[1995] OLRB Rep. June 748
4485-94-R Donald Epp, Applicant v. International Association of Heat & Frost Insulators & Asbestos Workers, and The International Association of Heat & Frost Insulators & Asbestos Workers, Local 95, Responding Parties v. Eve Sigfrid, carrying on business as D & E Insulation, Intervenor
BEFORE: K. G. O'Neil, Vice-Chair, and Board Members R. M. Sloan and P. V. Grasso.
APPEARANCES: Robert Reid and Donald Epp for the applicant, Bernard Fishbein and Joe de Wit for the responding parties, B. W. Adams and Eve Sigfrid for the intervenor.
DECISION OF THE BOARD; June 5, 1995
This is an application for termination of bargaining rights.
The facts necessary to this decision were contained in the evidence of Donald Epp, the applicant, and will be briefly summarized here. D & E Insulation, the intervening party in this matter, is the business name of the small insulation business started by Donald Epp and Eve Sigfrid who are husband and wife. Mr. Epp has many years of experience in the insulation trade and in 1991 he and his wife decided to start a business. It was initially registered as a partnership between the two of them. Mr. Epp spent the first six months after that trying to raise the profile of his new business and obtain contracts. He was successful in securing five or six small jobs in that six month period. Ms. Sigfrid then and later took care of the financial and administrative end of things.
After inquiring of certain contractors as to why they had not gotten certain jobs even though they believed they were the low bidder, Mr. Epp was given to understand that part of the problem was that he did not have a Workers Compensation Board account. He and Ms. Sigfrid then met with the Workers Compensation Board on May 5 or 6, 1992. The result of that meeting was that they cancelled the registration of the business as a partnership on May 5, 1992 and entered a new registration for the business on May 22, 1992 as a sole proprietor in the name of Eve Sigfrid. The registration document indicates that the first use of the sole proprietorship name "D & E Insulation" was May 5, 1992.
Prior to the decision to operate as a sole proprietorship, Mr. Epp had picked-up the forms to get what is called "Owner Operator Exempt Status" from the Workers Compensation Board. He had ascertained that he could get signatures from two contractors for whom he had done work saying that D & E Insulation was not part of their company, a prerequisite for this status. However, he was advised that it could take six to eight months to complete the process and he was not willing to wait that long. Thus, their decision to go with the sole proprietorship status instead.
At about the same time as the meeting with WCB the business obtained more work, including a large job with Zehr's. Having been a long time member of the union, Mr. Epp approached the union about signing a voluntary recognition agreement. He had one meeting alone with the union's business agent and then a second meeting with his wife. At the first meeting with the union Mr. Epp took a copy of the collective agreement to be reviewed by Ms. Sigfrid's attorney. The result of these meetings was a voluntary recognition agreement signed by Ms. Sigfrid on behalf of D & E Insulation. At the time of the signing of the voluntary recognition agreement the union offered the business three name hires, which was an exception to the 50/50 rule, (one referral from the out-of-work list for every name hire) otherwise in place, as well as the right for Mr. Epp to work on the tools. There was some suggestion that the union intended this as a time limited matter, but it is unnecessary to determine that point here. Mr. Epp testified that his understanding from the union was that if he wanted to work on the tools he would have to remain an employee and his wife would have to be the management component of the operation. In line with this, he was not allowed to quote jobs nor have business cards, nor have any dealings with the union other than as a member. His wife was to do all the quoting and communication with the union about hiring and anything that would be, as he called it, "management oriented".
Between May of 1992 and 1995 the business operated along those lines, with few exceptions. The company had at its highest four employees and 13 jobs at one time. Mr. Epp was referred by the union as a name hire. He did most of the work and had an apprentice who was his brother.
When Mr. Epp is on the job site, with one exception, detailed below, he was in charge of the job site. He consults Ms. Sigfrid when a matter involves a deviation from the specifications on which they have quoted, unless it involves an "extra" which can be done on the basis of time and material. Mr. Epp has dealt with at least one employee about when he would be laid-off. Mr. Epp estimated that he spent 80 percent of his time on the job doing insulating work and 20 percent of his time organizing material so Ms. Sigfrid knows what is in inventory, delivering material, repairing equipment and related duties.
The business seldom puts two journeymen on one job. However, on one job that lasted five months, another journeyman was in charge of the job site and Mr. Epp floated in and out as he was available and assisted him. Mr. Epp agreed that it would have been "difficult" for the person in charge of the five month job to discipline him. He also agreed that he would be the last person laid-off because he was Ms. Sigfrid's husband.
When Ms. Sigfrid was faced with the first name hire other than Mr. Epp, she brought the referral list home and consulted with Mr. Epp about who would be the appropriate choice. On another occasions she made a name hire without consulting Mr. Epp. In order to arrive at the labour factor necessary to do quotes, Ms. Sigfrid used the history of the early jobs on which Mr. Epp had done the labour factor quoting and the work. She now uses the accumulated history of actual time taken to perform work to do the quotes. She does not now consult Mr. Epp about the quotes unless there is something unusual, such as a situation in which there was a crawl space which was not a work environment on which they had quoted before.
Ms. Sigfrid is a qualified management accountant as well as having training in blue print reading and a family background in the construction industry. She has a full-time job as an accountant at a financial institution, but she has flexibility there to do certain of the duties related to the insulation business. Ms. Sigfrid has appeared on job sites many times both to see how things are going and to resolve any matter relating to deviations from specifications.
The business uses Mr. Epp's truck, which is in his name. The business buys gas and pays for its maintenance. The tools owned by the partnership version of D & E Insulation are still used by the sole proprietorship version of D & E Insulation. There was no transaction to transfer these items to the new entity. On some occasions when new equipment needs to be bought, Ms. Sigfrid consults Mr. Epp about what would be the better purchase in terms of the actual work on a job site.
Ms. Sigfrid takes care of billing for jobs and payment of wages but gives the cheques to Mr. Epp to deliver to the work site. Mr. Epp is paid on an hourly basis and received a Christmas bonus in 1993. There have not been substantial profits from the company thus far and the evidence was that they are in a separate D & E Insulation bank account.
In the early days of the business both Ms. Sigfrid and Mr. Epp decided that the business should join the Niagara Construction Association and Ms. Sigfrid is still active in that organization.
D & E Insulation runs out of an office in the home of Donald Epp and Eve Sigfrid. The house is owned jointly by the two of them, but D & E Insulation does not pay any rent to either of them.
Mr. Epp testified that after researching the idea of bringing a termination application because he did not feel that he needed the union to deal with his wife as an employee, he consulted with her about it. He said that he needed her blessing to do this because it would not make any sense for him to go down this road if she did not want the business to go down that road.
At the conclusion of Mr. Epp's testimony, his counsel indicated there was no more evidence to be heard from the applicant and Mr. Adams indicated the employer did not wish to call any evidence. Union counsel then informed the Board that it wished to make what it referred to as "the equivalent of a non-suit motion" without being put to its election as to whether or not to call evidence, based on the reasoning of the Board in Hurley Corporation, [1992] OLRB Rep. Aug. 940.
After hearing the submissions of all parties on this point, the Board ruled it would hear argument on the motion without putting the union to its election as to whether or not to call evidence. We adopt the reasoning of the Board in Hurley Corporation, cited above, for the proposal that the Board has the discretion to do so. In the circumstances of this case, we found it appropriate to exercise our discretion in that fashion as there was no prejudice suggested or present in so doing to either the applicant or to the intervening party; further, we were of the view that there was the potential to save all parties the significant cost of further days of hearing in this matter in so doing. See also Arthur Chen, [1994] OLRB Rep. Sept. 1184 where the Board, when faced with a motion for non-suit called on the applicant to make argument, and Kenneth Edward Homer, [1993] OLRB Rep. May 433 where the Board found that the applicant had presented no evidence upon which the application could succeed. See also the reference in Hurley Corporation, cited above, to the concept of early dismissal, i.e. that when an administrative tribunal is satisfied that an application could not possibly succeed, no matter what evidence might come forward, it can provide relief from the cost of further proceedings. In Metropolitan Toronto v. The Joint Board et. al, (unreported) Nov. 19, 1991 the Divisional Court, per O'Brien, J., saw no error in the early dismissal approach used by the Joint Hearings Board as part of its discretion in the control of the proceedings before it.
In this case it is the union's position that Mr. Epp is neither an employee within the meaning of section 1(3)(b) of the Act or at all; rather it is their view that he is a principal of the company. The union relies on Tradesmen Fabricating Ltd., [1984] OLRB Rep. Aug. 1141 in this respect. Secondly, the union takes the position that even if the Board were to agree with the applicant that he is an employee, the application cannot succeed because, having discussed the matter with the owner of the company and sought her approval, the application cannot qualify as a voluntary expression.
It is the applicant's view that the family relationship between Mr. Epp and Ms. Sigfrid should not be determinative and that it is clear that Mr. Epp voluntarily brought this application. He came to a conclusion based on his 20 years in the industry that he did not need union representation to deal with his wife over employment matters. The applicant relied on Donna Barnes v. International Beverage Dispensers and Bartenders Union, Local 280, [1981] OLRB Rep. June 690 and Kitchener Beverages, [1990] OLRB. Rep. Mar. 291 for this proposition.
On the question of management functions counsel for the applicant says the evidence supports the proposition that even if Mr. Epp performed some, they were not exercised to the point where the applicant should be considered to be outside the scope of the Act. He sought to distinguish Tradesmen Fabricating Ltd., cited above, where the person working with the tools was also a principal of the corporation, and a 50 percent shareholder. It is the applicant's argument that the fact that Ms. Sigfrid is skilled in financial matters and blueprint reading and has a construction background should convince the Board that the idea that it is her business is not a sham or a shell. In counsel's submission, what changed the way the business was run was the discussion with the union. Ms. Sigfrid now does the costing, the quoting and the finance and Mr. Epp does the work on the tools. He is not usually consulted, although he sometimes is. Counsel suggests there is nothing unusual or indicative of managerial status that a journeymen might have some say in matters related to how the work is done, especially in an industry that recognizes working foreman as employees. The Board ought to find that this is insufficient evidence of managerial functions to exclude him from the bargaining unit submits counsel. Applicant's counsel referred to Ford Motor Company of Canada Limited, [1993] OLRB Rep. Jan. 1 for the consideration the Board takes into account when looking at foremen.
Applicant's counsel said that the rationale for section 1(3)(b) is conflict of interest and that there is nothing to suggest that on the evidence before us, and that because of the marriage relationship that policy concern should be less.
Mr. Adams, on behalf of Ms. Sigfrid referred to the standard appropriate to a non-suit motion and took the position that the applicant's evidence should be preferred over any suggestion of controversy made by counsel for the union in cross-examination.
In considering the motion we used the standard of proof appropriate to a non-suit motion, i.e. is there a case for the opposite party to answer, not on the balance of probabilities but on a prima facie basis. See Hall v. Pemberton, 1974 CanLII 468 (ON CA), 5 OR. (2nd) 438 (Court of Appeal). We have assumed all the evidence given by the applicant to be true.
The Board's task on a termination application is to ascertain the number of employees in the bargaining unit at the time the application was made and whether not less than forty-five percent of the employees in the bargaining unit voluntarily signified in writing they no longer wish to be represented by the trade union. If that test is met a representation vote will then be ordered. The onus of proof is on the applicant. Having considered the evidence of the applicant as true, we are of the view that the applicant has not presented any evidence on which the application could succeed.
Applicant's counsel relied on Ford Motor Company of Canada Limited, cited above. In that case, referring to the Corporation of the City of Thunder Bay, [1981] OLRB Rep. Aug. 1121, the Board set out the framework for section 1(3)(b). It is noted there that collective bargaining by its very nature requires an arms length relationship between the "two sides" whose interest and objectives are often divergent. Without coming to any firm determination of the extent of Mr. Epp's managerial functions on any given job site, his evidence in its totality establishes that he is not in an arms length business relationship with his wife.
In any event and even if we were to accept the applicant's theory of that portion of the case and find that Mr. Epp was an employee, it is very clear that the decision to bring this application was a joint one made in consultation with Ms. Sigfrid. The Board has lengthy jurisprudence interpreting the meaning of the voluntariness requisite for the determination that must be made on a termination application. Wherever the employer has been involved in the origination of the petition, those applications have been rejected as not voluntary employee expressions.
The Board always looks at the actual situation and does not find distinctions of form and technicality to be determinative of issues such as who is part of management. Ms. Sigfrid is entirely qualified to manage this business and in that respect the idea that she could be the sole manager is in no way lacking in credibility. Rather, it is the idea that her interest is different from her husband's that cannot withstand scrutiny and has no evidence to support it. This is a jointly mounted business, which changed form on paper, without changing any of the underlying alliances of economic interest. No one can discipline Mr. Epp; he will not be laid-off unless there is no work. The evidence is compelling that this is Eve Sigfrid's and Donald Epp's business. And although Mr. Epp is the only person working on the tools at the moment, that is not always the case. As the Board pointed out in Ford Motor Company of Canada Limited, cited above, part of the policy of the scheme of the Act is the protection of the freedom of employees to participate in unions which are not dominated by the interest of their management, as well as the protection of the independence of those trade unions.
The case of Tradesmen Fabricating Ltd., cited above, found that a person who was a president as well as someone who performed bargaining unit work was not entitled to access to the termination provisions. Although the facts are distinguishable in that Mr. Epp is not a President and does not have any official contact with the union in the current arrangement with his wife, the avoidance of conflict of interest is the policy reason for that decision and is an equally compelling concern on the facts before us. See also Ford Motor Company of Canada Limited, for several examples of cases where people who were both managers and workers, a not uncommon occurrence in the construction industry, were not held to be employees under the Act.
As we have said above, even if we were to accept, which we cannot, that Mr. Epp is properly considered an employee in the bargaining unit, the evidence cannot support a finding of voluntariness as management was involved in the decision to mount the application. For cases where the involvement of working foremen and supervisors was fatal to termination petitions, see Johnson Matthey Limited, [1987] OLRB Rep. Apr. 518, Lyman Tube, [1980] OLRB Rep. Oct. 1472 and Apex Service, [1983] OLRB Rep. Jan. 1.
We have carefully considered the cases filed on behalf of the applicant and find they do not assist his case, in the face of the evidence before us.
Donna Barnes, [1981] OLRB Rep. June 690 cited by the applicant, was one where the applicant was the wife of one of the co-owners of a bar and others of the employees were related to one or another of the two owners of the hotel. The Board found no evidence or reason to conclude that the signing of the petition by the family members was anything other than voluntary. In coming to its conclusion it quoted Otto's Deli, [1980] OLRB Rep. Nov. 1673 as follows:
"We do not think that we should readily draw inferences from the mere existence of a family relationship. In some circumstances, relatives may reasonably be perceived as having a special relationship with the employer which could influence an employee's choice with respect to trade union representation, but we do not think that this is always the case, nor are we prepared to automatically assume that the existence of a family relationship necessarily evidences a community of interest with the employer. It may be that there is a presumption tending in that direction but we are all aware that family relationships do not always exhibit the solidarity which counsel suggest. The involvement of family members is not irrelevant, but it is not the only factor to be considered especially where, as here, the inferences to be drawn from it are unclear. Of equal significance in our view is the general atmosphere prevailing at the work place, and the impact this would likely have on employee perceptions."
In this case we do have evidence of a special relationship with the employer which would influence an employee's choice, i.e. the consultation with Ms. Sigfrid and the evidence about their financial and living situation makes it clear that there is a community and indeed an identity of interest between the two.
Applicant counsel also relied on King George Hotel, [1988] OLRB Rep. Dec. 1278 where the Board found that two daughters and a brother were able to voluntarily sign for the termination of the union although they found that non-family members were not voluntarily expressing their wishes. The Board made it clear in that case that most of the factors in that case would suggest that all of the signatures were involuntary, but based on the evidence that they heard, they concluded that these were independently held views. The evidence before us cannot support a similar finding. The evidence makes it is clear that the decision to bring the application was a decision about the direction they wished the business to take, jointly made by husband and wife.
For all the reasons above, this application is dismissed.