Ontario Labour Relations Board
[1999] OLRB REP. JULY/AUGUST 609
3361-97-G International Union of Operating Engineers, Local 793, Applicant v. H. Kerr Construction Ltd., Responding Party
BEFORE: Mary Ellen Cummings, Alternate Chair, and Board Members J. G. Knight and G. McMenemy
DECISION OF THE BOARD; August 5, 1999
This is a referral in the construction industry, pursuant to section 133 of the Labour Relations Act, 1995, (the "Act").
Although the parties are not agreed on all of the relevant facts, they have agreed to the following:
1 .The Applicant ("the union") represents employees of the Responding Party ("the company") only in the ICI sector of the construction industry even though the Provincial Collective Agreement covers employees engaged in schedules and classifications in addition to "Building and Construction Work".
2.The union was issued a certificate by the Ontario Labour Relations Board (the "Board") in December, 1978.
3.From the date of certification to 1991, there was minimal contact between the parties. In 1991, the union filed a grievance with respect to work being done at a landfill site. The parties resolved the grievance on the basis that the company acknowledged that it was bound to the ICI agreement.
4.On October 7, 1997 the parties entered into an agreement to settle a grievance filed on January 30, 1997 in respect of work performed at a soccer facility. At that time the parties agreed that the company was bound to the ICI agreement in the ICI sector of the construction industry only. The union waived claims relating to work performed prior to the date of the agreement. A copy of the Minutes of Settlement is attached to the Referral of Grievance.
5.The company is based in Wingham, Ontario and is involved in various kinds of work throughout the Province of Ontario but primarily in Western Ontario, involving earth moving associated with subdivisions, road building, airport runways, sewage lagoons, golf courses, landfill sites, and sewers and watermains.
6.This is the first grievance the union has ever filed in connection with work on lands ultimately intended to be used as a golf course. The company has performed 15 - 20 such projects since 1986 but the Union maintains that they were not aware of such projects.
7.In September of 1997 the company was engaged to perform topsoil stripping and stockpiling and some pond excavation on vacant property in Innisfil Township. The earth taken from the pond excavation was moved to build beams and mounds for the golf course.
8.A small portion of the property is zoned agricultural and cannot be used for golf course use. The remainder is zoned open space conservation. The lands are designated agricultural under the Official Plan for the Town of Innisfil. The open space conservation zoning allows the property be used as a golf course.
9.The property is comprised of approximately 84 acres, is vacant, and not being otherwise used at the present time. There is one unoccupied house on the property. A building permit has been issued for renovations to that structure.
- The company was engaged to do preparatory work for an eventual golf course use which will include such things as tees, greens, fairways and ponds.
11 . The company was engaged by New-Land Greenscapes Inc. to perform the work. Employees and equipment of the company were on site from September 22, 1997 to October 24, 1997 at which time weather conditions interfered with continuing work. The work was performed using bulldozers and scrapers. Other companies were working on site doing pond excavation.
A grievance was filed on October 29, 1997 and following that date the company has not performed any further work on the property.
The union claims that the work performed was construction work and that it comes under the ICI sector. The company maintains that this project was neither construction work nor in the ICI sector thereof.
The parties are not aware of any reported decisions of the Board as to whether work performed on a site intended for golf course use is work performed within the construction industry of the ICI sector thereof.
The responding party raised a number of defences to the grievance, and in an effort to resolve the issues efficiently, the Board has directed the filing of written submissions at various stages, and issued interim decisions, with direction.
In its March 1, 1999 decision, the Board considered the responding party's assertion, that the work involved was not work in the "construction industry". The Board concluded that the work was work in the construction industry. The next issue the Board must determine is which sector of the construction industry the work falls into. Initially, the responding party submitted that the work falls into the heavy engineering sector, but later proposed that it falls into the roads sector. The applicant maintains that the work falls into the ICI sector.
In the March 1, 1999 decision, the Board determined that the work at issue is work in the construction industry. The Board then wrote that it was reluctant to convene a sector determination unless it was satisfied that there was a triable issue. The panel was of the view that an oral hearing should be convened only where the responding party can satisfy the Board that there is a genuine dispute, having regard to the agreed statement of facts and the Board's jurisprudence around sector determinations. The Board then set out the jurisprudence briefly, putting particular emphasis on the strong line of cases citing that the end-use of the construction work in issue will be determinative of the sector into which the work falls, except in the heavy engineering sector (see, for example the Heavy Construction Association of Toronto, [1973] OLRB Rep. May 245). In its March 1, 1999 decision, the Board concluded:
A focus on the end-use of the construction work in question suggests that it would fall in the industrial, commercial, and institutional sector. However, the responding party is entitled to an opportunity to challenge the Board's jurisprudence, and approach. But, to be clear, this matter will not be scheduled for an oral hearing unless the responding party pleads a prima facie case that this work is not in the ICI sector.
The Board set a schedule for the parties to exchange and serve submissions. The parties made full submissions.
Counsel for the responding party submitted first, that the Board's decision on this issue will have far reaching effects because it is the first to deal with the question of which sector the construction of golf courses falls into. Although, according to counsel, there have been a number of golf courses built in the province, this is the first time the matter has come to the Board.
Second, counsel asserts that the work falls into the roads sector, based on an application of the work characteristics, as they have been defined by the Board in numerous cases, beginning with the Heavy Construction Association, supra. Third, counsel submitted that it should be permitted to call evidence of practice both with the applicant, and with other contractors, which would show that the building of golf courses has not happened under the ICI agreement. Counsel submitted that a number of Board cases have indicated area practice is relevant, because sector determinations are intended to reflect labour relations reality, and not to distort the understandings that have grown among employers and trade unions.
The responding party also takes issue with the approach that the Board has taken to date in this case. It noted that the Board referred to the end use as a "commercial golf course", when the parties had only agreed that the end use was a "golf course". The responding party alleged that the Board had reached a conclusion that the golf course was commercial, without any evidentiary foundation. Finally, counsel submitted that it is a denial of natural justice if it is not permitted the opportunity of a full oral hearing, to adduce all the evidence that it considers relevant to these proceedings. The Board understands the evidence the responding party wishes to lead relates to the practice between it and the applicant, and the practice of other contractors. The parties could not agree first, as to whether this evidence was relevant, and if it was relevant, they could not agree on the facts. Consequently, evidence with respect to practice did not form part of the parties Agreed Statement of Facts.
We will not set out in any detail the submissions of the applicant, which were thoughtful and extensive. Moreover, they were compelling.
We have some difficulty with the responding party's recitation of the significant body of law that starts with the Heavy Construction Association (supra). Counsel for the responding party asserts that the investigation into which sector the work falls begins with the work characteristics. But with respect, that it not what the Board has consistently said and done. An excerpt from the Heavy Construction Association is a good starting point. At paragraph 14, the Board wrote:
An examination of the enumerated sectors in clause (e) of section 106 [now section 126] leads to the conclusion that for all but one of the sectors listed the names given to these divisions of the construction industry relate to the use which is ultimately made of the construction. At first this may appear to be somewhat of a puzzle in that the connection between the use of the construction and the work characteristics may not be obvious. Open (sic) examination, however, it becomes clear that the use that is ultimately made of the construction will to a large extent determine the task or the work to be performed at the construction site. The task in turn will have certain characteristics which make that project distinguishable from other types of construction. Thus, each of the sectors enumerated, by focusing on the different end uses of the construction, distinguishes one type of construction from other types of construction on the basis of peculiar tasks which are common to that type of project. The work characteristics which distinguish one sector from the other sectors of the construction industry may be shown in terms of the type of problems to be dealt with at the job site, the types of solutions resorted to at certain job sites, the material used, the relative importance of various specifications, the variety of skills and trades, and certain characteristic relations with employees. This list of characteristics is not to be thought of as exhaustive, but as examples of particular characteristics which differ between the various sectors enumerated in the Act.
[emphasis added]
A pithier recitation of these principles, as they developed in the Board's case law, is found in Duntri Construction Ltd. [1996] OLRB Rep. May/June 399, at paragraph 8:
Having reviewed the jurisprudence and the submissions of the parties, we find the following principles to be applicable to the case before us: In a sector determination where the issue is whether particular work falls within the ICI sector or the sewer and waterman sector, the primary focus is the end use of the construction work in issue. Where an end-use analysis is determinative of the sector, it is unnecessary to enquire further. Where an end-use analysis is NOT determinative, it is necessary to inquire further and examine "work characteristics" to determine into which of the seven sectors of the construction industry the work in issue falls.
[emphasis added]
The Board has consistently held that except in the heavy engineering sector, a consideration of end use is the first, and potentially, the only consideration in a sector determination. Put simply, the first question for the Board is what is the product of the construction? In this case the answer is a golf course. A golf course is not a road. A golf course, whether private or public, is a commercial enterprise.
Counsel for the responding party takes issue with the Board "finding" that this particular golf course is "commercial", without any evidence to support such a finding. But with respect, the Board has some common sense; in our collective experience, we have never seen or heard of a golf course that was not a commercial enterprise. And the responding party has not made any submission that would cause the panel to conclude that this golf course is somehow different. And at the risk of repetition, whatever a golf course may be, it is not a road.
The Board is satisfied that this is a case where the end use of the construction can conclusively determine what sector the work falls into. The construction of a golf course falls into the ICI sector of the construction industry.
We turn next to the responding party's concern that the Board's approach denies it natural justice, because the responding party is not being allowed to call evidence of its practice or that of other contractors. The principles of natural justice do not require the Board to allow a party to call evidence which is irrelevant to its determination. Evidence with respect to local or area practice would only be arguably relevant if the Board were unable to make a sector determination based on end-use. In such a case, the Board would look at work characteristics, one aspect of which, would be practice. The Board has said, however, that cases in which practice is relevant will be few. At paragraph 26 of West York Construction Ltd., [1983] OLRB Rep. Dec. 2132, the Board wrote:
This is not to say that local area practices or local agreements will always be determinative. Most projects clearly fall within one sector or another, and a local practice or agreement cannot alter that fact. Accordingly, an agreement to regard a clearly ICI project such as a shopping plaza or a school as residential would not find much favour with the Board. Rather, it is only with respect to those relatively small number of projects which fall into the "grey area" between the sectors that a widely accepted local practice or agreement might assist in deciding how the project should be characterized. ...
The question of which sector a golf course falls into is not a "grey area". Consequently, evidence about area practice would not be relevant, and it is no denial of natural justice to prevent the responding party from leading that evidence.
In its reply, the responding party submits the Board has no discretion to make a sector determination without holding an oral hearing. Section 110(18) of the Act permits the Board to make rules to expedite proceedings in a number of areas, including the provisions relating to the construction industry. Rule 110 of the Board's Rules of Procedure reads:
Where the Board is satisfied that a case can be decided on the basis of the material before it, and having regard to the need for expedition in labour relations, the Board may decide an application under sections 119 to 138 of the Act without an oral hearing.
Of course, this application was brought pursuant to section 133, one of the sections included in Rule 110.
The responding party suggests that because the Board is making a determination about which sector of the construction industry the work falls into, pursuant to section 166 of the Act, the Board must hold an oral hearing. However, in the Board's view, the character of the application remains a referral of a grievance in the construction industry pursuant to section 133. It is true that in deciding the referral, the Board has exercised its powers pursuant to section 166, but it does not change the character of the proceeding. In Ellis-Don Limited [1993] OLRB Rep. February 120, the Board determined what sector the work fell into in a jurisdictional dispute proceeding. The Board concludes that there is no impediment to deciding this referral without convening an oral hearing.
In conclusion, the Board finds, based on the Agreed Statement of Facts, and submissions of the parties, that construction of a golf course is work in the ICI sector of the construction industry.
It appears to have been admitted that the responding party performed this work without regard to its obligations under the ICI provincial agreement. The parties shall have until July 31, 1999 to attempt to determine and resolve what damages flow from the failure to apply the terms of the ICI agreement. After July 31, 1999, either party may contact the Registrar to seek the Board's assistance in deciding any outstanding issues.
The Registrar is directed to place any remaining issues before this panel of the Board if practical, but this panel is not seized.