Ontario Provincial Conference of the International Union of Bricklayers and Allied Craftworkers v. International Union of Bricklayers and Allied Craftworkers, 1999 CanLII 20157

[1999] OLRB REP. JULY/AUGUST 621

2532-98-U Ontario Provincial Conference of the International Union of Bricklayers and Allied Craftworkers and the International Union of Bricklayers and Allied Craftw­orkers, Locals 1, 2, 4, 5, 10, 12, 20, 23, 28, 29, and 31, Jerry Coelho and Tom Oldham, Applicants v. International Union of Bricklayers and Allied Craftworkers, John T. Joyce, John J. Flynn, Frank Stupar, and James Bowland, Responding Parties v. Ter­razzo, Tile & Marble Guild of Ontario, Inc., Ontario Provincial Conference of the International Union of Bricklayers and Allied Craftworkers on its own behalf of all its affiliated Locals, and the International Union of Bricklayers and Allied Craftworkers, Locals 6, 7 and 25, Masonry Industry Employer's Council of Ontario, Intervenors

BEFORE: Jules B. Bloch, Vice-Chair.

APPEARANCES: Lorne Richmond, J. Coelho, T Oldham, J. Haggis, K. Wilson and L. Scoddellaro for the applicants; Donald K. Eady for the International Union of Bricklayers and Allied Craftworkers; Michael Gottheil, Dan Plunkett, Lou Mascarin and Rick Eade for International Union of Bricklayers and Allied Craftworkers, Locals 6, 7 and 25; no one appearing for Terrazzo, Tile & Marble Guild of Ontario, Inc. and Masonry Industry Employer's Council of Ontario.

DECISION OF THE BOARD; July 19, 1999

1. On May 12, 1999, the Board issued its decision finding that the International Union of Bricklayers and Allied Craftworkers, ("IU") acted without constitutional authority when it revoked the charters. This matter was set down for hearing to deal with whether the revocation of the charters was fair and reasonable in the circumstances?

2. Section 147 of the Act states:

3. (1) A parent trade union shall not, without just cause, alter the jurisdiction of a local trade union as the jurisdiction existed on May 1, 1992, whether it was established under a constitution or otherwise.

(2) The parent trade union shall give the local trade union written notice of an alteration at least 15 days before it comes into effect.

(3) On an application relating to this section, the Board shall consider the following when deciding whether there is just cause for an alteration:

1. The trade union constitution.

2. The ability of the local trade union to carry out its duties under this Act.

3. The wishes of the members of the local trade union.

4. Whether the alteration would facilitate viable and stable collective bargaining without causing serious labour relations problems.

(4) The Board is not bound by the trade union constitution when deciding whether there is just cause for an alteration.

(5) If a local trade union makes a complaint to the Board concerning the alteration of its jurisdiction by a parent trade union, the alteration shall be deemed not to have been effective until the Board disposes of the matter.

Section 149 of the Act states:

149. (1) A parent trade union or a council of trade unions shall not, without just cause, assume supervision or control of or otherwise interfere with a local trade union directly or indirectly in such a way that the autonomy of the local trade union is affected.

(2) A parent trade union or a council of trade unions shall not, without just cause, remove from office, change the duties of an elected or appointed official of a local trade union or impose a penalty on such an official or on a member of a local trade union.

(3) On an application relating to this section, when deciding whether there is just cause, the Board shall consider the trade union constitution but is not bound by it and shall consider such other factors as it considers appropriate.

(4) If the Board determines that an action described in subsection (1) was taken with just cause, the Board may make such orders and give such directions as it considers appropriate, including orders respecting the continuation of supervision or control of the local trade union.

To conclude that a parent union acted with just cause, the Board must, after weighing all the factors enumerated in section 147 and section 149 of the Act, find that the parent union's decisions were fair and reasonable in the circumstances.

3. The IU asserts that the Ontario Provincial Conference of the International Union of Bricklay­ers and Allied Craftworkers, and International Union of Bricklayer and Allied Craftworkers, Locals 1, 2, 4, 5, 10, 12, 20, 23, 28, 29 and 31, Jerry Coelho and Tom Oldham/Brick and Allied Craft Union of Canada ("OPC"/”BACU") negotiated the dues check off clause out of the Provincial ICI collective agreement in direct violation of Article 7 of the Constitution. It was this action, combined with the return to the members of IU dues check-off money that drove the LU to revoke the charters. I use the term OPC for all activity prior to the revocation of the charters. I use the term BACU for all activity post revocation of the charters.

4. This story has many beginnings. It is the story of two very different approaches to trade unionism. It is the story of the desire by some for Canadian autonomy. On November 7, 1995 the IU imposed a receivership on the OPC in large measure because of the OPC's continuing march towards Canadian autonomy. On March 26, 1996, the OPC agreed to stay the December 2, 1995 convention on Canadian autonomy and concomitantly, the IU agreed to stay the receivership. The parties agreed that they would continue to discuss, debate and determine their positions with respect to all the matters concerning Canadian self-government within the charge of the Executive Council committee for Canadian Affairs without any interference, restraint, adverse action or threat thereof by any of the signatory parties with full courtesy and respect for members who hold a different view.

5. In a supplementary Agreement, the OPC and the IU agreed to raise and resolve all issues regarding their affiliation and relationship, through the processes set out in the agreement. Further they all committed to carry out their activities in conformity with the agreement, the OPC Constitution, the IU Constitution and Codes.

6. Pursuant to the March 26, 1996 settlement, a committee was struck to make recommenda­tions to IU Executive Council which would provide for greater Canadian autonomy within the frame­work of the IU. The committee met three times during the summer of 1996. The OPC, walked out of the third session. The remaining committee reported to the IU Executive Council.

7. At the June 7, and 8, 1997 OPC convention, many of the seeds were sown for the course of action taken by the OPC and the BACU. It is not clear that the membership wanted their executive to proceed with the withholding of IU dues check-off monies, and the return of the collected monies to the membership, however it is clear that the convention gave the executive board decision making power in respect of the dues check-off issue. It is also clear that the executive was prepared to push the IU dues check-off issue to the point of eliminating the IU dues check-off from the ICI collective agreements.

8. On December 18, 1997, the OPC filed two applications for certification pursuant to section 154 of the Labour Relations Act as well as a letter to the Minister of Labour seeking the removal of the LU from the designation order. The purpose of these actions was to remove the IU from the 1978 designation order.

9. In response to the applications filed by the OPC, the LU placed the OPC under a new receivership order. The OPC filed for Interim Relief. Interim Relief was granted and the Board ordered the LU to cease and desist from interfering with the section 154 proceedings. Further, the Board ordered that bargaining should proceed as it has in the past, in accordance with the OPC Constitution, without interference from the receiver or the IU.

10. On May 12, 1998 the Board certified the OPC as the Designated Employee Bargaining Agency for "Brick" and "Tile" employees in the ICI sector of the construction industry.

11. Up until the time of the revocation of the charters, the Ontario Locals continued to pay IU per capita dues. IU per capita dues are monthly dues paid by individual members. These dues are not based on hours worked. There is no allegation that the charters were revoked as a consequence of the Ontario Locals failure to pay per capita dues.

12. On May 12, 1998 the OPC stopped remitting IU dues check off to the International Union. This IU dues check-off was contained in the 1995-98 ICI Collective Agreements. The employers, continued to pay dues check off, however the amounts collected by the OPC on behalf of the local unions were not remitted to the IU The OPC returned some of the collected IU dues check-off money to the Ontario members. It is the stated intention of the BACU to return the rest of the IU dues check off monies to the Ontario Members.

13. The Tile agreement was negotiated following several bargaining sessions. A Memorandum of Agreement was entered into in July 1998. The Memorandum was voted on by the steering committee of July 13, 1998. Representatives for Local 6 and 25 were not in attendance. The Steering Committee unanimously voted to recommend the ratification of the Tile Agreement. The Tile Agreement was ratified by over 90% of the members of the bargaining unit who voted. The members in Ontario, had upon ratification of the Tile Agreement removed the IU dues check-off from the Agreement. This amendment to the dues check-off was retroactive back to May 12, 1998.

14. At the July 13, 1998 meeting, the Steering Committee was given a strike mandate in respect of the Brick Agreement. Talks in the Brick Agreement broke down on August 11, 1998, and a Province wide strike ensued. On September 16, 1998, a memorandum of settlement was reached. At the Steering Committee meeting of September 18, 1998, all the Ontario Locals were in attendance, and voted unanimously in favour of the Agreement.

15. The Brick Agreement, which included a provision ending the IU dues check-off effective May 12, 1998, was approved by 96% of the membership voting in Ontario.

16. The negotiation of the amended dues check-off provision, which stopped the funding to the IU combined with the return of the collected IU dues check-off money to the Ontario members, brought the issues to a frothy boil. The IU had sent routine billing notices to the OPC asserting that the Ontario Locals were behind in their remittances of IU dues check-off. By letter dated October 9, 1998 signed by IU Secretary-Treasurer John Flynn, the IU notified the OPC and the local unions of the fact that they were in default of their obligations to pay IU dues check-off collected and that the executive board would revoke their charters if they were still in default on October 16, 1998.

17. After receiving the demand letter of October 9, 1998, only Locals 6, 7 and 25 wrote to the IU and told the JU that they wished to remain affiliated with the IU and wished to continue paying IU dues check-off. None of the other Ontario Locals or the OPC responded to the routine billing notices or the letter of October 9, 1998 prior to October 16, 1998.

18. On October 19, 1998 the IU revoked the charters of the OPC and the Ontario Locals, not including Locals 6, 7, and 25, pursuant to its view of the Executive Board power under Article XVI of the IU Constitution.

19. In the May 12, 1999 decision, I had the following to say about Article XVI of the IU constitution:

15.1 find that Article XVI, is a general power conferred on the Executive Board by the Constitution. (See: Bimson v. Johnston, 1957 CanLII 131 (ON HCJ), [1957] O.R. 519 (affirmed 1958 CanLII 345 (ON CA), 12 D.L.R. (2d) 379 (C.A.)) Article XVI N allows the Executive Board to organize and charter new locals and to revoke or modify any charters granted. Article xvi o places limitations on how the Executive Board is to charter a new local.

The IU. asserts that Article XVI does not create a limitation on the power to revoke or amend charters.

16. Article XVI, Section E of the Constitution, contains a section dealing with codes. Code 5 (Code of International Offences) is the charging section for offences. Code 6 is the trial and appeal section for the prosecution of those offences. The only charges laid by the IU. in respect of the default of working dues are the charges laid against Jerry Coelho and Tom Oldham. It is interesting to note that Code 5, Section (l)(R), is the charging section relating to the issue of evading financial obligations to the IU., however, that section is not one of the sections contemplated by Code 5, Section (2)(G), as allowing for a penalty that includes revocation of a charter.

17. Article XVI, Section E, contemplates the promulgation of Codes. I find that once a Code has been established to deal with the process and procedure in the exercise of general powers, like those found in Article XVI, then the I.U. must act pursuant to that Code. I find that by failing to follow the procedure in Code 5 and Code 6, the IU. revoked the charters in a manner not contemplated by the IU. Constitution.

18. It is clear that the IU constitution allows for the removal of charters. It is also clear that a specific process must be followed in the removal of the charters. The process was not followed in this instance. Section 147(4) of the Act states:

The Board is not bound by the trade union constitution when deciding whether there is just cause for an alteration.

21. Section 149(3) of the Act states the following:

On an application relating to this section, when deciding whether there is just cause, the Board shall consider the trade union constitution but is not bound by it and shall consider such other factors as it considers appropriate.

22. The IU asserted that the Board could uphold the removal of the charters because even though the process that the IU had taken was flawed, the decision to remove the charters was fair and reasonable in the circumstances. BACU and Locals 6, 7, and 25 both took the position that the Board's powers are limited by the Act. The BACU asserted that the Act does not grant the Board any greater power then what is constitutionally granted by the IU constitution. The BACU asserted that there is no power in the Act to cure the procedural deficiencies.

23. Section 147(4) and section 149(3) of the Act mandates that the Board consider the constitu­tion but is not bound by it and shall consider such other factors as it considers appropriate. These sections of the Act allow the Board the necessary jurisdiction to cure any deficiencies. By ousting the constitution as the only jurisdictional base for the Board to rely on, in its deliberations, the Legislature, has mandated the Board to look at factors outside the constitution in determining just cause. If on the facts, after looking at all the factors, the Board concludes that the actions of the LU are fair and reasonable, then the Board may uphold the removal of the charters even though the process used by the LU was constitutionally flawed. The Legislature has empowered the Board with broad reviewing powers. Those powers include the affirmation of acts performed by a parent union even in a context where the acts performed are constitutionally flawed.

24. The BACU asserts that all actions taken by a parent union, where natural justice is not afforded, would amount to a lack of just cause. Again, it would depend on the actions taken by the parent union in a particular set of circumstances. The Board will require greater scrutiny of a subordi­nate's procedural rights in a situation where the parent union has meted out a severe penalty. But even the most severe action taken by a parent union, in the proper context, with the right facts might lead the Board to uphold the penalty meted out even though the process is flawed and the parent union denied the subordinate procedural guarantees.

25. The IU asserts that the BACU's decision not to remit IU dues and the fact that the BACU negotiated out of the ICI collective agreement the IU dues check-off is a fundamental breach of the parent subordinate relationship. The IU submits that its only recourse was to revoke the charters.

26. The OPC and the Locals were put on notice of the consequences of not remitting the IU dues check-off. Only Locals 6, 7,and 25 responded to the notices. October 16, 1998 arrived with nary a word from the OPC or the other Ontario Locals. The IU contends that the only avenue open to it was to revoke the charters.

27. The OPC and the dissident Ontario Locals did not, prior to October 16,1998, give a reason for the non-remittance of dues. The reason for the failed remittances was finally conveyed to the IU during the ensuing litigation before the Board. In their pleadings, the BACU asserts that the OPC and the locals in Ontario could become "B" locals and pay reduced dues. B locals are locals that cannot achieve an IU dues check off clause in their collective agreements. Examples of B locals are locals in right to work states, or in Quebec. In those places, dues check off clauses are either statutorily barred as in the case of right to work states, or not feasible, as in the case of Quebec. No local has ever, without statutory interference, reverted to "B" local status from "A" local status.

28. It is intriguing, that the OPC did not set aside a trust fund filled with "B" local dues to pay for the "B" local assessment. Instead, the BACU decided to distribute the IU check-off dues to the members. It may very well be that the BACU was prepared to comply with the "B" local assessment and had monies set aside. There is no evidence before me about how the OPC, now the BACU, at least on a practical basis, had planned to pay for the assessment.

29. We will never know what the OPC would have done if it had received its "B" local assessment. The BACU asserts that, prior to the appropriate charges pursuant to the constitution ,it did not have to give any reason for the non payment of LU check-off dues. It asserts that the BACU, only had to respond to the charges that it expected to be filed under the constitution. The BACU did not expect that the charters would be revoked without some type of process or investigation.

30. One of the factors the Board looks at when deciding about just cause in the context of section 149 of the Act, is the degree of fairness accorded to the subordinate by the parent union.

31. Both the BACU and the IU were fully aware of the situation they had helped to create. Both organizations had left their natural orbits and were headed for a collision. The collision was expected. What was unexpected was the gravity of the collision.

32. These organizations had collided before. The OPC organized a special convention on Canadian autonomy. Simply the desire to talk about autonomy lead to the imposition of a receivership. The March 26, 1996 settlement resulted from that collision.

33. The autonomy talks, in the OPC's view, proved fruitless. The OPC applied under section 154 of the Act for certification of a new EBA. In response to that, the IU put the OPC under receivership. The OPC successfully applied to the Board for Interim Relief, and on that basis was able to negotiate the ICI collective agreements without interference from the IU.

34. In those negotiations, the OPC removed the IU dues check-off clause retrospectively to May 12, 1998 the day the OPC became the EBA. Further, the BACU distributed some of the monies collected from IU dues check-off to the members. In response to that, the IU revoked the charters of the dissident Ontario Locals and the dissident OPC.

35. From 1995 to today there existed a very deliberate pattern of stimulus and response. The OPC and the large majority of Ontario Locals want autonomy. The IU understands this however it has chosen to respond in a manner that has exacerbated the situation. It seems that the IU acted out of frustration rather than reason.

36. The IU did not offer any process by which the BACU and the Ontario Locals could explain themselves. The IU wanted to deal with the BACU with extreme prejudice. The removal of a local's charter is the gravest penalty that can be meted out by a parent union. Prior to meting out such a grave penalty, a subordinate body is at least entitled to an opportunity to explain, to those who would decide on the penalty, why it took the actions it did. That did not happen in this case.

37. This is not to say that the OPC and the Ontario Locals are not deserving of censure for their approach to these matters. They could have responded to the October 9, 1998 letter and explained their position. Also, they knew or ought to have known that removing the IU dues check-off from the ICI collective agreements and returning the IU collected dues to the Ontario members was not going to be allowed without a fight. I can only surmise that the approach they took was in furtherance of their strategic plan for autonomy.

38. I find that the IU had cause to be concerned about the situation. They also had cause to investigate the situation. However, the IU did not have cause to revoke the charters with out giving the OPC and the Locals a full opportunity to explain and defend their actions before the group that was to make the decision on the matter. I find, pursuant to section 149, that the IU did not act reasonably and therefore did not have just cause to take the actions it took.

39. Section 147(3) reproduced above requires that the Board look at certain enumerated factors prior to making a determination about just cause. In my previous decision, I found that the IU acted without constitutional authority. In reviewing the remaining factors, I find, for the reasons set out below, that the IU acted without just cause when it revoked the charters.

40. There are no allegations that prior to the revocations, the local unions were unable to carry out their duties under the Act. This factor does not play a role in my decision.

41. On balance, the wishes of the members favour the course of action taken by the OPC and the BACU. The members at their June 1997 convention mandated the executive to press for change and for Canadian autonomy. The Board in deciding the section 154 application found that there was majority support for ousting the IU from the EBA structure. Further, the referendum on Canadian autonomy indicates a desire for change. On balance, I find the members in Ontario wanted a change in their relationship with the IU. The revocation of the charters places the BACU in in limbo, which is a state that undermines the members request for change and autonomy.

42. The revocation of the charters, created serious labour relations harm to what has historically been a stable bargaining environment. Removing the charters from the OPC and locals undermines the Designated Bargaining Agency structure. The ABA's and the EBA are the foundation of the province-wide bargaining scheme. The province-wide scheme does not contemplate the evaporation of the EBA and the majority of the ABA's. This is especially true when the fight is about money. There were a myriad of approaches open to the IU, short of revocation of the charters, that could have rectified the problem. There is no evidence that the IU had any internal discussion about alternative approaches. It seems the IU was bent on the most severe approach in a situation that called for less drastic measures. The IU should have taken action aimed at solving the dues problem, rather than taking action exacerbat­ing the autonomy question.

43. Having regard to the enumerated factors, I find that the IU, pursuant to section 147 of the Act, did not act reasonably in the circumstances, and therefore did not have just cause to take the action it took.

44. The BACU do not want their charters back. Suffice it to say that section 147(5) and the January 4, 1999 Minutes of Settlement continue to fill the vacuum left by the BACU's position.

45. This matter is to continue on July 28, 29 and 30, August 25, September 24, 28 and 29 and October 18, 1999 at 505 University Avenue, 2nd Floor, Toronto, Ontario.

46. The parties should be prepared to deal with the remedial issues on the next day of hearing, in particular they should be prepared to deal with the status of the charters.

Stated Case

47. At the beginning of the Hearing on Tuesday, June 28, 1998 I dealt with the stated case matter. I noted that the BACU had asserted in its pleading that it had complied with my orders. I asked the other parties if they had information to the contrary. They said that they did not. Locals 6, 7, and 25 insisted that I hear their stated case application. After hearing their submission I gave the following oral ruling:

Oral Ruling

Having heard your submission and finding it unnecessary to call on the other parties to give submissions on this matter, I find that the BACU has complied with my order and consequently I decline to exercise my discretion to state a case to Divisional Court. I dismiss your request for a stated case.

48. I am seized.