Ontario Public Service Employees Union v. The Governing Council of the University of Toronto, 1995 CanLII 9989

[1995] OLRB Rep. January 71

2393-94-R Ontario Public Service Employees Union, Applicant v. The Governing Council of the University of Toronto, Responding Party v. International Union, United Plant Guard Workers of America, Local 1962, Intervenor

BEFORE: Paula Knopf, Vice-Chair, and Board Members J. A. Rundle and K. Davies.

APPEARANCES: Chris Dassios, Ed Ogibowski and Connie Hoosiuk for the applicant; John E. Brooks, Brian Marshall and Verugun Ghanaghian for the responding party; Joshua S. Phillips and Watson Cook for the intervenor.

DECISION OF THE BOARD; January 11, 1995

1. This is an application for certification in which a pre-hearing vote was requested. The Ontario Public Service Employees Union (OPSEU) wishes to displace the International Union of United Plant Guard Workers of America Amalgamated Local 1962 (the Plant Guards Union) as the bargaining for all police officers employed by the University of Toronto (hereinafter referred to as the employer). The Board (differently constituted) directed the taking of a pre-hearing repre­sentation vote in a decision dated October 24, 1994. The vote was conducted and the ballot box was sealed.

2. There is no dispute over the bargaining unit description. The only issue in dispute between the parties is the timeliness of the application. The parties agree that under the Labour Relations Act, the application would be timely. The issue to be determined is whether the provi­sions of the Social Contract Act S.O. 1993 c.5 would have the effect of rendering this application untimely or inoperative.

3. The facts are not in dispute. The employer entered into a collective agreement with the Plant Guards Union on October 17, 1991. The duration of that collective agreement was set to be from October 17, 1991 to November 30, 1993. The collective agreement provided for automatic renewal for periods of one year unless notice was given by either party of a desire to amend or ter­minate the collective agreement. As a result of the passage of the Social Contract Act in July of 1993, the Plant Guards Union and the employer entered into a local agreement on July 29, 1993 pursuant to the applicable sectorial agreement under the Social Contract Act. That local agreement acknowledged the existence of the parties' collective agreement and provided for the collective agreement's extension until March 31, 1996. This provisions reads:

Pursuant to section 35 of the Social Contract Act, 1993, the collective agreement which exist between the Union and the University and which expires November 30, 1993 will be extended until March 31, 1996.

In effect, the collective agreement was given a 4Y2 year term as a result of the local agreement under the Social Contract Act.

4. On October 7, 1994, OPSEU filed this application for certification seeking bargaining rights for the employees who are covered by the collective agreement between the plant guards and the employer. This application falls squarely within the "open period" contemplated by sec­tion 5(5) of the Labour Relations Act which provides:

5. (5) Where a collective agreement is for a term of more than three years, a trade union may, subject to section 62, apply to the Board for certification as bargaining agent of any of the employees in the bargaining unit defined in the agreement only after the commencement of the thirty-fifth month of its operation and before the commencement of the thirty-seventh month of its operation and during the two-month period immediately preceding the end of each year that the agreement continues to operate thereafter or after the commencement of the last two months of its operation, as the case may be.

Section 57(1) of the Labour Relations Act provides:

57.-(1) If the trade union that applies for certification under subsection 5 (4), (5) or (6) is certified as bargaining agent for any of the employees in the bargaining unit defined in the collective agreement, the trade union that was or is a party to the agreement, as the case may be, forth­with ceases to represent the employees in the bargaining unit determined in the certificate and the agreement ceases to operate in so far as it affects such employees.

The Social Contract Act provides:

Purposes

1. The purposes of this Act are as follows:

2. To encourage employers, bargaining agents and employees to achieve sav­ings through agreements at the sectorial and local levels primarily through adjustments in compensation arrangements.

7.-(1) The Minister shall establish expenditure reduction targets for sectors and for employers.

(2) If there is a sectoral framework in respect of a sector, the Minister shall establish lower expenditure reduction targets for every employer in the sector who,

(a) enters into a local agreement, not later than August 1, 1993, that implements the sectoral framework; or

(b) implements a non-bargaining unit plan, not later than August 1, 1993, that implements the sectoral framework.

35.-(1) A bargaining agent may, by written notice to the employer of employees to whom this Part applied, require that a collective agreement be extended to March 31, 1996 if the agreement was or is governed by an Act that permits the employees to strike.

52. The provisions of this Act and the regulations prevail over the provi­sions of any other Act and the regulations thereunder but only to the extent necessary to carry out the intent and purposes of this Act.

The argument of the Parties

5. Counsel for OPSEU places great reliance on the Ontario Labour Relations Board's pre­vious decisions in the Corporation of the City of Scarborough, (unreported decision dated March 1, 1994) [now reported at [1994] OLRB Rep. Mar. 300] and Ottawa Board of Education, (unreported decision dated August 17, 1994) [now reported at [1994] OLRB Rep. Aug. 1024]. It was argued that these cases stand for the proposition that nothing in the Social Contract Act has taken away the rights of employees to seek representation through another union during the "open periods" under the Labour Relations Act. It was argued that this application should run the normal course whereby if the application succeeds, the bargaining rights of the Plant Guards Union would be ter­minated and the collective agreement with the employer would cease to operate pursuant to sec­tion 57 of the Labour Relations Act. Counsel for OPSEU suggested that this would not necessarily affect the purposes and intentions under the Social Contract Act and that the application should therefore be allowed.

6. Counsel for the employer stated that the University was taking no position on the ques­tion of timeliness of the application. However it was doing this without prejudice to any position or rights it may wish to assert depending on how the application is determined with regard to the Local Agreement. Further, it was pointed out that the employer has grave concerns about any result that would alter or affect the Local Agreement covering the employees in the intended bar­gaining unit and this employer. It was said that nothing in this application should change any rights or positions under that Local Agreement. However, the employer also added that it was not appropriate or necessary for this panel of the Board to decided that issue at this time.

7. Counsel for the intervenor began his submissions by agreeing that, in the normal course, this application would be timely because it fell within the "open period" under section 5(5) of the Labour Relations Act. However, it was argued that the effect of section 52 of the Social Con­tract Act is that this certification application ought not to be allowed to proceed. It was argued that if this applicant was allowed to be certified, a conflict between the Labour Relations Act and the Social Contract Act would be created by putting in jeopardy the Local Agreement. It was submit­ted that the intent of the Social Contract Act is to give extended protection to bargaining agents who have been disadvantaged by the Social Contract Act by giving bargaining agents the unilateral right to extend the terms of collective agreements under section 35 of the Social Contract Act. Fur­ther, since one of the stated purposes of the Social Contract Act is "to encourage employers, bar­gaining agents and employees to achieve savings through agreements at the ... sectorial and local levels primarily through adjustments and compensation arrangements", (section 1.1), it was argued that one of the prime purposes of the Social Contract Act is to encourage and preserve negotiated local agreements between employers and bargaining units. It was argued that the effect of certifying OPSEU would be that the Local Agreement between this employer and the Plant Guards Union would be destroyed and nothing in the Social Contract Act would allow OPSEU to create a new local agreement with this employer. This is so because the Social Contract Act explic­itly requires the local agreements must to be "entered" not later than August 1, 1993 (section 13(1)). It was argued that section 57(1) of the Labour Relations Act requires that the collective agreement between the Plant Guards Union and this employer would cease to operate upon certifi­cation of OPSEU. Therefore, a conflict is created between the Social Contract Act and the Labour Relations Act because the Social Contract Act mandates the local agreement to continue to operate and the Labour Relations Act mandates that the collective agreement cease to operate. It was sub­mitted that in the case of such a conflict, the Social Contract Act must prevail. It was argued that the decision in the Ottawa Board of Education, supra, was incorrect and ought not to be followed because it did not recognize the potential conflict and it was said to have read the "intent and pur­poses" of the Social Contract Act too narrowly. It was stressed that the Social Contract Act has taken away many rights from the bargaining agent that it must be read to provide protection to incumbent bargaining agents during the life of local agreements. Further, stressing the effects and problems that would arise if this application were to succeed, counsel for the Plant Guards Union pointed out that both the employer and the employees in this bargaining unit have benefited from the Local Agreement in that it has given them the advantage of reduced expenditure targets. In addition, the Local Agreement gave some benefits to the individual employees, It was argued that if this Local Agreement ceases to operate because of the effects of section 57(1) of the Labour Relations Act, the employer and the employees covered by that Local Agreement would be signifi­cantly disadvantaged. It is stressed that nothing in the Social Contract Act allows for the assign­ment of a Local Agreement to another bargaining agent and there is no provision for successorship rights under the Social Contract Act. This was said to be indicative of the fact that the Social Con­tract Act contemplates that incumbent unions will remain as bargaining agents throughout the life of the Local Agreement. It was stressed that the only way one could avoid the potential of the employer loosing the benefits of the reduction targets and the employees loosing the benefits of what they negotiated in the local agreement would be to allow the Social Contract Act and its pro­tection of local agreements to prevail over the Labour Relations Act.

8. In reply, counsel for OPSEU argued that nothing in the Social Contract Act says that the Local Agreement would come to an end if representation rights changed. Acknowledging that OPSEU could make no undertakings as to what position it would take with this employer regard­ing the terms of the Local Agreement, counsel for OPSEU did say that this Board ought not to be swayed by any "hypothetical horribles" that the Plant Guards were trying to suggest. Instead, counsel for OPSEU suggested that many of the perceived or potential difficulties may well be able to be worked out between the parties and these potentialities ought not to affect how the Labour Relations Act ought to be read. Further, it was argued that nothing in the Social Contract Acf says or should be read to say that employees cannot change bargaining agents during the term of opera­tion of the Social Contract Act or suggests that representation rights have been overridden.

9. After hearing this exchange of positions by the two unions, counsel for the employer took the position that if the result of this case may be that the Local Agreement ceases to operate, then there may be a conflict between the Labour Relations Act and the Social Contract Act. Fur­ther, counsel for the Plant Guards concluded by saying that if the local agreement ceases to oper­ate, the government has to be considered as a player in this scenario because it may decide that the expenditure reduction targets will have to be altered if the Local Agreement ceases to operate.

The Decision

10. The effect of the Social Contract Act upon the timeliness of a certification application was first dealt with by this Board in the Corporation of the City of Scarborough, supra. In that case, the employer and the incumbent union were operating under the fail-safe provisions of the Part VII of the Social Contract Act. Their collective agreement was extended by virtue of the union triggering the provisions of section 35(1) of the Social Contract Act after the other union's certifica­tion application was filed. The application for certification was filed in compliance with the time limits of the Labour Relations Act and was challenged as untimely by the incumbent union. The Board noted that the certification application was timely when it was filed. The Board rejected the argument that the Social Contract Act could have the effect of closing the open period retroactively so as to invalidate an otherwise valid application. In a concurring opinion, panel Member Wight­man wrote:

Section 52 of the Social contract Act states that its provisions takes [sic] precedent over other statutes, "but only to the extent necessary to carry out the intent and purposes of this Act". The purposes of the Social Contract Act are expressly set out in section 1 of the statute and relate, generally, to expenditure reduction and control. They do not include, and can be carried out without, insulating trade unions or employers from the fundamental right of employees to express their views on trade union representation. Accordingly, I would have dismissed the intervenor's allegations for the further reason that the Social Contract Act does not purport to take precedent over employee representation rights set out in the Labour Relations Act.

11. This addendum was endorsed in the subsequent decision concerning the Ottawa Board of Education, supra, at paragraph 11. That case also involved an incumbent union an employer who also were in fail-safe under the Social Contract Act. Again, the issue for determination was the effect of the operation of an extended collective agreement under section 35 of the Social Contract Act upon the timeliness of an application for certification under the Labour Relations Act. The Board considered arguments very similar to the ones presented in this case. The Board concluded that when a union gives notice under section 35 of the Social Contract Act requiring the collective agreement to be extended to March 31, 1996, it is effectively exercising the unilateral option of extending the life of the collective agreement up to March 31, 1996. It was noted at paragraphs 14 and 15:

12. The scheme of the Labour Relations Act places considerable significance for employees and trade unions on the duration of collective agreements. By permitting a bargaining agent to uni­laterally extend the term of a collective agreement the Legislature was undoubtedly aware of the significance of such a step.

13. ... The SCA, given CUPE's notice to extend, determined what the term of the collective agreement would be. Other than assuring that collective agreements are for a term of at least one year, the Labour Relations Act does not generally dictate the duration of collective agree­ments. The Labour Relations Act however does provide for periods of time, given the duration of particular collective agreements, for employees to make decisions affecting their bargaining agent. With the SCA affecting the duration of a collective agreement and with the Labour Rela­tions Act generally providing for "open periods", it is difficult to see where in this instance there is a conflict between the provisions of the two statutes....

In the facts of the Ottawa Board of Education case, the Social Contract Act extension of the collec­tive agreement rendered the certification application by the other union untimely. But the impor­tance of that decision is that it holds that a collective agreement extended by the operation or trig­gering mechanism of section 35 of the Social Contract Act means that the term of the extended collective agreement becomes the defining term for purposes of computing the open period under section 5 of the Labour Relations Act. Having determined this, the Ottawa Board of Education case goes further and explores the question of when an extended collective agreement can become "open". At paragraph 16 it is said:

16. ... Subsection 5(4) of the Labour Relations Act provides that for a collective agreement of a period longer than 3 years the "open period" would occur during the 35th and 36th months. If a displacement application was filed during the 35th and 36th month, and was successful, it is not entirely clear that a conflict would exist between the provisions of the SCA and the Labour Relations Act which would cause one not to give effect to the 'open period". However, even if a conflict exists as argued by counsel for the Ottawa Board given that section 57(1) would provide for the cessation of the extended collective agreement, the mere existence of a conflict between the statutes does not mean that the SCA will prevail. As section 52 indicates, the SCA will pre­vail only to the extent necessary to carry out the intent and purposes of the SCA. The purpose clause of the SCA makes it quite clear that the purpose of the SCA is to reduce the deficit and there is no indication in the statute either explicitly or implicitly that one of the purposes of the SCA is to protect bargaining agents from displacement or termination applications. If the inten­tion of the Legislature was to provide such protection for bargaining agents one would have thought that such an intention would have been expressed quite clearly. Even if the provisions of the two statutes conflict during the period of the 35th and 36th months of the extended collec­tive agreement, the SCA provision would not prevail since removing the right of employees to change their bargaining agent is not necessary to carry out the intent and purposes of the SCA.

This quotation affirms that concept that there is nothing in the Social Contract Act that can be read to protect the representation rights of a bargaining agent or shield them from displacement applica­tions during the operation of the Social Contract Act.

12. Having seen how the Board has addressed the timeliness question in two cases dealing with parties operating under Part VII or the "fail-safe" provisions of the Social Contract Act, we must turn to the different facts in the case at hand. The parties involved in this case are not operat­ing under fail-safe. Part VII of the Social Contract Act has no application if the plant guards and the employer simply chose to enter into the local agreement that complies with section 4 of the Social Contract Act and to extend their collective agreement. The effect of this local agreement was not just to extend the duration, but also to amend the terms of the collective agreement. The sign­ing of the Local Agreement also positions these parties for the lower expenditure reduction targets under Part II of the Social Contract Act.

13. The question then arises is to whether the fact that the parties to this dispute were not operating under the fail-safe provisions of the Social Contract Act distinguishes this case from the analysis in the Scarborough and Ottawa cases. We start by affirming and adopting the reasoning found in those decisions. However the different facts in this case means that further analysis is required.

14. In the Ottawa and Scarborough cases, the facts disclosed no conflict between the opera­tion of the Social Contract Act and the Labour Relations Act. It was even suggested in the Ottawa case that if a problem did arise, the Labour Relations Act representation right provisions would prevail because a denial of such rights would not be necessary to carry out the intent and purposes of the Social Contract Act. However, in the case at hand, a potential conflict has been identified or suggested by the Plant Guards Union.

15. If the application for certification is to succeed, section 57(1) of the Labour Relations Act provides that the collective agreement between the Plant Guards and the employer "ceases to operate" so far as it affects these employees. Further, the local agreement, which is a contract between the Plant Guards and the employer, would be a contract between this employer and a union which no longer has representation rights over those employees. What would be the affect of such situation on the Local Agreement? How could it be enforced? How would it affect the expen­diture reduction targets? If it is rendered inoperative by virtue of a timely application under section 5(5) of the Labour Relations Act, what effect would this have on the University's funding source and Social Contract expenditure reduction targets under Part II of the Social Contract Act? How could the intent and purposes of the Social Contract Act, which is clearly aimed at the reduction of the deficit, be carried out without conflicting with the Labour Relations Act primary purpose of ensuring "that workers can freely exercise the right to organize by protecting the rights of employ­ees to choose, join or be represented by a trade union of their choice"? (section 2.1(1) of the Labour Relations Act).

16. These are but a few questions raised by this important and difficult case. The answers are not clear. They all cannot and should not be answered in the abstract in this case. The reason for the lack of clarity comes from the difficulties of applying the Social Contract Act to the tradi­tional and basic concepts of labour relations that are codified in the Labour Relations Act. To put it bluntly, the Social Contract Act has shattered many of the corner stones of collective bargaining and the parties' understanding of a collective agreement. Before the Social Contract Act, a collec­tive agreement's terms and duration were sacrosanct during the period of time agreed to by the parties with the only vulnerable point being the "open period" under the Labour Relations Act. The Social Contract Act has changed the sanctity of the terms of the collective agreement by opening up those contracts for amendments and reductions. Despite this, collective bargaining can remain strong and possible under the Social Contract Act. But it cannot be ignored that the struc­ture of collective agreements are and will remain shaky until their cornerstones are buttressed and restored by the passage of time in the expiry of the Social Contract Act. In the meantime, the par­ties in this Board must attempt to fathom how the Social Contract Act operates in conjunction with or overrides the Labour Relations Act.

17. One way to approach this case is to ask "What in the Social Contract Act would render this application for certification ineffective?" This is critical because, but for the issue of the Social Contract Act, the parties all agree that this application is timely under the Labour Relations Act. There is nothing in the Social Contract Act that specifically protects the representation rights of existing bargaining agents. One can argue that it would be a logical and fair premise that the Act was intended to give bargaining agents such protection in exchange for their loss of effective bar­gaining power or ability to exercise representation rights during the operation of the Social Con­tract Act. However, one looks in vain for explicit evidence or indication of such an intention. Sec­tion 35 does give a bargaining agent in fail-safe the exclusive right to extend the collective agreement. But that alone cannot be read as a protection of representation status because even under the Labour Relations Act, a long term collective agreement gives no representation guaran­tee to the incumbent union because it is still open to the challenges during the Open periods defined in the Labour Relations Act. Further, it would be a curious result to have union in fail-safe attaining protected status that unions able to negotiate local agreements may not have. Further, the labour relations scheme in this Province does allow for industrial peace during the term of the collective agreement. But it does not guarantee that a union would be protected from challenges to its right to represent the employees or that employers will be secure in the knowledge that the col­lective agreement with the incumbent union will be able to run its expected course. If the Social Contract Act intended to alter this basic concept of organizational and representation rights, one would expect clear and unambiguous language to that effect. There is no explicit or implicit lan­guage of that kind to be found in the Social Contract Act.

18. We are not ignoring the fact that the Social Contract Act does include as a stated pur­pose "to encourage employers, bargaining agents and employees to achieve savings through agree­ment at the sectorial and local levels." This could well be read with section 52 of the Social Con­tract Act to mean that the provisions of that Act which created the mechanism of the Local Agreement should be read to override anything in the Labour Relations Act that would defeat the intentions of the deficit reductions in the Social contract Act. There is no question that the entire scheme of the Social Contract Act is designed to encourage parties to enter into Local Agreements, to protect those Local Agreements and to achieve cost savings. But does this mean that any other statutory right, no matter how fundamental, must fall way in deference to those laudable goals? The question cannot be answered in the abstract. If the question is superimposed upon the facts of this case, one is forced to ask whether the Social Contract Act creation of the concept of the Local Agreement means that employees covered by a Local Agreement have effectively lost the right to change bargaining agents during the term of that agreement. One could argue that the Legislature may have done this in order to preserve the operation of the Local Agreement. However, this would be inconsistent with the Act as a whole and in particular Part VII of the Social Contract Act that deals with Plans that apply to non-bargaining unit employees. No one suggests that the Social Contract Act has taken away employees rights to organize and the union's right to gain certification during the operation of the Social Contract Act with regard to employees who were not previously organized. When and if certification is granted in those cases subsequent bargaining and/or first contract arbitrations could well impact upon the operation of Plans under Part VII in ways that are yet to be determined. What is clear is that the rights to gain certification and thereby impact upon the status quo still exist under the Social Contract Act.

19. Where the Social Contract Act is intended to prevail over specific statutory rights, it is clearly spelled out. Section 15(1) of the Social Contract Act states that the provisions of the collec­tive agreement that apply to employees prevail over other Acts and regulations that relate to holi­days, vacations, hours of work and overtime. Section 15(1) of the Social Contract Act does not state that the Local Agreements prevail over other statutory rights such as representation and organizational rights under the Labour Relations Act. This leaves the question of the potential undoing of the Local Agreement and whether this would put this application in conflict with the Social Contract Act. It may well be that if this application for certification is to succeed, OPSEU could decide to opt into the terms of the current local agreement covering the people in the pro­posed bargaining unit and/or that the employer would assert that OPSEU would be barred from seeking any other terms and conditions of employment for these employees so that the expenditure reduction targets are not jeopardized. In these ways, the interest of the Social Contract Act could be carried out without impeding upon the representation rights of the employees under the Labour Relations Act. But again, these questions cannot be answered in the abstract and they have to be left to a subsequent forum for resolution.

20. But the fact that such difficult questions are raised by this case does not dictate that the result must be fashioned to avoid such difficulties. The difficulties created by the Social Contract Act are being unmasked daily. The difficulties cannot be avoided by simply holding that the Social Contract Act prevails over anything that potentially affects the parties. The Social Contract Act does not require this. It only requires that its provisions prevail only to the extent necessary to carry out its purposes and intent.

21. In the case at hand, there is a potential of jeopardizing the fiscal planning evidenced in Local Agreement between the Plant Guards and this employer. But that potential has not yet been realized and can be avoided. On the other hand, the Labour Relations Act explicitly allows for employees to apply to change their bargaining agents during the open periods in term of the collec­tive agreement. This application was filed in a timely manner under the Labour Relations Act. Nothing in the Social Contract Act or the Labour Relations Act protects bargaining agents or employers from challenging the status quo during the open periods defined in the Labour Relations Act. To read the Social Contract Act as creating an inviolable status for bargaining agents and employers during the term of a Local Agreement and/or during "Fail-Safe" would require a read­ing into the Social Contract Act a fundamental alteration of labour relations concepts in this Prov­ince without any specific language to support such a change. If the Legislature intended such a result, one would expect it to be defined, and not left to be implied.

22. We are mindful of the disruption this conclusion could have on the fiscal planning of any employer who is expected to be free of collective bargaining obligations during the life of an extended collective agreement and who felt confident about engaging upon budgetary projections based on a collective agreement with the incumbent union. However, the inevitable disruption resulting from such a conclusion is no different than the result of any successful application under section 5(5) of the Labour Relations Act without having consideration to the Social Contract Act. So again, the difficulties resulting are not unprecedented or unusual under the current scheme of labour relations in this Province. They are one of the checks, balances and prices to be paid for the rights and obligations created by the labour relations legislation.

23. The function of this Board is not to try to find the least difficult solution for the parties. Instead it is to interpret and apply the Labour Relations Act in conjunction with the other relevant statutory provisions governing the parties before us. The case at hand explores some of the difficul­ties of rationalizing two sets of legislative directions. However, given the scheme of both Acts, we have concluded that nothing in the Social Contract Act renders this application for certification either untimely or inoperative no matter what difficulties may possibly arise in the future between the applicant union, the employer and the employees covered by the local agreement. We are con­fident that those difficulties can be resolved by sound labour relations and common sense. If they cannot, they must be resolved in another forum. In such a venue, the provisions of the Social Con­tract Act will prevail in the event of conflict if that is necessary to protect the purposes of the Social Contract Act. But sound labour relations should be able to avoid the exception of such a conflict.

24. Therefore the Board directs that the ballots cast in the representation vote be counted. The matter is referred to the Registrar.