[1997] OLRB Rep. September/October 872
3480-96-R Service Employees International Union, Local 204, Applicant v. Humber/Northwestern/York-Finch Hospital, Canadian Union of Public Employees, Local 1080 and Canadian Union of Public Employees, Local 3258, Responding Parties v. International Union of Operating Engineers, Local 796, The Ontario Public Service Employees Union and Association of Allied Health Professionals: Ontario, Interveners
BEFORE: R. O. MacDowell, Chair.
APPEARANCES: Mary Cornish for the SEIU; Brian O'Byrne for the successor hospital; Brian Sheehan for CUPE and its Locals; Wesley Emerson for IUOE Local 796.
DECISION OF THE BOARD; October 10, 1997
I
This is an application under section 69 of the Labour Relations Act, which arises from the recent merger of three hospitals: "Humber Memorial", "Northwestern", and "York-Finch".
The parties are agreed that this hospital merger constitutes a "sale of a business" within the meaning of section 69 of the Act. The parties are further agreed that there has been an "intermingling of employees" within the meaning of section 69(6) of the Act.
Sections 69(6) and 69(8) read as follows:
(6) Despite subsections (2) and (3). where a business was sold to person who carries on one or more other businesses and a trade union or council of trade unions is the bargaining agent of the employees in any of the businesses and the person intermingles the employees of one of the businesses with those of another of the businesses, the Board may, upon the application of any person, trade union or council of trade unions concerned,
(a) declare that the person to whom the business was sold is no longer bound by the collective agreement referred to in subsection (2);
(b) determine whether the employees concerned constitute one or more appropriate bargaining units;
(c) declare which trade union, trade unions or council of trade unions, if any, shall be the bargaining agent or agents for the employees in the unit or units; and
(d) amend, to such extent as the Board considers necessary, any certificate issued to any trade union or council of trade unions or any bargaining unit defined in any collective agreement.
(8) Before disposing of any application under this section, the Board may make such inquiry, may require the production of such evidence and the doing of such things, or may hold such representation votes, as it considers appropriate.
Section 69(6) of the Act applies when the "businesses" of the predecessor(s) and successor have been integrated and their work forces have been intermingled, so that there is a question about whether the pre-existing pattern of collective-bargaining units can, or should, be preserved in the new organizational setting. When such questions arise, the Board has the power to maintain or change the boundaries of existing bargaining units, to determine which union represents the employees in those units, and to amend the bargaining unit provisions of any surviving collective agreement(s). In effect, the Board has the power to rationalize the bargaining structure; and where there are two or more unions involved, the Board can conduct representation votes, so that employees can choose which union they want to represent them.
In other words, when the intermingling involves the operational merger of two or more groups of unionized employees, the Board examines the pre-existing bargaining structure in order to decide whether maintaining these units still makes sense in the new setting - which is to say, the Board determines pursuant to section 69(6)(b) "whether the employees concerned [the intermingled group] constitute one or more appropriate bargaining units”.
In the instant case, the successor employer and the various unions in the workplaces have resolved many of the bargaining unit issues that were generated by the merger of the three hospitals.
However, the parties cannot agree on whether the amalgamated hospital should have a separate bargaining unit of "maintenance employees" (i.e. separate and distinct from the general "service employees bargaining unit"). Nor do the parties agree on what to do with the handful of operating engineers at the former York-Finch site, who are now represented by the IUOE. Should those half dozen employees have their own "stand-alone unit" as well? Or should they be integrated into a larger "maintenance unit", or into an even broader "service unit"? Those were the choices put to the Board for its determination. The parties did not posit any other alternatives; and the successor hospital, AHPO and OPSEU resolved their differences respecting the "paramedical unit", on agreement, and without adjudication by the Board.
The Board received the parties' representations with respect to the maintenance employees and engineers on September 16, 1997. At the end of their submissions, the parties urged the Board to make its determination as soon as possible, so that they could get on with their restructuring - taking such representation votes as may be necessary to finalize the identity of the bargaining agent(s).
In deference to the parties' request, the Board has decided to issue this decision, with somewhat abbreviated reasons.
For ease of exposition, it will be convenient to use the "bargaining unit labels" that counsel used in the course of argument (i.e. "service unit", "clerical unit", "maintenance unit", etc.).
II
- Prior to the merger, the bargaining-unit pattern at the three hospitals (somewhat simplified and omitting nurses and paramedicals) looked like this:
Hospital Bargaining Units Trade Union
Humber
(maintenance employees and operating engineers) non-union service unit CUPE clerical unit CUPE
Northwestern
(maintenance employees and operating engineers) CUPE service unit SEIU clerical unit SEIU
York-Finch
service unit (including operating engineers and maintenance SEIU
employees)
clerical unit SEIU operating engineers (6 employees) IUOE
Nominally, at least, each of the predecessor hospitals had a "service unit". In that regard, the bargaining unit pattern looks, superficially, like what one would find in many public hospitals. However, the chart and the labels are a little misleading, because the composition of the "service unit" is not the same at each hospital, nor is it necessarily what the Board itself would have found to be "appropriate" in the absence of the agreement of the parties. In particular, the so-called "service units" do not exhibit uniform treatment for maintenance employees and operating engineers - who will often be found in a hospital "service unit", and certainly can be "appropriately" situated there.
On an application for certification, the Board is required to determine the "unit of employees that is appropriate for collective bargaining" tsee section 9 of the Act]. However, in a hospital setting, and in the absence of the parties' agreement, the Board would not usually exclude maintenance employees or operating engineers from the standard hospital "service unit" - as was apparently done for some reason at Humber Memorial. Maintenance employees are regularly part of that "standard" "service unit". Nor, if it were disputed and the Board had to adjudicate the matter, would the Board normally find a separate bargaining unit of maintenance employees and operating engineers (as exists at Northwestern) to be "appropriate". The Board would not normally make the "maintenance department" a separate bargaining unit, nor would it segregate and bundle together a unit of "maintenance" classifications.
In the absence of the agreement of the parties, the Board would not separate out the maintenance employees and operating engineers in this way because, in both cases, it would lead to anomalous (non-standard) bargaining-unit descriptions, and would contribute to an unduly fragmented bargaining unit structure. See, for example: St. Joseph's Hospital (Sarnia), [1983] OLRB Rep. June 984; Queen Elizabeth Hospital, [1982] OLRB Rep. Nov. 1711, and the many "hospital cases" referred to therein. On the other hand, if the parties do agree on the more fragmented bargaining structure, the Board has been inclined (at least in recent years) to accept their agreement - on the theory that the parties are in the best position to assess the potential for actual problems, and it is they who must live with the results of an improvident agreement.
The cases referred to in the preceding paragraph (and many others) are representative of the Board's thinking over the last 30 years about what the bargaining unit pattern in public hospitals should look like. The Board has determined that fragmentation of the bargaining structure is undesirable, and that in order to avoid that fragmentation, there should not be a separate bargaining unit for maintenance employees. See: York Central Hospital, [1978] OLRB Rep. Apr. 382; Joseph Brant Memorial Hospital, [1981] OLRB Rep. Nov. 1598; Queen Elizabeth Hospital, supra; and on their inclusion in service units see: Brockville General Hospital, 57 CLLC ¶ 18,061; St. Mary's General Hospital, [1963] OLRB Rep. Feb. 496; Toronto General Hospital, [1972] OLRB Rep. Jan. 33; and cf. St. Joseph's Hospital (Sarnia), [1983] OLRB Rep. June 984. Moreover, operating engineers are narrowly confined to their traditional "craft grouping", and are only granted that craft unit in the very limited circumstances spelled out in section 9(3) of the Act.
Accordingly, at Northwestern and Humber, the bargaining unit pattern and bargaining unit perimeters are probably not something that the Board itself would create, if the Board were looking at a fresh situation, the issue was in dispute, and the Board was asked to make an independent determination of "appropriateness".
CUPE concedes that a separate bargaining unit of "maintenance employees" would be an anomaly, and that it is not the kind of unit which the Board would find to be "appropriate" on an application for certification. However, counsel maintains that a separate bargaining unit and separate treatment for maintenance employees are something that two of the predecessor hospitals have lived with for many years. He submits that, against that background, an "extra" bargaining unit for maintenance employees - even if it is something of an anomaly - would not make much difference. In counsel's submission, the purpose of section 69 is to preserve bargaining rights; and the best way to do that, is to preserve a separate bargaining unit for maintenance employees.
It follows from CUPE's argument, of course, that the non-union maintenance group at the Humber Memorial site would also have to be part of that "maintenance unit". So would any maintenance employees now situated in the SEIU's "service unit" at York-Finch. For it would make no sense to have more than one maintenance bargaining unit, or to have a maintenance bargaining unit that did not encompass all maintenance workers.
The "maintenance unit" proposed by CUPE would be much bigger. But in order to create that maintenance unit, it would be necessary to subdivide the service unit at York-Finch, by removing the maintenance employees from it, and transferring them into the maintenance unit that CUPE proposes.
In effect, what CUPE's argument boils down to is this: because Humber Memorial and Northwestern had idiosyncratic service-unit descriptions that excluded maintenance employees and operating engineers, and because maintenance employees and operating engineers had a separate unit at Northwestern, the Board should subdivide the standard service unit at York-Finch, so as to preserve the "Northwestern pattern" in the new organization.
CUPE does not dispute that the more broadly described "service unit" (i.e. including the maintenance employees) is appropriate - perhaps even more appropriate than what CUPE proposes. Nor does CUPE dispute that maintenance employees are commonly and appropriately considered part of the service unit. However, CUPE asserts that under section 69(6), a separate maintenance unit is also "appropriate", because that is the pattern that is rooted in local history. In CUPE's submission, that history should govern the pattern of bargaining units in the merged hospital.
The successor hospital supports CUPE's proposal - pointing out that it has dealt with a separate maintenance/engineers group in the past, and that it does not foresee any problems in this regard. The successor hospital is prepared to tolerate more fragmentation (an extra bargaining unit for maintenance employees), as well as the narrower service unit that results.
The SEIU opposes the creation or preservation of a separate maintenance/engineers bargaining unit. The SEIU also objects to the subdivision of what it describes as a "standard" and "clearly appropriate" "service unit", so as to conform to what it describes as the anomalous structure in two of the predecessor hospitals.
The SEIU submits that its "service unit" definition is unquestionably appropriate, and that it should be adopted as the norm for restructuring purposes - because it is more broadly based, because it avoids fragmentation, and because it is "standard", so that it can be more easily matched with collective-bargaining developments elsewhere in the hospital sector. In counsel's submission, standard units facilitate extended area bargaining and its proposed definition is more typical and closer to the norm than the service groupings at Humber or Northwestern; moreover, broader-based bargaining units enhance employee mobility and job opportunities, and this too speaks in favour of the comprehensive service unit.
Counsel also urges the Board to consider the broader policy ramifications of using the more fragmented, unit pattern, as the template for restructuring under section 69(6). She notes, for example, that the transfer of the male maintenance workers out of the service unit, may add a complication for pay equity purposes, because the male comparators might then be in a separate bargaining unit. Counsel for the SEIU further asserts that the merger of the three hospitals marks a totally new departure, so that the Board should not be ruled by history - particularly an anomalous history. Rather, the Board should use the opportunity to consolidate the bargaining structure and create a more appropriate structure than was there before.
The IUOE concedes that employee job mobility and job opportunities are enhanced in a broader, more comprehensive bargaining unit - so that, for example, if engineers are displaced from their current jobs, there would be more places for them to "bump" if they were part of a much larger unit. Bigger bargaining units are usually better for employees, since there is a wider range of work alternatives and a broader reach for the exercise of seniority rights. Accordingly, the TUOF does not resist putting its members into a broader service unit, because their job security would be better protected as part of this larger grouping. However, the IUOE contends that its name should appear on the ballot in any representation vote affecting this now augmented grouping of service employees.
III
Before turning to the particular questions that the parties have posed in this case, I think that it is useful to mention two aspects of the labour-relations environment that may bear upon the answer to those questions - or at least illuminate the context in which the answer must be given.
The first aspect worth mentioning, is the pace of organizational change on the "employer side of the bargaining table" - beginning in recent years with "downsizing" and "restructuring" in the private sector, and now accelerated in the public sector, as cash-strapped governments try to find more efficient ways to deliver public services. Today, across Ontario, hospitals, school boards and municipal institutions are being restructured at an unprecedented pace, and on an unprecedented scale. And although this does not necessarily mean that the resulting institutions will be bigger overall, (because the consolidated organization may be smaller than the sum of its parts), it probably does mean that there will be fewer individual organizations, as their diverse elements are welded together and rationalized.
Against that background, it seems odd to suggest that the bench mark for bargaining structure should be the status quo, or that one should strive to maintain the checker board of bargaining units that prevailed historically. When business and government organizations are changing - sometimes radically - it seems curious to suggest that collective bargaining structures should stay the same or that the Board should not take the opportunity to evaluate that history in light of current concerns. It seems more appropriate to give serious consideration to consolidation (given the employee intermingling) and to cast a critical eye on bargaining-unit patterns that may retard the ability of employers and employees to adapt to these changes.
The current pattern of bargaining units in the broader public sector was, for the most part, established on a case-by-case basis from the I 960s to the mid-i 980s - having regard to local conditions and the collective bargaining environment of the time, and, in recent years, giving considerable weight to the parties' agreement (i.e. whether or not the Board itself would find that unit to be appropriate, absent such agreement). And, no doubt, at individual institutions, those bargaining structures have worked more or less well. But I do not think that this history provides an unfailing guideline to what the "appropriate" bargaining structure should look like in the year 2000. Nor is precedent determinative in a situation that is quite unprecedented.
In exercising its discretion to determine what is "appropriate" under section 69(6) of the Act, I do not think that the Board can ignore what is going on in the rest of the collective bargaining system. Any sensible reading of the word "appropriate" must take these realities into account. And the dominant reality today is towards fewer, larger public sector institutions - be they hospitals, school boards or municipalities - and fewer, bigger bargaining units.
The second factor that one has to keep in mind is the evolving consensus that broader-based bargaining structures are generally better for collective bargaining - and ultimately better for BOTH employers and employees.
This is not to say that "bigger is always better". However, labour relations boards across the country have all recognized the utility of broader-based bargaining structures, because they are more likely to: promote stability, increase administrative efficiency, enhance employee mobility, and generate a common framework for employment conditions for all employees in an enterprise. Bigger bargaining units also have more critical mass, so that they are better able to facilitate and accommodate change. (See the policy considerations enunciated by the British Columbia Labour Relations Board in Insurance Company of British Columbia (1974), 1 Can. LRBR 403 - a case which, incidentally, involved a large public sector institution; and compare, in a different legal context, the decision of this Board in Mississauga Hydro-Electric Commission, [1993] OLRB Rep. June 523.)
In the absence of statutory prescriptions, there is, today, a pronounced preference for broader-based bargaining units, unless that objective collides in a serious way with the employees' ability to organize themselves. Indeed, the Board has often favoured broader-based bargaining units, even in certification situations, where the shape of the unit may well influence whether there will be any collective bargaining at all. The Board has recognized that the structure of collective bargaining "matters" - as it noted in cases such as Board of Governors of Ryerson Polytechnical Institute, [1984] OLRB Rep. Feb. 371; Bestview Holdings Limited, [1983] OLRB Rep. Aug. 1250; The Board of Education for the City of Toronto, [1986] OLRB Rep. June 900; Kidd Creek Mines Limited, [1984] OLRB Rep. Mar. 481; TV Guide Inc., [1986] OLRB Rep. Oct. 1451; and, more recently, Pepsi Cola, [1995] OLRB Rep. Aug. 1311. Fragmented bargaining structures can pose serious labour-relations problems. Conversely, broader based bargaining units make collective bargaining go more smoothly and successfully.
There is nothing particularly novel about these observations. Nor are they unique to Ontario, or to the Ontario Labour Relations Board. The consolidation of bargaining structures has been ongoing in other jurisdictions for many years (the Post Office, CBC, railways, and airlines come to mind); and policy considerations such as those discussed in the Ontario cases can be found in the reasons of other adjudicators in other jun sdictions. Those boards, too, have been inclined to favour more comprehensive bargaining units unless there are persuasive countervailing considerations. See, for example: ICBC, supra; Canadian Pacific Limited (1976), 1 CLRBR 361; Saskatchewan Wheat Pool (1977), 1 CLRBR 510; Atomic Energy of Canada Ltd. (1978), 1 CLRBR 92; British Columbia Telephone Limited (1977), 2 CLRBR 385; CBRT and Sea Span International Ltd. (1979), 2 CLRBR 213; and compare the "rethinking" evidenced in Ontario cases such as Mississauga Hydro-Electric Commission, supra, and Caressant Care Nursing Home of Canada Limited, [1996] OLRB Rep. Sept./Oct. 748.
The fact is: bargaining units are being consolidated on a regular basis - either because the legislation requires it, or because the legislation permits it, (e.g. section 7 of Bill 40), or because of employer restructuring, or contingent upon the merger of trade unions themselves. And generally speaking, neutral commentators think that such consolidation is a good thing. Bigger may not always be better, but broader, more comprehensive bargaining units are usually preferable - and more appropriate - than narrow fragmented ones. On the other hand, there may well be a variety of broadly-based groupings (but less than "all employees") which were and continue to be appropriate despite an operational merger of the predecessor organizations. In the hospital sector, for example, comprehensive units of paramedicals, service workers, etc. have been and may still be appropriate despite the bigger size of the successor organization.
In summary, the direction of the law, the direction of policy, the metamorphosis of employer and union organizations, and the evolution of thinking on these issues have, for the most part, all pointed towards broader bargaining units and extended area bargaining.
I do not think that one should ignore these trends when applying section 69(6) of the Act.
IV
Section 69(4) of the Act is designed to preserve the "like bargaining units" which existed before, with such revisions as may be necessary to eliminate conflict between established bargaining-unit descriptions. By contrast, the terms of section 69(6) are much broader, and contemplate the possible elimination of bargaining units or collective agreements, as well as the termination of bargaining rights - that is, the restructuring of bargaining units, bargaining agents, and collective agreements, to meet the new situation. Section 69(6) empowers the Board to take a second look at existing bargaining structures and realign bargaining units and bargaining rights in a manner that makes industrial relations sense in the new circumstances.
In each case, the Board has to give some weight to the status quo. But at the same time, the Board also has to consider the desirability of modifying the existing bargaining structure and representational rights in a manner which will better suit the new situation. Unlike section 69(4) where the Board is maintaining "what is" and ironing out definitional conflicts, section 69(6) requires the Board to determine what is "appropriate" - which will not necessarily be what is there already.
Section 69(6)(b) contemplates that the Board will designate one or more "APPROPRIATE" bargaining units. The use of the term "APPROPRIATE" is no accident. It suggests an exercise that is similar to the one undertaken by the Board on an application for certification, where there is also a question of "appropriateness" (see section 9 of the Act). And, with that in mind, I do not think the Board should ignore the fact that an existing bargaining structure may be one that the Board would never have found to be "appropriate" in the first place, or may be unnecessarily fragmented.
Of course, these general notions of what is "standard" and "appropriate" must be balanced against the fact that an idiosyncratic unit or fragmented bargaining structure may nevertheless have worked quite well in its former organizational setting. The Board's approach under section 69(6) need not be precisely the same as on an application for certification, where a group of employees is trying to organize for the first time. But, by the same token, where there is a successorship, intermingling, and a "two-union situation", any inclination to preserve established bargaining rights must be considered in relation to the express power to realign the bargaining structure to meet the new circumstances -recognizing that such realignment will not raise concerns about access to collective bargaining that the Board mentioned in "pure certification" cases such as Canada Trustco, [1977] OLRB Rep. June 330 or K-Mart Limited, [1981] OLRB Rep. Sept. 1250.
On an application for certification, the Board must weigh the question of the "appropriate" bargaining unit, in light of its potential impact on the ability of employees to organize. Too broad a definition would unnecessarily impede the employees' statutory right to organize themselves - however desirable or "more appropriate" a more comprehensive unit may be. However, in a successorship/intermingling scenario, the Board usually does not have to worry about that. The situation is more like the one described by the Board in Stratford General Hospital, [1976] OLRB Rep. Sept. 459, where two unions were competing and the Board observed:
Even where the Board has found that two competing applications propose appropriate bargaining units, it has exercised a discretion in favour of the more comprehensive bargaining unit, in finding "the" appropriate bargaining unit for the purposes of section 6(1) [now section 9] .... Surely where there are competing applications, the Board can be more concerned with the ideal characteristics of collective bargaining structures in that, whatever the decision, employees will not be denied access to the collective bargaining process.
Similarly, in his text, Canadian Labour Law, former Board Chair G. W. Adams, Q.C. commented:
When intermingling involves the merger of two groups of unionized employees, a Board will look to the existing bargaining structure to decide if maintaining the separate units can be justified. The Boards note that the choice of the employees regarding their bargaining agent should be honoured, unless to do so would undermine rational collective bargaining. Balanced against this recognition of the employees' wishes is the preference for single, all-employee units. Where a conflict arises between these two policy goals, the interest of maintaining industrial peace prevails and undue fragmentation is avoided. [emphasis added]
In other words, where there is no concern about access to collective bargaining, Labour Boards have more scope and more inclination to opt for broader-based bargaining units. Or to put the matter another way: in intermingling situations, where there are different ways to define the new structure and different "degrees of appropriateness", labour boards may be more inclined to opt for the "more appropriate" unit, unless there are compelling countervailing considerations (for example: if there are long-established "craft rights" that have historical and statutory recognition, as well as continuing collective bargaining utility; if there is an existing local structure that facilitates extended area bargaining, or conforms more closely to established sectoral collective bargaining practices; and so on).
In the instant case, for example, the issue is not whether maintenance workers or engineers will continue to be represented by one union or another, but rather which union will represent them, and what the bargaining structure should be. Accordingly, in multi-union intermingling situations like the one here, I think that the Board can give less weight to the pre-existing status quo, and can exhibit more concern about the problems of fragmentation, and the establishment of the most coherent and sensible bargaining arrangement for the new business context (again see the comments of the Board in Mississauga Hydro supra). Indeed, one cannot really preserve the status quo in this case. The real question (and dispute) is about how it should be changed.
V
I have weighed the practical and policy considerations referred to above. I have also considered the pre-existing status quo and the preference of some of the parties for their more fragmented and somewhat anomalous bargaining-unit structure. However, on balance, I am satisfied that the "appropriate" bargaining-unit configuration for the merged hospital is the one urged upon me by the SEIU; namely, that both maintenance employees and operating engineers should be grouped together for collective-bargaining purposes in the single "service bargaining unit".
I do not think that it is "appropriate" to preserve a separate bargaining unit of maintenance employees; nor, in the particular circumstances of this case, is it "appropriate" to preserve a separate quasi-craft bargaining unit containing a handful of operating engineers (a group particularly susceptible to the impact of "de-skilling" - see Queen Elizabeth Hospital, [1982] OLRB Rep. Nov. 1711). In this sense, the situation of the engineers is like that of the handful of employees in the "craft unit" considered by the Board in Municipality of Metropolitan Toronto [1992] OLRB Rep. March 315) - and ultimately rolled into the larger unit, for the reasons articulated above. Accordingly, whatever utility the former unit structure may have had in the predecessor organizations, I find that the more comprehensive service unit - including engineers and maintenance employees - is what is sensible and appropriate in the new hospital setting.
VI
This decision answers the "policy issue" which the parties have put before the Board for consideration.
With the bargaining unit question clarified, the parties should now be able to work out the mechanics of any representation votes which may be required.
To this end, the Board hereby appoints Senior Labour Relations Officer Frank Reilly to meet with the parties for the purpose of resolving any outstanding issues with respect to voting rights, voting constituencies, or otherwise.
In the event that the parties are unable to resolve any of these issues, they may make further application to the Board.
For the purpose of clarity, it should be noted that although Bill 136 was passed while this case was before the Board, this is an application that was made and decided under section 69 of the Labour Relations Act. Accordingly, the decision should not be taken as a comment on the issues which may arise under this new legislative umbrella.