effective "policing language" Redermeier feared that the collective bargaining

framework would breakdown into a "dog eat dog" environment, which, in the end, would under­mine both the wage rates and the union itself. Wage concessions had been given in other parts of the province (Kingston, London) to protect the members' access to work. In that regard the pro­posed settlement was not particularly novel. On the other hand, strict policing language was a use­ful precedent that was to become part of both the ICI and residential collective agreements, and might stem the flood of grievances that was becoming increasingly unmanageable.

260. This was a plausible position for Mr. Redermeier to take. Indeed, from an objective point of view, it may even be the most reasonable course of action for the union to take. And had Mr. Redermeier simply told employees that, and acted accordingly, I do not think that he could be faulted.

261. The decision might have angered employees. It might have prompted members to go over to the Labourers' Union. It might have fuelled a later termination of the union's bargaining rights. But I doubt that it could be characterized as arbitratory, discriminatory, or undertaken in bad faith.

262. On June 26, Mr. Redermeier assured the membership that he would not accept a wage rollback, that he would not settle without their further involvement, that he would not conduct fur­ther negotiations without Mr. Bickle's attendance, and that he would attend the assistance of a conciliation officer and could take the steps to arrange for a timely strike vote. However he did not none of those things. Barely two days later, he did precisely the opposite.

263. Was there any reason for this sudden change of heart? Was there any reason why Mr. Redermeier could not have followed through with his undertakings? Was there any reason why negotiations could not have proceeded a little longer, without a strike, and while parallel meetings with the members continued? Would conciliation not have helped to reach an accommodation? Would a strike vote not have increased the union's leverage - even if no strike were ultimately called? And, most important, was there any reason why Mr. Redermeier had to sign a settlement that Wednesday, having told the members that he would not do so only two days before?

264. No reasons were advanced. One can only conclude that Mr. Redermeier thought that it was appropriate to mislead the members "for their own good". That may have been an under­standable human reaction - especially when faced with the angry and unruly group who attended the June 26th meeting. However, it was wrong to make the undertakings that he did, then immedi­ately do the reverse.

265. I conclude therefore that on June 26, 1995 (but only on June 26), Helmut Redermeier, on behalf of Local 675, was acting in bad faith, and contrary to section 69 of the Labour Relations Act.

266. The objective employees' primary remedial argument was that a breach of section 69 should prompt the Board to set aside the proposed residential agreement and the ICI amendments. I have some doubt whether the Board has the authority to do that, or whether it would be appro­priate, where, as here, the employers have not acted improperly (see the remarks of the Board in Cuddy Foods Products Ltd., supra, at pages 1240-12-43). It is one thing to require an employer to engage in an arbitration process that would have been triggered in any case, or deal with a griev­ance that would have been processed "but for" a union's default. It is quite another to set aside a collective agreement that an employer has bargained in good faith.

267. However, I do not have to explore that option in this case, because I have already found for other reasons (see above) that the settlement was ineffective. Nor is it necessary to pur­sue the employees' damage claim against Local 675 (which in effect would come out of the mem­bers' own pockets) or perhaps that OPC, because, at most, what they have lost is a couple of weeks of bargaining and the opportunity for some further "input" into the ultimate result. Since bargaining has been ongoing for some months and must now continue, the employees will have the opportunity for further participation.

268. I do think that it is appropriate to make a declaration that section 69 has been breached on the single occasion mentioned above, and to require Local 675 to hold a further membership meeting so that the Local officials and members can consider their positions in light of this decision and the need for continuing negotiations.

269. It is so ordered. I also direct that a copy of the summary at the end of this decision be provided, at the union's expense, to each member of Local 675.

270. In my view, it is not appropriate to make any further directions about how those negoti­ations should now be conducted or what ratification process (if any) must be employed. In particu­lar, I make no order or directions concerning Mr. Redermeier's future conduct of the affairs of Local 675 or the actions that obtaining a settlement may require. Although he may have acted inappropriately at one union meeting (under especially trying circumstances), it is clear that throughout his stewardship, he has always acted in what he genuinely believed to be in the best interests of the Local and its members.

The Trusteeship

271. Section 138.5(1) and 84(1) of the Act read as follows:

138.5-(l) A parent trade union or a council of trade unions shall not, without just cause, assume supervision or control of or otherwise interfere with a local trade union directly or indirectly in such a way that the autonomy of the local trade union is affected.

84.- (1) A provincial, national or international trade union that assumes supervision or control over a subordinate trade union, whereby the autonomy of such subordinate trade union. under the constitution or by-laws of the provincial, national or international trade union is suspended, shall. within sixty days after it has assumed supervision or control over the subordinate trade union, file with the Board a statement in the prescribed form, verified by the affidavit of its principal officers, setting out the terms under which supervision or control is to be exercised and it shall, upon the direction of the Board, file such additional information concerning such super­vision and control as the Minister may from time to time require.

272. The evidence establishes that by the end of March 1995, the affairs of Local 675 were in disarray. Its senior officers had defected to Local 183, which was then mounting a campaign against Local 675 that threatened the very existence of the Local. Subordinate officials had also departed. There were serious doubts about the loyalty of administrative staff. A number of union members had deserted the local to join the rival union. And no one knew the extent to which the administration of the local had been subverted or whether funds had been misused or misappropri­ated. The ongoing activities and the day to day direction of the Local had been seriously under­mined.

273. In the circumstances, it was entirely reasonable for the parent International Union to assert control, as it was entitled to do under the terms of the International Union Constitution. The remaining (loyal) officers of Local 675 had requested the parent union to intervene. It was neither unreasonable nor unjust to impose what Mr. Redermeier described as a "friendly supervi­sion".

274. The parent union was not obliged to hold new elections, when the Local itself was in turmoil and exposed to external attack. Trusteeship was an appropriate instrument to restore con­trol.

275. Section 138.5 appears to focus on the imposition of a trusteeship, rather than the actions of the trustee. However, even assuming that the behaviour of the trustee is regulated by section 138.5(4) (or perhaps section 69) I am unable to find anything wrong with the way that Mr. Smith conducted himself.

276. I do not think that Mr. Smith acted inappropriately in appointing Mr. Redermeier, the Acting Business Manager. Given Mr. Redermeier's long experience as an official of the Local, he was a reasonable choice to fill-in temporarily, and to step into the negotiating process that Gus Simone had abandoned. Nor do I think that Redermeier's selection makes Smith or the parent union personally responsible for Redermeier's behaviour on June 26, 1995. Mr. Redermeier should not have misrepresented his intentions at the tumultuous meeting of June 26. But this default does not undermine the legitimacy of the trusteeship.

277. I see no reason to tinker with the terms of the trusteeship. If anything, the uncertainties arising from this litigation may require more direct intervention by the parent union - particularly since quite a number of members of Local 675 (and perhaps some local officials) seem prepared to totally disregard the law and engage in unlawful strikes.

278. Section 84(1) of the Act is a filing/information provision. The fact that the required doc­umentation was filed a month late does not, in my view, impair the integrity of the trusteeship or the actions of the trustee. To the extent that there may have been a "breach" of the Labour Rela­tions Act, it is a technical one only, for which no remedy is necessary.

279. The material required by section 84 was filed by the end of June, and was made avail­able to those who might be interested in it, including the parties to this litigation. There is no evi­dence that anyone was actually prejudiced by the late filing or was actually unaware or deprived of the information contained in the filing.

280. This aspect of the employees' complaint is therefore dismissed.

Summary of Board Findings and Result

281. After eight days of evidence and argument the Board has reached the following conclu­sions:

282. The parties bargained honestly and in good faith with a view to amending the ICI agreement to take into account the difficult eco­nomic situation that the contractors were facing (including a weak market for construction and non-union competition). The parties reached a settlement on June 28-29 which seemed sensible to them, and seemed to meet their common concerns.

283. The parties agreed that wages would be reduced so that they would be more in line with what seemed to be the market rates that many employees seemed to be working at anyway. A wage cut was consid­ered necessary so that unionized contractors would continue to get work. In return, the contractors agreed to language that would require all employees to adhere to the agreement. The parties agreed that this was a sensible trade off in difficult times.

284. However the Carpenters' Ontario Provincial Council, for its own good reasons, refused to agree to the ICI changes, so that, insofar as the ICI is concerned, the proposed amendments are ineffective.

285. The bargaining parties never intended that there would be a "stand alone" residential agreement, separate and distinct from the situa­tion in the ICI sector. The only common intention - never realized -was that ICI and residential changes would take place together.

286. When the proposed ICI amendments were rejected, the basis for the residential agreement was discarded. If Local 675 and ISCA wish to renew the now expired residential agreement, they will have to return to the bargaining table to pursue that objective. Similarly, they will have to continue discussions about the appropriate changes (if any) to the ICI agreement.

287. When Helmut Redermeier agreed to wage concessions in return for language compelling contractors to pay the contract rates, he was acting in what he believed to be the best interests of Local 675 and its members. He genuinely and reasonably believed that concessions were necessary and that a strike would be disastrous for the Local. Mr. Redermeier may right about that. Mr. Redermeier may also be right in his belief that the members of Local 675 do not fully under­stand that the consequences of a strike might be a permanent loss of work to other contractors.

288. Nevertheless, on June 26, 1995 Mr. Redermeier assured the mem­bership of Local 675 that he would not sign a collective agreement granting concessions without consultation or ratification by the mem­bers, that he would have Doug Bickle at the next round of bargain­ing, that he would seek the assistance of a conciliation officer and that he would arrange for a strike vote. Instead of doing that, Mr. Redermeier signed a settlement, two days later that agreed to signifi­cant rollbacks. In so doing, the Board finds that Local 675 contra­vened section 69 of the Labour Relations Act. However, in all the circumstances, no remedy is appropriate other than this simple decla­ration.

289. The parent union had just cause to impose the trusteeship over Local

290. There is no reason to disturb the trusteeship or make any direc­tions concerning the conduct of the trustee.