Living Solutions Inc. o/a Henley House, 2023 ONSC 1628
DIVISIONAL COURT FILE NO.: 144/22 (Toronto) DATE: 20230323
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
Sachs, Lederer and Lococo JJ.
BETWEEN:
Labourers’ International Union of North America, Local 3000
Applicant
– and –
Primacare Living Solutions Inc., o/a Henley House and A BOARD OF ARBITRATION COMPOSED OF
CHRISTOPHER ALBERTYN – CHAIR
FERNANDO REIS – UNION NOMINEE
STEVEN WILSON – EMPLOYER NOMINee
Respondents
Georgina Watts and Leila Gaine, for the Applicant
Brandin O’Connor and Lexa Cutler, for the Respondent
HEARD at Toronto: January 16, 2023, by video conference
REASONS FOR JUDGMENT
R. A. Lococo J.
I. Introduction
[1] The applicant Labourers’ International Union of North America, Local 3000 brings an application for judicial review of an interest arbitration award dated February 10, 2022, reported at 2022 11160 (Ont. L.A.).
[2] The award set the terms of a renewal collective agreement for certain employees of the respondent Primacare Living Solutions Inc., operating as Henley House (“Henley House”), a for-profit long-term care home in St. Catharines. The applicant takes issue with the terms of the award addressing wage adjustments, arguing that the award is unreasonable and the arbitration board’s reasons inadequate.
[3] For the reasons below, I would dismiss the application for judicial review. The Board’s decision was reasonable and adequately explained.
II. Background
[4] Employees of an Ontario hospital (defined to include a long-term care home) are not permitted to go on strike and are not subject to lock out: Hospital Labour Disputes Arbitration Act, R.S.O. 1990, c. H.14 (“HLDAA”), ss. 1(1), 11(1). Instead, unresolved disputes between hospitals and their unionized employees are determined through interest arbitration in accordance with HLDAA.
[5] Since 2004, the applicant has represented a bargaining unit of approximately 200 employees of Henley House, consisting of Registered Practical Nurses (RPNs), Personal Support Workers (PSWs) and dietary, housekeeping, laundry and recreational employees, leading to an initial collective agreement and subsequent renewal agreements. An interest arbitration determined the terms of the parties’ collective agreement for the two years ended November 30, 2017: see Henley House Long Term Care Facility v. Ontario Federation of Health Care Workers, Liuna Local 1110, 2017 34808 (Ont. L.A.). The parties themselves agreed to the terms of their next collective agreement, the term of which ended on November 30, 2019.
[6] In June 2020 and April 2021, the parties engaged in negotiation and reconciliation to settle the terms of their subsequent collective agreement, covering the two years ended November 30, 2021. They were unable to reach an agreement on all issues. An interest arbitration board consisting of a union nominee, an employer nominee and a neutral chair (the “Board”) was then appointed to determine the outstanding bargaining issues. The Board received the parties’ evidence and submissions at a hearing by video conference on September 3, 2021.
III. Arbitration Board’s decision
[7] The Board issued its decision setting the terms of the collective agreement for the two years ended November 30, 2021 (the “Board decision”) on February 10, 2022, over two months after the expiry of that agreement. The Board decision included separate reasons for each Board member. Since the union and employer nominees both dissented, the Chair’s reasons set the terms of the renewal collective agreement: see HLDAA, s. 6(18).
[8] The outstanding issues addressed in the Board decision relate principally to wage adjustments for Henley House employees. The renewal collective agreement also includes unchanged terms from the collective agreement that expired on November 30, 2019, which were agreed to by the parties themselves: Board decision, at para. 9.
[9] In order to determine the outstanding issues, the Chair states in general terms that after considering the parties’ submissions, “we try to replicate the collective agreement the parties themselves would have agreed upon. In doing so, we consider comparability, demonstrated need, total compensation, and the statutory criteria”: Board decision, at para. 10.
[10] In that passage, the Chair refers to the replication principle, which has been described in previous case law as “a core principle in interest arbitration” under which “the arbitrator should seek to replicate the agreement that the parties would have achieved if they had bargained freely”, applying “objective criteria in preference to the subjective self-imposed limitations of the parties, in formulating an award”: see Ontario Nurses’ Association. v. Burloak Long Term Care Home, 2022 ONSC 4098 (Div. Ct.), at para. 15.
[11] The “statutory criteria” that the Chair refers to are set out in ss. 9(1) and (1.1) of HLDAA, as follows:
9 (1) The board of arbitration shall examine into and decide on matters that are in dispute and any other matters that appear to the board necessary to be decided in order to conclude a collective agreement between the parties …
(1.1) In making a decision or award, the board of arbitration shall take into consideration all factors it considers relevant, including the following criteria:
The employer’s ability to pay in light of its fiscal situation.
The extent to which services may have to be reduced, in light of the decision or award, if current funding and taxation levels are not increased.
The economic situation in Ontario and in the municipality where the hospital is located.
A comparison, as between the employees and other comparable employees in the public and private sectors, of the terms and conditions of employment and the nature of the work performed.
The employer’s ability to attract and retain qualified employees.
[12] In the Board decision, at para. 12, the Chair reviews the applicant’s position relating to wage adjustments. He states that the applicant was seeking “normative industry increases” of 1.5 percent per year, plus additional adjustments of $3.00 per hour for RPNs and PSWs and $1.00 per hour for all other classifications. The applicant’s position before the Board was that these additional adjustments were warranted, given the additional burdens and hardships that the COVID-19 pandemic placed on long-term care home employees, and were also necessary to address staff retention issues: Board decision, at paras. 11, 14-16.
[13] The Chair also refers to the applicant’s position that the Board should not follow the model for wage adjustments provided in the master award between the Extendicare long-term care homes and Services Employers International Union (SEIU) because only a minority of home and unions were involved in the award process and the award was decided before the pandemic: Board decision, at paras.13-14.
[14] In his analysis of the wage adjustment issue, the Chair considers the parties’ two most recent collective agreements, noting that there were modest special adjustments to assist in closing the gap between Henley House and the most proximate comparators: Board decision, at para. 22. Those adjustments for certain classes of employees were in the range of (i) 10 cents to 20 cents per hour on a one-time basis in the immediately previous collective agreement that expired on November 30, 2019, and (ii) 5 cents to 10 cents per hour in each year of the collective agreement that expired on November 30, 2017: Board decision, at paras. 20-21.
[15] The Chair also observes that the substance of the applicant’s complaint was not with Henley House but rather with “the system of bargaining in the long-term care sector and the general circumstances of long-term care [homes] in Ontario.” He notes that “[r]eform of the system of collective bargaining in the long-term care sector is beyond the scope of our jurisdiction in this award”: Board decision, at paras. 23-24.
[16] The Chair finds that to replicate the parties’ bargaining, it was necessary to take comparators into account, stating that the outcome of the Extendicare process continues to be persuasive, given that a “relatively large group” of comparators participated in that process: Board decision, at para. 24. The Chair goes on to say that “we have considered the impact of the pandemic on the employees, that occurred after the Extendicare award was issued”: Board decision, at para. 26.
[17] The Chair notes that there was some discussion at the hearing about Henley House’s ability to pay, stating that Henley House made it clear that it was not claiming an inability to pay if the applicant sought only normative increases. The applicant then responded that its proposed increases were not normative: Board decision, at para. 25.
[18] The Chair also acknowledges the difficulties in retaining staff across the health sector that apply to Henley House “but no more than other homes”: Board decision, at para. 27. The Chair finds that Henley’s higher than average staff to resident ratio ought to be a factor in favour of retention, which he then took into account in determining the issues in dispute: Board decision, at paras. 27-28.
[19] The Chair then sets out the Board’s award relating to wage adjustments, at paras. 31-32, as follows:
a. The night shift premium and the weekend premium were each increased 5 cents per hour.
b. Wages were increased as follows:
i. 1.5 percent, retroactively to December 1, 2019:
ii. 1.5 percent, retroactively to December 1, 2020;
iii. 15 cents per hour across-the-board, retroactively to November 30, 2021.
[20] The Chair also notes that special adjustments were made in both previous collective agreements, but Henley House wages were still lower than those of its most proximate comparators. He also states that special adjustment was being ordered “to replicate the process of closing that gap”: Board decision, at para. 33.
IV. Issues
[21] The applicant submits that the Board decision was unreasonable and its reasons inadequate. The applicant asks that the portion of the Board decision addressing wage adjustments be set aside and the matter be remitted to the Board to be determined in accordance with the court’s decision.
[22] In particular, the applicant argues that the Board erred in the following respects:
a. The wage adjustments awarded lie outside the range of possible acceptable outcomes which are defensible in light of the facts and the law;
b. The Board placed too much reliance on the collective agreement between SEIU and the Extendicare long-term care homes to justify the awarded wage adjustments;
c. The Board failed to consider all the applicant’s arguments and mischaracterize its arguments;
d. The Board erred in its interpretation and application of HLDAA; and
e. Throughout its decision, the Board failed to provide sufficient reasons.
V. Jurisdiction and standard of review
[23] The Divisional Court has jurisdiction to hear this application for judicial review: Judicial Review Procedure Act, R.S.O. 1990, c. J.1, ss. 2, 6(1).
[24] There is no dispute that the standard of review is reasonableness: Ontario Nurses’ Association, at para. 10. The burden is on the party challenging the decision to show that it is unreasonable: Canada (Minister of Immigration) v. Vavilov, 2019 SCC 65, [2019] 4 S.C.R. 653, at para. 100.
[25] The standard of reasonableness is applied not only to the outcome of the decision but also to the reasons themselves, considered as a whole. A reasonable decision is one that is based on an internally coherent and rational chain of analysis and that is justified in relation to the facts and law that constrain the decision maker. This standard requires a reviewing court to defer to such a decision: Vavilov, at para. 85.
[26] As indicated in Vavilov, at para. 86, (citing Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, at paras. 47-49,):
Reasonableness, according to Dunsmuir, “is concerned mostly with the existence of justification, transparency and intelligibility within the decision-making process”, as well as “with whether the decision falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and law” …
[27] The focus of reasonableness review must be on the decision actually made by the decision maker, including both the decision maker's reasoning process and the outcome. The reviewing court should, as a general rule, refrain from deciding the issue themselves and should not “ask what decision it would have made in place of that of the administrative decision maker, attempt to ascertain the ‘range’ of possible conclusions that would have been open to the decision maker, conduct a de novo analysis or seek to determine the "correct" solution to the problem”: Vavilov, at para. 83.
[28] Previous case law consistently indicates that on judicial review, a court owes significant deference to an interest arbitration award, given the nature of interest arbitration. For example, in Service Employees International Union v. The Participating Nursing Homes, 2013 ONSC 4650 (Div. Ct.), at paras. 11-13, the court states as follows:
An interest arbitrator applies the criteria set out in HLDAA in order to arrive at the terms of a collective agreement for the parties, a statute with which interest arbitrators in hospital labour disputes have particular familiarity.
As well, interest arbitrators exercise a broad discretion, as they are not interpreting a collective agreement, as do rights arbitrators. Rather they are settling the terms of the agreement, a task that has been said to be analogous to a legislative function in which arbitrators draw on their labour relations expertise (Canadian Union of Public Employees (C.U.P.E.) v. Ontario (Minister of Labour), 2003 SCC 29, [2003] 1 S.C.R. 539 at para. 53).
Accordingly, a high degree of deference is to be accorded to the arbitrator’s application of the factors in s. 9(1.1) and to his or her conclusions about the appropriate terms of the collective agreement.
[29] In previous cases, the reviewing court has deferred to an interest arbitration award even when the court describes the reasons provided as “sketchy” or “very brief indeed”: see Ross Memorial Hospital v. Canadian Union of Public Employees, Local 1909, 2007 39896 (Ont. Div. Ct.), at para 6; St. Gabriel’s Villa of Sudbury v Ontario Nurses’ Association, 2015 ONSC 3459 (Div. Ct.), at para 13. In the latter case, the court found the reasons to be sufficient “taking account of the [legislative] nature of the process, the evidence, submissions, issues and the reasons of the Board”.
VI. Analysis
[30] The applicant does not dispute that deference should be afforded to an interest arbitration award. However, the applicant argues that deference is not owed to an unreasonable decision or inadequate reasons, which the applicant says is the situation in this case.
[31] As explained below, I have concluded that the Board decision was reasonable and the reasons sufficient, meeting the required standard of review.
A. Do the wage adjustments lie outside the range of possible acceptable outcomes?
[32] The applicant submits that the wage adjustments that the Board awarded lie outside the range of possible acceptable outcomes which are defensible in light of the facts and the law: see Vavilov, at paras. 83, 86.
[33] Noting the Chair’s acknowledgement that the Henley House employees’ wage rates were lower than its most proximate comparators, the applicant argues that the 15-cent special wage adjustment, applied as of the last day of the contract period, cannot be justified. The applicant says that adjustment did nothing to close the wage gap, except perhaps modestly on a prospective basis only. The applicant argues that the Board did not provide justifiable, transparent and intelligible reasons for awarding such minimal wage adjustments. Among other things, the Board decision does not address the rationale for the effective date for the wage adjustment being the last day of the agreement term, rather than an earlier time.
[34] I disagree. Looking at the ordered wage adjustments in context, the adjustments are in addition to an increase of 1.5 percent, which the Chair describes (and the applicant agrees) were “normative”. In the Board decision, at para. 33, the Chair explains the rationale for the additional 15-cent across-the-board increase retroactive to November 30, 2019.
[35] The Chair states that special adjustments were made in both previous collective agreements, but Henley House wages continued to be lower than those of its most proximate comparators. He states that the special adjustments in in this award were intended “to replicate the process of closing that gap.” In this regard, it is important to note that in the collective agreement that expired on November 30, 2019, the parties agreed to a 20-cent special adjustment for RPN’s and a 10-cent special adjustment for Life Enrichment Aides. In the collective agreement before that, 10-cent and 5-cent special adjustments were made for housekeeping, dietary and laundry employees, and PSWs.
[36] In the award under review, the Board awarded a special adjustment of 15 cents across-the-board, which was not a minimal adjustment, given the historical context. Elsewhere in the Board decision, the Chair explains his consideration of the special adjustments in a similar range made in the previous two collective agreement as well as the need to take comparators into account. In that regard, the Chair refers to the outcome of the Extendicare process as persuasive given the “relatively large group of comparators” involved in that process. Thus, he disagreed with the applicant’s submission that the Extendicare outcome should be disregarded because only a small group of unions and homes were involved in that process. He found that the group involved was “relatively large”. This finding was a reasonable one, given the fact that the Extendicare process involved 92 long-term care employers in Ontario
[37] Taking into account the Board decision as a whole, as well as the evidence and submissions before the Board, I agree with Henley House’s counsel that the applicant has not established that the wage adjustments were outside the range of reasonable possible outcomes. I also find that the Board’s decision on wage adjustments was adequately explained taking into account the legislative nature of the award.
[38] While the Board decision does not specifically address the rationale for the effective date being the last day of the agreement term, it is clear from the Board decision that a similar approach was taken in the last interest arbitration award between the parties, which settled the terms of the collective agreement for the two years ended November 30, 2017. In that award, arbitrator Goodfellow also delayed various special adjustments until the last day of the term, November 30, 2017. The Board’s conclusions are entitled to deference. In my view, it would not be consistent with the Supreme Court’s guidance to second-guess the Board’s legislative decision relating to wage adjustments in the manner that the applicant suggests: see Vavilov, at para. 83.
[39] As the applicant acknowledged to the Board, it was seeking wage adjustments that were beyond the normative range. Jumping from previously awarded 5 to 20 cent increases to $3.00 increases, as requested by the applicant, would be a considerable departure from the parties’ history and the other interest arbitration awards on the record before the Board.
[40] An interest arbitration board plays an important role in labour relations in Ontario but the scope of its authority is circumscribed. Its role is aptly described by the board chair in Pembroke (City of) v. Pembroke Professional Fire Fighters’ Association, 2000 29504 (Ont. L.A.), as follows:
First and foremost, as a Board of Arbitration resolving an interest dispute, the task is to try to replicate collective bargaining as closely as possible…The task of an interest board of arbitration is not to impose terms and conditions that seem attractive or even fair to the board of arbitration. Instead, the task of a board of arbitration is to design a collective agreement that comes as close as possible to what the parties could have expected if they had been forced to impasse. [Emphasis added.]
[41] In the Board decision under review, the Chair indicates that he is aware of the scope of the Board’s authority. As noted previously, he states that the substance of the applicant’s complaints against Henley House related to “the system of bargaining in the long-term care sector and the general circumstances of long-term care [homes] in Ontario.” The Chair appropriately points out that reform of the system of collective bargaining in that sector is beyond the scope of the Board’s jurisdiction in deciding an individual award.
[42] Considering the Board decision as a whole in the context of the record before this court, I see no basis for concluding that the wage adjustments in the Board decision were outside the range of reasonable possible outcomes or were not adequately explained.
B. Did the Board place too much reliance on the collective agreement between SEIU and the Extendicare long-term care homes to justify the awarded wage adjustments?
[43] The applicant submits that the Board erred in determining employees’ wage adjustments solely or primarily based on the “master” collective agreement between SEIU and the Extendicare long-term care homes, which was the result of “central bargaining” for the resolution of outstanding items in dispute.
[44] Among the authorities that the applicant cites to support its position is the sole arbitrator’s decision in Participating Nursing Homes v. Service Employees’ International Union Local 1, Canada, 2022 63787 (Ont. L.A.), at paras. 26-29. That decision addressed the weight to be afforded to the “SEIU Master”, the centrally-bargained master agreement being considered in that case. In that decision, at paras. 27-28, the arbitrator states as follows:
It is true that the SEIU Master is an acknowledged “pattern setting” agreement or award that is relied upon and given great weight by interest arbitrators and interest arbitration boards resolving similar disputes under HLDAA…. [T]he SEIU Master provides a highly relevant comparator that is given appropriate persuasive weight for the application of replication….
The application of replication as informed by comparability does not mean that an interest arbitration board or an arbitrator is required to follow other awards and settlements religiously and slavishly…. As stated by the Ontario Divisional Court in Scarborough Health Network v. Canadian Union of Public Employees, Local 5852, 2020 ONSC 4577, previous awards have a role to play in applying the replication principle, but the arbitrator or interest arbitration board must also consider the specific circumstances of the parties and consider the market and other conditions confronting the parties. [Emphasis added.]
[45] Relying on the foregoing principles, the applicant submits that the Board placed too much reliance on the Extendicare master agreement, to the exclusion of other more pertinent comparators, noting that the master agreement was but one comparator agreement before the Board. The applicant also questioned the weight to be afforded to the Extendicare master agreement, since it was decided before the COVID-19 pandemic and does not consider the impact of this public health crisis on the long-term care sector.
[46] I disagree with the applicant’s position. Among the factors that the Board took into account in making the award, the Board decision refers to other proximate comparators as well as the bargaining history of the parties, Henley House’s staffing ratios and the impact of the COVID-19 pandemic. While the Board decision refers specifically to the Extendicare master agreement, it is clear from the record before the Board that it had several comparator collective agreements before it when making its decision. At paragraph 24, the Chair explains that the award must take into account the comparators and that among those comparators is the relatively large group that participates in the Extendicare central bargaining process. In these circumstances, I see no basis for concluding that the Board has unreasonably placed too much reliance on the Extendicare master agreement as a comparator in reaching its decision.
[47] What the applicant is in effect asking this court to do is reweigh the evidence and reach a conclusion consistent with the applicant’s position before the Board, which the Board rejected. To do so would not be consistent with the court’s proper role on judicial review.
C. Did the Board fail to consider all the applicant’s arguments and mischaracterize its arguments?
[48] The applicant submits that the Board erred in failing to consider all its arguments in reaching its decision. In particular, the applicant argues that the Board did not consider, acknowledge or accurately portray the applicant’s position with respect to replication, a key principle in interest arbitration, which included evidence and submissions as to what would likely have occurred if the employees had the legal ability to withdraw their labour and strike. The applicant also submits that the Board failed to acknowledge or accurately portray the applicant’s submissions relating to conditions at play during the term of the collective agreement, including economic forecasts, the impact of the pandemic, the effects of inflation, and recruitment and retention.
[49] Once again, I do not agree that the Board committed a reversible error in the manner it addressed the applicant’s evidence and submissions. In Vavilov, at para. 128, the Supreme Court makes it clear that it is not necessary or even desirable for an administrative decision-maker to respond to each and every argument made by the parties:
Reviewing courts cannot expect administrative decision makers to “respond to every argument or line of possible analysis” (Newfoundland Nurses,[^1] at para. 25), or to “make an explicit finding on each constituent element, however subordinate, leading to its final conclusion” (para 16). To impose such expectations would have a paralyzing effect on the proper functioning of administrative bodies and would needlessly compromise important values such as efficiency and access to justice.
[50] As well, the reasons provided for an interest arbitration award are often relatively brief, given the award’s legislative nature.
[51] In any case, the Board decision explicitly states that they have “carefully reviewed and considered all the submissions” and makes specific reference to the replication principle: at paras. 10, 24, 29. The Board decision also refers to the impact of economic conditions and the effect of the pandemic on employees and the long-term care sector generally: at paras. 23-26. The evidence and submissions made to the Board are also evident from the record of proceedings that forms part of the application record before the court as well as from the dissenting reasons provided by the Board’s union and employer nominees.
[52] From the Board decision, the dissenting reasons and the court record, it is clear that the Board did not accept or give effect to the applicant’s position on the matters in issue. However, the applicant has not established that the Board committed a reversible error by failing to consider or mischaracterizing the applicant’s evidence or submissions.
D. Did the Board err in its interpretation and application of HLDAA?
[53] The applicant submits that the Board erred in its interpretation and application of HLDAA and applicable case law. In doing so, the applicant argues that the Board relied on irrelevant factors and failed to consider relevant factors in rendering the Board decision.
[54] In particular, the applicant says that the Board failed to consider the third factor in s. 9(1.1) of the HLDAA, the economic situation in Ontario and the City of St. Catharines. The applicant says that the Board failed to consider the unique circumstances in Ontario and St. Catharines that were caused by the COVID-19 pandemic, including the additional burdens, responsibilities and hardships placed on Henley House’s employees by the pandemic and its detrimental impact on recruitment and retention.
[55] The applicant also submits that the Board erred in its consideration of the fourth factor s. 9(1.1) by failing to consider the wage rates of Henley House’s most proximate comparators.
[56] I disagree. The applicant’s submissions relating to consideration of economic factors and comparators have already been addressed elsewhere in these Reasons for Judgment. As noted previously, the Board decision states that it considered the “statutory criteria”. It also addresses comparators, Henley House’s ability to attract and retain qualified employees, and the impact of the pandemic on Henley House and the long-term care sector generally. The conclusions reached were not consistent with the applicant’s submissions, but that is not a valid basis for finding that the Board’s conclusions were unreasonable or its reasons inadequate.
VII. Disposition
[57] Accordingly, I would dismiss the application for judicial review.
[58] I would award costs to the respondent Henley House in the agreed amount of $10,000 all inclusive, payable by the applicant.
___________________________ Lococo J.
I agree
___________________________ Sachs J.
I agree
___________________________ Lederer J.
Date of Release: March 23, 2023
Living Solutions Inc. o/a Henley House, 2023 ONSC 1628
DIVISIONAL COURT FILE NO.: 144/22 (Toronto) DATE: 20230323
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
Sachs, Lederer and Lococo JJ.
BETWEEN:
Labourers’ International Union of North America, Local 3000 Applicant
– and –
Primacare Living Solutions Inc., o/a Henley House and A BOARD OF ARBITRATION COMPOSED OF CHRISTOPHER ALBERTYN – CHAIR FERNANDO REIS – UNION NOMINEE STEVEN WILSON – EMPLOYER NOMINEE Respondents
REASONS FOR JUDGMENT
R.A. Lococo J.
Date of Release: March 23, 2023
[^1]: Newfoundland and Labrador Nurses’ Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62, [2011] 3 S.C.R. 708