CITATION: Toronto Transit Commission v. Amalgamated Transit Union, 2020 ONSC 1008
DIVISIONAL COURT FILE NO.: 397/19
DATE: 20200214
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
BACKHOUSE, LOCOCO and PENNY J.J.
BETWEEN:
TORONTO TRANSIT COMMISSION
Applicant
– and –
AMALGAMATED TRANSIT UNION, LOCAL 113
Respondent
Frank Cesario and Dolores Barbini, for the Applicant
Joshua Phillips and Kristen Allen, for the Respondent
HEARD: February 10, 2020
Overview and Issue
[1] This application arises out of an interest arbitration between the Toronto Transit Commission and the Amalgamated Transit Union, Local 113 concerning the terms of employment for Customer Service Agents (CSAs), a new position in the bargaining unit represented by the ATU.
[2] The TTC has applied for judicial review of two interest arbitration awards of Arbitrator Davie. The first award considered a Letter of Agreement on non-contracting out of specific services (Appendix E-27 of the existing collective agreement). She found that the CSA position fell within the category of “subway service” which was protected against any contracting out under Appendix E-27. In this Award, therefore, the Arbitrator found that the CSA position should be subject to the non-contracting out protection in Appendix E-27.
[3] The TTC complained that the issue of which positions fell into the category of “subway service” under Appendix E-27 was the subject of unresolved pending rights arbitrations, and that the parties had “agreed” that the issue of which positions were subject to the non- contracting out agreement in Appendix E-27 was not to be decided in the CSA interest arbitration. Instead that issue would be left to a different proceeding for a future time before a different arbitrator.
[4] The Arbitrator then issued a Supplementary Award in which she determined that she had jurisdiction to deal with the issue of contracting out the CSA function but that, due to an error in expressing the “manifest intention” of her Award, the Award should be corrected to remove any reference to “subway service” as the basis upon which the CSAs should be protected against contracting out. She nevertheless went on to find that the CSA positions should benefit from a non-contracting out provision like Appendix E-27.
[5] In this application, the TTC requests an order quashing both the Supplementary Award and the related portion of the original Award dealing with the application of Appendix E-27 to the CSAs on the basis that the Award is unreasonable or, in the alternative, that the TTC was denied procedural fairness.
Background
[6] The TTC initiated a Stations Transformation Project and implemented the PRESTO card fare payment system. It therefore intended to eliminate the “Collector” position in subway stations and create a new position, the CSA position. The parties initially disagreed about whether the CSAs were covered by the existing collective agreement. However, in a Memorandum of Agreement of December 16, 2016, the parties agreed that the CSAs would be subject to the collective agreement.
[7] In the MOA, the parties agreed that the new CSA position would be rolled into the existing collective agreement and that Article 1 (the general provisions article applicable to all employees covered by the collective agreement) and other provisions of general application would apply to the CSAs. The parties appointed Arbitrator Davie as an interest arbitrator to determine the terms and conditions of employment applicable to the CSA position. When the parties’ efforts to negotiate and mediate the terms and conditions applicable to the CSAs failed, an interest arbitration hearing was conducted on November 27 and 28 and December 17, 2018. Prior to the hearing, the parties filed extensive written briefs and reply briefs. After the December 17 hearing, further written submissions were filed on multiple dates in 2018.
[8] As noted, Appendix E-27 is a Letter of Agreement providing that the TTC will not initiate any contracting out of certain services, including “subway service,” during the term of the collective agreement. Neither Appendix E-27 nor the subject of contracting out was raised in any of the prehearing briefs or during oral submissions at the hearing.
[9] The first time Appendix E-27 came up in the arbitration was in post-hearing “housekeeping” submissions. The TTC filed a chart summarizing its position on the application of the collective agreement (and its various provisions and appendices) to the CSAs. It listed a number of Appendices which it said should apply to the CSAs, but Appendix E-27 was not among them. The ATU filed a written submission responding to the TTC’s chart. Under the heading “Appendix E-27”, the ATU submitted:
The application of Appendix E-27 is in dispute between the parties. Since the CSAs would replace Collectors in the subway stations, Local 113 submits that it would be appropriate to maintain the status quo with respect to the application of Appendix E-27. Specifically, Local 113 requests that Appendix E-27 applies (or does not apply) to CSAs in the same manner that it applies (or does not apply) to Collectors. The issue of whether Appendix E-27 applies or does not apply to Collectors and CSA’s will be left for a future arbitrator to determine.
[10] The TTC’s responding written submission simply stated:
Appendix E-27
The TTC agrees with the ATU that the applicability of this Appendix goes beyond the scope of this proceeding and ought to be left for a future arbitrator to determine.
[11] This, effectively, represents the entirety of all substantive submissions on the issue of contracting out and the applicability of Appendix E-27 to the CSAs before the Arbitrator issued her Award.
[12] In her Award, the Arbitrator was similarly brief. At page 30 she held:
Appendix E-27 (page 300)
This Appendix applies to Customer Service Agents. I have determined that the term “subway service” includes those in the Customer Service Agent classification.
[13] The parties are in agreement that there is no arbitral decision establishing that Appendix E-27 applies to Collectors (or CSAs) and that this issue is undecided. The parties also agree that the ATU’s submission that Appendix E-27 “applies (or does not apply) to CSAs in the same manner that it applies (or does not apply) to Collectors”, was meant to reflect that circumstance. The parties do not agree, however, about whether the ATU’s submission (that “the issue of whether Appendix E-27 applies or does not apply to Collectors and CSAs will be left for a future arbitrator to determine”) and the TTC’s submission (that the “applicability of this Appendix goes beyond the scope of this proceeding and ought to be left for a future arbitrator to determine”) meant that the Arbitrator in this interest arbitration was not supposed to consider or impose non-contracting out obligations on the TTC in respect of the CSA position at all.
[14] A great deal of argument, both written and oral, was made on whether the Arbitrator’s Award or Supplementary Award were reasonable, in the context of an interest arbitration, whether the Arbitrator had jurisdiction to impose non-contracting out as a term or condition of CSA employment and whether the Arbitrator had jurisdiction, under the doctrine of functus officio, to change her Award and to issue the Supplementary Award. These, however, are largely questions for the arbitrator not the Court to decide or are not directly relevant to the essential issue. In my view, this judicial review turns on the issue of procedural fairness. Was the TTC (and the ATU for that matter) deprived, by the peculiar circumstances in which the issue of non-contracting out and Appendix E-27 arose at the hearing, of (i) the right to know that contracting out and/or the applicability of Appendix E-27 to the CSAs was an issue for determination by the Arbitrator in this arbitration, and (ii) the right to make submissions to the Arbitrator before she made a decision on that issue,? In my view, it was.
Analysis
Standard of Review
[15] The standard of review of an arbitrator’s award is generally reasonableness. However, the reasonableness standard does not apply to issues of procedural fairness. The process was either fair or it was not. The duty to comply with the rules of natural justice and procedural fairness extends to all administrative bodies acting under statutory authority, including interest arbitrators, Religious Hospitaliers of Saint Joseph of the Hotel Dieu Hospital of Kingston v. Ontario Public Service Employees Union, Local 465, (2009) 256 O.A.C. 167 (Div. Ct.) at para. 42; Toronto (City) v. Toronto Professional Firefighters Association, Local 3888, 2014 39811 (Board of Arbitration Chair: Kevin M. Burkett) at pp. 9-10.
Procedural Fairness
[16] A key component of the duty of procedural fairness is the requirement that each party be aware of the issues to be decided by the administrative tribunal and be given an opportunity to respond to those issues, Saskatchewan (Employment Standards) v. North Park Enterprises Inc., 2019 SKCA 69 at para. 16.
[17] Further, the procedure for an interest arbitration under the Toronto Transit Commission Labour Disputes Resolution Act, 2011, S.O. 2011 c. 2, s. 7(5) states that the arbitrator may determine his or her own procedure but “shall give full opportunity to the parties to present their evidence and make their submissions.”
[18] The problem in this case is not really of the Arbitrator’s making. The issue of contracting out/Appendix E-27 was clearly something of an afterthought. There was obviously a history to this issue, known to the parties, involving pending rights arbitrations on the very point. There is no evidence that any of that history was brought to the attention of the Arbitrator. The references to these issues, when they finally came up at the tail end of the process, were cryptic and somewhat ambiguous, although both clearly stated that the applicability of Appendix E-27 to CSAs was to be left to a future arbitrator. The parties now disagree about what they intended by these references and about what the other party, and the Arbitrator, should reasonably have concluded from them.
[19] In my view, however, the omission of Appendix E-27 from the TTC’s summary chart, the ATU’s analogy of CSAs to the Collectors and its explicit reference to leaving the issue of whether Appendix E-27 applies to the CSAs “for a future arbitrator to determine,” combined with the TTC’s agreement with the ATU that this issue be “left for a future arbitrator to determine” could only reasonably have left the parties with the impression that the applicability of Appendix E-27 or contracting out protection to the CSAs would not be a matter resolved by the Arbitrator in this arbitration. The ATU admits as much – they did not anticipate that the Arbitrator was going to make a ruling on the application of contracting out protection to the CSAs in this proceeding.
[20] The ATU now argues that the TTC, in its post-award submissions, did not ask the Arbitrator for the hearing to be reopened on procedural fairness grounds and for the right to make submissions on the contracting out/Appendix E-27 issue. The ATU further argues that, having not taken that opportunity and made that request, the TTC cannot now seek that relief from the Court.
[21] It is true that the TTC’s principal submission to the Arbitrator was a request that the references to Appendix E-27 and contracting out simply be removed from the Award or that the Award be revised to indicate that this issue was being left for a future arbitrator to determine. However, the TTC also submitted, in the alternative, that it “never had an opportunity to provide submissions or evidence in respect of the order that was made” and that, as a result, it had been deprived of its natural justice right to respond. This submission cannot be interpreted in any other way than to embody a request for the right to be heard on Appendix E-27 and contracting out.
[22] Not knowing that the applicability of Appendix E-27 was an issue in the arbitration, the TTC made effectively no submissions about it. Similarly, the ATU made effectively no submissions on this issue. The Arbitrator, as a result, did not hear anything from the parties on an issue which they did not expect was going to be resolved in her Award. That, in my view, resulted in a denial of procedural fairness on this point.
[23] For these reasons, I would order that the portion of the Award dealing with Appendix E-27 and the Supplementary Award be set aside. The matter is remanded back to the Arbitrator to determine, with the benefit of appropriate submissions from the parties:
whether the Arbitrator should consider the issues of the applicability of Appendix E-27 or contracting out to the CSAs in this arbitration and, if so;
what the application or non-application of these issues to the CSAs’ terms and conditions of employment should be.
Conclusion
[24] For the foregoing reasons, the application for judicial review is allowed in part. The balance of the application is dismissed.
Costs
[25] The parties agreed that costs should be fixed in the amount of $7,500 to the successful party. The TTC was the substantially successful party in result, so it is awarded costs in this amount.
Penny J.
I agree _______________________________
Backhouse J.
I agree _______________________________
Lococo J.
Released: February 14, 2020
CITATION: Toronto Transit Commission v. Amalgamated Transit Union, 2020 ONSC 1008
DIVISIONAL COURT FILE NO.: 397/19
DATE: 20200214
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
BACKHOUSE, LOCOCO and PENNY J.J.
BETWEEN:
TORONTO TRANSIT COMMISSION
Applicant
– and –
AMALGAMATED TRANSIT UNION, LOCAL 113
Respondent
REASONS FOR JUDGMENT
Released: February 14, 2020