Public Service Alliance of Canada v. NAV CANADA, 2015 ONSC 1407

CITATION: Public Service Alliance of Canada v. NAV CANADA, 2015 ONSC 1407

DIVISIONAL COURT FILE NO.: 14-DC-1993 DATE: 2015/04/16

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

AITKEN, LEDERER & RAMSAY JJ.

BETWEEN:

PUBLIC SERVICE ALLIANCE OF CANADA Applicant

– and –

NAV CANADA Respondent

COUNSEL: Andrew Raven & Amanda Montague-Reinholdt, for the Applicant Jacques Emond & Raquel Chisholm, for the Respondent

HEARD at Ottawa: January 26, 2015

LEDERER J.:

INTRODUCTION

[1] This is an application for judicial review. It seeks to quash the award of the majority of an arbitration panel dedicated to resolving disputes arising from the implementation of a new job classification system agreed to by the applicant, the Public Service Alliance of Canada (“PSAC”), the Union, and the Respondent, NAV CANADA, the Employer.

[2] NAV CANADA co-ordinates the safe and efficient movement of aircraft in Canadian domestic airspace and international airspace assigned to Canadian control. Prior to 1996, this service was operated by the federal government and its employees were employed by Treasury Board. In that year, the service was privatized and NAV CANADA established. Employees were transferred to it from Treasury Board. Immediately following this transfer, NAV CANADA continued to use the job classification and wage structure that had been employed by Treasury Board.

[3] In July 1998, the Canadian Human Rights Tribunal found that Treasury Board had maintained differences in wages between male and female employees performing work of equal value. This was contrary to the Canadian Human Rights Act.[^1] As a result of that decision and a subsequent consent order setting out specific wage adjustments, employees in certain Treasury Board female-dominated job classifications received an increase in wages retroactive to 1985. Some of those classifications were present at NAV CANADA.

[4] When NAV CANADA was privatized, it inherited and maintained multiple classification systems from the public sector. In 2002, PSAC filed a human rights complaint alleging that NAV CANADA had violated the Canadian Human Rights Act by continuing to apply the classification and wage structure that had resulted in the finding of discrimination against Treasury Board. As a result, in 2005, PSAC and NAV CANADA agreed to jointly develop a new job classification system that, among other things, would be gender-neutral and comply with the Canadian Human Rights Act.[^2] In 2010, they agreed to use the “Hay Group Classification Plan”, which was described as a gender-neutral method of evaluating and classifying jobs. All jobs in the bargaining unit were evaluated using this approach. There was agreement:

By the fall of 2011 the jobs at the Employer were placed in rank and order according to their point ratings thereby providing a basis for a fair pay and grading structure essential in dealing with pay equity. Ultimately, the parties agreed that eight (8) separate grade levels, bands or classifications (‘Levels’) would capture the scope of work in this bargaining unit. The parties further agreed to five (5) steps, point bands or salary/wage ranges (‘Steps’) for each Level. ...

Once the parties agreed to this new [Job Classification] System, they were able to agree on which jobs fell within each Classification of the 8 Levels as set out in the ‘New Job Hierarchy’.[^3]

[5] Issues reflecting on the implementation of the new classification system remained, the most significant of which was the actual salary for each point on the wage grid. When the parties concluded a collective agreement in 2012, they entered into a Letter of Understanding which specified that disputes regarding the implementation of the classification system would be referred to an arbitration panel.

[6] The Arbitration Panel held a hearing on May 9-10, 2013.

THE ISSUES

[7] The principal issue placed before the Arbitration Panel was the understanding that the award should comply with the provisions of the Canadian Human Rights Act:

First it is necessary to determine an appropriate methodology that establishes a base salary grid that addresses the pay equity issue...[^4]

[8] Joined to that question was the proposition that the award should replicate the result that would have been arrived at had the issue been freely negotiated by the parties. While acknowledging that the parties, in their submissions, had combined the two issues, this was expressed by the majority in its reasons “for ease of discussion” as a separate question:

After the grid, which meets those criteria, is determined, the discussed arbitral principles must be applied to ensure that the Steps and the number of green circled employees replicates what the parties might have arrived at had they engaged in wholly free collective bargaining.[^5]

[9] On this application for judicial review, PSAC submitted that the majority of the Arbitration Panel failed to properly address either of these questions. Its decision standardized wages paid to men and women for work of equal value by lowering the wages that had previously been paid to male employees. This was directly contrary to s. 11(6) of the Canadian Human Rights Act, which says:

An employer shall not reduce wages in order to eliminate a discriminatory practice described in this section.

[10] As well, in regard to the issue of replication, as the Union sees it, no bargaining unit would ever agree to wages being lowered to the extent they are under the Majority Award as a means of overcoming a discriminatory wage scale. It is not possible (or reasonable) that the award of the majority can be held out as a result that would have been freely negotiated.

[11] For these reasons, it was submitted that the decision of the majority of the Arbitration Panel must be set aside.

STANDARD OF REVIEW

[12] The parties agree that the standard of review is reasonableness, but they disagree as to its application to the decision of the Arbitration Panel. For its part, PSAC refers to Dunsmuir v. New Brunswick.[^6] As articulated in that case, reasonableness is concerned with “the existence of justification, transparency and intelligibility in the decision-making process...[and],…whether the decision falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and the law.”[^7]

[13] PSAC goes on to submit that, in this case, the range of acceptable alternatives is limited. Reasonableness “takes its colour from the context” of the particular question before the decision-maker.[^8] This means that the range of acceptable alternatives may widen or narrow depending on the nature of the question.[^9] In this case, on this understanding, the range is particularly limited as a result of responding to a question of statutory interpretation, being the application of the Canadian Human Rights Act, s. 11(6):

In this case, the range is relatively narrow. The Tribunal’s decision primarily involves statutory interpretation – a matter constrained by the text, context and purpose of the statute. It also involves equality law – a matter constrained by judicial pronouncements. In this case, the Tribunal had less room to maneuver than in a case turning upon one or more of factual appreciation, fact-based discretions, administrative policies, or specialized experience and expertise not shared by the reviewing court on the particular point in issue.[^10]

[14] NAV CANADA submitted that the application of the reasonableness standard would tend to be wider because this was an “interest” rather than a “rights” arbitration. The role of the two types of arbitration has been contrasted as follows:

…When collective bargaining parties are unable to make their own collective agreement deal they can (or are required by statute to) take the matter to an arbitrator who settles the collective agreement issues the parties cannot and completes the collective agreement. ... Grievance arbitration on the other hand is a mandatory alternative (to the Courts) quasi-judicial adjudication process which finally determines disputes between the parties concerning the interpretation or application of the collective agreement. The Courts have recognized that this difference between the two processes is significant.[^11]

[15] A high degree of deference is owed to interest arbitrators and their conclusions concerning the appropriate terms of a collective agreement.[^12] The application of reasonableness as the appropriate standard of review recognizes that interest arbitrators exercise this distinct function and are given broad discretion. Unlike rights arbitrators, who are called upon to interpret the terms of collective agreements and who, therefore, carry out an adjudicative function, the task of interest arbitrators is to settle the terms of agreements between the parties, often collective agreements but, in this case, a new wage grid resulting from the re-classification exercise.[^13]

[16] To my mind, these seemingly competing perspectives are not necessarily at odds. It depends on the point of view from which the question is examined. If it is considered as an issue of legislative interpretation, particularly one with a strong “legal content”, the range of options would be narrower. Where the concern is for the nature of the employment relationship and preliminary assessments of the facts and the law which fall squarely within the expertise of the Arbitration Panel, deference would be high and the range of alternatives broader. This distinction can be found in Public Service Alliance of Canada v. Canada (Attorney General), a decision of the Federal Court, as follows:

In Abraham, Justice Stratas noted that where the decision is based on legal issues or legal content, the range of reasonable outcomes may be narrow. For example, in AG v CHRC, the range of possible, acceptable outcomes was found to be relatively narrow because the Tribunal's decision primarily involved statutory interpretation and equality law. The scope of the reasonable outcomes ‘takes its colour’ and would be narrowed by such context.

However, assessing the nature, organization, and employment relationships and practices of the Code Agencies involves preliminary assessments of the facts and law, which falls squarely within the expertise of the Commission. Moreover, as noted by Justice Rothstein in Canada Post, the scope of judicial review of the Commission’s section 41 decision is narrow and deference is owed by the reviewing Court. Although the reasonableness standard of review is informed by the context and the range of possible, acceptable outcomes would vary depending on that context, in the present circumstances the range would not be narrow. [^14]

[17] It is not always a question of one position winning over the other. The better view is to consider which approach applies to the question immediately at hand. I will return to this dichotomy later in these reasons.

ANALYSIS

[18] I begin by placing the issues taken to the Arbitration Panel into context. As pointed out by counsel for NAV CANADA, the arbitration was not generated by a pay equity complaint. The hearing of the Arbitration Panel and its decision are the completion of a process leading to a new collective agreement. In all, the Arbitration Panel dealt with five issues, each one a matter that the parties were unable to resolve through collective bargaining.[^15] The work undertaken and the agreement reached through the application of the Hay Group Classification Plan had resulted in the preparation of a new job hierarchy. It consisted of eight separate grade levels that would capture the scope of work in the bargaining unit. There were to be five steps (salary wage ranges) within each of the eight grade levels. The parties had been able to place each of the jobs within the eight levels that defined this new job classification system.[^16] What remained was the calibration of the actual wages to be paid in each band at each level.

[19] It was a given that the pre-existing structure did not comply with the requirements of the Canadian Human Rights Act. In particular, it had breached s. 11(1) of the Act. Women had been paid less than men for work of equal value. Counsel for PSAC was careful to point out that, in approaching this problem, it was important to understand that, where there is a difference in wages between the sexes, there is a presumption that the distinction is based on gender. The presumption is rebuttable.[^17] Pursuant to the Canadian Human Rights Act, s 11(4)[^18], a difference in wages between male and female employees performing work of equal value can be justified, and therefore need not be limited, if it is based on a factor prescribed in the Equal Wage Guidelines, 1986.[^19] The applicable factors are found in the Guidelines at s. 16. None of the factors listed apply in this case.

[20] PSAC submitted that the Arbitration Panel erred in that it accepted the approach proposed on behalf of NAV CANADA and, in so doing, accepted the breach of the Canadian Human Rights Act, s. 11(1) found in the pre-existing wage structure. This position is explained by a consideration of the methodology used by NAV CANADA’s consultant who analyzed the issue and testified at the hearing. It was her view that the “compensation model or rates of pay existing [were] less than ideal as a reliable input”.[^20] There were inequities in the historical pay structure of the bargaining unit which arose from multiple unrelated bargaining processes. They had led to jobs which are valued at the same level, but have significant differences in compensation rates. It would not be fair to use actual current salaries for the development of the base salary model since they are not reflective of actual job evaluation values.[^21] Accordingly, weighted averages were calculated (the salary of all incumbents in a job class were averaged) and a regression analysis applied to manage the structural data. This work allowed for the calculation of a fully- internal, and pay equity compliant, base salary model. A band specific job rate was established and a 25% range set between base salary maximum and minimum. The range includes each of the five steps. From this methodology, a base salary model was set.[^22]

[21] This approach and the evidence supporting it was accepted and relied on by the majority of the Arbitration Panel in coming to its decision. Counsel for PSAC objects. Counsel is concerned that the salaries established in this way were less than those paid to men under the pre-existing regime. He points to two graphic depictions of these differences. The first is a chart found in the factum filed on behalf of PSAC, which compares the salaries as proposed by NAV CANADA, and accepted by the majority of the Arbitration Panel, to a weighted average of the male salaries from the prior system.[^23] The second is a graph plotting lines representing wages for men and women under the pre-existing structure and the proposed gender neutral wage structure.[^24] On this basis, it is argued, on behalf of PSAC, that the inequity between men and women doing work of equal value has been cured by lowering the salary of men. It is said that this is directly repugnant to the Canadian Human Rights Act, s. 11(6).[^25]

[22] PSAC says the methodology described continues or “embeds past inequity.”[^26] It proposed a different approach to the Arbitration Panel. The witness it called acknowledged that there were difficulties with the historical pay structure. He testified that the pre-existing pay grid was “fraught with structural inequities brought about by the fact that multiple bargaining unit positions were absorbed into NAV CANADA from various government agencies”[^27] at the time of its inception. Nonetheless, “... he concluded that devising a new system that ignores the historical pay inequities would cause problems”.[^28] He began by plotting regression lines for each and every position (and the salary) in the “old” bargaining unit. In doing so, he constructed a male and a female line. From this, he concluded that there was a pay equity issue to be remedied. He went about this by selecting what was referred to as a “pivot point.” PSAC chose the most populous band and deemed this to be the pivot point of the salary structure[^29]. This is the number on which the entire system is grounded. Thereafter, differentials were assigned moving up and down from the pivot level.[^30] The witness produced a “Linear Regression Analysis”[^31] that provides a visual demonstration of what the Union is trying to achieve. The male line and the female line are on exactly the same plane.

[23] The majority of the Arbitration Panel refused to accept the methodology employed on behalf of PSAC. The evidence produced by PSAC did not convince the majority that the methodology used, and the male wage lines generated, were sufficiently reliable to support the argument it advanced[^32]; namely, that to be compliant with the Canadian Human Rights Act, s. 11(6), the female line in the new wage grid had to be equal to the historical male line. The fact is that the proposal made by PSAC did not meet the test it sought to satisfy. Had its proposal been accepted, it would still have been necessary to “green circle”[^33] 27% of the bargaining unit.

[24] The problem with the approach taken by PSAC is the insistence that it make use of, and rely on, the historical male salary levels as the starting point for any assessment of compliance with the requirements of the Canadian Human Rights Act. This fails to recognize and accept that there was a range of structural inequities that needed to be rectified. The parties agreed “that there is no specific methodology for adjusting wages in order to remedy or close the pay equity portion of the wage gap, where one exists, between male and female employees performing work of equal value. Neither section 11 of the [Canadian Human Rights Act] nor anything in the Guidelines, prescribes a specific methodology for adjusting wages in order to remedy or close the pay equity gap.”[^34] In this case, the process undertaken was to construct a new grid – not correct, amend, reconstruct or justify the old one. The Letter of Understanding which outlined the agreement under which the new system was to be developed makes this clear. Its subject is stated to be the: “New Classification System”. Each time the words “classification system” appear in the letter, they are preceded by the word “new”. The goal, as the witness for PSAC expressed it, was not to look back but “...to find a solution which set the course for a gender-neutral and fair pay system going forward” (italics in the original).[^35] NAV CANADA agreed there were structural pay inequities in the past grid, but it took the position, and the majority of the Arbitration Panel agreed, that the pay equity issues going forward were addressed in its wage grid proposal.[^36] The past was not disregarded. The Arbitration Panel noted that, while the PSAC proposal required 27% of the bargaining unit to be “green circled”, the proposal made by NAV CANADA required this for 52% of the unit. This gave the Board pause.[^37] Nonetheless, it approved the NAV CANADA proposal. The proposal included a payment to PSAC to distribute to the members of the bargaining unit to even out or cushion the impact of the new structure.

[25] The Arbitration Panel undertook a detailed and critical analysis of both methodologies. It noted that “a comparison of the two is essential”.[^38] It concluded that the methodology utilized by NAV CANADA relied on the results of the job evaluation process that had been undertaken and agreed upon by the parties. Its base salary model was arrived at through clearly articulated foundational principles. Conversely, the approach of PSAC, with its reliance on the pivot point analysis and all of the historic salaries, did not provide reasonable clarity or reliability in defining the pre-existing male wage lines.

[26] The Arbitration Panel found the wage grid advanced by NAV CANADA was arrived at “through a clearly articulated methodology and set of foundational principles”[^39] which lead to clearly defined data points and a consistent outcome. Its approach insured that individual incumbents and overall job classes that are entitled to a pay equity-based adjustment could be identified. The Arbitration Panel could not say the same for methodology used by PSAC. It was critical of the approach it used. As the Arbitration Panel saw it, PSAC had erred in relying on a false premise, namely: that the male comparator was the appropriate comparator because in this case it could not be said that there was “no reason to suspect that the male jobs were either under or over-valued.”[^40]

[27] The Arbitration Panel also pointed out that the process used by PSAC “unreasonably and unreliably did not take into account reasonable factor considerations under section 16 of the Guidelines notwithstanding the union’s acknowledgement of the historical realities, complexities and inequities of the bargaining unit.”[^41] As already noted in these reasons, these factors have no application in this case. The system being imposed is new and not reliant on the past. Contrary to the position taken by counsel for PSAC, there was no need for the Arbitration Panel to make reference to the factors listed in section 16 of the Guidelines in its consideration of the work done on behalf of NAV CANADA. That work only looked to the future.

[28] It is at this point that the standard of review becomes relevant. In Canada Post Corporation v. Public Service Alliance of Canada[^42], the following was noted:

In my view, the choice of an appropriate methodology for determining the existence and extent of a wage gap is within the discretion of the Tribunal, and is reviewable for unreasonableness. Given both its technical aspects and the absence of statutory criteria, the Tribunal’s selection is entitled to a high degree of deference. I am not persuaded that only the methodology proposed by CPC can reasonably be said to be consistent with the objectives of section 11 of the Act or that the methodology proposed by CHRC, and adopted by the Tribunal, was unreasonable.[^43]

[29] The Arbitration Panel provided clear reasons for its conclusion that the application of the methodology brought forward by NAV CANADA resulted in a classification and wage structure that met the requirements of s. 11 of the Canadian Human Rights Act. There was evidence upon which it could reasonably arrive at this decision. As well, the evidence of PSAC failed to persuade the Arbitration Panel that, on a go forward basis, there would be differences in wages between male and female employees performing work of equal value. This left the question of whether s. 11(6) of the Canadian Human Rights Act applied in the circumstances and, if it did, whether it had been breached.

[30] PSAC submitted that there was and would be a continued breach of s. 11(6) of the Canadian Human Rights Act and that, as a result, the decision of the majority of the Arbitration Panel should be quashed. The Arbitration Panel considered this issue in detail. It asked two questions: (1) were the male wage lines developed on behalf of PSAC, both current and for proposed salary grid, reasonably accurate for the purposes they would be used for in this case and (2) does s 11(6) prevent reduction of male predominant wages in the new classification process as it goes forward?

[31] Based on the evidence provided by PSAC the Arbitration Panel was unprepared to find that the male wage lines it had provided were sufficiently reliable. Accordingly, the Arbitration Panel was unable to conclude that there was a demonstrated breach of s. 11(6) of the Canadian Human Rights Act. This being so, the Arbitration Panel found that any determination of whether the s. 11(6) compelled an employer to maintain the same male wage rates and, thus, the male wage line within the new system was moot. The Arbitration Panel went on to say that even if the evidence of PSAC had been sufficient to prove the disparity it alleged, the Arbitration Panel would not have found that NAV CANADA was compelled to pay the same compensation in the new classified pay grid to support the male wage line that had existed under the prior scheme. This only stands to reason. It was a new scheme. From the outset, the parties understood that it would be difficult, if not impossible to rectify the problem based on the old structure. It was for that reason they agreed to build a new classification system that was “…relevant to the current workplace and [NAV CANADA’s] realities rather than the public sector … .”[^44]

[32] I return to the two perspectives on reasonableness. In this case, to the extent that the concern is with the interpretation of s. 11(6) of the Canadian Human Rights Act, the issue could be limited, as suggested by PSAC. The meaning of the clause is clear. It is its application that is the concern. The “colour” provided by the context is informed by the fact that what is being put in place is a new wage structure. I repeat what counsel for NAV CANADA said at the outset of his submissions. This does not concern a wage equity complaint. It is the final stage of completing a new collective agreement which defines in a fresh way the relationship between the parties. This concerns the appropriate terms of the collective agreement. It is an interest arbitration. The wider deference owed in such situations applies. The decision of the majority of the Arbitration Panel fits within the terms of Dunsmuir v. New Brunswick. It falls within the range of possible, acceptable outcomes and contains the requisite justification, transparency and intelligibility. There will be no breach of s. 11(6) of the Canadian Human Rights Act. There is no lowering of the wage rates of male employees that has occurred in an effort to overcome wage disparity between men and women. Rather, there is a whole new job classification system and new wage grid. It is designed to overcome a range of inequities. It is not based on or related to the past.

[33] Finally, there remains the issue of replication, the responsibility of the Arbitration Panel to come to a result that represented what the parties would have negotiated if they had completed a freely-bargained collective agreement. Counsel for PSAC submitted it cannot be said that this has happened. No bargaining unit would ever, as part of a negotiated collective agreement, allow for wages of 52% of the bargaining unit to be lowered. Because the purpose of the new wage scale was to rectify past discrimination, this result “is simply insupportable.”[^45] “Exceptional circumstances would be required to justify a pay scale that reduced the wages of over half the positions in the bargaining unit and reduced the overall payroll in the long term.”[^46] This misses the point. It is not for the Arbitration Panel to accept that the subjective response of one party or the other would carry the day and determine, on that basis, what the bargained agreement would be. The application of the principle of replication requires the Arbitration Panel to have reference to objective criteria in preference to the self-imposed limitations of the parties:

The replication principle requires the panel to fashion an adjudicative replication of the bargain that the parties would have struck had free collective bargaining continued. The positions of the parties are relevant to frame the issues and to provide the bargaining matrix. However, it must be remembered that it is the parties’ refusal to yield from their respective positions that necessitates third party intervention. Accordingly, the panel must resort to objective criteria, in preference to the subjective self-imposed limitations of the parties, in formulating an award. In other words, to adjudicatively replicate a likely “bargained” result, the panel must have regard to the market forces and economic realities that would have ultimately driven the parties to a bargain.[^47]

[34] It should be said that the Arbitration Panel was mindful of “the market forces and economic realities” that applied. It took into account the fact that a green-circling of 52% of the positions in the bargaining unit was high. NAV CANADA had submitted that this was justified because the salaries proposed responded to historical structural pay inequities. The Arbitration Panel considered the representations made concerning NAV CANADA’s “… ‘ability to pay’ having regard to its current financial circumstances including its significant solvency deficits and its Pension Plan liabilities.”[^48] It also took account of the current salary proposal of NAV CANADA which would “…cost 3.60% as opposed to the average of 1.175% that it had incurred in the successful classification exercises with its other unions with in its operational sphere”.[^49] “[T]he ‘in grid costs’- in addition to those already ordered [by the Arbitration Panel]- involved in increasing the [NAV CANADA] proposal will have a significant impact on its going forward having regard to its current financial realities.”[^50]

[35] In the end, the Arbitration Panel felt constrained. Neither party was prepared “…to negotiate a middle ground” or to “…move off their final positions.”[^51] Given the overarching concern that the result would have to be pay equity compliant, the Arbitration Panel did not feel it could impose a model other than those proposed by the parties. It had to choose between the two. In the circumstances, where one proposal was found to be reliable and the other was not, the Arbitration Panel felt it was reasonable to accept the one that was.

[36] Replication is not a “test” to be met in respect of each issue. It is a principle to be applied by an interest arbitrator in seeking to arrive at a settlement of all the issues in dispute that is fair and reasonable. In this case, the Arbitration Panel met this standard. It accepted the only proposal that met the underlying and central criteria: that the result, going forward, be pay equity compliant.

[37] The Arbitration Panel concluded that the proposal of NAV CANADA and the methodology in employed were both reasonable and appropriate.[^52] The decision of the Arbitration Panel is entitled to significant deference. The analysis undertaken on behalf of the parties is highly technical. There is no single “right” way to create to create a pay equity compliant system. The Arbitration Panel did a detailed critical analysis of both methodologies and highlighted their respective strengths and weaknesses. It was with in the proper parameters of its task to choose the one it believed accomplished the goals at hand. It decided that NAV CANADA’s methodology was transparent, clear, fair, based on factors already agreed to by the parties and capable of being reproduced. The Arbitration Panel was not persuaded that the approach of PSAC met the same criteria. The analysis of the Arbitration Panel and the result it arrived at met the standard of reasonableness set by Dunsmuir v. New Brunswick.

CONCLUSION

[38] For the reasons referred to herein, the application is dismissed.

COSTS

[39] As agreed to by the parties, costs to NAV CANADA, the successful party in the amount of $6,000.

LEDERER J.

CONCURRING REASONS

AITKEN J.

[40] I agree with the outline of the facts, context, issues, and conclusion provided by Lederer J. in his Reasons and with much of his analysis; however, I wish to clarify certain aspects of my reasoning process in arriving at the same conclusion as he did.

[41] First, as Lederer J. emphasized, it must be remembered that the Arbitration Panel was tasked with establishing a completely new classification system and wage grid. This was not a grievance arbitration where the Panel was being asked to correct a discriminatory practice within an existing system.

[42] Second, in determining the appropriate methodology to use when establishing a new salary grid that is pay equity compliant, the Panel’s decision is entitled to a high level of deference, as explained in paragraph 37 above of the Reasons of Lederer J.

[43] In choosing NAV CANADA’s methodology over PSAC’s, one factor the Panel relied on was that “…the Union’s methodology unreasonably and unreliably did not take into account reasonable factor considerations under section 16 of the Guidelines notwithstanding the Union’s acknowledgement of the historical realities, complexities and inequities of the bargaining unit.” [^53] It is not in dispute that no s. 16 factors apply in this case. Although it may not have been reasonable for the Panel to prefer NAV CANADA’s methodology over that of PSAC for this reason, this factor was only one of five criticisms that the Panel made regarding PSAC’s methodology. The court’s task is not to examine whether each element of the Panel’s decision is reasonable on its own. It must examine the reasoning process and outcome together as an integrated whole to determine whether the results fall within a range of acceptable possible outcomes (Newfoundland and Labrador Nurses’ Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62, [2011] 3 S.C.R. 708 at para. 14.)

[44] Third, the Panel provided clear reasons why it concluded that the application of NAV CANADA’s methodology resulted in a classification and wage structure that met the requirements of s. 11 of the Canadian Human Rights Act. There was evidence upon which the Panel could reasonably rely in arriving at this decision. As well, for the reasons elaborated upon by Lederer J., the evidence of PSAC failed to persuade the Panel that, on a go forward basis, there would be differences in wages between male and female employees performing work of equal value. This left the question of whether s. 11(6) of the Canadian Human Rights Act applied in the circumstances and, if it did, whether it had been breached.

[45] Ultimately, the Panel concluded that s. 11(6) of the Canadian Human Rights Act did not apply in the circumstances of this case to force NAV CANADA to pay the same compensation in the new classified pay grid to support the same male wage line that existed under the historical one. Although, due to the legal nature of the question, the Panel’s interpretation of s. 11(6) may call for less deference under the reasonableness standard than its decision regarding methodology; nevertheless, the standard of review is still reasonableness, and some deference must be afforded. It was not unreasonable for the Panel to conclude that, in establishing a completely new classification system and wage grid to replace a faulty existing system, s. 11(6) of the Act had no application. The purpose of the exercise was not “to eliminate a discriminatory practice” described under s. 11(1) of the Act. It was to set up a completely new compensation scheme already agreed to by the parties.

[46] The Panel also concluded that, even if s. 11(6) was applicable, PSAC had failed to prove that NAV CANADA would be reducing wages in order to make the new wage grid pay equity compliant. The Panel decided that, due to inadequacies in PSAC’s methodology, all of which the Panel clearly articulated, the male wage line calculated under that methodology was unreliable. Therefore, it could not be relied on in establishing that male wages were being reduced under NAV CANADA’s methodology. This was a finding of fact available to the Panel.

[47] In regard to the issue of replication, I agree with the reasons provided by Lederer J. and simply add that the Arbitration Panel cannot be faulted for feeling constrained to choose either NAV CANADA’s proposal or PSAC’s proposal. As has been stated, creating a pay equity compliant wage structure is a highly technical and complicated exercise. It is not something that the Arbitration Panel could properly have done in the absence of evidence from those capable of undertaking the necessary calculations. With the Panel being provided with only two options with background calculations to show what those options would produce, the Panel had to choose one or the other. The Panel considered existing market forces and economic realities before determining that using NAV CANADA’s proposed wage grid would not run afoul of the replication principle. The Panel’s decision in this regard should be afforded a high degree of deference due to their experience and expertise in the area of labour negotiations.

AITKEN J.

RAMSAY J.

[48] I agree with both my colleagues. I emphasize only that a high degree of deference is owed to the arbitrators and that nobody’s pay was actually reduced.

RAMSAY J.

Released: 2015/04/16

CITATION: Public Service Alliance of Canada v. NAV CANADA, 2015 ONSC 1407

DIVISIONAL COURT FILE NO.: 14-DC-1993 DATE: 2015/04/16

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

AITKEN, LEDERER & RAMSAY JJ.

BETWEEN:

PUBLIC SERVICE ALLIANCE OF CANADA Applicant

– and –

NAV CANADA Respondent

JUDGMENT

LEDERER J. AITKEN J. and RAMSAY J. (concurring)

Released: 2015/04/16

[^1]: R.S.C., 1985, c. H-6 at s.11(1), which states: It is a discriminatory practice for an employer to establish or maintain differences in wages between male and female employees employed in the same establishment who are performing work of equal value.

[^2]: Letter of Understanding #2, Appendix A to the Award of the Majority, (see: p. 39) referred to at p. 4 as having been incorporated into the last Collective Bargaining Agreement, effective July 2005 to June 2009, and in which the following is noted: The new classification system will be gender-neutral and shall comply with section 11 of the Canadian Human Rights Act, including the Equal Wages Programs.

[^3]: Award of the Majority of the Arbitration Board, dated December 13, 2013, at p. 5.

[^4]: Ibid, at p. 14.

[^5]: Ibid, at p. 14.

[^6]: 2008 SCC 9, 2008 S.C.C. 9.

[^7]: Dunsmuir v. New Brunswick, ibid, at para. 47.

[^8]: Canada (Citizenship and Immigration) v. Khosa, 2009 SCC 12, [2009] 1 SCR 339, 2009 S.C.C. 12, at para. 59.

[^9]: Canada (Attorney General) v. Canadian Human Rights Commission et al., 2013 FCA 75, 2013 F.C.A. 75, at paras. 13-14, referring to Catalyst Paper Corp. v. North Cowichin (District), 2012 SCC 2, 2012 S.C.C. 2, [2012] 1 S.C.R. 5, at paras. 17-18 and 23; Canada (Citizenship and Immigration) v. Khosa, supra, (fn. 8), at para. 59, and also referring to Canada (Attorney General) v. Abraham, 2012 FCA 266, 2012 F.C.A. 266, at paras. 37–50.

[^10]: Canada (Attorney General) v. Canadian Human Rights Commission et al, supra, (fn. 10), at para. 14.

[^11]: University Health Network and O.N.A. (CM-34), Re, 2013 39960 (ON LA), 2013 CarswellOnt 9707, 115 C.L.A.S. 216, 233 L.A.C. (4th) 166, at para. 35; and, see also: Revera Retirement LP v. Armstrong, [2010] O.J. No. 2470, 195 L.A.C. (4th) 191 (Div. Ct.), at para. 8.

[^12]: Service Employees International Union v. The Participating Nursing Homes, 2013 ONSC 4650 (Div. Ct.), at paras. 10 and 12-13.

[^13]: Canadian Union of Public Employees (C.U.P.E.) v. Ontario (Ministry of Labour), 2003 SCC 29, [2003] 1 S.C.R. 539, at para. 53.

[^14]: 2014 FC 393, at paras. 45 and 46 referring to Canada (Attorney General) v Abraham, 2012 FCA 266 and to Canada (Attorney General) v Canadian Human Rights Commission et al, 2013 FCA 75 [AG v CHRC]

[^15]: Award of the Majority of the Arbitration Board, dated December 13, 2013, at p. 7: (1) implementation date; (2) the increment anniversary date; (3) the transition/conversion rules; (4) the challenge process for the new job classification system; and, (5) the pay scale and new base salary grid.

[^16]: Ibid, at p. 5.

[^17]: Canada (Attorney General) v. Public Service Alliance of Canada, 1999 9380 (FC), [2000] 1 F.C. 146, [1999] F.C.J. No. 1531, at para. 143: ... Accordingly, once a complainant has established a difference in wages paid to male and female employees performing work of equal value, a breach of section 11 is thereby established, subject only to the employer’s demonstrating that the difference is attributable to one of the ‘reasonable factors’ prescribed in section 16 of the Guidelines.

[^18]: s. 11(4): Notwithstanding subsection (1), it is not a discriminatory practice to pay to male and female employees different wages if the difference is based on a factor prescribed by guidelines, issued by the Canadian Human Rights Commission pursuant to subsection 27(2), to be a reasonable factor that justifies the difference.

[^19]: SOR/86-1082 (current to May 1, 2014) issued by the Canadian Human Rights Commission, pursuant to subsection 27(2) of the Canadian Human Rights Act.

[^20]: Deloitte, NAV CANADA, PSAC Job Evaluation Report, dated May 9, 2013, at p. 5.

[^21]: Award of the Majority of the Arbitration Board, dated December 13, 2013 at p. 16.

[^22]: Ibid, at p. 17.

[^23]: Factum of the Applicant Public Service Alliance of Canada, at para. 58.

[^24]: Deloitte, NAV CANADA, PSAC Job Evaluation Report, dated May 9, 2013, Supplementary Data, at p. 4.

[^25]: Quoted at para. [8], above.

[^26]: Dissent of the Union Nominee with respect to the Arbitration Award, December 18, 2013, at p.1.

[^27]: Award of the Majority of the Arbitration Board, dated December 13, 2013, at p. 22.

[^28]: Ibid, at p. 22.

[^29]: The most populous band was Step 5, Level 4 (Ibid, at p. 24).

[^30]: The pivot level was $56,500.00 (Ibid, at p. 24).

[^31]: PSAC Brief to the Interest Arbitration Panel, May 8-10, 2013, at p.18.

[^32]: The Award of the Majority of the Arbitration Board, dated December 13, 2013, at pp. 27-28, notes: ...the PSAC analysis, particularly its reliance on a pivot point methodology and all of the historic salaries paid, including the outliers, did not provide reasonable clarity or reliability in its approach for defining the male wage lines.

[^33]: I understand “green circled” to mean that male employees whose salary will be lower as a result of the implementation of the new job classification system would have their salary level protected.

[^34]: Award of the Majority of the Arbitration Board, dated December 13, 2013, at p. 26. The Award of the Majority goes on to say that "[t]his proposition was expressly recognized in Public Service Alliance of Canada v. Canada (Treasury Board), [1998 3995 (CHRT)]. The Tribunal recognized that the Guidelines favour "a flexible approach as opposed to a regulated one", which allows a tribunal: "to adopt the methodology best suited to the circumstances of the case...".

[^35]: Ibid, at p. 23.

[^36]: Ibid, at p. 30.

[^37]: Ibid, at pp. 36 and 37.

[^38]: Award of the Majority of the Arbitration Board, dated December 13, 2013, at p. 27.

[^39]: Ibid at p. 28

[^40]: Ibid at p. 30

[^41]: Ibid at p. 29

[^42]: (2010) F.C.A. 56.

[^43]: Ibid, at para. 293.

[^44]: Award of the Majority of the Arbitration Board, dated December 13, 2013, at p.4

[^45]: Factum of the Applicant Public Service Alliance of Canada, at para. 73.

[^46]: Ibid, at para. 77.

[^47]: University of Toronto v. U.T.F.A., 2006 93321 (ON LA), [2006] O.L.A.A. No. 782, 148 L.A.C. (4th) 193, 85 C.L.A.S. 11, at paras. 11 and 17.

[^48]: Award of the Majority of the Arbitration Board, dated December 13, 2013, at p. 36

[^49]: Ibid at p. 36

[^50]: Ibid at p. 37

[^51]: Ibid at p. 37

[^52]: Ibid at p. 30

[^53]: Ibid at p. 29