COURT OF APPEAL FOR ONTARIO

CITATION: Toronto (Police Association) v. Toronto (Police Services Board), 2015 ONCA 188

DATE: 20150319

DOCKET: C58237

Feldman, Watt and van Rensburg JJ.A.

BETWEEN

Toronto Police Association

Respondent (Applicant)

and

Toronto Police Services Board

Appellant (Respondent)

Michael A. Hines, for the appellant

Ian J. Roland and Michael Fenrick, for the respondent

Heard: June 18, 2014

On appeal from the judgment of the Divisional Court (Justices Molloy, Hambly and Herman), dated July 2, 2013, with reasons reported at 2013 ONSC 4511, 311 O.A.C. 1, allowing an appeal from a decision of Arbitrator Paula Knopf, dated January 16, 2012, with reasons reported at 2012 1800.

Feldman J.A.:

A. Overview

[1] The Toronto Chief of Police issued an Order requiring officers under suspension to report twice daily at police headquarters. The Toronto Police Association (“the Association”) filed a policy grievance challenging the reasonableness of the Order. The preliminary issue before the arbitrator was her jurisdiction to hear the grievance. If the Order involved a management rights issue that fell within the ambit of the Collective Agreement, it could be the subject of a grievance. If the Order fell within the statutory prerogative of the Chief of Police to manage the discipline of officers, make operational decisions and conduct the day-to-day operation of the police force, the arbitrator had no jurisdiction to review it.

[2] The arbitrator concluded that the Order was not arbitrable. The Association sought judicial review of the decision before the Divisional Court. In full and comprehensive reasons, applying the reasonableness standard of review as established in New Brunswick (Board of Management) v. Dunsmuir, 2008 SCC 9, [2008] 1 S.C.R. 190, the Divisional Court found that the decision of the arbitrator was unreasonable. Leave was granted for the Toronto Police Services Board (“the Board”) to appeal to this court. For the reasons outlined below, I would dismiss the appeal.

B. Background

(1) Factual Background

[3] I adopt the factual background set out by Molloy J. in her decision for the Divisional Court:

[5] A police officer may be suspended with pay pending criminal charges or discipline charges relating to misconduct. While under suspension, officers are required to surrender all police identification, uniforms, weapons and equipment and are not permitted to perform any of the duties of a police officer. However, they are still employees and receive their full pay. As is the case with all police officers, suspended officers are required to conduct themselves in a manner that would not bring the police service into disrepute and are subject to discipline if that responsibility is breached. Suspended officers may also be required to testify in criminal matters that arose prior to their suspensions. On rare occasions, a suspended officer may be required to report for duty in an emergency situation. However, it was conceded by the Board that this would not likely occur in a police service as large as the Toronto Police Service.

[6] Beginning in at least 1983, suspended Toronto police officers have been required to report daily to their Unit Commander, either by phone or in person. In 1983, this requirement was imposed by the Board. At various points over the years, the Board Rule (Rule 4.8.0.) was varied slightly, but continued to be referenced under the Policy and Procedure Manual and various Directives issued by the Chief.

[7] In 1990 there were legislative amendments that changed the responsibilities of the Board and the Chief. Under the new Police Services Act (which remains in force), the Board cannot issue operational orders to a Chief or a police officer. Notwithstanding this change, the Board continued to issue its Rule 4.8.0 each year.

[8] In March 1993, the Chief issued the Policy and Procedure Manual by Routine Order that included the Board’s Rule 4.8.0, and also the Chief’s Directive 13-05, which referred to Rule 4.8.0.

[9] In 2002, the Board conducted a review of all of its rules. Starting in 2003, the Chief’s Procedure Manual no longer contained a reference to the Board’s Rule 4.8.0, but did set out the text of that rule. This continued for a number of years.

[10] In June-July 2007, the Chief decided that suspended officers would be required to report twice daily instead of just once. The Board was not involved in the decision-making process and was not advised of the change until August 2007, when the new requirement imposed by the Chief was already in effect.

[11] The Association complained to the Board about this new rule, but the Board took the position that the matter was not arbitrable.

[12] In December 2007, the Board repealed the By-Law that had contained Rule 4.8.0, and thereafter did not enact any rules or policies relating to reporting requirements for suspended officers.

[13] In 2009, the Chief revised the Procedure he had issued relating to suspended officers to require that the twice-daily report take place at police headquarters in Toronto, rather than before the suspended officer’s unit commander.

[14] In November 2010, the Board issued a policy regarding “Conduct of Service Members” which included the following:

1. The Chief of Police will establish procedures to ensure the professional conduct of Service members at all times. ...

2. The Chief of Police will establish procedures to ensure that members will not act in a disorderly manner or in any manner likely to bring discredit on the reputation of the Toronto Police Service; and

3. The Chief of Police will ensure that there is a process in place to discipline members who violate the foregoing procedures and ensure that these discipline procedures are consistently and appropriately applied to all Service members.

[15] Staff Sergeant Stubbings testified before the arbitrator that the reporting requirement for suspended police officers is meant: to provide accountability; to ensure that discipline and good conduct are maintained; and to monitor whether officers under suspension are not suffering from addictions, substance abuse and/or personal circumstances that could affect their well-being. The twice-daily requirement is supposed to facilitate better evaluation and monitoring of physical and emotional health than was possible with once-daily reporting and to assist in ensuring that any bail conditions are being met.

[16] In practice, suspended police officers report twice daily to whomever is the Duty Officer at Headquarters at the time, and simply sign-in, with little personal interaction and minimal opportunity for monitoring or evaluating their condition.

(2) Relevant Collective Agreement and Police Services Act provisions

(a) The Collective Agreement

[4] There is no specific provision of the Collective Agreement that addresses reporting requirements for suspended officers. However, Article 5.01 (b) of the Agreement does provide a requirement relating to the timing of reporting for duty. It states:

5.01 (b) Each member shall report for duty at least fifteen minutes prior to the commencement of his/her tour of duty, which time shall not be included in computing the duration of such period.

[5] The Association argues that the management rights clause of the Collective Agreement gives the Board authority over the reporting requirements of suspended officers. That Article provides:

Article 3 – Management Rights

3.01 (a) The Association and its members recognize and acknowledge that, subject to the provisions of the Police Services Actand the Regulations thereto, it is the exclusive function of the Board to:

(i) maintain order and efficiency;

(ii) discharge, direct, classify, transfer, promote, demote or suspend, or otherwise discipline any member;

(iii) hire.

(b) If a member claims that the Board has exercised any of the functions outlined in paragraph (a) (ii) in a discriminatory manner or without reasonable cause, then such a claim may be the subject of a grievance under the provisions of the grievance procedure outlined in the Collective Agreement or dealt with under procedures within the exclusive jurisdiction of the Ontario Civilian Commission on Police Services, as prescribed by the Police Services Act.

(c) The Board agrees that it will not exercise any of the functions set out in this Article in a manner inconsistent with the provisions of this Collective Agreement or the Police Services Actof Ontario and the Regulations thereto.

The Association submits that subsection 3.01(b) provides the basis for the “reasonableness” review it seeks.

[6] The Divisional Court observed, at para. 31, that unless there are statutory restrictions in the Police Services Act, R.S.O. 1990, c. P.15 (“PSA”), that remove the issue of suspended officers’ reporting requirements from the Board’s authority to maintain order and efficiency, this matter would fall within the management rights clause of the Collective Agreement. I turn now to the provisions of the PSA which limit the scope of the Board’s jurisdiction.

(b) The Police Services Act

[7] The PSA governs the powers of the Board, the Chief of Police and members of the police force. Section 41 describes the duties of the Chief of Police:

41. (1) The duties of a chief of police include,

(a) in the case of a municipal police force, administering the police force and overseeing its operation in accordance with the objectives, priorities and policies established by the board under subsection 31 (1);

(b) ensuring that members of the police force carry out their duties in accordance with this Act and the regulations and in a manner that reflects the needs of the community, and that discipline is maintained in the police force;

(c) ensuring that the police force provides community-oriented police services;

(d) administering the complaints system in accordance with Part V.

(2) The chief of police reports to the board and shall obey its lawful orders and directions.

[8] The Chief of Police has the power to suspend officers, pursuant to s. 89(1):

89. (1) If a police officer, other than a chief of police or deputy chief of police, is suspected of or charged with an offence under a law of Canada or of a province or territory or is suspected of misconduct as defined in section 80, the chief of police may suspend him or her from duty with pay.

[9] In addition, the Chief of Police has certain powers that may be exercised following a discipline hearing (s. 84):

85. (1) Subject to subsection (4), the chief of police may, under subsection 84 (1),

(a) dismiss the police officer from the police force;

(b) direct that the police officer be dismissed in seven days unless he or she resigns before that time;

(c) demote the police officer, specifying the manner and period of the demotion;

(d) suspend the police officer without pay for a period not exceeding 30 days or 240 hours, as the case may be;

(e) direct that the police officer forfeit not more than three days or 24 hours pay, as the case may be;

(f) direct that the police officer forfeit not more than 20 days or 160 hours off, as the case may be; or

(g) impose on the police officer any combination of penalties described in clauses (c), (d), (e) and (f).

(7) In addition to or instead of a penalty described in subsection (1) or (2), the chief of police or board, as the case may be, may under subsection 84 (1) or (2),

(a) reprimand the chief of police, deputy chief of police or other police officer;

(b) direct that the chief of police, deputy chief of police or other police officer undergo specified counselling, treatment or training;

(c) direct that the chief of police, deputy chief of police or other police officer participate in a specified program or activity;

(d) take any combination of actions described in clauses (a), (b) and (c).

[10] Section 42 lists the public duties of police officers:

42. (1) The duties of a police officer include,

(a) preserving the peace;

(b) preventing crimes and other offences and providing assistance and encouragement to other persons in their prevention;

(c) assisting victims of crime;

(d) apprehending criminals and other offenders and others who may lawfully be taken into custody;

(e) laying charges and participating in prosecutions;

(f) executing warrants that are to be executed by police officers and performing related duties;

(g) performing the lawful duties that the chief of police assigns;

(h) in the case of a municipal police force and in the case of an agreement under section 10 (agreement for provision of police services by O.P.P.), enforcing municipal by-laws;

(i) completing the prescribed training.

[11] Section 31 outlines the responsibilities of the Board:

31. (1) A board is responsible for the provision of adequate and effective police services in the municipality and shall,

(a) appoint the members of the municipal police force;

(b) generally determine, after consultation with the chief of police, objectives and priorities with respect to police services in the municipality;

(c) establish policies for the effective management of the police force;

(d) recruit and appoint the chief of police and any deputy chief of police, and annually determine their remuneration and working conditions, taking their submissions into account;

(e) direct the chief of police and monitor his or her performance;

(f) establish policies respecting the disclosure by chiefs of police of personal information about individuals;

(g) receive regular reports from the chief of police on disclosures and decisions made under section 49 (secondary activities);

(h) establish guidelines with respect to the indemnification of members of the police force for legal costs under section 50;

(i) establish guidelines for dealing with complaints under Part V, subject to subsection (1.1);

(j) review the chief of police’s administration of the complaints system under Part V and receive regular reports from the chief of police on his or her administration of the complaints system.

[12] Section 31(6) provides that the Board “may, by by-law, make rules for the effective management of the police force.” The Board’s powers are circumscribed by ss. 31(3) and (4):

(3) The board may give orders and directions to the chief of police, but not to other members of the police force, and no individual member of the board shall give orders or directions to any member of the police force.

(4) The board shall not direct the chief of police with respect to specific operational decisions or with respect to the day-to-day operation of the police force.

[13] The scope of what is “bargainable” in a collective agreement is defined in s. 126 of the PSAas follows:

126. Agreements and awards made under this Part do not affect the working conditions of the members of the police force in so far as those working conditions are determined by sections 42 to 49, subsection 50 (3), Part V (except as provided in subsections 66 (13) and 76 (14)) and Part VII of this Act and by the regulations.

[14] As noted by the Divisional Court, at para. 41, the relevant “non-bargainable” matters are those governed by s. 42, the provision setting out the public duties of a police officer.

C. Decisions below

(1) The Decision of the Arbitrator

[15] In order for a grievance to be arbitrable, it must concern an employment matter arising out of the Collective Agreement. Matters that fall within the exclusive authority of the Chief of Police cannot be the subject of collective bargaining. Consequently, the jurisdiction of the arbitrator turns on whether “the essential nature of the dispute” falls within the Collective Agreement or whether it is a matter that is excluded from the Collective Agreement by the PSA. The arbitrator agreed to address the jurisdictional issue raised by the Board as a preliminary matter.

[16] As the arbitrator stated numerous times, the characterization of the essential nature of the dispute was the issue before her: Was the twice-daily reporting requirement a working condition governed by the Collective Agreement, or a was it a matter of discipline, or day-to-day operations, both of which are the exclusive prerogative of the Chief of Police under the PSA? The issue was placed squarely before the arbitrator by the parties in their submissions to her, which she described in her decision.

[17] After reciting the facts, the legislative context and the positions of the parties, she began her analysis by agreeing with the parties that the issues raised were “very parallel” to the issues in Toronto Police Services Board and Toronto Police Association (Use of Force and Equipment) (Re)(2011), 202 L.A.C. (4th) 113 (Ont. Arb. Bd.) (“Procedure 15-10 Award”), a recent decision by the same arbitrator involving the same two parties. In that case, the Association had challenged one aspect of a Procedure issued by the Chief of Police regarding the discharge of firearms at motor vehicles by police officers.

[18] In order to avoid “re-inventing the wheel”, the arbitrator quoted extensively from her decision in the Procedure 15-10 Award. Her excerpts outlined the unique context in which police labour relations operate, where the governance structure involves both the Collective Agreement as well as the PSA. The PSA grants and limits the powers of the Board and of the Chief of Police.

[19] In the quoted excerpts from the Procedure 15-10 Award, the arbitrator referred to a number of decisions of courts and arbitrators[^1] that sought to explain the interrelationship between (i) the employment function of the Board towards the Association and its members, (ii) the Board’s policy-making and supervisory function in relation to the Chief of Police and (iii) the exclusive power of the Chief of Police over the day-to-day operation of the police force and its individual members carrying out their public duties.

[20] In the Procedure 15-10 Award, the arbitrator found that the “real essence of the issue” in that case was whether the impugned Procedure contravened the PSA and the Criminal Code, R.S.C., 1985, c. C-46. The dispute over the Procedure’s statutory validity did not arise out of the Collective Agreement or the employment relationship between the Board and the Association. The management rights clause of the Collective Agreement, on which the Association relied, did not apply because of the exclusionary clause in s. 31(4) of the PSA, which provides that the Board cannot “direct the chief of police with respect to specific operational decisions or with respect to the day-to-day operation of the police force.” The arbitrator found that the Procedure governing the discharge of firearms was an operational “policing” matter outside the Board’s authority. The Procedure was therefore not arbitrable.

[21] The arbitrator acknowledged, at para. 52 of her reasons, two important differences between the case at hand and the Procedure 15-10 Award: (i) No issue of statutory interpretation outside the PSA is raised by the twice-daily reporting requirement; and (ii) “the obligation to report cannot be said to be parallel to the daily law enforcement duties associated with the ‘use of force’ and firearms.”

[22] In order to determine the essence of the impugned Order, the arbitrator then proceeded to discuss nine framework questions suggested by the parties to assist her in this analysis. The first five were proposed by the Association and the last four by the Board:

1. Does the dispute concern the public duties of a Police Officer or does the dispute concern public safety, public policy or emergency situations?

2. Does the dispute concern a policy or procedure relating to working conditions or labour relations?

3. Does the resolution of the dispute require the interpretation or application of the Collective Agreement or any employment related legislation?

4. Is the dispute within the realm of expertise of a labour arbitrator?

5. How should one characterize the activity that is in dispute; is it a policing or a labour relations matter?

6. Has the Order or Policy properly emanated from the Chief or the Board?

7. Does the Order involve the day-to-day operations of the Service?

8. What would be the adjudicative forum to deal with the matter in the event of non-compliance?

9. Does the matter arise expressly or inferentially from the legally enforceable provisions of the Collective Agreement?

[23] In the course of answering these questions, the arbitrator made a number of important observations. For example, she noted that characterizing the dispute as involving “working conditions” cannot provide a complete answer, because although every aspect of an officer’s duties and obligations relates to working conditions, some are excluded by the PSA from the Collective Agreement and are therefore non-arbitrable. Examples include discipline and routine operational orders, both of which fall under the exclusive authority of the Chief of Police, pursuant to the PSA.

[24] Having said that, the arbitrator observed that Article 5.01(3) of the Collective Agreement requires police officers to report for duty fifteen minutes before their shift begins without accounting for this added time in measuring the duration of their shifts. The arbitrator found, at para. 57, that although this clause could not apply to suspended officers because they do not report for duty while suspended, “it is relevant to the case at hand because it illustrates that a reporting requirement is an issue that the parties consider to fall within the sphere of labour relations and collective agreement administration.”

[25] In answering the sixth question, whether the Order properly emanated from the Chief of Police or from the Board, the arbitrator made the critical finding for this case: the Order came within the exclusive authority of the Chief of Police. She explained that it is the substance of an order, not its form, that determines the jurisdictional question of arbitrability.

[26] She observed that as a matter of form, the Order at issue emanated from the Chief of Police directly and not from the Board. As to its substance, she found that the twice-daily reporting requirement could not have emanated from the Board as part of its responsibility to establish policies for the effective management of the police force. She observed that the Board’s own review of the amendments to the PSA led it to cede control over the issue of reporting requirements.[^2] She held that the Order constituted an exercise of the Chief of Police’s exclusive powers over giving orders to individual members of the police force, day-to-day operations and maintaining discipline. She then qualified and arguably undermined this finding by stating that the Order does not involve the “typical day-to-day operations” of officers while on duty (the statutory requirement for exclusion from collective bargaining, under the PSA). Rather, it affects the “daily lives” of suspended officers and the role and responsibility of the duty officers to whom they report.

[27] After considering the questions posed by the parties, the arbitrator concluded that in answering the questions, she still had not determined the fundamental nature of the dispute. In her subsequent discussion, she made a number of findings.

[28] First, she re-iterated her finding that the twice-daily reporting requirement was an exercise of the Chief of Police’s exclusive statutory and common law authority to “supervise, direct operations and maintain the discipline of Police Officers.”

[29] Second, she stated that the issue of whether the Order is reasonable or lawful could be determined at an OCCPS discipline hearing if a suspended officer refused to comply. However, she acknowledged that suspended officers “dare not expose themselves to further sanctions,” that is, it would not be practical or prudent for a suspended officer to test the reasonableness of the Order in the disciplinary context.

[30] Third, she observed that because the twice-daily reporting requirement “does not directly affect active policing duties”, the case was more difficult to resolve than the Procedure 15-10 Award. Nonetheless, she ultimately concluded that the Order affects some aspects of an officer’s policing responsibilities, and therefore remains within the Chief of Police’s exclusive control and “does not arise directly or inferentially from the administration, application or interpretation of the Collective Agreement.”

[31] Finally, the arbitrator referred to the Divisional Court’s decision in Toronto Police Services Board v. Phipps, 2010 ONSC 3884, 271 O.A.C. 305,where the court held that although the Board is precluded by the PSA from giving orders to individual officers and that authority is expressly reserved to the Chief of Police, the Board is nevertheless liable for human rights violations by officers. The court explained its reasoning at para. 118 of Phipps, which was quoted by the arbitrator:

We appreciate that the PSA expressly precludes a police services board from giving orders or directions to individual police officers. That authority is expressly reserved to the Chief of Police. That demarcation, however, only reflects the unique operational requirements of a police service. It does not change the fact that a police services board may give orders and directions to the Chief of Police, who in turn gives orders and directions to his or her officers, and that a police services board is ultimately responsible for the performance of the Chief of Police. It would follow, in our view, that it is the police services board that is ultimately responsible for the actions of the members of the police service.

[32] From the arbitrator’s point of view, the important holding in Phippswas the court’s recognition of the demarcation between the roles of the Chief of Police and the Board in relation to operational matters. She concluded, at para. 73:

The Court’s insistence upon assigning liability for Human Rights violations is a very different matter than the question of jurisdiction over operational Orders issued from the statutory and common law authority that resides exclusively with the Chief. While the Court may have made the Board liable for actions of Police Officers’ misconduct, the obiter dicta in the Toronto Police Services Board v. Phipps decision does not affect questions of arbitral jurisdiction.

[33] The arbitrator concluded her analysis by stating, at para. 74, that the reasonableness of the Chief of Police’s exercise of his exclusive power in enacting the twice-daily reporting requirement “remains a vexing question that could only be decided on the basis of evidence presented in another forum.” However, she held that she did not have the authority to decide that question in this grievance.

(2) The Decision of the Divisional Court

[34] In the Divisional Court, the Association argued that the standard of review on a question of jurisdiction is correctness. The court rejected that position, holding that the issue to be decided was the classic issue of arbitrability under the test in Weber v. Ontario Hydro, 1995 108 (SCC), [1995] 2 S.C.R. 929, and that the standard of review is reasonableness. The Weber test involves determining the essential character of the dispute and then asking whether it arises from “the interpretation, application, administration or violation” of the Collective Agreement. Under the reasonableness standard, the decision of the arbitrator is entitled to deference.

[35] Molloy J., writing for the court, concluded that although the arbitrator had asked the right question, she acted unreasonably by failing to properly consider and apply established jurisprudence and by unreasonably interpreting the PSA and the Collective Agreement. The Divisional Court held that the result was therefore unreasonable and unjustifiable.

D. Analysis

(1) Standard of review

[36] On appeal to this court, the parties agree that the standard of review to be applied to a decision of an arbitrator is reasonableness, even where the arbitrator is determining the jurisdictional question of the arbitrability of the grievance. They disagree, however, on the application of the standard.

[37] The test from Dunsmuir requires a reviewing court to consider both the result reached as well as the process by which it was reached. The reviewing court must ensure that there was “justification, transparency and intelligibility within the decision-making process” and consider “whether the decision falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and law”: Dunsmuir, at para. 47.

[38] In a case where there are only two possible outcomes – the matter is arbitrable or it is not – it may seem somewhat counter-intuitive that both outcomes may be justifiable. However, this result is theoretically possible, provided the reviewing court examines (i) the transparency and logic of the reasoning process of the decision-maker and (ii) the potential effects of the two outcomes as part of its analysis of whether the result reached is reasonable.

(2) Reasonableness of the arbitrator’s decision

[39] In this case, I agree with the Divisional Court that the arbitrator’s interpretation of the PSA and the Collective Agreement was unreasonable. While I agree with the Divisional Court that some of the arbitrator’s specific attempts to distinguish past jurisprudence were invalid, in my view it was her failure to apply the principles from these cases, as well as her unreasonable approach to the fundamental question at issue, that rendered the process by which she came to her decision flawed. In my view, three aspects of the arbitrator’s analysis undermine and vitiate the cogency of her decision-making process and the acceptability of the result.

[40] First, her analysis is based on what was, in effect, a presumptive conclusion that the Chief of Police had the “exclusive authority” to make the twice-daily reporting order. As the arbitrator correctly acknowledged, her role was to determine whether the essential nature of the Order was a working condition, or an order concerning day-to-day operations or discipline. The Chief of Police’s “exclusive authority” to make the Order was crucial to the arbitrator’s analysis of the essential nature of the Order, and determined whether the reasonableness of the Order was arbitrable. Yet, the arbitrator’s reasoning on this essential question was conclusory.

[41] Second, the arbitrator appeared to be comforted by the belief that her decision would not have the drastic consequence of precluding a reasonableness review of the Order. She stated, twice, that there was another forum where the issue could be adjudicated, that forum being in a discipline hearing following disobedience of the Order. With respect to the arbitrator, that suggestion is contrary to all the jurisprudence on this issue, which indicates that in a police discipline hearing, the only justiciable issues are whether the Order was lawfully made under the PSA and if so, whether it was disobeyed. Had the arbitrator recognized that there was no other forum for adjudicating the reasonableness of the Order, that recognition may well have influenced her analysis and her ultimate conclusion.

[42] Third, the reasonableness of the outcome is weakened by the arbitrator’s failure to assess the effect of her decision on the police labour relations regime. By effectively broadening the scope of what are considered “day-to-day operations” over which the Chief of Police has exclusive authority and which are immune from arbitral oversight, the decision has the potential to upset the balance of the tripartite nature of the police labour relations regime that includes the Board, the Chief of Police and the Association, working under the PSA and the Collective Agreement, as it has been understood and functioned for many years.

[43] I turn now to a discussion of the aspects of the arbitrator’s decision that rendered the result and the decision-making process unreasonable.

(a) Conclusory analysis of the substance of the Order

[44] Unlike most other cases that were referred to by the arbitrator, except for the Procedure 15-10 Award, the impugned Order came from the Chief of Police. Therefore, the arbitrator had to determine the source of his authority to make the Order: Was he implementing a directive of the Board, or was he issuing an Order as part of his exclusive authority over operational policing matters and discipline?

[45] If the Chief of Police’s authority to issue the Order came from the Board, then it had to be reasonable, pursuant to the management rights clause of the Collective Agreement (Article 3.01(b)). However, if he was exercising his exclusive authority to discipline or to give day-to-day operational orders, then the arbitrator would have no jurisdiction to assess the reasonableness of the Order, because the PSA excludes such matters from the ambit of the Collective Agreement.

[46] The two issues, the essential nature of the dispute and the source of authority of the Chief of Police to make the impugned Order, are really two sides of the same coin. The characterization of the substance of the Order as either a working condition or an operational order also determines the source of the Chief of Police’s authority to make the Order. The arbitrator implicitly recognized this point in an excerpt from her Procedure 15-10 Award that she reproduced in her reasons, at para. 62:

[W]here a Chief of Police takes an action that can be characterized as an exercise of management rights under the contract, it may be arbitrable. Further, pursuant to s. 128, a collective agreement may bind a Chief of Police. However, if his/her action invokes a chief’s exclusive powers under the statute or falls within another designated authority, it may not be arbitrable.

[47] The Board’s position, as summarized by the arbitrator, was that:

[A]n arbitrator has no authority to interfere with the decision of a Chief of Police on an ‘operational’ or ‘supervisory’ matter, such as the requirement for twice-daily reporting … [A]n arbitrator only has jurisdiction to deal with matters that fall within the Board’s scope of authority under the Collective Agreement.

The Board characterized the Order as an operational policing matter, not a working condition governed by the Collective Agreement.

[48] In its submissions to the arbitrator, the Association argued that the twice-daily reporting requirement is neither part of the disciplinary process, nor is it an operational order. Rather, it arises under the management rights clause of the Collective Agreement. It submitted that only the public duties of police officers that are recognized as working conditions, but are specifically excluded by s. 42 of the PSA, are excluded from collective bargaining. The Association relied on the Procedure 15-10 Award as an example of a public function of a police officer that falls under the exclusive authority of the Chief of Police. The order in Procedure 15-10 involved the use of force, which is at “the heart of the exercise of public duty” of police officers and therefore outside the scope of bargaining and arbitral review. In contrast, submitted the Association, the twice-daily reporting requirement for suspended officers is a labour relations issue that falls within the ambit of the Collective Agreement.

[49] The Association recognized that there is a “‘continuum’ of policies that deal with issues that affect working conditions and specific operational orders.” It therefore suggested that the test is whether the essential nature of the dispute “concerns public duties of a Police Officer and falls within the scope of s. 42 of the Act … public safety or emergency situations.” In the alternative, the court could ask whether it concerns a labour relations matter. Either way, the issue should not be determined on the basis of who issued the Order, but rather on its essential nature.

[50] In its reply submissions before the arbitrator, the Board took a contrary position and focused on the importance of the Chief of Police’s authority to issue the Order. It submitted that only the reasonableness of the Order, not the Chief of Police’s authority to issue it, was challenged. An order of the Chief of Police, according to the Procedure 15-10 Award, is not arbitrable because it is an exercise of the Chief of Police’s “governing authority.”

[51] On this issue, both parties addressed the applicability of the Board’s policy directing the Chief of Police to “establish procedures” regarding the professional conduct and discipline of members of the police force (Minute No. P292/10). They disputed whether the issuance of the Order by the Chief of Police could be viewed as an exercise of his delegated authority in furtherance of this Board policy.

[52] I set out the positions that were taken by the parties before the arbitrator to demonstrate that the two issues that determine arbitrability were put squarely before her: the essential nature of the dispute and the source of the Chief of Police’s authority to make the Order. Although the arbitrator stated a number of times that the issue in the case was to determine the essential nature of the dispute, her discussion and analysis of this issue was very limited. She reached a presumptive conclusion regarding the Chief of Police’s “exclusive authority” to make the Order which led her to conclude that the “essential nature” of the Order involved operational matters, without engaging in sufficient supporting analysis.

(i) Principles from Durham

[53] Importantly, the significance of the “essential nature” question in the context of the police labour relations regime was best articulated by Arbitrator Knopf herself in Durham (Regional Municipality) Police Services Board and Durham Regional Police Association (Re) (2007), 164 L.A.C. (4th) 225 (Ont. Arb. Bd.).

[54] The context of that case involved an interest arbitration concerning a provision in the Collective Agreement that mandated patrol cars be staffed by two officers on certain night shifts. The Board and the Chief of Police wanted the article removed from the Collective Agreement on the basis that it infringed upon the Chief of Police’s exclusive statutory authority over operational matters. They asserted that the arbitrator had no jurisdiction to consider the merits of the provision and that it was non-arbitrable.

[55] The same issue had arisen under the former Police Act, R.S.O. 1970, c. 351, in the case of Re Metropolitan Toronto Board of Commissioners of Police and Metropolitan Toronto Police Association (1975), 1975 645 (ON CA), 8 O.R. (2d) 65 (C.A.), leave to appeal to S.C.C. refused, 57 D.L.R. (3d) 161n, where this court held that the two-officer patrol provision was an arbitrable working condition. In Durham, Arbitrator Knopf undertook a cogent analysis of the applicability of Metropolitan Toronto Police Commissioners in the context of the subsequently enacted PSA, at paras 69, 70 and 73:

This is the first police sector case that has squarely demanded the resolution of the jurisdictional issue since the Court of Appeal’s decision in the Metropolitan Toronto Police Commissioners case mentioned above. While we are under a different statute, we must start from the assumption that this case is a significant and guiding authority. The question then becomes whether the enactment of the Police Services Act in 1990 has changed the situation. Under the old Police Act, s. 29(2), the parties could bargain “working conditions” except those that were governed by the regulations. Now, under the Police Services Act, the parties must still meet to bargain their “working conditions.” However, there are specific limits on what is ‘bargainable,’ such as the stipulations that agreements and awards cannot affect the duties of police officers, hiring criteria, probationary periods, oaths of office and secrecy, political activity, legal indemnification, discipline complaints and the role of the Special Investigations Unit, see s. 126. The PSA has also made the respective roles of the Board and the Chief more explicit. Under s. 31(1) the Board can and must, amongst its other duties, generally determine, after consultation with the Chief, objectives and priorities. It must also establish policies for the effective management of the Police force, recruit and appoint the Chief of Police, and direct and monitor his or her performance. The Chief must then administer the police force, oversee its operation in accordance with the objectives, priorities and policies established by the Board. The Chief must also maintain discipline and ensure that members of the force carry out their duties in accordance with the Act and the regulations in a manner that reflects the needs of the community. On top of this more delineated scheme, the Regulations further refine the scope of responsibilities. Regulation 421/97, s. 12 dictates that Board members shall not interfere with the Police force’s operational decisions and responsibilities or with the day-to-day operation of the Police force. ....

Do these Regulations and the scheme of the PSA mean that the parties can no longer bargain over issues of deployment or two-officer cars? In particular, does Regulation 421/97’s prohibition against the Board interfering with “operational decisions” and “day-to-day operations” take away its ability to bargain provisions that may affect operations, such as Article 19.01? The answer to this question must be ‘no.’ Many provisions in a collective agreement affect operations. Vacations, overtime, leave of absence, severance, promotions, and shift schedules are clearly within the scope of police sector collective bargaining and directly affect generalized operational matters in terms of budget, planning and even deployment. Policing operations are constantly impacted by normal and vacation schedules, shift premiums, leave provisions and other items that are routinely bargained into collective agreements without raising any jurisdictional concerns. If such items were not within the realm of bargaining in this sector, the right to bargain under s. 119(3) would be a facade. … That must be why the Court of Appeal recognized that under the Police Act there was a balancing of a Police Commission’s ability to bargain working conditions with its responsibilities towards governance. While the PSA may have more clearly delineated some of the focal points of authority, it has not taken away that balance. …

… [N]o clear restrictions on a Board’s ability to bargain staffing or deployment provisions exist in the legislative scheme that governs Police bargaining. The scheme is designed to allow for the Board, the Chief and the officers to protect the public and still allow for the negotiation of working conditions. As the Court of Appeal said in the Metropolitan Toronto Police Commissioners case supra, “The statute must be interpreted so that both these important objects can be given effect as far as possible.” [C.A., p. 74] Nothing in the PSA has signalled that there should be any alteration in this guide to interpretation.

[56] In Durham, Arbitrator Knopf referred to the then recent decision, Health Services & Support-Facilities Subsector Bargaining Association v. British Columbia, 2007 SCC 27, [2007] 2 S.C.R. 391, where the Supreme Court held that the constitutional protection of freedom of association under s. 2(d) of the Canadian Charter of Rights and Freedoms includes certain protections over collective bargaining. To give effect to the Supreme Court’s guidance, she concluded that the PSA should be read to allow for negotiation over working conditions unless very explicit language removes a subject matter from the scope of labour relations. As no specific provision of the PSA prohibited collective bargaining over staffing issues, she held that it must be interpreted to allow bargaining over those working conditions.

[57] She also observed, at para. 79 of Durham,that while the Board cannot direct day-to-day operations, it still has the power “to establish the policies and procedures that are necessary to provide adequate and effective Police services,” and she explained the relationship between the Board and the Chief of Police as follows:

The legislation must be taken to have created a harmony between a Board’s and the Chief’s respective responsibilities. Otherwise, a Board’s policies could have no impact on a Police service. The harmony exists because there is an inevitable interface between Board policies and operational decisions. One sees this with the granting of the Board the power to determine objectives and priorities in consultation with the Chief, and yet leaving the Board with the sole power to establish policies for the effective management of the force. The Chief is then charged with the responsibility of administration and oversight “in accordance with the objectives, priorities and policies established by the Board,” ss. 31 and 41. One sees this actualized in the course of collective bargaining with items such as shift schedules, vacation provisions and leave of absence policies that are determined by a Board, in consultation with its Chief, and then implemented into collective agreements. A Chief then has to determine day-to-day operations in accordance with these policies and the Board has to budget accordingly. Therefore, the mere fact that a Board’s policy may affect operations does not make that policy outside the scope of the Board’s authority. Police Service Board policies can and must, by definition, pertain to the effective management of the police force. Therefore, they can affect, without interfering with day-to-day operations. Viewed in this way, there is no conflict between the Board’s policy making powers over working conditions and the Chief’s powers over operations. There is, in fact, a harmony in our scheme of governance over police services. That scheme allows for collective bargaining and yet preserves the respective authorities of the Boards and Chiefs. [Emphasis added.]

[58] She concluded, at para. 82:

It is still the case that an arbitrator cannot introduce or maintain a contractual provision that is inconsistent with a Board’s or a Chief’s exclusive statutory mandate. However, while the Chief may now have exclusive authority over specific operational decisions, the Board retains the authority to give directions to the Chief and establish policies for effective management of the Police force. As Justice Laskin advised these parties many years ago and has been repeated numerous times since, if there is a legislative or political desire to take away the right to bargain a particular item, this can be achieved through regulation. The PSA and its regulations do not contain the specificity necessary to direct that the provisions of Article 19.01 are incompatible with the Board’s ability and mandate to negotiate working conditions or the Chief’s authority to oversee operations.

[59] In the present case, the arbitrator referred to her decision in Durham in a lengthy quote from the Procedure 15-10 Award, which included excerpts from paras. 72 and 79 of Durham. However, she did not attempt to relate the principles of Durham to the issue to be decided in the case at hand, namely, whether the twice-daily reporting requirement was a working condition or whether it was non-arbitrable because it was within the exclusive authority of the Chief of Police. Nor did she explain why her analysis in Durham, where she concluded that the two-officer patrol provision was a bargainable working condition, did not also apply to the twice-daily reporting Order of the Chief of Police in this case.

[60] Given the importance and relevance of Durham, the arbitrator’s failure to discuss its application or to distinguish it derogates from the transparency and cogency of her reasoning. I note briefly that the Divisional Court’s comments, at para. 59, on precisely how she should have applied Durham, went beyond the role of a reviewing court applying the standard of reasonableness. It might have been considered reasonable for the arbitrator to hold that the employee safety aspects of the two-car staffing provision were more related to “working conditions” than a requirement that suspended officers report twice daily. However, I agree with the Divisional Court that it was “inexplicable” that she did not apply the principles established in Durham or explain her failure to do so.

[61] Instead of applying the principles from Durham, which support a narrow interpretation of the exclusionary provision in s. 31(4) the PSA, the arbitrator did the exact opposite. As will be discussed, she effectively construed the notion of “working conditions” narrowly, while expansively interpreting the meaning of “day-to-day operations” – directly contradicting her approach in Durham. The following sections demonstrate how she approached the various questions posed by the parties.

(ii) Whether the Order fell within the exclusive authority of the Chief of Police

[62] The first question posed by the parties asked whether the dispute concerned the public duties of a police officer, public safety or emergency situations. The arbitrator’s response was that although the Order is directed to suspended officers who cannot exercise any police powers, there are still “some public aspects” to these officers’ “situations and responsibilities” because they still receive full pay and benefits and must comply with orders. In the final paragraphs of her reasons, she again stated that the Order “does affect some aspects of a Police Officer’s policing responsibilities and therefore remains within the ambit of the Chief’s exclusive control and direction” (emphasis added). She rejected the Board’s argument that the public purpose of the Order was to oversee the welfare of suspended officers, on the basis that that issue could only be decided on evidence if the merits of the reasonableness challenge were to be reached. Though she had heard conflicting evidence about how the reporting actually worked, she declined to use it to assist her in her decision regarding jurisdiction.

[63] With respect to the arbitrator, as the issue of whether the Order affects the public duties of officers determines whether the Order falls within the exclusive authority of the Chief of Police, the issue required a much more thorough and detailed analysis. It is also the case that officers who are not suspended have “some” public aspects to many of their duties, but that does not remove most working conditions from the collective bargaining regime. The arbitrator did not explain why the fact that the Order affected “some” aspects of police officers’ policing responsibilities made the “essence” of the Order a policing matter.

[64] The sixth question posed by the parties, which should have involved a very similar analysis as the first question, was whether the Order properly emanated from the Chief of Police. The arbitrator answered that it did. She stated that while the Board’s responsibility is to establish policies for the effective management of the police force, the Chief of Police’s powers are to give orders, conduct day-to-day operations and maintain discipline. She found that the twice-daily reporting requirement could not be a matter of Board policy or direction and therefore the power to issue the Order fell within the Chief of Police’s exclusive authority over operational matters and day-to-day operations. She then noted that in fact, the Order does not involve “typical day-to-day operations”, but it does involve the “daily lives” of suspended members as well as the officers to whom they report. There was no attempt to explain why the fact that the impugned Order did not affect typical day-to-day operations but only the “daily lives” of officers allowed it to come within the specific statutory exception that refers to day-to-day operations.

[65] The arbitrator stated a number of times in her reasons that the Order was made by the Chief of Police in accordance with his exclusive authority, without further analysis. Effectively, the arbitrator concluded, without explanation, that the Order could not emanate from the Board because it came within the Chief of Police’s exclusive authority to give orders to members of the police force regarding day-to-day operations. Again, there was no attempt to distinguish Durham, where a similar argument was firmly rejected, and where the arbitrator looked for something more specific in the PSA to exclude what would otherwise be a working condition.

[66] In order to be able to assess the reasonableness of an arbitrator’s decision, the reasoning must be clear and logical, whether or not the court agrees with it. On the critical issue of why the Order fell within the Chief of Police’s exclusive authority as an operational matter, the reasoning of the arbitrator is at best conclusory.

(iii) Analysis of whether the Order involved “working conditions”

[67] The issue of whether the essence of the twice-daily reporting requirement involves “working conditions” was the subject of the second question posed by the parties. This is the flip side of the analysis of the essential nature of the Order. In answering this question, the arbitrator observed that virtually all aspects of a police officer’s duties relate to working conditions, but some are excluded by the PSA. She also referred to Article 5.01(3) of the Collective Agreement as an illustration of a reporting requirement that the parties agreed is part of labour relations.

[68] In arriving at her final conclusion, the arbitrator briefly addressed the specifics of the “working conditions” issue. She stated that the Order does not relate to matters covered under Article 5 of the Collective Agreement such as hours of work, tours of duty or compensation. She engaged in no analysis, however, of why a reporting requirement for suspended officers cannot be a working condition. Since suspended officers have obligations and must comply with orders, it is certainly arguable that the essence of the twice-daily reporting order is a working condition. The arbitrator also did not address the clear difference, which she notes elsewhere, between the impugned Order and the order in Procedure 15-10 regarding discharge of firearms, which she found was excluded from “working conditions” for the purpose of applying the statutory exclusion in the PSA because it is part of the public duties of a police officer.

[69] The arbitrator's conclusory reasoning effectively predetermined the outcome and lacked the thorough analysis that was required to resolve the jurisdictional dispute.

(b) The effect of the arbitrator’s belief that there was an alternative forum where the reasonableness of the Order could be assessed

[70] At two places in her reasons, the arbitrator suggested that there is an alternative forum where the reasonableness of the Order could be adjudicated. At para. 68, she stated: “Whether the Order is reasonable or lawful could certainly be asked and answered in the context of an OCCPS hearing if someone refused to comply and was subjected to further discipline.”

[71] In her concluding remarks, at para. 74, she stated: “Whether the order to require twice-daily reporting is a reasonable exercise of the Chief’s exclusive powers remains a vexing question that could only be decided on the basis of evidence presented in another forum.”

[72] These statements appear to answer a question the arbitrator posed at para. 59 of her reasons:

[T]here is an implied general duty for the Board to act reasonably in the administration of the Collective Agreement as recognized by many arbitrators and the courts, see Metropolitan Toronto (Municipality) v. C.U.P.E. (1990), 1990 6974 (ON CA), 69 D.L.R. (4th) 268 (Ont. C.A.), as cited in Waterloo, supra. But does this apply to the Chief of Police who is bound by, but not a party to the Collective Agreement? Must his/her operational and supervisory orders be “reasonable” and also subject to arbitral review? That question remains to be answered below. [Emphasis added.]

[73] The answer given was that there is a forum where the reasonableness of a Chief of Police’s order can be challenged, but that the forum is not arbitral review.

[74] However, her belief that the reasonableness issue could be raised at an OCCPS hearing is contrary to existing jurisprudence and is not supported by either party. Molloy J. specifically found the arbitrator to be in error on this point, stating, at para. 76:

At the time of discipline, the issue is never whether the order itself was reasonable, but rather whether it was lawful. The only forum for determining reasonableness is an arbitration such as the one brought here.

[75] Under the PSA, a police officer must perform the “lawful” duties that the Chief of Police assigns. Violation constitutes misconduct and is subject to discipline. The only issue is lawfulness; reasonableness is not relevant in the OCCPS discipline context. This conclusion was confirmed in a decision of the OCCPS, Re Constable Matthew Jeary and the Waterloo Regional Police Service (5 April 2000), Toronto, 00-05 (OCCPS).

[76] The arbitrator’s belief that the Chief of Police’s orders are not immune from a reasonableness review may well have played a role in her conclusion that she did not have jurisdiction to consider this Order. By declining to take jurisdiction, she did not believe that she was foreclosing the ability to have the reasonableness of the Order determined. This apparent misapprehension may have contributed to the arbitrator’s failure to consider, as part of her analysis, the potential effects of her decision on the police labour relations regime. I now turn to that issue.

(c) The unreasonableness of the outcome in light of the potential effect on the police labour relations regime

[77] Perhaps because the arbitrator did not see the danger that the reasonableness of the Order would never be assessed outside the arbitration context, she did not consider, as part of her analysis, the potential effect of her decision to broaden the scope of non-arbitrable orders. Nor did she assess the merits of the significant change that would follow in the balance of roles and duties in the tripartite labour relations regime that governs police officers.

(i) Unreasonable interpretation of the PSA

[78] The Divisional Court found that the arbitrator’s interpretation of the PSA, in particular s. 31(4), which prohibits the Board from directing the Chief of Police with respect to “specific operational decisions” and “day-to-day operations”, was unreasonable. As noted by the Divisional Court, at para. 68:

If orders that “involve the daily lives” of officers are solely within the authority of the Chief, it is hard to imagine any order he could give that would not be in his sole authority, and equally hard to imagine what role the board would have to play at all. This flies in the face of how the parties have governed themselves for decades, and is contrary to the provisions of the collective agreement itself. Many provision of the collective agreement relate to the day-to-day lives of police officers. The collective agreement covers items such as hours of work, time of shifts, vacation time, two-officer patrol cars and court appearances. All of these matters would fall within the Arbitrator’s concept of “day-to-day operation” of the police force, but all have been treated by the parties as subject to collective bargaining and the grievance process.

[79] I agree with Molloy J. that the effect of the arbitrator’s decision could unreasonably extend the reach of s. 31(4) to all operational decisions, with the effect that they would now appear to fall within the exclusive purview of the Chief of Police and would therefore not be arbitrable. The arbitrator thereby ignored the role of the Board under s. 31(1) to determine objectives and priorities with the Chief of Police, to formulate policies for the effective management of the police force and to direct the Chief of Police. The arbitrator did not consider the outcome that her interpretation of “day-to-day operations” might have on the balance of police labour relations.

[80] Her interpretation was inconsistent with significant past jurisprudence on the role of the Chief of Police within the statutory structure of the PSA, and in particular, the Durham decision of Arbitrator Knopf discussed above. Expanding the scope of subject matters that are excluded from collective bargaining is also inconsistent with recent Supreme Court jurisprudence that has extended the constitutional protection over meaningful collective bargaining: Mounted Police Association of Ontario v. Canada (Attorney General), 2015 SCC 1, 380 D.L.R. (4th) 1; Saskatchewan Federation of Labour v. Saskatchewan, 2015 SCC 4. The arbitrator recognized the significance of the constitutional protection over collective bargaining in Durham, as discussed above. Her failure to note the constitutional implications of her interpretation of s. 31(4) of the PSA detracts from the cogency of her reasoning process.

[81] To reach her decision in this case, the arbitrator had to address a number of previous arbitral awards that dealt with similar issues but came to different conclusions. The Divisional Court concluded that the arbitrator’s explanations for those distinctions were invalid and therefore rendered her decision unreasonable. The recent decision of the Supreme Court in Irving Pulp & Paper Ltd. v. CEP, Local 30, 2013 SCC 34, [2013] 2 S.C.R. 458, confirms that a court conducting a reasonableness review should consider whether a labour arbitrator reasonably followed or distinguished significant, relevant arbitraI jurisprudence.

[82] I have already commented on the arbitrator’s failure to deal with Durham and to address the factual difference between this case and the Procedure 15-10 Award. The other two important cases identified by the Divisional Court are Waterloo Regional Police Services Board v. Waterloo Regional Police Association (2000), 135 O.A.C. 86 (Div. Ct.) and Ontario Provincial Police Association v. The Queen in Right of Ontario (6 July 2010), Toronto (Ont. Arb. Bd.) (Unreported) (the “OPP case”).

(ii) Treatment of Waterloo and the “disciplinary” question

[83] Waterloo involved a “no-beard policy” of the Waterloo Regional Police Services Board that was implemented by a standing order of the Waterloo Chief of Police. On a grievance, the policy was challenged as unreasonable. The Board took the position that the arbitrator had no jurisdiction to consider the reasonableness of the policy because it was a disciplinary matter that was properly dealt with by the OCCPS under Part V of the PSA, following a breach of the policy by an officer.

[84] The Divisional Court in Waterloo recognized that if the essential nature of the dispute was disciplinary, then as discipline is the exclusive province of the Chief of Police, the matter would not be arbitrable. The court held, however, that the essential character of the dispute was not disciplinary because no one was being disciplined, and the mere possibility of disciplinary consequences was not sufficient to characterize a dispute as “disciplinary”. The court held that the police association had to have a remedy for breach of the reasonableness requirement of the Collective Agreement short of having an officer disobey. To promote harmony in the workplace, the officer was required to “obey now and grieve later”. That principle applied despite the fact that the policy itself was not in the Agreement.

[85] In the present case, the arbitrator stated, at para. 58, that because discipline is governed by Part V of the PSA, which precludes arbitral jurisdiction over discipline, “an arbitrator cannot interpret or apply the provisions of Article 3.01 [of the Collective Agreement] for purposes o[f] determining whether there has been ‘reasonable cause’ for discipline.” She then acknowledged that this statement may appear contrary to the decision in Waterloo, but distinguished that case given the “particular circumstances that made that situation arbitrable”, namely, “[t]he grievance was advanced independently of disciplinary proceedings, and could have been advanced before or after the disciplinary proceedings arising out of a refusal to comply with an order”: at para. 58, citing Waterloo, at para. 12.

[86] The arbitrator’s holding in this case that the “no discipline without reasonable cause” provision in the Collective Agreement (Article 3.01(b)) could not apply because Part V of the PSA precludes arbitral jurisdiction over disciplinary matters is the exact argument that was rejected in Waterloo. It is also confusing in light of her finding that the parties had agreed that the Order did not concern discipline. This reasoning was contradictory.

[87] I am in substantial agreement with Molloy J. that the arbitrator’s attempt to distinguish Waterloo was flawed and illogical. The point of Waterloo was to interpret the essential nature of the dispute and the powers of the Chief of Police in a way that would allow rules made by the employer to be tested for reasonableness before any issue of discipline arises. The arbitrator failed to address why that same principle should not be reflected in her approach in this case.

[88] However, the arbitrator would have been justified in not applying Waterloo had her finding that the Order was legitimately made by the Chief of Police under his exclusive authority been reasonable. If this were the case, then the Order could not be grieved, and the “obey now, grieve later” principle from Waterloo would not apply. However, as discussed above, a significant reason why the arbitrator’s decision is unreasonable is because there is no clear explanation for the important finding of exclusive authority.

[89] In challenging the Divisional Court’s approach to the reasonableness review, the appellant argues that Molloy J. ignored the fact that the arbitrator did not base her finding that the Chief of Police had exclusive authority to make the Order solely on basis that it is an operational order. Rather, her finding was also based on the Chief of Police’s statutory authority over discipline and maintaining good conduct in the service under s. 41(1) of the PSA, because the Order relates to suspended officers.

[90] I agree that the arbitrator did mention these powers in her discussion. However, the arbitrator was clear in her reasons that she did not view the substance of the Order as disciplinary and that the parties agreed that it was not. She relied on the fact that discipline was not involved to distinguish Waterloo and to find that the “no discipline without reasonable cause” provision of the Collective Agreement could not apply. Therefore, if as is now submitted, the arbitrator was also relying on the Chief of Police’s authority over discipline, her reasoning on this point is not discernible. I also note that it appears from the arbitrator’s summary of the parties’ submissions that the Board was not relying on the Chief of Police’s authority over discipline, but only on his operational or supervisory authority.

(iii) The OPP case

[91] In the OPP case, Arbitrator Trachuk found that a twice-daily reporting requirement for OPP members, similar to the Order in this case, was unreasonable and in violation of the Collective Agreement. In distinguishing the OPP case, the arbitrator stated that (i) there was no jurisdictional challenge in that case and (ii) the OPP statutory scheme is “slightly different” than the scheme governing the Toronto Police.

[92] I agree with the comments of Molloy J. that the second distinction was not sufficiently explained and does not withstand scrutiny. The OPP scheme has a similar division of powers as the scheme at issue. However, I do not agree that the first basis for distinction was unreasonable, as Arbitrator Trachuk explicitly stated that the parties did not challenge her jurisdiction to decide the case, and she does not discuss the issue.

[93] Nonetheless, the OPP case was relevant given that the Order in that case was very similar to the one at issue. Arbitrator Trachuk, in the OPP case, referenced the “obey now, grieve later” principlefrom Waterloo and emphasized its fundamental importance. The arbitrator’s failure in the present case to recognize that her decision may effectively limit the application of this principle by removing a broad scope of subject matters from arbitral review detracts from the reasonableness of the result.

[94] In reviewing an arbitrator’s decision to determine whether it is reasonable, the court considers whether it falls within a range of reasonable outcomes. The absence of any apparent appreciation for the effect that the broadening of the interpretation of the Chief of Police’s exclusive powers could have on the labour relations regime requires the reviewing court to conduct its own analysis of the effect as part of the reasonableness review.

[95] The unprecedented broadening of the scope of orders of the Chief of Police that are not subject to arbitral review, and the potential effect on the police labour relations regime, is a strong factor that makes the result one that is not within the range of reasonable outcomes. The fact that the arbitrator appears to have proceeded on an erroneous premise about the availability of an alternative forum adds to the unreasonableness of the result.

[96] Had the arbitrator addressed the possible effects of her decision as part of her justification of the result she reached, this court would owe more deference to her decision. However, the absence of any indication that she appreciated the effects undermines the reasonableness of her disposition.

E. Conclusion

[97] As I agree with the conclusion reached by the Divisional Court, I would dismiss the appeal with costs in the agreed amount of $10,000 inclusive of disbursements and HST.

Released: “KF” Mar 19, 2015

“K. Feldman J.A.”

“I agree. David Watt J.A.”

“I agree. K. van Rensburg J.A.”

[^1]: Re Metropolitan Toronto Board of Commissioners of Police and Metropolitan Toronto Police Association (1975), 1975 645 (ON CA), 8 O.R. (2d) 65 (C.A.); Pembroke (City) Police Services Board v. Kidder (1995), 1995 7172 (ON SC), 22 O.R. (3d) 663 (Ont. Gen. Div.); Heritage Custom Jewellers v. Metropolitan Toronto (Municipality) Police Services Board (2000), 2000 22318 (ON SC), 46 O.R. (3d) 593 (S.C.); Odhavji Estate v. Woodhouse, 2003 SCC 69, [2003] 3 S.C.R. 263; Waterloo Regional Police Services Board v. Waterloo Regional Police Assn. (2000), 135 O.A.C. 86 (Div. Ct.); Durham (Regional Municipality) Police Services Board and Durham Regional Police Association (Re) (2007), 164 L.A.C. (4th) 225 (Ont. Arb. Bd.).

[^2]: Though the Board revoked its specific reporting requirement rule, in 2010 it issued a policy regarding “Conduct of Services Members” (Minute No. P292/10) referred to above. This policy directs that “[t]he Chief of Police will establish procedures to ensure the professional conduct of Service members at all times” and “establish procedures to ensure that members will not act in a disorderly manner or in any manner likely to bring discredit on the reputation of the Toronto Police Service.”