United Food and Commercial Workers International Union, Local 175 v. Loeb Inc., 1998 CanLII 18315

[1998] OLRB REP. JULY/AUGUST 660

0809-98-R United Food and Commercial Workers International Union, Local 175, Applicant v. Loeb Inc., Responding Party v. Retail Wholesale Canada, Canadian Service Sector Division of the United Steelworkers of America. Local 414, Intervenor

BEFORE: D. L Gee, Vice-Chair.

APPEARANCES: A. M. Minsky and Wayne Hanley for the applicant; Richard Anstruther, Bob Auger and Don Erskine for the responding party; Paul J. J. Cavalluzzo for the intervenor.

DECISION OF THE BOARD; August 10, 1998

1The style of cause is hereby amended to refer to the responding party as "Loeb Inc.".

2This is an application for certification filed on behalf of the United Food and Commercial Workers International Union, Local 175 (the "UFCW") for a unit of employees working for Loeb Inc. at its store located at 4048 Carling Avenue in Kanata., Ontario. In response to the application, submis­sions were filed on behalf of Loeb Inc. and Retail Wholesale Canada, Canadian Service Sector Division of the United Steelworkers of America, Local 414 (the "USWA") in which it is asserted that Loeb Inc. and the USWA are party to a collective agreement covering the employees affected by the application. The UFCW challenged the validity of the collective agreement between Loeb Inc. and the USWA on the basis of sections 44 and 66 of the Labour Relations Act, 1995 (the "Act"). By decision dated June 8, 1998, the Board (differently constituted) declined to direct a vote pending a Board determination as to whether the application is timely. A hearing was held on July 2, 1998 for such purpose.

Relevant Statutory Provisions

3Sections 44 and 66 of the Act provide as follows:

44. (1) A proposed collective agreement that is entered into or memorandum of settlement that is concluded on or after the day on which this section comes into force has no effect until it is ratified as described in subsection (3).

(2) Subsection (I) does not apply with respect to a collective agreement,

(a) imposed by order of the Board or settled by arbitration;

(b) that reflects an offer accepted by a vote held under section 41 or subsection 42(1); or

(c) that applies to employees in the construction industry.

(3) A proposed collective agreement or memorandum of settlement is ratified if a vote is taken in accordance with subsections 79(7) to (9) and more than 50 per cent of those voting vote in favour of ratifying the agreement or memorandum.

66. (1) Where an employer and a trade union that has not been certified as the bargaining agent for a bargaining unit of employees of the employer enter into a collective agreement, or a recognition agreement as provided for in subsection 18 (3), the Board may, upon the application of any employee in the bargaining unit or of a trade union representing any employee in the bargaining unit, during the first year of the period of time that the first collective agreement between them is in operation or, if no collective agreement has been entered into, within one year from the signing of such recognition agreement, declare that the trade union was not, at the time the agreement was entered into, entitled to represent the employees in the bargaining unit.

(2) Before disposing of an application under subsection (1), the Board may make such inquiry, require the production of such evidence and the doing of such things, or hold such representation votes, as it considers appropriate.

(3) On an application under subsection (1), the onus of establishing that the trade union was entitled to represent the employees in the bargaining unit at the time the agreement was entered into rests on the parties to the agreement.

(4) Upon the Board making a declaration under subsection (1), the trade union forthwith ceases to represent the employees in the defined bargaining unit in the recognition agreement or collective agreement and any collective agreement in operation between the trade union and the employer ceases to operate forthwith in respect of the employees affected by the application.

Facts

4This matter was argued on the basis of an Agreed Statement of Facts which states as follows:

UFCW Local 175 v. Loeb Inc. (USWA Intervenor)

OLRB file 0809-98-R

Agreed statement of facts

Background

1. The Respondent operated a grocery store, known as Loeb Beaverbrook ("Beaverbrook") located at 2 Beaverbrook Road in the City of Kanata, Ontario. Beaverbrook ceased operations at the close of business February 14, 1998.

2. The Respondent currently operates a grocery store known as Loeb March Road at 4048 Carling Avenue (the corner of Carling Avenue and March Road) in the City of Kanata, Ontario. The March Road store is approximately one mile from the location of the Beaverbrook store. The March Road store officially opened the day following the closure of Beaverbrook, i.e. February 15, 1998.

3. The Intervenor USWA held bargaining rights for employees of Beaverbrook in an "all employee" bargaining unit with standard exclusions.

4. The USWA acquired bargaining rights at Beaverbrook pursuant to an OLRB certificate dated December 30, 1991.

5. There was a collective agreement in effect at Beaverbrook between the USWA and the Respondent which expired December 31, 1997. This was the second such agreement negotiated by the USWA on behalf of the Beaverbrook employees since certification in 1991.

6. The second Beaverbrook collective agreement was originally concluded between the USWA and a franchisee who was the owner of the Beaverbrook store at that time.

7. During the life of the second collective agreement the Beaverbrook store reverted to corporate ownership, i.e. the ownership of the Respondent.

8. Prior to the events in this proceeding, the Respondent decided to close the Beaverbrook store and to open another grocery store, to be known as Loeb March Road, approximately one mile from the location of the Beaverbrook store. The March Road location allowed for greater square footage than was possible at Beaverbrook and, unlike Beaverbrook, the March Road location is accessible from a major highway.

9. The decision to close the Beaverbrook store and open the March Road store was known to the Respondent and the Intervenor by the time the Beaverbrook collective agreement expired December 31, 1997. The Respondent and the Intervenor therefore commenced negotiations for a collective agreement to cover the March Road store.

10. The Respondent and the Intervenor successfully concluded an agreement for the March Road store on February 13, 1998. Its status as a valid collective agreement is subject to the Board's ruling on the Applicant's challenge pursuant to sections 44 and 66 of the Labour Relations Act, 1995.

11. The March Road agreement recognizes the USWA as the bargaining agent for employees at the March Road store in an "all employee" unit with standard exclusions.

12. The March Road agreement erroneously describes the address of the March Road store as being 360 March Road as both the Respondent and the Intervenor were at that time under a misunderstanding as to the correct address of the store. In fact the correct address is 4048 Carling Avenue.

13. No "no board" report was issued between the expiry of the Beaverbrook agreement December 31, 1997 and the conclusion of the March Road agreement February 13, 1998.

14. In the last three months of the Beaverbrook store's operation, the store employed approximately 55 employees.

15. During the last few months of Beaverbrook's operation, signs in the store advised the public of the impending closure of the Beaverbrook store and the impending opening of the March Road store.

Staffing issues

16. The Respondent looked first to the employees of the Beaverbrook store to fill the staffing requirements of the March Road store. Only after making offers of employment at March Road to the Beaverbrook employees did the employer commencing hiring from other sources.

17. The Respondent has produced 93 documented offers of employment in non-management positions at March Road. The Company made these offers prior to February 13, 1998 on the date indicated on the form. These offers are signed and dated by the individuals to whom the offer is made.

18. There are four additional forms, apart from the 93 which have been produced. These relate to individuals from the Beaverbrook store who accepted employment at March Road, but who later declined, or resigned or were terminated prior to February 13, 1998.

19. Two individuals employed in bargaining unit positions at Beaverbrook applied for and obtained excluded management positions at March Road. There are no forms for these individuals.

20. Of the 93 forms, 44 ("the Beaverbrook forms") are signed by individuals who were employed at Loch Beaverbrook and subject to the Beaverbrook collective agreement. Forty-nine forms were signed by individuals not employed at Beaverbrook ("the non­Beaverbrook forms").

21. Ten of the 44 Beaverbrook forms were signed by individuals who were in their probation­ary period under the Beaverbrook collective agreement as of February 13, 1998. None of these employees were members of the USWA.

22. Of these probationary employees, one Jeff Henry, was a full time employee. The re­maining nine probationary employees were part time employees.

23. Jeff Henry received training in respect of his March Road position prior to February 13, 1998, for which he was paid, but resigned from Beaverbrook prior to February 13, 1998 and did not work at March Road.

23.1) Dues were checked off for all probationary employees at Beaverbrook pursuant to the collective agreement. By February 15, the official opening date, all 43 Beaverbrook employees and 49 non-Beaverbrook employees commenced their regular shifts at March Road.

24. One of the Beaverbrook forms is signed by Jennifer Joanisse, who was offered, and accepted, a bargaining unit position at March Road but was promoted to management at approximately one week after the February 15, 1998 opening of the March Road store.

25. One of the Beaverbrook forms is signed by Mark Chisholm. Mr. Chisholm was employed at Beaverbrook, accepted a March Road position, was employed at March Road, but resigned from nis March Road position approximately one week after the opening of the March Road store.

26. Four of the 49 non-Beaverbrook forms are signed by individuals who came to March Road from other Loeb stores.

27. One of these four individuals is Wayne Owens. Mr. Owens came to Loeb March Road from a bargaining unit position at Loeb Convent Glen, a store at which the USWA holds bargaining rights. The parties agree that Wayne Owens was subject to the Loeb Convent Glen collective agreement prior to commencing employment at March Road and was not a probationary employee at Convent Glen.

28. Two of the four individuals from non-Beaverbrook Loeb stores are from Loeb Blackburn, a store at which the Applicant UFCW holds bargaining rights.

29. One of the four individuals comes from Loeb Strafford, a non-union store.

30. All of the employees who came to March Road from other Loeb stores retained their employee number and date of service for purposes of benefit calculations. They did not retain seniority and were required to complete a probationary period at March Road.

31. Besides the four individuals from non-Beaverbrook Loeb stores, the remaining 45 non-­Beaverbrook forms are signed by individuals hired "off the street".

32. All of the individuals employed at March Road, from whatever source, received training in respect of their March Road position.

33. This training was a minimum of sixteen hours and may have been either within the March Road store, or at another Loeb store or at a remote location.

34. The employees were paid wages for the time spent in this training.

35. The training occurred between January 18, 1998 and February 13, 1998. All training was completed by February 13, 1998.

36. Some individuals worked in the March Road store on February 13, 1998 to assist in setting up the store in preparation for the official opening on February 15, 1998. The work of setting up the store included placing stock on shelves and setting up displays. Of these individuals, four were Beaverbrook employees, twenty-three were not from Beaverbrook and four were employees temporarily "borrowed" from other Loeb stores who were never offered employment at March Road.

Ratification

37. The Intervenor held a ratification vote on March 10, 1998 in respect of the agreement of February 13, 1998 between the Respondent and the Intervenor for the March Road store.

38. The vote was held by secret ballot and the vote result was in favour of ratification.

38.1) A prior ratification meeting had been held February 23, but the vote was cancelled because of poor turnout. Four employees attended this meeting.

39. Two employees attended for the vote.

40. On the date of the ratification vote, approximately 100 employees were employed at March Road.

41. There were no March Road employees on the USWA bargaining committee which concluded the March Road agreement.

41.1) Adequate notice of the ratification vote was given to the employees by posting notices in the workplace.

Documents admitted into evidence on consent

42. List of Beaverbrook employees dated November, 1997.

43. List of March Road employees who worked in the week ending February 28, 1998. March Road employees who did not happen to work this week because of vacation, lack of hours or some other reason, do not appear on this list.

44. Set of employment forms, various dates, indicating employees offered employment at March Road by February 13, 1998.

45. Four computer printouts indicating persons paid wages in respect of activity on behalf of Loeb March Road in the four week period ending on February 14, 1998.

46. Time cards indicating work performed at March Road in the week ending on February 14, 1998. The time cards for the part time employees indicate the dates on which hours have been worked. The time cards for full time employees indicate 40 hours plus overtime hours, but do not specify the dates on which the employees worked. A full time employee working the week ending February 14, 1998 would have worked on February 13, 1998.

47. OLRB Certificate in respect of Loeb Beaverbrook dated December 31, 1991.

48. Loeb Beaverbrook collective agreement expiring December31, 1997.

49. Loeb March Road collective agreement (subject to section 66 objection).

50. Loeb Convent Glen collective agreement.

50.1) By way of correction to paragraph 27, the above figures are calculated on the assumption that Wayne Owens came to March Road from Convent Glen. However, in fact Wayne Owens came to Beaverbrook from Convent Glen. He was a probationary employee at Beaverbrook at the time of going to March Road and the figures above should be amended accordingly.

Argument

5It is submitted on behalf of the USWA that section 66 of the Act does not apply to the instant fact scenario or, if it is determined that section 66 does apply, that the application of section 66 must be tailored so as to fit the unique circumstances of this case.

6In support of the USWA's position, counsel urged the Board to take note of the following facts. The collective bargaining relationship between Loeb Inc. and the USWA flows from a Board issued certificate. Following the issuance of the certificate to the USWA the parties negotiated two collective agreements applicable to the Beaverbrook Store. Before the expiry of the second collective agreement, the USWA was advised of the closing of the Beaverbrook Store and the opening of the March Road Store. Loeb Inc. decided to staff the March Road Store with employees from the Beaverbrook Store before hiring from elsewhere. Signs were posted in the Beaverbrook Store advising the clientele that the store was closing and that the March Road Store was opening. The closing of the Beaverbrook Store and the opening of the March Road Store were inextricably bound. Beaverbrook closed on February 14, 1998 and March Road opened on February 15, 1998. The March Road Store is located a very short distance from where the Beaverbrook Store had been located and serves the same neighbourhood that Beaverbrook previously served.

7The bulk of the employees from Beaverbrook moved over to March Road. Of the 97 individuals who were offered positions at March Road, 51 were from Beaverbrook (45 of the 51 actually moved to March Road in bargaining unit positions). Forty-five of the 48 non-Beaverbrook employees at the March Road Store were hired off the street. All employees who accepted an offer of employment at the March Road Store were made aware, by way of a statement contained on the Employment Offer form, that their employment conditions would be in accordance with the Collective Agreement with the USWA. The Collective Agreement entered into between Loeb Inc. and the USWA with respect to the March Road Store is basically the Beaverbrook Agreement with minor changes to the provisions regarding scope and wages. The March Road agreement was signed by Loeb Inc. and the USWA on February 13, 1998.

8The March Road Agreement was subsequently ratified by way of a secret ballot vote after adequate notice of the ratification vote had been given.

9Counsel for the USWA argues that section 66 was never intended to apply to a situation where a company, for reasons relating to better customer access, decides to move, within the same market area, to a larger store and opens the new store at the very same time as it closes the old one. Counsel argues that the situation is no different than if Loeb Inc. had expanded the Beaverbrook store and hired additional employees to staff the expanded space.

10Counsel argues that the section 66 paradigm is the situation where there is a brand new collective agreement or voluntary recognition agreement and points out that where the Board has applied section 66 to a situation other than the paradigm it has been very careful to ensure that it is applied with a knowledgeable hand because of the interests section 66 was intended to protect. In counsel's submission, the facts of this case are so unique, section 66 has no application.

11Turning to the USWA's alternative position, counsel argued that, if it is determined that section 66 is applicable, the Board must keep in mind the interests that section 66 was designed to protect and ought not to apply section 66 in a manner that would overshoot its purpose. Counsel asks the Board to consider the fact that, although section 66 has been in the statute for a considerable number of years, section 44, mandating ratification votes, has recently been added to the statute. Further, counsel points out that section 66 is discretionary such that the Board has the discretion to permit an agreement reached by way of the collective bargaining process to stand. Counsel points to the fact that the agreement between Loeb Inc. and USWA is not a sweetheart deal, the USWA is not a sweetheart union, a significant number of employees who were represented by the USWA at Beaverbrook moved over to March Road and all individuals who accepted employment at March Road were aware of the union and the Collective Agreement, and urges the Board not to apply section 66 in the present circumstances.

12Counsel for the USWA pointed out that section 66 does not contain a membership require­ment. Rather, section 66 refers to an entitlement to represent. Thus, the question for the Board to determine is not whether a majority of the March Road employees were members of the USWA but rather whether the USWA was entitled to represent a majority of the March Road employees.

13Counsel argues that the USWA was entitled to represent all of the March Road employees who were previously employed at the Beaverbrook Store as all of the Beaverbrook employees were required to be members of the USWA, by virtue of the following articles of the Beaverbrook collective agreement:

ARTICLE II- RECOGNITION

2.01 The Company recognizes the Union as the exclusive representative and sole bargaining agent for all employees of the Company as certified by the Labour Relations Board. This Agreement is entered into on behalf of all employees outlined above.

ARTICLE III- UNION SECURITY AND CHECK-OFF

3.01 All employees in the bargaining unit, upon completion of their probationary period, shall become and remain members of the Union in good standing during the lifetime of this Agreement as a condition of employment.

In counsel's submission, the USWA was entitled to represent all of the Beaverbrook employees covered by the collective agreement as a result of the requirement that they become members of the union as a condition of employment. With respect to the probationary employees, counsel submits that the USWA was not only entitled to represent them but required to do so and points out that, had the USWA failed to do so, a probationary employee could have filed a duty of fair representation complaint against the union.

14Counsel further argues that the USWA was entitled to represent everyone else who accepted an offer of employment at the March Road Store because, when they accepted the offer, they agreed to be bound by the USWA Collective Agreement. As a result, it is the USWA's position that, at the material point in time, it was entitled to represent all employees of the March Road Store, whether they were members of the union or not.

15Relying on Spring Plastering Limited, [1967] OLRB Rep. Dec. 887, Gisborne Design Services Ltd., [1995] OLRB Rep. June 796, York County Quality Foods Ltd., [1984] OLRB Rep. Sept. 1340 and Bestview Holdings Limited, [1983] OLRB Rep. Aug. 1250 counsel submits that membership evidence is not required in order to establish an "entitlement to represent" and that an entitlement to represent has been found where the employees are members of the union by virtue of having been previously covered by a collective agreement containing a union security clause, where the collective agreement has been ratified and where individuals were made aware, prior to commencing employment, that they would be represented by the trade union. Applying the principles of the above-cited decisions, counsel argues that the USWA is entitled to represent all of the employees at the March Road Store because the individuals who were previously employed at the Beaverbrook Store were USWA members or, in the case of the probationary employees, were individuals to which the USWA owed a duty of fair representation, and a ratification vote was held at which a majority of the employees voting voted in favour of the agreement.

16Counsel for Loeb Inc. adopts the submissions made on behalf of the USWA. Counsel advised the Board that Loeb Inc. has stable ongoing collective bargaining relationships with both the USWA and the UFCW at other Loeb Inc. stores in Ottawa and is content to have its relationships continue.

17Counsel for Loeb Inc. urges the Board to conclude that section 66 does not apply to the instant fact scenario. Counsel highlights the fact that the March Road Store opened coincident in time with the closing of the Beaverbrook Store and that virtually the entire Beaverbrook staff moved to the March Road Store. In counsel's submission, the Board is not faced with the paradigm situation contemplated by the drafters of section 66 as there is no fresh voluntary recognition agreement. Counsel argues that the agreement between Loeb Inc. and the USWA is not a sweetheart deal and that the USWA is not a sweetheart union. Loeb Inc. and the USWA are parties to an ongoing and legitimate relationship who dealt with the employer's need to relocate to another location in the same neighbourhood. Counsel submits that the Board should be hesitant to throw out an established bargaining relationship based on a discretionary clause.

18Counsel for Loeb Inc. suggested that one option in the Board's power which the Board should consider is the holding of a vote under section 66(2) of the Act. While not suggesting that the number of employees who moved from the Beaverbrook Store to the March Road Store is indicative of the level of the the USWA's representation entitlement, counsel for Loeb Inc. points out that 45 of the 93 employees who initially commenced working at the Loeb Inc. store were former Beaverbrook employees. Although not a majority, counsel suggests that it is a sufficient percentage that the Board would order a vote in a certification application.

19Counsel for the UFCW submits that there is nothing unusual about the facts of this case.

20Counsel submits that it is a trite proposition that bargaining rights attach only to the geographic scope or area as set forth in the union's certificate or in its ensuing collective agreement. In the present case, the collective agreement entered into between Loeb Inc. and the USWA for the Beaverbrook store incorporates by reference the bargaining unit description in the certificate issued to the USWA by the Board. Article 2.01 of the Beaverbrook Collective Agreement provides as follows:

The Company recognizes the Union as the exclusive representative and sole bargaining agent for all employees of the Company as certified by the Labour Relations Board. This Agreement is entered into on behalf of all employees outlined above.

21The unit as described in the Board's certificate is as follows:

all employees of the respondent [Loeb I.G.A. Beaverbrook] at 2 Beaverbrook Road, Kanata, save and except store owner, store manager Loeb Fresh, store manager Loeb Ready, Store Manager Grocery, persons above the rank of store manager Loeb Fresh, store manager Loeb Ready, store manager Grocery, and office and clerical staff.

Thus, the USWA has bargaining rights restricted to employees at a site specific address, namely 2 Beaverbrook Road.

22Counsel points out that the Board normally defines the bargaining unit in a certificate by reference to a municipality and not to a street address. A certificate is only restricted to a street address where the employer has multiple locations within the municipality. Counsel submits that the enormous drawbacks of a site specific certificate are well known. Where the union has site specific bargaining rights, the employer could move its operations next door and the union would have no legal entitlement to represent the employees.

23Counsel submits that where a trade union has site specific bargaining rights the difference between an employer expanding its operations and moving them down the street is the difference between night and day. In the first scenario the trade union maintains its bargaining rights. In the second, the trade union loses its bargaining rights. Where the trade union loses its bargaining rights to regain them it must organize the employees and apply to be certified, or obtain voluntary recognition from the employer.

24Counsel thus submits that it is a trite proposition that when Loeb Inc. closed its store located at 2 Beaverbrook Road and opened a new store at 4048 Carling Avenue, the USWA had no pre-existing entitlement to represent the employees. It cannot be said that the voluntary recognition agreement for March Road is either a continuation or a renewal of the Beaverbrook collective agreement. It is a different collective agreement for a different bargaining unit which purports to create bargaining rights for the USWA which it did not previously enjoy. In counsel's submission, the March Road collective agreement is a voluntary collective agreement between Loeb Inc. and the USWA in its first year of operation such that section 66 applies.

25In support of the above submissions, counsel refers the Board to Mountain View Dairy Ltd., [1967] OLRB Rep. Feb. 911 at paragraph 4 where the Board stated as follows:

It must be noted, although no argument was made on this point, that the bargaining rights held by Retail Wholesale were for employees of Mountain view at Dundas (a fact which was drawn to the attention of the parties at the hearing), whereas the operations, with respect to which it claims to represent employees, have been moved to Waterdown. Had there been no sale, but had Mountain View simply moved the base of its own operations from Dundas to Waterdown, it would seem that the bargaining rights of Retell Wholesale would not continue, except by the agreement of the parties. Retail Wholesale could not be in a better position in this case, where Oakvllle Dairy, having purchased the business of Mountain view, moved its operations to Waterdown. The Board does not, however dispose of the application on this ground.

26Counsel also refers the Board to Sunnylea Foods Limited, [1981] OLRB Rep. Nov. 1640, Chateau Gardens (Queens) inc., [1979] OLRB Rep. April 289, and Silverwood Dairies, [1980] OLRB Rep. Oct. 1526 in which the Board's comments in Mountain View were adopted.

27Counsel submits that, based on the foregoing, as a legal matter, section 66 must apply to the present circumstances.

28In the event the Board is not persuaded that section 66 applies as a legal matter, counsel urges the Board to have regard to the way in which Loeb Inc. and the USWA dealt with one another. In counsel's submission, the conduct of Loeb Inc. and the USWA indicates that they did not consider themselves bound by the provisions of the Beaverbrook collective agreement. Loeb Inc. decided which of the Beaverbrook employees it would offer employment to at the March Road location. The offer of employment forms, in counsel's submission, make it clear that Loeb Inc. was not transferring the Beaverbrook employees to the March Road location, rather it was engaging in a fresh hiring process. Counsel points to the fact that the seniority provisions of the Beaverbrook collective agreement were not applied: two Beaverbrook employees were not offered employment at March Road; two Beaverbrook employees were offered a demotion to March Road which they did not accept (they received termination packages); two Beaverbrook employees were offered a demotion to March Road which they did accept; one employee accepted a transfer to another Loeb Inc. store; three employees accepted transfers to other positions at the March Road store; and three employees accepted a non-union management position. All Beaverbrook employees who accepted employment at the March Road store, regardless of their length of service, reverted to probationary status. All employees were required to serve a 90 day probationary period from the date the store opened. Based on the foregoing facts, counsel submits that it cannot be said that Loeb Inc. and the USWA treated the situation as a continuation or amendment to their old collective agreement.

29Counsel further submits that the situation cannot be characterized as an expansion of bargaining rights. Loeb and the USWA did not expand the scope of the existing bargaining unit to include the March Road store but in fact deleted the reference to the Beaverbrook store and inserted reference to the March Road store.

30In the alternative, if the Board were to find that there has been an expansion of bargaining rights, counsel submits that the USWA is unable to demonstrate that it was entitled to represent a simple majority of the employees. On the date on which the voluntary recognition agreement was entered into, there were 31 employees on the March Road payroll (employees were being trained in anticipation of the February 15, 1998 store opening), and only four of those employees were individuals who were employed at Beaverbrook. Relying on paragraphs 33 through 38 inclusive of the Board's decision in Bestview Holdings Limited, supra, counsel argues that, where a group of existing employees are swept into a bargaining unit, the parties to the voluntary recognition agreement are required to demonstrate that the union was entitled to represent a majority of such individuals. In light of the numbers set out above, counsel submits that the USWA cannot establish that it was entitled to represent a majority of the March Road employees as of February 13, 1998.

31Counsel relies on Darrigo Supermarkets Limited, [1975] OLRB Rep. Feb. 93, Warren Bitulithic Limited, [1982] OLRB Rep. Sept. 1375, Eugene Marks, [1987] OLRB Rep. June 872 and Gisborne Design Services Ltd., supra in support of the proposition that the Board takes an arithmetic approach to calculating the union's count position as of the date the voluntary recognition agreement is entered into.

32In counsel's submission, there is no point in time when the USWA can demonstrate that it was entitled to represent a majority of the employees. Counsel's argument concerning USWA's entitle­ment to represent as of the date on which the voluntary recognition agreement was entered into is set out above. Alternatively, the Board might calculate the USWA's entitlement to represent based on the offers of employment. These forms indicate that 93 individuals were offered employment at March Road. Forty-five of such individuals were formerly employed at the Beaverbrook Store. Forty-eight of such individuals were non-Beaverbrook employees. Thus, the USWA cannot establish entitlement to represent a majority of the March Road employees based on the fact that the Beaverbrook employees were USWA members. Further, 10 of the Beaverbrook employees were probationary employees who were not required to be members of the USWA, thereby reducing the number of USWA members to 35 of the 93. In response to the USWA's argument that it was entitled to represent the probationary employees at Beaverbrook, counsel for UFCW asserts that USWA's entitlement to represent the probationary employees was limited to matters in relation to their employment with Loeb Inc. at the Beaverbrook Store. In counsel's submission, it was not an entitlement to represent that went beyond employment at the Beaverbrook Store. Thus, only 35 of the 93 employees that started work at the March Road Store were USWA members or individuals that the USWA was entitled to represent.

33On the official opening date, there were 43 former Beaverbrook employees and 49 non­ Beaverbrook employees at the March Road Store. Thus, in counsel's submission, it cannot be said that on the date of the store opening the USWA was entitled to represent a majority of the employees.

34On February 28, 1998, two weeks following the store opening, there was a total of 98 unionized employees 41 of whom were former Beaverbrook employees.

35In the alternative, counsel for the UFCW takes issue with the USWA's assertion that any of the individuals who were formerly employed at the Beaverbrook location are its members. Counsel submits that, notwithstanding his invitation to the USWA to do so, no membership evidence has been produced in relation to any of the Beaverbrook employees. Counsel submits that in the absence of such evidence the Board has no proof that any of such individuals were union members.

36Turning to the ratification vote, counsel submits that the Board decisions which have looked to the outcome of a ratification vote as evidence of an entitlement to represent are distinguishable from the present case. In York County Quality Foods Ltd., supra the Board indicated that it was prepared to treat the ratification result as indicative of the will of the majority. Counsel for the UFCW distinguishes York County Quality Foods Ltd. on the basis that the collective agreement in issue in that case was explicitly subject to ratification and the trade union had proved by way of union records that 80% of the employees were its members at the time the agreement was entered into. In counsel's submission, the Board's reference to the ratification vote was unnecessary. In Gisborne Design Services Ltd., supra the Board found that the employees indicated by way of a ratification vote their willingness to have the trade union represent them. Counsel distinguishes Gisborne Design Services Ltd. on the basis that all of the employees attended the ratification vote and only after the majority of employees had voted in favour of ratification, was the agreement signed.

37Counsel for the UFCW argues that this case turns on whether or not the employees at the March Road Store selected USWA as their bargaining agent. Counsel argues that they did not. None of the employees were on the negotiating committee for the March Road Store and there is no suggestion that employees were asked for their views on proposals.

38Concerning the ratification vote, counsel points to the fact that a ratification vote was scheduled for February 23, 1998, however, when only four employees showed up the vote was cancelled. The vote was rescheduled for March 10, 1998, at which time only two employees showed up, however, this time the vote was held. Thus, counsel submits that the USWA is relying on a ratification vote at which fewer people showed up than at a vote the USWA cancelled for poor attendance. Counsel argues that, given that there were 100 employees working at March Road on March 10, it cannot be said that the results of the ratification vote indicate that the employees freely and actively selected the USWA to represent them. Further, counsel suggests that in order for the ratification vote to lead the Board to conclude that the USWA was entitled to represent a majority of employees, a majority of the employees would have had to have actually voted at the ratification vote in favour of acceptance as occurred in York County Quality Foods Ltd.

39With respect to the statement contained in the offers of employment to the effect that the individual would be employed in accordance with the USWA collective agreement, counsel for the IJFCW suggests that such is employer support for a trade union. In counsel's submission, it cannot be said that the employees have freely selected the USWA if the employer is telling the employee that they have to accept the USWA.

40In response, counsel for the USWA urged the Board to adopt the approach taken in Bestview Holdings Limited which counsel described as an admonishment of form over substance. In counsel's submission, the Board should apply a realistic approach, looking at all of the circumstances and should not pick a particular day and perform an arithmetical calculation on that date. Instead, counsel submits that the Board should ask itself whether the union was entitled to represent the employees.

41Counsel disputes the submissions made by counsel for the USWA to the effect that the US WA's representation rights for the probationary employees is limited to representing them in respect of their employment at the Beaverbrook Store. Counsel suggests that when a new collective agreement was negotiated the USWA acted as the bargaining agent of the probationary employees and the probationary employees achieved the right of first hire at the March Road Store as a result of such representation.

42Concerning the ratification vote, counsel argues that the Board's comments in York County Quality Foods Ltd. were not obiter rather, they were a necessary part of the decision because the memorandum of agreement was specifically subject to ratification such that the union had to prove ratification. In counsel's submission, the Board in York County Quality Foods Ltd. adopted the view that the Act is concerned with process as opposed to results. Thus the question for the Board was whether the employees had adequate notice of the ratification vote. Provided such was the case, the wishes of a majority of the individuals voting was sufficient for the Board's purposes. Further, counsel suggests that the cases must now be read in light of section 44 of the Act which provides that a collective agreement is not effective until ratified. Thus, there is no longer any need to explicitly state that a collective agreement is subject to ratification, section 44 requires such.

43In response to the suggestion that the offers of employment demonstrate employer support. counsel suggests that the Board view the offers of employment in context. The offers of employment arose out of an established collective bargaining relationship which flowed from a Board issued certificate.

44Counsel for the USWA urges the Board to look at all of the circumstances and refrain from taking a technical approach. In counsel's submission, this is not the situation section 66 was intended to address and the Board should not intervene.

Decision

(i) Does Section 66 Apply?

45Counsel for the USWA urges me to conclude that section 66 does not apply in the present circumstances. Counsel argues that the facts before me are no different than if Loeb Inc. had decided to expand the Beaverbrook Store and hired additional employees to staff the expanded space and is to be contrasted with the situation where there is a new collective agreement or voluntary recognition agreement which is the situation section 66 was designed to address.

46It is my determination that the present circumstances are not analogous to an expansion of the Beaverbrook Store and that the facts are such that it is apparent that Loeb Inc. and the USWA have entered into a new, as opposed to continuing an old, collective bargaining relationship. Section 66 is intended to ensure that the right of employees to participate in the selection of a trade union representa­tive is not undermined as a result of an employer granting a trade union voluntary recognition. It is triggered by the voluntary granting of representation rights. For the reasons that follow, it is my determination that such has occurred in the present case and accordingly section 66 applies.

47It is, as counsel for the UFCW suggests, a trite proposition that bargaining rights attach only to the geographic scope or area as set forth in the union's certificate or as amended by its ensuing collective agreement. In the present case, the bargaining unit description set out in the Board certificate issued to the USWA defines the bargaining unit as employees of Loeb I.G.A. Beaverbrook at 2 Beaverbrook Road. The bargaining unit description set out in the Board certificate is incorporated by reference into the Beaverbrook collective agreement. Accordingly, the USWA's bargaining rights are "site specific" with the result that they are limited to representing employees at 2 Beaverbrook Road.

48It is equally trite that the enormous drawback of site specific bargaining rights is that, should the employer in good faith move its operations to any other location, including a location next door, the union has no legal entitlement to represent the employees at the new location (see: Mountain View Dairy Ltd., supra; Sunnylea Foods Limited, supra; Chateau Gardens (Queens) Inc., supra; and Sil­verwood Dairies, supra).

49Thus, as a result of the fact that its bargaining rights were site specific vis-a-vis the Beaverbrook Store, when Loeb Inc. closed the Beaverbrook Store and opened the March Road Store, the USWA had no pre-existing entitlement to represent the employees at the March Road Store.

50Based on the facts before me, it is apparent that the Loeb Inc. and the USWA recognized that the USWA had no entitlement to represent the employees at the March Road Store arising out of the Beaverbrook collective agreement and that they entered into a new collective bargaining relationship with respect to the employees at the March Road Store. Loeb Inc. and the USWA did not amend the scope clause of the Beaverbrook collective agreement so as to include the March Road Store. Rather, Loeb Inc. and the USWA negotiated an entirely separate collective agreement to apply to the March Road Store. Although most of the employees from the Beaverbrook Store were offered positions at the March Road Store, a number of employees were not offered positions at March Road, were offered demotions to March Road, or were transferred to different positions at March Road. None of the employees retained their seniority from the Beaverbrook Store. All of the employees, upon commence­ment of employment at March Road, reverted to probationary status and were required to serve a 90 day probationary period. Thus, the parties themselves recognized that the USWA had no pre-existing right to represent the employees at the March Road Store and that the collective bargaining relationship with respect to the employees at the March Road Store was a new, as opposed to a continuing, relationship.

51Thus, the facts before me are not analogous to an expansion of the Beaverbrook Store. In such a case, the USWA would have had a legal entitlement to represent all of the employees at the store and would have simply continued in its representative capacity. No new collective bargaining relation­ship or collective agreement would have been necessary. No voluntary recognition would have occurred.

(ii) Entitlement to Represent

52Counsel for the UFCW argues in favour of an arithmetical approach to determining whether the USWA can, at any time, show that it was entitled to represent a simple majority of the employees at March Road. Counsel for the USWA urges the Board to consider all of the circumstances and avoid adopting a technical approach to the determination of his client's representation entitlement. Further, counsel for the USWA urges the Board to exercise its discretion under section 66 and decline to declare that the USWA is not entitled to represent the employees at March Road.

53It is my determination that, applying either of the approaches urged upon me, the USWA has failed to demonstrate that it is entitled to represent a majority of the employees at March Road.

54Considering the facts before me on a purely arithmetic basis, it is my determination that, at no time, can the USWA show that it was entitled to represent a majority of the employees at March Road. As argued by counsel for the UFCW, at no time did the Beaverbrook employees transferred to March Road constitute a majority of the employees at March Road. Thus, even assuming that the USWA's representation rights with respect to these individuals at the Beaverbrook Store is sufficient to demonstrate an entitlement to represent such individuals, it would not be sufficient to demonstrate that the USWA was entitled to represent a majority of the March Road employees.

55Further, I am not persuaded that the fact that the employees were made aware of the fact that they would be represented by the USWA upon commencement of employment bestows upon the USWA an entitlement to represent such individuals. The only case in which such a factor was given weight is the case of Bestview Holdings Limited, supra. Bestview Holdings Limited was, however, concerned with a scenario where the collective bargaining parties agreed to expand the scope of an existing collective agreement so as to include a new location at which employees had not yet been hired. The Board considered at length the distinction between the situation before it and the creation of a new bargaining unit by way of voluntary recognition. In the context of the creation of a new bargaining unit, the Board remarked that section 66 (then section 60) ensures that the employees are afforded an opportunity similar to what would be available to them in the context of a union organizing drive and certification application to fully participate in determining their own fate. In this regard, the Board, at paragraph 25, referred to the fact that employees would have the ability to engage in debate over the strengths and weaknesses of the union, and perhaps its rivals, and thereby potentially influence the outcome. In contrast, in a situation where the parties to an existing collective agreement agreed to expand the scope of the bargaining unit, the Board remarked that employee self-determination has to be balanced with the dangers of a fragmented bargaining structure. The Board expressed its view, at paragraph 35, that the rights of future employees should bow to the benefits of broadly-based bargaining structures. Accordingly, the Board indicated that, provided the employees hired into the newly-added portion of the bargaining unit were made aware at the time of hiring that their jobs would entail trade union representation, the Board would exercise its discretion so as to uphold an agreement entered into before there were any employees in the unit.

56In the present case, Loeb Inc. and the USWA did not expand the scope clause of the Beaverbrook collective agreement, or any other collective agreement to which they are parties, so as to include the March Road Store. Loeb Inc. and the USWA created an entirely new collective agreement and thus an entirely new bargaining unit. Accordingly, there is no policy rationale, such as the desire to avoid a fragmented bargaining structure, which would lead the Board to give the employees' right to participate in the selection of their own bargaining agent less significance. The present fact scenario is the creation of a new collective bargaining relationship which, as the Board stated in Bestview Holdings Limited, should entail employee participation. It cannot be said that being presented with an offer of employment which indicates that the bargaining agent has been pre-selected and forecloses the em­ployee from engaging in any debate as to the identity of his/her bargaining agent or the selection thereof constitutes employee participation. Accordingly, I do not accept that the fact that the employees knew, prior to commencing employment at March Road, that they would be represented by the USWA is indicative of the USWA's entitlement to represent them.

57I turn then to the ratification vote. My findings in this regard are concerned solely with the issue of whether the ratification vote is sufficient to establish the US WA's entitlement to represent the March Road employees for the purposes of section 66 and are in no way concerned with the issue of whether the ratification vote would be sufficient for the purposes of section 44.

58As indicated in the Agreed Statement of Facts, a ratification vote was scheduled and cancelled when only four people turned up to vote. A second vote was scheduled. Adequate notice of the vote was given. Two people showed up. The vote was held and the vote result was in favour of ratification. At the time the vote was held, there were 100 employees in the bargaining unit.

59In my view, the fact that two of 100 employees voted in favour of the March Road collective agreement, is, when viewed in combination with the lack of any other evidence going to support such a conclusion, insufficient to establish that the USWA was entitled to represent a majority of the employees at the March Road Store.

60Having determined that the USWA cannot establish on an arithmetic approach that it was entitled to represent a majority of the employees, I turn to consider whether, by viewing all of the circumstances together, I am able to conclude that the USWA has established that it had an entitlement to represent the employees at the March Road Store. It is my determination that it has not.

61As indicated above, I do not accept that the scenario before the Board is analogous to an expansion of the Beaverbrook Store or a continuation of the collective bargaining relationship that had existed between Loeb Inc. and the USWA with respect to the Beaverbrook Store. The USWA had no legal entitlement to represent the employees at the March Road Store. Loeb Inc. and the USWA conducted themselves in manner that demonstrates that they recognized this fact. A new collective agreement was negotiated and no recognition was given to the seniority accumulated by Beaverbrook employees who were offered jobs at the March Road Store.

62As the Board remarked in Bestview Holding Limited, the creation of new bargaining rights, either by way of certification or by way of voluntary recognition, entails employee participation and employee choice. In the present case, there is very little evidence of employee participation (or consultation) in connection with the selection of the USWA as their bargaining representative at March Road. There is no evidence of the employees at Beaverbrook being advised, in advance of the US WA's actually obtaining such, that the USWA would be seeking voluntary recognition from Loeb Inc. for the March Road Store or of the employees being kept informed throughout the ensuing negotiations as was the case in York County Quality Foods Ltd. No meetings were held with employees to discuss what was occurring and no employees were on the negotiating committee. In contrast, employees were informed, by way of their offer of employment, that they would be represented by the USWA at the March Road Store.

63Thus, in a situation where new bargaining rights are being created and employee participa­tion and choice is of paramount importance, there is little if any evidence to support a determination that the employees hired to work at the March Road Store had any participation in the selection of their bargaining agent. Such being the case, I am not persuaded that the circumstances, when viewed as a whole, either establish that the USWA was entitled to represent a majority of the employees at March Road or should cause me to exercise by discretion so as to uphold the March Road collective agreement.

64Accordingly, for the foregoing reasons, it is my determination that the March Road collective agreement is a voluntary collective agreement between Loeb Inc. and the USWA in its first year of operation such that section 66 applies and that the parties to the March Road collective agreement have not established that the USWA was entitled to represent the employees in the bargaining unit. I declare that the USWA forthwith ceases to represent the employees in the bargaining unit defined in the March Road collective agreement and the March Road collective agreement ceases to operate forthwith.

65As a result of my determination in the foregoing paragraph there is no bar to the application for certification filed by the UFCW and I find it to be timely.

66It appears to the Board on an examination of the evidence before it that not less than forty per cent of the individuals in the bargaining unit proposed in the application for certification were members of the union at the time the application was made.

67This matter is referred to the Manager of Field Services for the appointment of a Labour Relations Officer for the purpose of consulting with the UFCW and Loeb Inc. and determining arrangements for the conduct of a vote upon completion of which a further decision of the Board will issue directing that a vote be held.

68I am seized.