United Steelworkers of America v. Saxum Canada Incorporated, 1998 CanLII 18419

[1998] OLRB REP. MARCH/APRIL 327

3379-97-FC; 3534-97-R; 3608-96-U United Steelworkers of America, Applicant v. Saxum Canada Incorporated, Responding Party; Rick Wazid, Applicant v. United Steelworkers of America, Responding Party v. Saxum Canada Incorporated, Intervenor

BEFORE: Timothy W Sargeant, Vice-Chair, and Board Members J. A. Ronson and R. R. Montague.

APPEARANCES: James Hayes for the applicant United Steelworkers of America; Sandra Hinksman for the applicant Rick Wazid; F G. Hamilton for the responding party.

DECISION OF TIMOTHY W. SARGEANT, VICE-CHAIR AND BOARD MEMBER, R. R. MONTAGUE; March 4, 1998

1. A hearing was held on January 22, 1997 to determine a preliminary issue between the parties. File 3379-97-FC is an application for a first contract made pursuant to section 43 of the Act. File No. 3534-97-R is a termination application made pursuant to section 63 of the Act. The first contract application was received by the Board on December 10, 1997. The termination application was received by the Board on December 19, 1997. The issue between the parties for the purpose of this interim decision is whether the first contract application or the termination application should be heard first.

2. The representative of the employees who brought the first termination application and the employer take the position that the termination application should be heard prior to the first contract application. The union on the other hand, takes the opposite view, and is of the opinion that the first contract application should be heard first.

3. The issue arises pursuant to section 43(23) of the Act. This states:

4. (23) Despite subsection (2). where an application under subsection (1) has been filed with the Board and a final decision on the application has not been issued by it and there has also been filed with the Board, either or both,

(a) an application for a declaration that the trade union no longer represents the employees in the bargaining unit; and

(b) an application for certification by another trade union as bargaining agent for employees in the bargaining unit,

the Board shall consider the applications in the order that it considers appropriate and if it grants one of the applications, it shall dismiss any other application described in this section that remains unconsidered.

4. There is no argument between counsel for the employer and counsel for the union that the Board is given a discretion under section 43(23) as to which application it should hear first. The only difference between the counsel on this point is that counsel for the union argues that in the normal course the application filed first should be the application heard first. Counsel for the union does not dispute, however, that the Board is given a wide discretion under section 43(23) to determine which application the Board considers appropriate to be heard first.

5. The decision on this issue has an obvious impact. If the Board hears the termination application prior to the first contract application and the termination application is successful then pursuant to section 43(23) the first contract application would be dismissed. On the other hand, if the Board hears the first contract application first and it is successful then the termination application would be dismissed.

6. No evidence was led through witnesses at the interim hearing held on this issue. The parties argued on the basis of the pleadings filed. At the outset it should be noted that counsel for the union took the position that the pleadings were only pleadings and as such were not evidence. With this caveat counsel for the union did not object to the issue being argued based on the pleadings.

7. It was pointed out by counsel for the employer that there is no application before the Board that the employer has bargained in bad faith contrary to section 17. Further, counsel for the employer pointed out that there is no allegation that the termination application was initiated by the employer within the meaning of section 63(17) of the Act or that the termination application is untimely. Counsel for the union pointed out that there is no application before the Board that the first contract application did not disclose a prima facie case.

8. Certification was achieved in December 1996. The vote in favour of the trade union was 22 to 15. In its response to the termination application the trade union submitted "the responding party submits that the vote should be postponed pending disposition of the first contract application (Board file 3379-97-FC) filed on December 10, 1997." The termination application is alleged to have the support of 28 out of 29 employees.

9. From the pleadings filed, the union was notified as early as September 16, 1997 of the employees' intention to file a termination application. A letter to the union from a representative of the employees stated in part that:

"we feel misled and betrayed and are asking that we have the opportunity to vote whether to continue having R.W.C. represent us or not. We feel we are entitled to such democratic rights at the first anniversary of the inception of the Union. Also we request that the R.W.C. do not sign any agreement with Saxum Canada Inc. before the vote is mentioned is held."

10. On September 18, 1997, Robert McKay, a National Representative of the Union answered this letter in part:

"No collective agreement will be signed by the union until you have had a chance to vote on it.

You will make the decision on your contract by secret ballot".

11. On December 5, 1997, a representative of the employees again notified the union of the employees' intention to file an application for decertification:

You will be receiving, in the next few days, application for decertification.

12. There is no issue that a number of bargaining meetings took place between the parties. These were held on February 24, March 17, April 7, April 18, May 26, June 25, August 14, September 17, October 9 and 27, 1997.

13. In the letter sent by Mr. McKay dated September 18, 1997, referred to earlier, he did state in regards to negotiations that:

"we are very close in resolving the outstanding issues. We had planned to meet again on October 9, 1997. 1 feel confident that we will be able to resolve the issues at the bargaining table."

14. Without reviewing in detail, the application for the first contract it does allege among other matters that on behalf of the employer there was:

(a) a refusal to provide the information to the union;

(b) an uncompromising position in bargaining issues taken by the employer without reasonable justification. For example, to cite two examples:

(i) wages; and

(ii) the scope of the bargaining unit;

(c) a refusal of the company to recognize the bargaining authority of the union.

The applicant submits it is entitled to a first contract direction pursuant to section 43(2)(a), (b), (c) and (d) of the Act.

15. Counsel for the employer and counsel for the union agree that the issue before the Board is one of process and procedure. As stated before, both parties agree that the Board has discretion to determine which application should be heard first.

16. The representative of the employees argued that the employees wishes should be respected. The representative points out that the union has known since September 1997 that the employees did not wish the union to represent them and that the employees wished to have a decertification vote as soon as possible. The representative argues strenuously that the employees have done nothing wrong and there should be no delay to having their rights heard. The representative asks why, if as the union has stated in the constitution it believes in democracy, it does not agree to a vote in these circumstances. The representative for the employees submits a vote should be held as soon as possible and that the employees should not have to delay their application to hear the outcome application for first contract. The cost involved and the delay would serve no purpose. Employees already feel frustrated in that they have been prevented by the Act from applying for decertification until a year had passed. The representative of the employees submits the union was fully aware of this fact, and in the circumstances the decertification application should be heard first.

17. Counsel for the employer set out a number of arguments under the following headings:

(1) There are new employee rights under Bill 7 which should be considered in determining how to apply the Board's discretion in this matter.

(2) Reference to the provisions in the Act concerning the order of procedure;

(3) There are no statutory provisions governing which application should proceed first and the Board has discretion how this matter should be exercised;

(4) The facts of the case and;

(5) Reference to the Board's decisions.

18. Employer counsel submits that under Bill 7 there are new employee rights conferred by this Act. Reference can be made to many sections of the Act, for example, the Act now requires the trade union to conduct both strike votes and ratification of contract votes with employees. These new rights confirm that a trade union has to represent employees and that it cannot act contrary to the wishes of the employees. Counsel for the employer points out that in a termination application, the employees do not have to prove it is voluntary. The only restriction is found in section 63(17) and this deals with the issue of whether the employer initiated such application. After a year has passed there is an unfettered right for employees to apply for decertification. In counsel's submission there must be a primary recognition given to the importance of employee rights under the Act. In counsel's view a termination application as it deals with representation rights deals with fundamental rights under the Act. In this context such a fundamental right should be determined prior to the application for first contract. Counsel submits that a first contract application is a one time application and is specific to a one time situation. Further counsel argues a first contract application depends on the assumption that the union has the support of the employees. In this instance obviously the union does not have such support. The purpose of section 43 in counsel's view is to ensure that the employer bargains fairly. The section is not designed to defeat employee rights. The application for termination in counsel's view is a superior type of application as it deals with basic rights and therefore in this instance should be heard first.

19. Company counsel submits that under section 43(23) the Board has a discretion right up to a final decision to determine which application should be heard first. The wording of this section obviously contemplates that it does not matter who is in the door first in terms of the date of application. Therefore, the Board should consider what makes industrial relation sense in exercising the discretion under Section 42(23). Surely if the union does not have support of the employees then it is not appropriate to continue with the union agency relationship. Further the Board should consider the rights that employees might lose if the first contract application is successful. Obviously the employee would lose the right to ratify a collective agreement, would lose the right to vote on a strike and lose the right to strike. Furthermore, it might be some two years after the date of the first contract arbitration before the employees would get another chance to decertify. This could result in real terms in delay of some three and a half to four years by the time the arbitration is completed before the employees would have a right to decertify. In counsel's view, labour relations delayed is labour relations denied. The facts before the Board illustrates there is nothing the employees have done to defranchise themselves. It is obvious, therefore, given the employees notification to the union, given the letters to employees from the union, and given that the first contract application was filed just days before the termination application that the first contract application was filed tactilly to defeat the employees' rights in this situation. When one contrasts the pleadings in the application for first contract with the letters written to employees by the union, such comparison supports the conclusion that the first contract application was filed to defeat the employees' application. There is nothing in the letters written by the union to the employees to suggest the company would not recognize the union or would not move on bargaining issues. There is nothing in these letters that criticizes the company's behaviour or makes the suggestion that the employer was acting improperly. This is in stark contrast to the application for first contract where such allegations are raised.

20. Further counsel for the employer points out there is no application that there has been a failure by the employer to bargain in good faith made under section 17. The problem in this case is not with the employer or with the employees but with the union. The employees just do not wish the union to represent them. In these circumstances, counsel submits that the application for termination of bargaining rights should proceed first.

21. Counsel for the union agreed that the Board has a discretion in this matter but argued that in the normal course the union has the right to expect that the first application filed will be the first application to be heard. There is no persuasive argument before this Board to depart from this principle. Counsel argued very strenuously that many of the arguments of the employer are based on pleadings without the context of the total situation. For the Board to fully understand the situation and to appreciate the context, it must hear the evidence on the merits.

22. Without making any arguments concerning the interpretation of matters raised in the pleadings, counsel for the union submits that the first contract application raises real concerns of the union about the employer's behaviour. Counsel submits that it is evident from its pleadings that the union is concerned about surface bargaining. Counsel argues that if the allegations in first contract application were upheld, it is no wonder that employees would not be supporting a union prior to the first contract application. Counsel submits that if the bargaining is unsuccessful because the employer did not want negotiations to succeed, such conduct by the employer would necessarily affect the employees' view of union representation.

23. Counsel for the union argues that the Board has to be careful when considering the matter of discretion in this instance. If the first contract application is not successful, then of course the termination application is still alive. However, the Board should be careful because in counsel's view this is a classic case of divide and conquer. It is no answer to say before evidence has been heard on the merits, that the employees do not want the union anymore; otherwise, in essence the Board would be supporting a boot strap argument. Though counsel agrees there are new employees' rights granted under Bill 7, he nevertheless submits that the consideration of the Board under section 43(23) in exercising its discretion has not really changed. Counsel does not quarrel that representational rights are fundamental but such rights are not hierarchical in the Act. Another important right is freedom from an employer's improper interference in bargaining and the right to insist that bargaining be conducted in good faith.

24. In counsel's submissions, the Act does not require the union to operate by popularity po11. In summary, counsel argued that the first contract application had been filed first and that such application on its face raises serious issues. Further, counsel points out that there is no application before the Board that the first contract application does not raise a prima facie case. If the first contract application is granted, then the employer has obviously engaged in conduct falling within the meaning of section 43(2) (a), (b), (c) and (d). The union has a responsibility not to cut and run, merely because it runs into a difficult employer. In summary there is no real reason for the Board to exercise its discretion to depart from the normal practice of hearing the first application filed first.

25. In the course of argument the Board was referred to a number of cases, namely Ingersol [1997] OLRB Rep. May/June 463; North field Metal Products, [1990] OLRB Rep. March 302; Fort William Clinic, [1996] OLRB Rep. Nov./Dec. 942 and Knob Hill Farms, [1991] OLRB April 521.

Decision

26. The Board recognizes that under the Act employees are given certain opportunities to express their wishes as to whether they wish a trade union to continue to bargain on their behalf. The Board also understands the frustration that employees may be experiencing. On the other hand, the Board is aware that bargaining is not always easy and at times is frustrating for all parties concerned. Obviously there will be times when employees are not happy with the course of negotiations. This may be caused by both union and employer behaviour, but, again this is not an issue in this matter that can be determined merely on the basis of pleadings before the Board.

27. How then should the Board exercise its discretion in this instance? Certainly, the practice of the Board to-date in this type of issue has been to hear the first application filed in the normal course. The Board agrees the cases are distinguishable and each matter must be decided on its own facts. The Act clearly contemplates that the Board has discretion on this issue.

28. The Board does not take issue that there is a genuine desire of employees to have a vote to determine whether or not they wish to have the union represent them. In this case, however, the right to seek such vote is granted under the Act only after 12 months have expired from the date of certification. The Act therefore allows a trade union within that 12 months' frame to try and establish itself in the new relationship and endeavour to negotiate a collective agreement. One of the tools available to a trade union in a first contract negotiation is the right to make an application for a first contract direction. In this instance the union has exercised this right and on the face of the application it does not seem to be frivolous. Such a direction however is not automatic. For a trade union to be successful in a first contract application the Board may be convinced that collective bargaining has been unsuccessful for the reasons enumerated in section 43(2) of the Act. If the first contract application is not successful then the termination application may still be heard. Though there is a concern of the Board that the rights of the employees may in this matter be delayed depending on the outcome of the first contract application. the Board is not convinced that this delay is of such a nature as to persuade it to hear the termination application prior to the first contract application.

29. If the first contract application is successful, it would suggest that the employer's conduct right might have had a bearing on the employees attitude towards a trade union. This view is supported by section 43(23), it that such section would result in the termination application being dismissed if a first contract application is granted, even though such application is of itself timely and uncontested.

30. Though the Board recognizes the concerns of the employees involved, given that the first contract application was filed in advance of the termination application and considering the submissions of the parties, the Board has determined that it will follow its normal practice and hear the application filed first. The Board is not persuaded in this instance to exercise its discretion to hear first the second application filed. Thus the Board will hear evidence on the first contract application prior to any consideration of the termination application.

31. The hearing of the first contract application will be heard on April 1, 2, 3. 8 and 15, 1998 commencing at 9:30 a.m., in the "Board Room", 6th Floor, 400 University Avenue, Toronto, Ontario.

32. This panel does not remain seized.

DECISION OF BOARD MEMBER J. A. RONSON; March 4. 1998

1. My approach in a matter such as this remains as I expressed it in Knob Hill Farms [1991] April 521. My impression since then was that Bill 7 (the most recent amendments to the Labour Relations Act) had changed the Board's focus. But I am wrong. Nothing has changed. The wishes of the employees remain a minor factor in any exercise of the Board's discretion.

2. On the facts before us, I would proceed to hear the termination application first. By taking that path. the employees may have the opportunity to tell us just who has been 'surface bargaining'.