2062-99-U Communications, Energy and Paperworkers Union of Canada, CLC, Local 28-0, Applicant v. DuPont Canada Inc., Responding Party.
BEFORE: Timothy W. Sargeant, Vice-Chair
APPEARANCES: Phillip G. Hunt, Fred Theobald and Steve Armstrong for the applicant; Paul Jarvis, Stu Maloney, Art Lee, Julian Walker, Christine Blais and Bill Byker for the responding party.
DECISION OF THE BOARD; June 6, 2000
1This is an application brought pursuant to section 96 of the Labour Relations Act, 1995 (the “Act”) that the responding party, DuPont Canada Inc. (“DuPont”) has breached sections 70, 72, 73 and 76 of the Act.
2The issue involves the bargaining unit at the Maitland site. The current collective agreement came into place on May 1, 1999. Throughout its locations in Canada, DuPont offers to its employee on a voluntary basis a program referred to as the DuPont Canada Performance Sharing Program (the “Program”). The Program permits employees to participate in the annual performance and profitability of the Company. Without going into all the details of the Program, essentially an employee may voluntarily elect to participate in the Program during the open periods. An open period occurred in January 2000. In an exchange for a deduction of 4% from gross earnings from their pay stub (if an employee participates, such employee is taxed only on the amount of gross earnings less this 4%) the employee is entitled to, depending on DuPont’s performance, a payout based on profitability of DuPont. The budgeted target is based on what is called the “normalized return on equity”. This is set by referring to the average return of equity for the top one hundred businesses in Canada. Currently the target is set at 16%. Thus if DuPont meets the budgeted target of 16%, the employee receives his/her 4% back. If DuPont does not meet the target of 16% the employee receives back less than 4%. In fact if DuPont only reaches 68.74% of the budgeted target the employee will receive no money back. If DuPont exceeds the budgeted target of 16%, the employee receives more than 4% back calculated in accordance with the Program. The Program is run basically on five year terms. In the first year of participation an employee is not required to contribute and is granted a holiday from payment for the first year. The Program is voluntary. There are other aspects of the Program, including payout and how that payout may be used that are not necessary to review for the purpose of this decision.
3The dispute arises as the Company through a written communication in September of 1999 offered participation in the Program to employees at the Maitland site on an individual basis.
4The union takes the position that this Program was introduced unilaterally by the Company, without the consent or agreement of the union, contrary to the provisions of the Act.
5DuPont submits that as the collective agreement is silent on this Program and as the Program is voluntary there is no breach of the Act as DuPont is entitled to offer such Program through its management rights clause. In the alternative DuPont submits that the Program was not introduced unilaterally but was discussed with the union, and after such discussions it was clear that the union had given to DuPont permission to allow bargaining unit employees to participate in the Program as long as the Program was voluntary and done by way of payroll deduction.
6The Board heard testimony from a number of witnesses.
7Without detailing in full the testimony heard, it is clear that the Company witnesses felt that as long as participation in the Program was done by way of payroll deduction and was voluntary, the union would have no objection to DuPont introducing the Program. According to the testimony of the Company witnesses the union representatives told them it (the Program) would then not be a collective bargaining issue and there would be nothing for the bargaining committees to discuss. The union witnesses testified that they told the Company that the union was not there to negotiate pay at risk, but as long as participation in the Program was like a credit union deduction it would be up to the membership. The union witnesses felt that the proposal of the Company, however, was not like a credit union deduction in that a credit union deduction is taken from the net pay whereas the deduction under the Program is taken from gross earnings (even though the Company takes this deduction into account and reimburses the employee for the income tax difference that arises as a result of this method of deduction). It was the union’s witnesses position that the Program was therefore a pay at risk program which they never agreed to, or consented to be implemented.
8It was evident from the evidence that this Program has been a topic in a number of prior collective agreement negotiations. These negotiations had not obviously produced any resolution of the issue. Again without detailing the testimony, one of the early drawbacks from the union standpoint had been that if accepted the Program would be mandatory for all employees in the bargaining unit. This issue had been left in abeyance for the bargaining committees to consider in the latest round of collective bargaining. As far as the introduction of the Program in September 1999, mandatory participation was no longer a necessary requirement.
9I have no reason to disbelieve the testimony of any of the witnesses. The net result, however, is that though DuPont sought consent in writing, there is no written documentation to support a finding that there was concurrence by the union that the Company could introduce this Program without a specific written agreement. It is evident from the documentation filed that DuPont felt it needed authorization from the union to introduce the Program. While the Company mangers were of the opinion they had received such authorization, and while the union distinction that this is not like a credit union deduction may appear to be a distinction without merit, I am unable to conclude based on the testimony that the parties had reached an agreement that this Program could be introduced, as it was, by the Company in September of 1999. Further on the testimony I find that no estoppel arises in these circumstances.
10Having heard the submissions and able arguments of counsel, the Board finds that the Program is properly a negotiable matter between the parties as it clearly has an impact on wages. The Board further, as stated, finds that there was no agreement by the union for the introduction of this Program in September of 1999. The Board, however, agrees with counsel for the employer that at best this is a technical breach of the Act. Considering the testimony, the Board can easily understand how the DuPont management might have thought that the union had agreed to the introduction of the Program by DuPont in September of 1999. Thus while I find that this was not the case, and that no estoppel arises, I also find that there was no intention by the Company to breach the Act.
11In conclusion, I find that the Company has breached section 70 of the Act. In the circumstances I am only prepared to issue a declaration to that effect. As a result I find that the Program cannot be introduced as it was in September of 1999, but must be introduced only on agreement of the parties. The Board is not prepared to find any other breaches of the Act or issue any other remedies in this situation.
“Timothy W. Sargeant”
for the Board