PAY EQUITY HEARINGS TRIBUNAL
0426‑93 Corporation of the Township of Michipicoten, Applicant v. the Crown in Right of Ontario, Respondent and Group of Employees, Respondent
Before: Mary Ellen Cummings, Vice‑Chair, and Members Bruce Budd and Janet Slone Taylor
Appearances: David Cameletti, Grant Southwell and Don Cheslock for the Corporation of the Township of Michipicoten
Leanne Chahley, Paula Valois and Caroline Therrien for the Group of Employees
Cite as: Michipicoten (28 February 1995) 0426‑93 P.E.H.T.
DECISION OF THE TRIBUNAL, FEBRUARY 28, 1995
At issue in these proceedings is who is the employer of employees working at Chadwic Home, a Family Resource Centre providing residential and non‑residential services to women in crisis. The parties are agreed that Chadwic Home is not an entity capable of being an employer. The question is whether the employer is the Corporation of the Township of Michipicoten ("the Township") or the Crown in Right of Ontario ("the Crown"). The Crown and the Group of Employees take the position that the Township is the employer; the Township takes the position that the employer is the Crown.
On March 14, 1994, the Tribunal issued reasons on the preliminary question of whether subsection 1.1 of the Pay Equity Act, R.S.O. 1990, c.P.7, as amended ("the Act") restricted the Tribunal's jurisdiction to order a remedy against the Crown if we concluded that it was the employer. In that decision (Michipicoten (14 March 1994) 0426‑93 P.E.H.T.), we concluded that subsection 1.1 precluded the Tribunal from issuing a remedy naming the Crown as the employer of the employees working at Chadwic Home.
At that point, the Crown and the Group of Employees requested that we determine whether any evidence about the Crown's involvement in Chadwic Home was relevant. The Crown and the Group of Employees argued that the effect of subsection 1.1 of the Act was to make irrelevant any consideration of whether the Crown was factually an employer, since no remedy could be issued against it. The Crown took the position that by default, the Township was the employer. The Group of Employees took a different position, arguing that the Tribunal had to be satisfied that there was an employment relationship between the employees working at Chadwic Home and the Township, before we could find it to be the employer. However, they argued that the effect of subsection 1.1 was to remove the Crown from the typical balancing exercise the Tribunal normally undertakes when more than one entity is a potential employer. In the Group of Employees' view, subsection 1.1 rendered irrelevant any evidence about the Crown as employer, so that our focus was limited to examining the relationship between the Township and the employees at Chadwic Home. To do otherwise, the Group of Employees argued, would be to invite the possibility that these employees would have no employer for the purposes of pay equity.
The Township argued that subsection 1.1 only limited our jurisdiction to order a remedy against the Crown. It did not change the fact‑finding process carried out by the Tribunal which involves looking at various factors, balancing them and then selecting which entity is the employer. In the Township's view, nothing in subsection 1.1 precluded the Tribunal from considering the Crown as a potential employer, and making a factual conclusion that the Crown is the employer, even if no remedy could be issued.
We declined to determine on a preliminary basis which of the approaches we would take, thus permitting the parties to lead evidence about the Crown's involvement in Chadwic Home.
At the conclusion of the hearing, counsel for the Group of Employees urged us to decide this matter, even if not necessary to reach our decision, because it would be helpful to other parties. We have concluded that it is not necessary for us to decide this issue, and decline to do so.
Another preliminary issue that arose concerned the relevant time period for evidence on the issue of "who is the employer". Consistent with the Tribunal's decision in Hilton Works No. 2 (1993), 4 P.E.R. 17, we determined that the focus of our inquiry is "who is the employer" on the "effective date" of the Act, that is January 1, 1988, but agreed that we would hear evidence up to the mandatory posting date of January 1, 1990, in the event that organizational changes would affect any remedy we might order.
We have concluded that the evidence overwhelmingly points to the Township as being the employer of the employees at the Chadwic Home. While there is no doubt that the Crown has played a very significant role in funding the programs at the Home, every other aspect that the Tribunal would consider in determining who is the employer, points to the Township.
The decisions of the Tribunal to date have looked at a number of factors in determining who is the employer, and different panels have emphasized some factors over others. In this case, it does not matter which factors one emphasizes, because with the exception of providing the funding, the Township exercises significant control in all other areas. It exercises all the powers of a typical employer in hiring, setting wages and establishing terms and conditions of employment. The Township has a significant role in determining what programs will be provided, and it administers them in the manner it wishes. The Township has integrated the Chadwic Home's program, its administration and its staff to such an extent that they are indistinguishable from its other services and employees.
The Evidence and Analysis
Towards the end of 1983, a group of women called Herizons approached the Township's Council to see if they would be interested in supporting a Family Resource Centre. Herizons informed Council that the Ministry of Community and Social Services ("MCSS") was prepared to fund a Family Resource Centre in the Algoma region, but that a transfer agency was necessary, and that the Township could serve as the transfer agency. MCSS made a presentation to Council which outlined that MCSS would pay all capital and start up costs, then fund 80% of the operating budget, with the remaining 20% to be paid by the Township and other municipalities in the Algoma region. Council indicated its interest, and in May 1984, MCSS presented three possible models for operation. The Township chose to operate the Centre, which was named Chadwic Home, through a Board of Management ("the Board"). The Township Council appointed 2 councillors and 10 citizens, who had expressed an interest through advertisements placed by the Township, to the Board. Other spots on the Board were reserved for appointees from other municipalities in the catchment area, but practically, there was little participation from them.
Chadwic Home was built on Township land, for which the Township was paid by MCSS. The Township selected a building design, from choices offered by MCSS, and tendered the construction and furnishing of the building in accordance with the Township's tendering policies. Although MCSS provided all funds, Township Council approved all budgets and tenders, and design changes. Once the Home was built, the land and the building were turned over to the Township.
The Township and MCSS entered into agreements for the capital project and for operations. The operating agreement required the Township to provide a programme with two components: a safe residential environment for women and children in time of crisis, and a non‑residential counselling aspect to help women decide on a future course of action. The programme description in the operating agreement entailed about 5 paragraphs. The agreement called for 4 full‑time and 2 part‑time staff, whose duties were described in a general way. The agreement also set out the operating budget. The Township agreed to provide the program in accordance with MCSS policies; to permit entry and inspection of documents by MCSS staff and to provide regular financial and other reports. MCSS could terminate the agreement in the event that the Township was in default of any terms. The Township could also terminate the agreement.
The operating agreement was amended when new programs were added and when the annual budget was renegotiated or further staff were added. The agreements were drafted by MCSS after discussion with the Township, approved by MCSS and then approved by the Township Council.
The Board was established by Township Council by‑law. The by‑law required the Board to establish job descriptions, hire staff, establish admission criteria for clients, establish rules for staff and residents, provide community education on family violence, present a monthly report to Council on occupancy and operations and to prepare a work plan about how the Board planned to meet these objectives. The work plan was to be approved by Council. The Board met monthly and dealt with such matters as designing the budget, preparing job descriptions for staff, and recruiting the first supervisor and other staff. The Board kept minutes and the Township councillors regularly reported to the Township Council. The Board made recommendations to Township Council which were then debated by the Council. These issues included the hiring of the Home's Supervisor, establishing salary and benefits, and terms and conditions of employment. All purchasing and other administrative functions were overseen by the Township's administrative staff.
In late 1986, the Council asked Grant Southwell, the Township's Director of Leisure Services, to prepare a report on the functioning of the Board and Chadwic Home in general. Mr. Southwell's report indicated that Council was concerned that the Board was operating outside of the terms of reference in the by‑law and in a manner which was inconsistent with the general policies of the Township. Council had indicated that it would prefer to have administrative and operational issues handled at the Township. As a result of Mr. Southwell's report, Council disbanded the Board of Management put an Advisory Committee in its place, and placed Chadwic Home under the direction of Mr. Southwell. Chadwic Home was folded into the Department of Leisure Services, and the Supervisor started reporting directly to Mr. Southwell. This change was made without consultation with MCSS.
In his testimony, Mr. Southwell emphasised that since the Township was accountable to MCSS, as signatory to the agreements, it was critical that the Township appropriately manage Chadwic Home. Under Southwell's management, extensive efforts were made to bring Chadwic's operations into line with the practices and policies of the Township. There were a number of examples of this. Travel for Chadwic Home staff had to be approved by Council, even where approved funds existed in the budget. The Chadwic Home Supervisor was included in the Township by‑law that determined the terms and conditions of Township supervisory and management staff.
In 1988, Mr. Southwell and two Township Councillors formed a Negotiating Committee to meet with Chadwic Home staff to discuss implementing a collective agreement‑like document which would govern their terms and conditions of employment. Similar documents exist for other non‑union employees in the Township. The document, the Minutes of the Negotiating Committee and Mr. Southwell's evidence indicate that the goal was to integrate Chadwic Home staff into the Township and provide benefits and terms and conditions that were the same as other Township staff. The parties to the agreement are the Township and employees at Chadwic Home, and it is clear from the terms of the agreement that the Township is the employer. It exercises management rights, determines hours of work, determines the probationary period and determines vacation entitlement and entitlement to leaves. Of particular importance, the Township, through the agreement, determines into which classifications the staff of Residential Counsellors fall, based on education and experience. The classifications, in turn, determine the salary to be paid. This document was passed by Council and enacted as a by‑law.
The Township Negotiating Committee also recommended to Council that salary increases would be given to staff based on funding provided by MCSS. In no instance did Council implement salary increases in excess of the budget approved by MCSS and the Township, but on a couple of occasions, Council approved a salary that was less then what had been funded by MCSS, and on other occasions, delayed the payment of salary dollars for some time.
For example, in April 1987, MCSS made available funds to "top up" the salaries of Chadwic Home employees, because they were among the lowest paid in the Province. The Township was not required to match it with its own funds. However, the Council was slow in deciding whether to use the money, resulting in a letter from MCSS in August 1988, asking the Township to either use the money, or give it back so that it could be offered to someone else. Mr. Southwell testified, as did Judy Tucci, MCSS' Program Supervisor, responsible for Chadwic Home, that MCSS could not force the Township to use the money. Ultimately, Township Council passed a by‑law accepting the funds, and they were distributed to Chadwic Home employees.
In November 1988, Council approved a salary increase for the Supervisor that was less than what had been approved in the budget. MCSS had done a salary survey of wages paid to Family Resource Centre workers, which demonstrated that the Chadwic Home staff were lower paid than others. Although the survey was made available to Council, it appeared that Council was more interested in fitting the Supervisor into the Township's salary grid. In June 1989, the issue was raised again with Council by Mr. Southwell's successor, who indicated Ms. Tucci's concern that the funds had been provided for an increase, but the money had not been advanced. Council accepted the recommendation that the Supervisor's salary be adjusted.
This evidence of the Township's real control over the salary that was paid is particularly interesting at this time, because as of April 1, 1988, the entire Chadwic Home budget was supplied by MCSS. None of the money over which Council exercised control was its own.
The Township controlled the hiring process for all Chadwic staff. Advertisements and the recruitment process were handled by the Township. Recruitment of the Supervisor and other staff involved senior Township staff and Councillors. Offers were made by the Township, and all staff hirings were approved by Council. Similarly, all resignations, leaves of absence and salary increments of Chadwic Home staff were approved by Council.
Under cross‑examination, Mr. Southwell agreed that in all respects, the Township was the employer of the staff of Chadwic Home. He directly supervised the Supervisor, and he and his successor were involved in all disciplinary action of Chadwic Home staff. On one occasion, the Supervisor's disciplinary action was overruled by her Township Director.
It is difficult to convey in this decision the extent of the involvement of the Township in the administration of Chadwic Home. It is fair to say that the Supervisor and her staff were left to deliver the programme in the manner they thought best. However, in every other area, senior Township staff and Council, to a great extent, directly managed the administrative operations, and most important for our purposes, the compensation and the valuing of the work of the Chadwic Home staff. Chadwic Home was completely integrated into the Township, and operated as a department of the Township. Every conceivable issue, from approving attendance of Chadwic staff at a conference, to accepting a new program fully funded by MCSS, was the subject of lengthy memos from Township staff to Council, and lively debate among the Councillors.
The documents disclose that Mr. Southwell both supervised and advocated for Chadwic Home. He saw it as an important municipal service, meeting a real community need. He sought to educate Council about the service, and ensure that Chadwic Home was being administered in a manner consistent with other Township services. The Township clearly took its responsibility to provide the Family Resource Centre program quite seriously.
Although the Family Resource Centre was an initiative of MCSS, there was no legislative mandate to provide the service. There was also little in the way of guidelines or directions as to how the service would be provided. Surprisingly, there was little evidence of input by MCSS in how the program was delivered. We suspect that this could in large part be due to the regular reporting provided by the Township to MCSS, and by what was obviously very competent and thorough administrative management by the Township.
In terms of control over budget, the evidence indicated that MCSS provided the Township with the "economic adjustment factor" before budgets were drafted, and the Chadwic Home budget generally fell within that guideline. On only one occasion was the Township's requested budget not approved. On occasions when MCSS was prepared to offer money for a new program, or to top up salaries, it required the approval of Township Council before acceptance. And when Council was deliberating about whether to accept it, MCSS could do little more than urge Council to take the money.
We acknowledge that most of the money up to mid‑1988 and all of the money after April 1, 1988 was provided by MCSS. That is not an insignificant factor. However, the Township demonstrated that it enjoyed considerable independence in using it. Of course, it could not use the money for other things, but it exercised considerable discretion around whether and how to use it within Chadwic Home.
We also acknowledge that the program or service was initially established by MCSS. However, the limited program description in the operating agreement left the Township wide scope in how it delivered the program. The Township, either through Mr. Southwell, or in the early days, through the Board, decided what kind of staff to hire, what qualifications they would hold and what their job duties were. We heard little evidence about the actual programs delivered, but there is no doubt that it was the Chadwic Home staff and the Township, rather than MCSS, who decided how to deliver the programs.
Even where MCSS initiated new programs, the Township Council exercised considerable discretion. For example, in late 1986 or early 1987 Chadwic staff identified a need to have a child services worker, who could provide day care and other services for children who accompanied their mothers to the Home. MCSS was approached by the Board to fund the position, and in March 1987, MCSS indicated they were prepared to fund the position to a maximum salary of $18,000. In April 1987, Township Council approved the addition of a child care program, but only as a responsibility integrated into an existing staff position. The Chair of the Management Board wrote to the Township indicating the Board could not agree that the child services worker not be a separate position. Mr. Southwell asked the Supervisor to prepare a proposal for presentation to Council outlining the need for the service and the financial requirements. In December 1987, Mr. Southwell presented the proposal to Council, noting that they were the only Family Resource Centre in Ontario that had not accepted MCSS's 100% funding of a child services worker and enclosing a letter from Ms. Tucci indicating that they were in jeopardy of losing the funds if the matter was not resolved soon.
Mr. Southwell's evidence and Council Minutes indicated that Council was not so much concerned about the financial impact of the position (the Township would have had some costs to provide supplies and pay for travel), but were unconvinced of the need for the program. Ultimately, in early 1988, Council approved the additional program, and a child services worker was recruited by the Township.
The child care issue demonstrates that the Township had significant control over the programs at Chadwic Home, including those programs that were funded 100% by MCSS.
We have also considered that MCSS retained the power to "audit" Chadwic Home, both as to finances and operations, and could decide to cancel the agreement if the Township defaulted on any terms. We heard evidence that these powers were rarely exercised with respect to Chadwic Home, in large part, we suspect, because of the Township's stewardship and regular communications with MCSS. Although these powers did exist, our review of what really happened over the 6 to 8 year period we are examining, demonstrate that they did not amount to significant control, when measured against the day to day control exercised by the Township.
Decision
- We find that the Township is the employer of the employees working at Chadwic Home. We uphold the order of the Review Officer, dated March 18, 1993.