Turkiewicz v. Ontario Labour Relations Board, 2021 ONSC 1259

COURT FILE NO.: DC 262/18, 601/18, 789/18 DATE: 20210531

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Backhouse, D.L. Corbett and Gomery JJ.

B E T W E E N:

TOMASZ TURKIEWICZ, a sole

Marek Tufman and Gregory Tufman,

proprietor c.o.b. as TOMASZ TURKIEWICZ

for the Applicant

CUSTOM MASONRY HOMES

Applicant

• and -

BRICKLAYERS, MASONS

Aaron Hart, for the OLRB

INDEPENDENT UNION OF CANADA,

LOCAL 1, LABOURERS’

Paul J.J. Cavalluzzo and Aminah Hanif, for

INTERNATIONAL UNION OF NORTH

the Respondent Unions

AMERICA, LOCAL 183 and MASONRY

COUNCIL OF UNIONS TORONTO

AND VICINITY

Respondents

Heard at Toronto: November 19, 2019[^1]

D.L. Corbett J.

REASONS FOR DECISION

Overview

[1] This application requires the court to consider the successor and related employer provisions of the Labour Relations Act, 1995 (the “Act” or the “LRA”) in the context of deciding whether the principal of a defunct employer in the construction industry is a “successor” or “related” employer of the company some seven years after it was dissolved and the principal himself emerged from personal bankruptcy.

[2] Similar or related legal issues arose in two other applications under reserve in this court while the decision in this case was under reserve.[^2] In Enercare, I reviewed applicable provisions in the Act and the controlling tests where it is alleged that an employer is related to another employer. In Deloitte, I reviewed these principles to decide whether a receiver carrying on an employer’s business during a receivership under the Bankruptcy and Insolvency Act (the “BIA”) is a “successor employer” under the LRA.

[3] Tomasz Turkiewicz (“Turkiewicz”)[^3] seeks judicial review from three decisions of the Ontario Labour Relations Board (the “OLRB” or the “Board”) finding him a related employer to his defunct company, Brickpol Masonry Corporation (“Brickpol”), finding him bound to current collective agreements, finding him in breach of one of those collective agreements, and imposing a fine of $32,466.00 as remedy for this breach.[^4]

[4] The parties raise nine issues in written argument but on distillation there is only one serious question: Whether the Board’s declaration is reasonable that Turkiewicz is a related employer to his defunct company, Brickpol, pursuant to LRA, s.1(4). I conclude that, in determining that Turkiewicz was a related employer, the Board failed to analyze whether a related employer declaration would serve a labour relations purpose as it was required to do. This was unreasonable and so the First Decision cannot stand. The Second and Third Decisions turn on the First Decision and therefore must also be quashed.

[5] I do not see merit in most of the other issues raised by Turkiewicz. I do have considerable difficulty with the penalty imposed and had I not concluded that all three Decisions must be quashed, I would have quashed the Third Decision and remitted the issue of penalty back to the Board for re-determination on the basis of all the circumstances of the case.

[6] Ordinary principles of deference would usually lead this court to send the issue in the First Decision back to the Board for a fresh hearing. However, the agreed facts are not a sufficient basis for a declaration under LRA, s.1(4). I have concluded that no purpose would be served by sending the case back to the Board on this issue, particularly given the negative impact of the extended proceedings on Turkiewicz.

[7] In the result, then, for the reasons that follow, the application for judicial review in respect to the First Decision is allowed, the decision of Vice-Chair Rowan is quashed, and the application for a declaration pursuant to LRA, s.1(4) is dismissed. This finding removes an essential basis for the Board’s findings under review in the Second Decision and the Third Decision, and so those decisions are also quashed.

Background Facts

[8] In January 2001, Brickpol was incorporated by Turkiewicz[^5] to carry on a bricklaying and masonry business.[^6] Brickpol signed voluntary recognition agreements binding it to two collective agreements made between an employer group and the respondent unions.[^7] Brickpol signed renewal agreements in 2004 and 2007.[^8] Thus, Turkiewicz’s company, Brickpol, was bound to the two collective agreements from 2001 onwards, through to and including renewal of the agreements in 2007. During this period, Turkiewicz himself did masonry and bricklaying work for Brickpol as a union member.[^9]

[9] In 2007, Turkiewicz was injured in a car collision.[^10] He was unable to work because of his injuries, and this led to him declaring personal bankruptcy.[^11] In 2008, Brickpol sent notice to the unions that it was no longer performing work under the collective agreements.[^12] The company was dissolved in 2010.[^13] Turkiewicz was discharged from personal bankruptcy in December 2011.[^14]

[10] In May 2017, Turkiewicz registered a sole proprietorship called “Tomasz Turkiewicz Custom Masonry Homes”.[^15]

[11] In October 2017, Turkiewicz was observed performing bricklaying and masonry work in the name of his sole proprietorship. The unions filed a grievance against Brickpol and against the sole proprietorship on November 17, 2017. Four weeks later, the unions filed an application with the OLRB seeking a declaration that Brickpol and the sole proprietorship are “related employers” pursuant to s.1(4) of the LRA.

The Sole Proprietorship and Turkiewicz Are the Same Person

[12] A sole proprietorship and its proprietor are the same legal person. This is trite law. By registering the name of a sole proprietorship, Turkiewicz did not create a business entity separate from himself. When he performed work under the name of his proprietorship, he was not “employed” by his proprietorship – Turkiewicz did not, and could not, employ himself.[^16] Referring to the sole proprietorship as somehow distinct from Turkiewicz creates the illusion of an “enterprise” distinct from the man himself. Throughout this decision I refer to Turkiewicz and his registered sole proprietorship as “Turkiewicz”, without distinguishing between the two because, in law, they are indistinguishable.

[13] Turkiewicz suffered serious injuries that kept him from work starting in 2007. There is no evidence that Turkiewicz resumed working until 2017. There is no evidence that Brickpol carried on business in any way after it sent notice to the unions in 2008. There is no evidence that any aspect of Brickpol’s business, aside from Turkiewicz’s own qualifications and expertise as a bricklayer and mason, survived when he started working again.

Procedural History

[14] As of December 2017, the unions had filed a grievance and an application for a s.1(4) declaration. On December 13, 2017, the unions referred the grievance to arbitration pursuant to LRA, s.133. The OLRB adjourned the grievance pending determination of the s.1(4) application.

(a) The Related Employer Application (LRA, s.1(4)) [First Decision: DC File 262/18]

[15] The parties submitted written materials to the Board on the LRA, s.1(4) application. Turkiewicz agreed with many facts alleged by the unions, following which the unions requested that the Board issue a ruling without a hearing on the basis that the agreed facts were sufficient to meet the test in LRA, s.1(4). Turkiewicz also requested that the ruling be issued without a hearing on the basis that the agreed facts do not establish a prima facie case for an LRA, s.1(4) declaration.

[16] This gave rise to the First Decision, in which Vice-Chair Rowan determined whether Brickpol and Turkiewicz were related employers based on the agreed facts.[^17] She found that LRA, s.1(4) does not require that related employers operate simultaneously. She concluded:

The applicants’ collective bargaining rights acquired with Brickpol through the voluntary recognition agreements referred to above are binding on Brickpol and are being eroded by virtue of Tomasz Turkiewicz’s decision to perform work falling within the scope of those voluntary recognition agreements on a non-union basis through a sole proprietorship rather than through an entity that recognizes those pre-existing bargaining rights.

Vice-Chair Rowan ordered that the proprietorship be deemed a signatory to the recognition agreement first signed by Brickpol in 2001 but left the question of whether the proprietorship was bound to the current collective agreements to be decided in the grievance proceeding.

[17] The proprietorship sought judicial review of the First Decision on April 27, 2018, in Toronto Divisional Court file No. 262/18. On May 22, 2018, Conway J. of this court refused Turkiewicz’s motion for a stay of the First Decision.

(b) Turkiewicz Bound to Current Collective Agreements (Second Decision: DC 602/18)

[18] The issue of whether the proprietorship was bound by the current collective agreements, determined in the Second Decision, turned on two issues:

a. Whether the proprietorship ever became bound to the collective agreements; and

b. If the answer to a. was yes, whether it was bound by the most recent interest arbitration decision establishing that the parties were bound by the 2016-2019 collective agreements.

[19] The first issue was disposed of by the First Decision declaring Turkiewicz and Brickpol ‘related employers’ pursuant to LRA, s.1(4). As a result, Turkiewicz was deemed to be a signatory to the collective agreements in 2001, and to the renewals of those agreements by Brickpol in 2004 and 2007.

[20] The most recent renewal of the collective agreement was the subject-matter of an interest arbitration in 2017 under LRA, s.150.4. The award in this interest arbitration bound the unions and a group of employers to the 2016-2019 collective agreements. The employers were listed in a schedule to the collective agreements. Brickpol was on this list.

[21] The unions argued that the First Decision and the interest arbitration award, taken together, had the effect of binding Turkiewicz to the current collective agreements.

[22] Turkiewicz argued that the collective agreement could not bind Brickpol. It had never been served with notice of the interest arbitration proceedings or the award. Service would, in fact, have been impossible because Brickpol had been dissolved back in 2010. Turkiewicz also argued that his personal bankruptcy had terminated his obligations under the collective agreements.

[23] Vice-Chair Patrick Kelly rejected Turkiweicz’s arguments in the Second Decision, finding that the former arguments were collateral attacks on the interest arbitration award, and the latter argument was inconsistent with the First Decision. Vice-Chair Kelly found that Turkiewicz was bound to the current collective agreements and left the question of whether the collective agreements had been breached to a further hearing.[^18]

[24] Turkiewicz commenced an application for judicial review of the Second Decision in Toronto Divisional Court File No. 602/18.

(c) Breach of the Collective Agreements and Remedy (Third Decision: DC 789/18)

[25] The unions alleged that Turkiewicz performed substantial work on a townhouse project in North York on a non-union basis. Turkiewicz argued that the collective agreement did not apply when he sought out and performed work on his own account. In the Third Decision, Vice-Chair Kelly rejected this argument on the basis that the work was clearly bargaining unit work over which the unions had exclusive rights pursuant to the collective agreement. Vice-Chair Kelly found Turkiewicz in breach of the collective agreement and fixed damages on the basis of a calculation that the work involved 600 hours of bargaining unit work, at a bargaining rate of $54.11 per hour, for a total of $32,466.00.

[26] Turkiewicz commenced judicial review of the Third Decision on December 19, 2018 in Toronto Divisional Court File No. 789/18. On June 23, 2019, Wilton-Siegel J. ordered the three applications heard together. The Third Decision was stayed pending final disposition of these applications, on consent, by order dated September 10, 2019.

Jurisdiction and Standard of Review

[27] This court has jurisdiction to hear these applications for judicial review pursuant to ss. 2 and 6 of the Judicial Review Procedure Act.[^19] The standard of review of these decisions in this court is reasonableness.[^20] The OLRB is protected by the strongest privative clauses known to our law[^21] and the issues decided by the Board in this case lie within the core of the Board’s specialized expertise.[^22]

Analysis

Was the First Decision reasonable?

The Basis for the Board’s Decision

[28] In their submissions for the First Decision, the unions took the position that the facts alleged by them, agreed by Turkiewicz, were sufficient for the Board to make the requested declaration pursuant to s.1(4) of the LRA.[^23] The unions argued that this was so “even if [the Board] were to accept the additional facts asserted by [Turkiewicz] in his response.”[^24] The Board accepted this argument. Thus, the factual basis for the First Decision was “the agreed facts set out in the application and the additional facts asserted in the response.”[^25]

[29] The critical agreed facts are summarized in paragraphs 8 to 11, above, and are footnoted to the First Decision for reference.

[30] The Board made the following findings in the First Decision:

a. Brickpol and Turkiewicz are “separate entities under the common control and direction of Tomasz Turkiewicz” (First Decision, para. 12). This finding was available to the Board on the undisputed facts and is reasonable.

b. The unions’ bargaining rights “have been undermined by a shifting of one or more workers from one corporate vehicle to another entity without regard to the applicants’ pre-existing bargaining rights” (First Decision, para. 14). This finding was technically correct. One “worker” was “shifted”: Turkiewicz himself.

[31] The Board distinguished this case from two authorities cited on behalf of Turkiewicz[^26] and concluded that “[t]he present case therefore reflects precisely the type of mischief to which s.1(4) of the Act is meant to address” (First Decision, para. 16). Aside from stating this conclusion, the Board did not address the “labour relations purpose” for making an LRA, s.1(4) declaration in this case.

Related Employer Jurisprudence

[32] The history of successor employer provisions of the LRA is set out in Deloitte[^27], and the history of related employer provisions of the LRA is set out in Enercare[^28]. The provisions arose from similar problems: the use of different legal structures for operating a business to avoid or escape collective bargaining rights. To quote from Enercare:

The essential balance – between “protecting against the loss of bargaining rights” and “enabling businesses to… arrange their affairs” – runs through the jurisprudence on both successor and related employer applications. The successor employer provisions were added to the LRA in 1962 and enacted in roughly their current form in 1970. The related employer provisions were added in 1970, and their genesis relates closely to the reasons for enacting the successor employer provisions: to protect against loss of bargaining rights through re-arrangement of business structures, while still enabling businesses to arrange their affairs.[^29]

[33] LRA, s.1(4) provides:

Where, in the opinion of the Board, associated or related activities or businesses are carried on, whether or not simultaneously, by or through more than one corporation, individual, firm, syndicate or association or any combination thereof, under common control or direction, the Board may, upon the application of any person, trade union or council of trade unions concerned, treat the corporations, individuals, firms, syndicates or associations or any combination thereof as constituting one employer for the purposes of this Act and grant such relief, by way of declaration or otherwise, as it may deem appropriate.

[34] In most circumstances, “related” employers carry on business simultaneously. However, this is not required for a declaration of related employer status. In Ian Somerville Construction, the OLRB made a related employer declaration where there had been a gap of five years between the operations of one related employer, and the commencement of operations of the other.[^30] The OLRB held that “the Board is concerned with the nature of the business” and “the gap in and of itself is not determinative of the relatedness issues.”[^31] Similar dicta may be found in other Board decisions.[^32]

[35] The development of the test for “related employers” is set out in Enercare,[^33] and there can be no doubt that Turkiewicz and Brickpol meet the statutory test for the exercise of discretion to make a s.1(4) declaration. They had common ownership, common management, and they were engaged in the same activities, in the same markets. The Board’s conclusion to this effect is reasonable.[^34]

[36] However, that does not end the matter. The Board must then ask itself if there is a “labour relations purpose” to granting a related employer declaration.[^35] This is the crucial question the Board must ask itself to decide whether it should exercise its discretion to make a s.1(4) declaration. To answer this question, the Board must assess the entire context of the case. This the Board failed to do.

Labour Relations Purpose for a Related or Successor Employer Declaration

[37] There must be a valid “labour relations purpose” to grant successor or related employer declarations. The Board’s discretion is not to be exercised to enable a union to extend its bargaining rights to bypass the normal certification process.[^36] Nor is it a “catch all” to address other labour relations issues such as contracting-out or an individual union member accepting non-union work.[^37]

[38] A labour relations purpose is found where a related employer declaration may:

(a) preserve or protect from artificial erosion the bargaining rights of the union;

(b) create or preserve viable bargaining structures; and

(c) ensure direct dealings between a bargaining agent and the entity with real economic power over the employees.[^38]

Where no such labour relations purpose can be found, the OLRB usually declines to grant a related or successor employer application.[^39] This principle has not been applied consistently in construction industry cases, and it should be.

[39] This is not a case of an employer repositioning its business to avoid its labour relations obligations. This case is about a man whose life and business were largely destroyed because of injuries he suffered in a collision, who, many years later, tried to start again. Nothing has been transferred or redeployed from the original business, other than the man himself. The Board failed to assess Turkiewicz’s perspective, to consider all the circumstances, to decide if a legitimate labour relations purpose was served by making the requested declaration. I return to the balancing that ought to have been done after considering the special context of construction industry collective agreements.

[40] It is not necessary to review the Board jurisprudence in construction industry cases on this point at length. It starts from the undeniable premise that in cases arising in the construction industry, a hiatus, even a long hiatus, may not preclude a s.1(4) declaration. However the thrust of Board decisions on this issue is that a hiatus does not matter at all, and even when the hiatus is long and the only common aspect of the two businesses is one key individual, the declaration should be granted if the relatedness test is met. This logic, by itself, is unreasonable. It defeats the requirement to consider the hiatus and subsumes the requirement that there be a “labour relations purpose” for a s.1(4) declaration into the test for relatedness.

Successor and Related Employers in the Construction Industry

[41] Labour boards have developed special considerations for successor and related employer applications in the construction industry because of that industry’s distinct characteristics. Construction employers often have few tangible or permanent assets and few permanent employees. Construction employment is often based on short-term engagements at particular work sites, with the employment ending on completion of a particular employee’s work on the particular work site.[^40] As stated in Arlington Crane Service:

… it is uneconomical for large firms to develop a permanent work force organized into departments of specialists each with its own supervision. From the point of view of the entrepreneur, while he might retain a small number of key employees, it makes more business sense to hire the bulk of his employees as and when he wins a new contract, keep them on his payroll while they do that specific work, but when that job is finished, terminate their employment.[^41]

[42] Trade unions in the construction industry have developed a special role because of the transient and episodic nature of construction employment, a role that benefits both union members and employers. As the OLRB describes in Bell Air Conditioning:

The long-term stability which one finds elsewhere in the employment relationship is found in the construction industry in the relationship between the skilled tradesman and his craft trade union. Among its varied activities, the craft trade union fulfills a personnel function for the contractors in any particular sector of the industry, by referring to them for employment, through the hiring hall, sufficient skilled tradesmen to meet their particular manpower requirements.[^42]

[43] The court in Arlington Crane Service put it as follows;

Since the relationship between the employer and employee in construction is typically episodic rather than enduring in character, a special form of union organization has emerged to fill this vacuum. The major craft specialties have all developed their own trade unions; the union is the body with which the individual tradesman tends to have the most salient relationship in the industry. The union has often taken the lead in the development and operation of apprenticeship programs which are necessary to train newcomers in the skills of the trade. As well, the union collects and administers funds for the workers’ vacation pay, health and welfare benefits, and retirement pensions.[^43]

[44] In Ontario Hydro Services, the OLRB held that:

The purpose of section 1(4) is to preserve the meaningful nature of bargaining rights. It serves to protect them from being deliberately subverted, or from being eroded by commercial decisions entirely divorced from labour relations considerations. It is therefore necessary for an applicant to demonstrate that there is either actual or potential erosion of those bargaining rights. In the context of a construction collective agreement, that means looking at the work claimed in or covered by the collective agreement. The erosion need only be minor or be only reasonably likely to happen. The claim to the work in the collective agreement need not be conclusive or obvious on its face. But there must be some actual or potential activity on the part of the related employer which could reasonably be said to fall within the scope of the applicant’s collective agreement.[^44]

[45] Erosion may be found where a related employer is carrying out work that could be considered work covered by the collective agreement – “bargaining unit work”. This may arise, for example, where there is “direct diversion of work that would have been performed by the union company to an associated non-union company.”[^45] This analysis does not require diminution of a union’s rights or membership: as stated in Kustom Installation, where an employer has expanded through a related non-union business, this may be “erosion of bargaining rights”:

In general, bargaining rights obtained by a union attach to the employer’s business and not to a particular segment of its work. If an employer expands its business the union’s bargaining rights automatically encompass the employees doing new work coming within the scope of the collective agreement.[^46]

This reasoning hearkens back to the finding in Brant Erecting that s.1(4) ensures that “the institutional rights of the union” attach to a “definable commercial activity”.[^47] Put another way, if the test for a related employer declaration is met, then the union’s rights attach to a definable commercial activity – carried on by the employer and the related employer – and the union is entitled to share in the growth of the definable commercial activity.

[46] In the context of the construction industry, it is normal for there to be gaps between periods in which the employer engages employees through the union. In periods between engagements of unionized employees, the union’s bargaining rights are not extinguished:

… the fact that the employer lays off a group of employees at the end of its job, and might not hire other employees for months or even years, does not cause the certification to lapse. It lies dormant, but ready to be legally activated as and when the contractor reappears in that area.[^48]

[47] Because of the transient and episodic nature of employment relationships in the construction industry, and the relative ease with which employers can close a business and reconstitute that business in another form, related and successor employer provisions are of special significance in the construction industry. The Supreme Court of Canada has held that conventional indicia of a transfer of a business may not be sufficient for construction employers, which often lack significant tangible assets.[^49] In this context, Labour Boards developed a “key individual” concept, to recognize that in some circumstances in the construction industry, sometimes the only material ‘asset’ transferred is the “key individual”, usually the business’ principal.

[48] This focus on a “key individual” led to amendment of LRA, s.169 in 2000, prescribing factors to be considered by the Board when an application is made pursuant to s.1(4) respecting a construction industry employer.[^50] Factors to be considered in such an application focus on the “key individual”: (a) the length of the hiatus between the individual’s role in each entity; (b) whether the individual was in a “formal management role” in the prior entity; and (c) whether the first entity “was able to” carry on business “without substantial disruption” after the individual left.

[49] The Board did not expressly address LRA, s.169 or the jurisprudence related to “key individuals” in the construction industry context. It is clear that Turkiewicz would fit the test for a “key individual” under s.169 subject only to the consideration of “the length of the hiatus between the individual’s role in each entity”. The Board noted, correctly, that there may be a lengthy hiatus – as much as five years had been previously found to still permit a related employer declaration, but the Board did not put its mind to considering the nature and reason for the hiatus in this case – an aspect critical to weighing the hiatus itself. Nor does it seem that it placed weight on the length of the hiatus in this case – in practical terms, a decade.

Application of the above principles in this case

[50] As I noted above, the Board did not analyze whether a related employer declaration would serve a labour relations purpose in this case. It stated, as a conclusion, that s.1(4) was intended to address precisely the kind of circumstances raised in this case, but it did not explain why. The Board noted, correctly, that even a business gap of five years is not so long as to preclude a related employer declaration. The Board did not, however, go on to ask itself what sort of gap – its nature, its length and the reasons behind it – would not lead to a related employer declaration. On the Board’s reasoning, if the circumstances of the case satisfy the statutory test for a related employer declaration, no matter the length of the gap, the reasons for it and the effect of it, a labour relations purpose is served by making the declaration.

[51] This reasoning runs contrary to the legislative and jurisprudential history of s.1(4) and to prior Board decisions. For example, in a case structured analogously to the case at bar, the Board stated as follows:

The responding parties have requested as a preliminary matter that the Board dismiss this application without hearing its merits on the basis that the application fails to establish a prima facie case for sections 69 and 1(4) findings and remedies. In its decision of October 25, 2000 the Board dismissed the section 69 application. In that decision the Board also indicated that it was satisfied that the application disclosed a prima facie case that the responding parties are associated or related activities or businesses, carried on through more than one corporation, under common control or direction, pursuant to section 1(4) of the Labour Relations Act, 1995 (the “Act”). However, the Board directed the parties to make oral arguments on the subject of whether or not it would or should exercise its discretion to make a section 1(4) declaration even if all of the prerequisites of that section had been satisfied.

For the purpose of the argument made and dealt with in this decision the responding parties accept that the applicant has established, on a prima facie case basis, that all of the prerequisites of section 1(4) can be found. However, they take the position that the Board should not and would not exercise its discretion in this case even if it heard all of the evidence and was satisfied that the elements of section 1(4) of the Act had been established.

Hence, even if all of the prerequisites of section 1(4) have been established, in order for the Board to make a section 1(4) declaration it must also be convinced that there is some labour relations mischief that must be remedied through the declaration. In Industrial Mine Installations Ltd., [1972] OLRB Rep. 1029 at page 1031, the Board described the mischief that section 1(4) is designed to remedy….[^51]

In other words, the “labour relations purpose” aspect of a s.1(4) analysis must be more than being satisfied that a prima facie case exists for a s.1(4) finding. The Board’s failure to analyse the “labour relations purpose” test was unreasonable, and the resulting decision cannot stand.

[52] I also note the underlying circumstances of this case and weigh them against the underlying purpose of LRA ss.1(4) and s.69. As noted above, these provisions arose to address a significant labour relations problem in the 1960s and 1970s, one that was particularly troubling in the construction industry. There are many ways to transfer or re-formulate a business. In the construction industry, this problem is compounded by the way in which the industry is structured – where a permanent work force may be small and gaps between work are normal. “Key principals” may be a large portion of the underlying operating business. So, in the circumstances of this case, if Turkiewicz had not been injured in a collision and had purported to close his corporation and commence work as a sole proprietor after a period of time, the Board could well have concluded that the case fit precisely into the mischief that the provisions were designed to prevent – rearranging business structures for the purpose and effect of avoiding established collective bargaining rights.

[53] But that is not this case. On the facts below, Turkiewicz had been off work for ten years, not because of a hiatus in available work or because he was doing different work or working in a different territory. No inference can be drawn of continuation of the underlying business, despite gaps in operations. No assets have been transferred. No business has been transferred. No employees have been transferred. Rather, Turkiewicz’s business was destroyed and he himself was rendered unable to work, not for a “gap” in operations, but for a decade of non-operation.

[54] The “gap” in this case is not a normal feature of the construction industry, nor is any part of it properly characterized in this way. Neither does the gap arise from an intention to avoid collective bargaining rights. The effect of the declaration is to find that Turkiewicz, himself, could not – after ten years away from work – decide he would try to re-establish himself as a bricklayer except as a union member himself.

[55] Turkiewicz was starting over. What labour relations purpose is served by requiring him to start over subject to the collective agreements? This question is not answered in the decision below, and no answer could be given to justify a declaration that Turkiewicz and his defunct business are “related employers”. On the agreed facts, such a declaration was not reasonably available.

Other Issues

[56] In written argument, Turkiewicz submitted that the Vice Chair erred in the First Decision by “presumably” finding a transfer of a business pursuant to LRA, s.69 (Factum, paras. 17 and 19). The Board made no such finding. The Board’s decision was based on LRA, s.1(4) and not LRA, s.69.

[57] In written and oral argument, Turkiewicz submitted that the Board erred in finding that he was bound by the current collective agreements because notice could not have been given of the interest arbitrations to Brickpol. I agree with the Board that this argument was a collateral attack on the Award from the interest arbitration. An employer cannot avoid a collective agreement by the expedient of winding up a corporation and then carrying on its business in another business form. Reliance on the failure of service because of dissolution of the corporation would open the door to the mischief that s.1(4) is designed to address. If Turkiewicz was a related employer to Brickpol, it would have been his obligation to ensure that his address for service was updated with the Board so that he would receive notice of periodic interest arbitrations. I note, in the circumstances of this case, that the apparent unfairness of this requirement arises not because of the procedures followed by the Board for interest arbitrations in construction industry cases, but because the finding that he is a related employer was, itself, unfair to Turkiewicz. That is, the First Decision was unreasonable, and its unreasonableness is what renders the Second Decision unreasonable, not the logic of the Second Decision itself.

[58] In written argument, Turkiewicz argued that the collective agreement was terminated by his personal bankruptcy and the dissolution of Brickpol. I do not accept this argument for the reasons given in Deloitte. Bankruptcy terminates the employment of the bankrupt’s employees but does not terminate a collective agreement or bargaining rights.[^52]

[59] Turkiewicz argued that the trifurcated process followed by the Board was unreasonable. The Board is master of its own process. While splitting the issues into three hearings does seem a cumbersome way in which to proceed, each of those hearings was scheduled and decided promptly. By the time of argument of these applications, all questions had been decided and procedural issue of trifurcation was effectively moot. The unfair effect of a prolonged process is addressed in my consideration of remedy and does not bear on the Board’s substantive decision.

[60] Turkiewicz argued that the penalty was harsh and unreasonable. I agree. It was punitive rather than compensatory, and it was imposed in circumstances where it was incumbent on the Board to assess Turkiewicz’s situation – the true nature of his fault and all the circumstances surrounding it. If Turkiewicz had resumed work as a member of the union, he would have been entitled to be paid for his work but would have had to make remittances to the unions. There is no reason to believe that Turkiewicz was not acting in good faith, understanding that he was free to go back to work as a non-union member, whether as a sole proprietor or as an employee of a non-union firm. The circumstances in which he did this – having suffered grievous personal injury, loss of his business, personal bankruptcy and long-term unemployment, all militate towards a more lenient approach to penalty. No regard was made to these factors in the Third Decision.

[61] Had I not concluded that all three Decisions must be quashed, I would have quashed the Third Decision and remitted the issue of penalty back to the Board for consideration on the basis of all the circumstances of the case. I appreciate that considerable deference is owed to the Board on questions of remedy, and it is for that reason that I would have remitted this issue back to the Board rather than deciding the issue in this court.[^53]

Remedy

[62] In most cases, the proper result would be to remit the First Decision back to the Board for a new hearing.[^54] This approach has been reinforced by the Supreme Court of Canada’s decision in Vavilov,[^55] which confirms the importance of the Legislature’s choice that such matters be decided by the Board and not by a court. Where, as here, the jurisprudence below is not well developed on the issue leading this court to intervene, it is better for that jurisprudence to be developed by the Board at first instance, rather than this court.

[63] However, on the record before this court, the result is inevitable: the declaration does not serve the underlying purposes of s.1(4), as reflected in the legislative and jurisprudential history of that provision and its related provision, s.69. Whatever test might be developed to distinguish between “gaps’ that preclude a s.1(4) declaration and “gaps” that do not preclude such a declaration, it seems evident that no labour relations purpose could be served by a declaration in this case.

[64] In these circumstances, I have concluded that no purpose would be served by sending this case back to the Board for a fresh hearing. This is not because this court wishes to seize unto itself a role reserved to the Board. It is because one must not lose sight of the fact that there is a person whose life and ability to earn an income has been impacted by these extended proceedings for several years with the accompanying stress, uncertainty and expense. He should not be required to face further proceedings on these issues.

[65] To quote from Vavilov:[^56]

However, while courts should, as a general rule, respect the legislature’s intention to entrust the matter to the administrative decision maker, there are limited scenarios in which remitting the matter would stymie the timely and effective resolution of matters in a manner that no legislature could have intended: D’Errico v. Canada (Attorney General), 2014 FCA 95, at paras. 18-19 (). An intention that the administrative decision maker decide the matter at first instance cannot give rise to an endless merry-go-round of judicial reviews and subsequent reconsiderations. Declining to remit a matter to the decision maker may be appropriate where it becomes evident to the court, in the course of its review, that a particular outcome is inevitable and that remitting the case would therefore serve no useful purpose: see Mobil Oil Canada Ltd. v. Canada-Newfoundland Offshore Petroleum Board, 1994 114 (SCC), [1994] 1 S.C.R. 202, at pp. 228-30; Renaud v. Quebec (Commission des affaires sociales), 1999 642 (SCC), [1999] 3 S.C.R. 855; Groia v. Law Society of Upper Canada, 2018 SCC 27, [2018] 1 S.C.R. 772, at para. 161; Sharif v. Canada (Attorney General), 2018 FCA 205, 50 C.R. (7th) 1, at paras. 53-54; Maple Lodge Farms Ltd. v. Canadian Food Inspection Agency, 2017 FCA 45, 411 D.L.R. (4th) 175, at paras. 51-56 and 84; Gehl v. Canada (Attorney General), 2017 ONCA 319, at paras. 54 and 88 (). Elements like concern for delay, fairness to the parties, urgency of providing a resolution to the dispute, the nature of the particular regulatory regime, whether the administrative decision maker had a genuine opportunity to weigh in on the issue in question, costs to the parties, and the efficient use of public resources may also influence the exercise of a court’s discretion to remit a matter, just as they may influence the exercise of its discretion to quash a decision that is flawed: see MiningWatch Canada v. Canada (Fisheries and Oceans), 2010 SCC 2, [2010] 1 S.C.R. 6, at paras. 45-51; Alberta Teachers, at para. 55.

[66] After a decade out of the business, a hiatus arising from serious personal injury, loss of the business, and personal bankruptcy, Turkiewicz is trying to start over. Turkiewicz has already been subject to the declaration made in the First Decision since 2018, and his ability to earn an income and his financial wellbeing have been in serious question for four years, no doubt a stressful and difficult experience for a man seeking to recover from such serious personal losses. Fairness and justice require that this matter be brought to a close now so that he may move on.

Order and Costs

[67] The applications are allowed and the three impugned orders of the Board are quashed. Turkiewicz shall have his costs of these applications from the unions fixed in the aggregate amount of $24,000 all-inclusive.

___________________________ D.L. Corbett J.

I agree:___________________________ Backhouse J.

I agree:___________________________ Gomery J.

Date of Release: May 31, 2021

CITATION: Turkiewicz v. Ontario Labour Relations Board, 2021 ONSC 1259

COURT FILE NO.: DC 262/18, 601/18, 789/18 DATE: 20210528

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Backhouse, D.L. Corbett and Gomery JJ.

BETWEEN:

Tomasz Turkiewicz

Applicant

– and –

Ontario Labour Relations Board, Bricklayers, Masons Independent Union of Canada, Local 1., Labourers’ International Union of North America, Local 183 and Masonry Council of Unions Toronto and Vicinity

Respondents

REASONS FOR DECISION

D.L. Corbett J.

Date of Release: May 31, 2021

[^1]: Release of this decision was delayed in order to receive submissions respecting the decision of the Supreme Court of Canada in Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, and as a result of the COVID-19 pandemic.

[^2]: Enercare v. Unifor, Local 975, 2021 ONSC 606 (“Enercare”) and Deloitte Restructuring v. UFCW Local 175, 2021 ONSC 1260 (“Deloitte”).

[^3]: I refer to both Tomasz Turkiewicz and his sole proprietorship as “Turkiewicz” in this decision. When I refer to Turkiewicz’s brother, I call him “Macin Turkiewicz”

[^4]: Respectively, the “First Decision”, “Second Decision” and “Third Decision”.

[^5]: The company was jointly incorporated by Turkiewicz and his brother, Marcin Turkiewicz. It appears that Marcin Turkiewicz’s involvement in the business may have reduced or ceased at some point. As I explain later in these reasons, although some consideration was given to Marcin Turkiewicz’s role in events, the Board’s finding that Tomasz was a directing mind throughout is reasonable and Marcin Turkiewicz role in the business is not material to the issues in the case.

[^6]: First Decision, para. 9(5).

[^7]: First Decision, para. 9(6).

[^8]: First Decision, para. 9(7) and 9(8).

[^9]: First Decision, para. 9(9).

[^10]: First Decision, para. 10(a).

[^11]: First Decision, para. 10(b).

[^12]: First Decision, para. 9(8).

[^13]: First Decision, para. 11.

[^14]: First Decision, para. 10(b).

[^15]: First Decision, para. 9(15).

[^16]: This case does not turn on this observation. The result does not turn on Turkiewicz having returned to bricklaying as a sole proprietor rather than by incorporating a new company or forming a partnership. However, the decisions below consistently refer to the proprietorship as something distinct from Turkiewicz himself, thereby occluding the central problem in this case – the problem that should have been but was not addressed in the Decisions below.

[^17]: Bricklayers, Masons Independent Union of Canada, Local 1, Labourers' International Union of North America, Local 183 and Masonry Council of Unions Toronto and Vicinity v. Brickpol Masonry Corporation, 2018 28124 (ON LRB).

[^18]: Bricklayers, Masons Independent Union of Canada, Local 1, Labourers' International Union of North America, Local 183 and Masonry Council of Unions Toronto and Vicinity v. Brickpol Masonry Corporation, 2018 81789 (ON LRB).

[^19]: Judicial Review Procedure Act, RSO 1990, c. J.1, ss. 2 and 6.

[^20]: Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, para. 10.

[^21]: LRA, ss. 114, 116.

[^22]: National Waster Services Inc. v. CAW-Canada [2009] O.J. No. 4485, paras. 18 and 20 (Div. Ct.); Brookfield Multiplex Construction Canada Limited v. Labourers’ International Union of North America, 2018 ONSC 548, para. 20 (Div. Ct.); Audio-Visual Services (Canada) Corp. v. Ontario Labour Relations Board, 2019 ONSC, para. 57 (Div. Ct.); Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, para. 31.

[^23]: First Decision, para. 3.

[^24]: First Decision, para. 3.

[^25]: First Decision, para. 6.

[^26]: Durham Access to Care, Canadian Red Cross Society (Ontario Zone), Comcare Independent Living Inc., Kawartha Quality Care Inc., ParaMed Health Services, and Bayshore Healthcare, 2000 12981 (ON LRB); XDG Construction Limited, 2016 1920 (ON LRB); L. P. Masonry and 1359605 Ontario Inc. c.o.b. as A+ Masonry, 2012 74405 (ON LRB).

[^27]: Deloitte Restructuring v. UFCW Local 175, 2021 ONSC 1260.

[^28]: Enercare v. Unifor, Local 975, 2021 ONSC 606.

[^29]: Enercare v. Unifor, Local 975, 2021 ONSC 606, para. 20.

[^30]: C.J.A., Local 27 v. Ian Somerville Construction Ltd., 1988 CarswellOnt 1274, paras. 7-8.

[^31]: C.J.A., Local 27 v. Ian Somerville Construction Ltd., 1988 CarswellOnt 1274, paras. 16-17.

[^32]: C.J.A., Local 259 v. Crossroad Interiors Ontario Ltd., [2002] OLRB Rep. 1034; I.B.E.W., Local 353 v. Agincourt Electric, [1991] OLRB Rep. 209; C.J.A., Local 494 v. Kent Acoustics Ltd., [1990] OLRB Rep. 855; C.J.A., Local 785 v. Roy Brandon Construction, [1981] OLRB Rep. 219.

[^33]: Enercare v. Unifor, Local 975, 2021 ONSC 606, paras. 25-31.

[^34]: See the cases quoted and cited in Enercare, particularly, Industrial-Mine Installations Ltd. v. U.S.W.A., [1972] OLRB Rep. 1029; Ironworkers' District Council of Ontario v. Brant Erecting & Hoisting, [1980] O.L.R.B. Rep. 945; United Brotherhood of Carpenters and Joiners of America, Local 27 v. Century Store Fixtures Ltd., [1990] OLRB Rep. 1119; Lester (W.W.)(1978) Ltd. v. United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry, Local 740, 1990 22 (SCC), [1990] 3 SCR 644; Lithographers & Photoengravers International Union, Local 12-L v. Walters Lithographic Co., [1971] OLRB Rep. 406.

[^35]: Enercare v. Unifor, Local 975, 2021 ONSC 606, paras. 32-36.

[^36]: Canadian Union of United Brewery, Flour, Cereal, Soft Drink and Distillery Workers, Local 304 v. The Charming Hostess Inc., 1982 824 (ON LRB), paras. 46-47; Judy Fudge and Kate Zavitz, “Vertical Disintegration and Related Employers: Attributing Employment-Related Obligations in Ontario” (2006-2007) 13 CLELJ 107 at 142.

[^37]: Enercare v. Unifor, Local 975, 2021 ONSC 606, para. 32.

[^38]: B.A.C., Local 2 v. Etobicoke (City) Public Library Board, 1989 OLRB Rep. 935, para. 88.

[^39]: Jules E. Boch, Robert E. Salisbury, Leslie A. Brown and Stephen McArthur, Canadian Construction Labour and Employment Law (Toronto: LexisNexis Canada, 1997), paras. 4.20, 4.52; Sommer & Saxe, Understanding the Labour Relations Act, 2nd ed. (Aurora, ON: Canada Law Book, 2001), p. 101.

[^40]: Hon. G.W. Adams, Q.C., Canadian Labour Law, 2nd ed. (Toronto: Thomson Reuters, 1993), paras. 15.10-15.20.

[^41]: Arlington Crane Service v. Ontario (Minister of Labour) (1988), 1988 4802 (ON SC), 67 OR (2d) 225, para. 23 (SCJ), per Henry J.

[^42]: Sheet Metal Workers’ International Assn., Local 47 v. Bell Air Conditioning, 1986 CarswellOnt 1250, para. 14.

[^43]: Arlington Crane Service v. Ontario (Minister of Labour) (1988), 1988 4802 (ON SC), 67 OR (2d) 225, para. 27 (SCJ), per Henry J.

[^44]: Ontario Hydro Services, [2003] OLRD No. 3722, para. 47.

[^45]: H.F.I.A. v. Kustom Installation Ltd., 1979 CarswellOnt 1160, para. 19.

[^46]: H.F.I.A. v. Kustom Installation Ltd., 1979 CarswellOnt 1160, para. 20.

[^47]: Ironworkers' District Council of Ontario v. Brant Erecting & Hoisting, [1980] O.L.R.B. Rep. 945, para. 99.

[^48]: Arlington Crane Service v. Ontario (Minister of Labour) (1988), 1988 4802 (ON SC), 67 OR (2d) 225, para. 26 (SCJ), per Henry J.

[^49]: Lester (W.W.) (1978) Ltd. v. United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry, Local 740, 1990 22 (SCC), [1990] 3 SCR 644 at 677-679, per McLachlin J. (as she then was).

[^50]: LRA, s.169, as am. by An Act to amend the Labour Relations Act, 1995 in relation to the construction industry, SO 2000, c.24, s.2.

[^51]: Service Employees International Union, Local 204 v. Durham Access to Care, 2000 12981 (ON LRB), paras. 1, 5 and 27.

[^52]: Deloitte Restructuring v. UFCW Local 175, 2021 ONSC 1260, paras. 17-20.

[^53]: Giguère v. Chambre des notaires du Quebec, 2004 SCC 1, [2004] SCR 3, paras. 66-68.

[^54]: See, for example, Enercare v. Unifor, Local 975, 2021 ONSC 606; Longueépée v. University of Waterloo, 2020 ONCA 830

[^55]: Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65.

[^56]: Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, para. 142.