PAY EQUITY HEARINGS TRIBUNAL

0704-00 Ford Motor Company of Canada, Applicant

Before: Patricia E. DeGuire, Vice-Chair, Margaret Kvetan and Pauline R. Seville, Members

Appearances: Julie A. O’Donnell for Ford Motor Company of Canada

Cite as: Ford Motor Company of Canada (No. 3) (January 22, 2003), 0704-00 (P.E.H.T.)

DECISION OF THE TRIBUNAL, JANUARY 22, 2003

INTRODUCTION

1. Ford Motor Company of Canada (“Applicant”) brings this Application and asks the Tribunal to revoke a Review Officer’s Order dated February 7, 2000, (“Order”). The reasons for its request are that there were no “major” changed circumstances at its Windsor operation, so that the Applicant needs to amend the “original” 1990 non-bargaining unit pay equity plan for salaried employees (“Plan”); and that the Order lacks specificity.

Procedural Matters

2. Initially, a Group of Anonymous Non-union Employees, (“GANE”), through their Agent, David Deluzio, responded to the Application. In addition Milan Podhorsky, Autar Singh Sidhu and Darryl Lucier, who are or were employees at the Applicant’s Windsor establishment, responded as Affected Parties to the Notice of Application issued by the Tribunal. In their Responses they had asked the Tribunal to confirm the Order, and to direct the Applicant to amend and repost the pay equity plan and send it by registered mail, within forty-five (45) days of the Tribunal’s Order, to any employee or former employee who may be affected by it. GANE and Mr. Podhorsky, who adopted GANE’s Response, had requested that the Applicant pay costs.

3. Implicit from the Order, GANE had lodged a complaint to Review Services. They alleged that in September 1992, the Applicant had done “major restructuring” and built a new plant at its Windsor establishment. As a result, the “job classes” in the Plan “changed significantly”. In other words, they alleged that because of changed circumstances at the Windsor establishment, the Plan is no longer appropriate for the job class to which they belong. Messrs. Milan Podhorsky, Autar Singh Sidhu and Darryl Lucier did not participate in that complaint.

4. The Review Officer was “of the opinion”, that the Applicant had “failed to maintain pay equity in a timely manner and is in contravention of subsection 7(1)” of the Pay Equity Act R.S.O., 1990, c. P, as amended (“Act”). The Officer ordered the Applicant to “prepare and post an amended pay equity plan, within ninety (90) days of its February 1, 2000 order, to show any changes since November 1993, [consistent with sections] 13 and 15 of the Act.” The Applicant had said it had not received the original Order dated February 1, 2000. So, on June 1, 2000, the Officer sent a copy of the Order to the Applicant and directed it to comply with the Order within thirty (30) days.

5. After filing their Responses, and before the hearing on the merits had begun, Messrs. Lucier, Podhorsky and Sidhu withdrew their Responses to this Application. And, GANE’s agent asked the Tribunal for permission to withdraw its Response. The Tribunal granted permission to withdraw after it was satisfied that the appropriate steps had been taken to notify all parties who might have been affected by GANE’s withdrawal. So, the Applicant is the only party now in this matter.

6. At the hearing, the Tribunal reminded the Applicant that it was still required to establish a prima facie case, although it is the only party to the hearing. And, the standard civil test, on the balance of probabilities, would still apply.

ISSUES

7. The Applicant raises the following two issues: a matter concerning disclosure and production of particulars; and it asserts that it has not violated subsection 7 (1) of the Act. The Applicant asserts there was no changed circumstance at its Windsor establishment that requires it to amend the Plan retroactive to November 1993. Specifically, the Applicant asserts that there was no “major restructuring” at its Windsor establishment in 1992, so that the “job classes” indicated in the Plan, had “changed significantly”.

8. After carefully reviewing the Applicant’s pleadings, evidence and submissions, there is one issue before the Tribunal: Has the Applicant made out a prima facie case so that the Tribunal may confirm, revoke or vary the Order?

9. The Tribunal will not deal with the issue of costs because the Respondents have withdrawn from the hearing.

DECISION

10. The Tribunal dismisses this Application. Also, the Tribunal has concluded that it cannot exercise its authority to confirm, revoke or vary the Order because it is vague. The reasons are dealt with under the heading entitled “Analysis”.

SUMMARY OF EVIDENCE

11. At the hearing, the Applicant called one witness, Mr. Gary Lesperance. He has been the Supervisor of Organization and Personnel Planning, Human Resources since July 2001. His responsibilities include all salary-related administration for salaried employees at the Windsor establishment. Since he began working for Ford Canada in 1977, Mr. Lesperance has held different positions in Human Resources, abroad and in the Windsor establishment, including Labour Relations and Salary Administration. He became aware of this matter when he took over his current position. Below is a summary of his evidence.

12. When Mr. Lesperance began working for Ford Canada, three plants made up the Windsor operation: – one casting operation and two engine facilities, known as the Windsor Engine Plant I and II. The Applicant manufactured a five-litre V-8 engine at Plant II before closing it in 1990. When the Applicant closed Plant II, it outsourced the manufacturing of that product to Cleveland, Ohio. Around 1992, the Applicant demolished and began to rebuild Plant II. Over time, it reopened the finished sections until Plant II was completed in 1995.

13. On its completion, the Applicant renamed Plant II the Truck Modular Engine Plant (“Truck Plant”). Ford Canada manufactures the V-8 and V-10 engines for trucks there. Ford Canada closed Plant I and demolished it around 1996, because it no longer needed the product it had been manufacturing there. So, “in the broad sense,” the Applicant did undergo restructuring, but no other restructuring was done in 1992. Specifically, during the said period, there was “no downsizing, closing, major addition or major renovations to any of its facilities.”

14. Specifically, the Applicant did not terminate any employee; nor did it create any new job class between September 1992 and November 1993. The hourly and salaried employees, who worked at Plant II, were moved to other facilities. Salaried employees were relocated, primarily in the engine plants because of their expertise. Those who qualified were “allowed” to retire.

15. There were two changes in job class titles. The job class “Production Supervisor”, a “traditional” class in an engine plant, was renamed “Manufacturing Advisor”; and at the new plant, the “Superintendent” job class was renamed “Team Manager”. Neither the job content nor the salary level changed for either job class. The Panel asked the witness where one would find the new job titles in the Plan. He states that neither job class is listed in the Plan because both are “gender-neutral”; Ford Canada has not listed any gender-neutral job class in its pay equity plans.

16. “Traditionally”, Ford Canada uses the same job classifications for salaried employees “regardless of the product”, whether they work in the truck or car plant, or whether the “plant is in Windsor, Michigan, Ohio or Mexico.” The current job classifications for salaried employees have been used since 1977.

17. Since the 1940’s, Ford Canada has been using the same salary grade structure “in every country [in which] it operates” globally. Ford Motor Company, the parent company in the U.S.A. (“Ford”), determines the classification and the salary grade for each position for all the Applicant’s employees. It decides a salary grade based on “responsibility, complexity and content” of the position. There are eight grades for general salaried employees. Salary grades were reduced from eight to six. However, no employee is in salary grades one or two; so both pay equity plans begin at salary grade three.

18. Between September 1992 and November 1993, there was no change in any salary grade; but there were “merit increases”. A merit increase is based on the median salary for the same position of the Applicant’s major competitors and other leading companies in Canada.

19. The Panel asked the witness whether anything else changed when Ford Canada reduced the number of salary grades from eight to six. He said, “no.” The Panel asked why Ford Canada deemed it necessary to change the two job titles. He said the “team” management style had been tried in the U.S.A. and Ford Canada believed it “sounded better” to have salaried employees adopt that style. Also, it was in harmony with the “new family” concept of production. The team consisted of unionized employees. Non-bargaining unit salaried employees merely helped the team if necessary. He explained that the “new family” allows Ford Canada to build a variety of products. By contrast, the traditional engine plant built only one engine for one model.

20. Finally, the Panel asked the witness whether the Applicant was required to make any compensation adjustments to achieve pay equity. He said, “no.”

ANALYSIS

21. The Tribunal finds that the Applicant has not made out a prima facie case that there were no changed circumstances at its Windsor establishment between September 1992, and November 1993, which affected the Plan, or any job class so that it ought to amend the Plan.

22. Further, the Tribunal concludes that the Applicant made numerous changes at the Windsor establishment. Mr. Lesperance admits that the Applicant demolished Plants I and II; rebuilt Plant II; relocated employees to other facilities; renamed two job titles; and changed to a “team” management style at Plant II. Those changes constitute changed circumstances. The Tribunal looks sceptically at the Applicant’s evidence and submission that it underwent changes, but those changes did not affect any job class of the Plan.

23. The Tribunal is not convinced that those changes were done with such precision that there was no impact on the Plan in any way. The Applicant has not tendered any evidence, oral or documentary, about how it decided that those changes, individually or collectively, did not affect, at least any female job class or male comparator, for employees in the non-bargaining unit, so that the Plan is still appropriate. Indeed, it is not mandatory that an Applicant leads documentary evidence; but, more likely than not, in this case, such evidence would have helped the Tribunal to appreciate the steps the Applicant had undertaken to decide that none of the changes affected the Plan.

24. The Panel notes two ancillary phenomena about the Applicant’s pay equity practices. First, the Applicant states that it has gender-neutral job classes, female job classes and male job classes at its Windsor establishment. Yet, Mr. Lespearance testifies that it was not required to make any compensation adjustments at all to achieve pay equity.

25. The Plan that the Applicant posted in January 1, 1990, shows that the “Occupational Health Nurse” classification is a female job class, which had no male comparator and was “currently under review.” (Exhibit 4, p. 2). The Applicant amended the Plan as at April 1, 1990. In the amended plan, it lists several male comparators for “female dominated classifications” including the Occupational Health Nurse positions: (exhibit 5, p. 2). Attached to the amended plan, is an explanatory letter dated February 16, 1990, about the proposed amendment. The salient excerpts are re-produced below verbatim:

Subject: Occupational Health Nurses

Further to my memo dated January 10, 1990, this is to advise you that we have completed our analysis of the Occupational Health Nurse (070.307.44) and the Occupational Health Nurse Sr. (070.307.45).

These classifications should be re-graded SG5 and SG6 respectively. The position codes are 070.307.05 and 070.307.06 respectively. Affected employees should receive a promotional increase effective April 1, 1990 and the increase should be charged against your local merit funding.

Additionally, you should amend Attachment I to your Pay Equity Plan posted January 1, 1990 to include the Occupational Health Nurse with the other Female Dominated classification at the SG5 level and Occupational Health Nurse Sr. with the other Female Dominated classifications at the SG6 level. Insert the amended date in parenthesis after the original date on the Attachment, e.g. 22-Dec-89 (amended 20-Feb-90). (Exhibit 5, p. 3: emphasis in original).

26. These are indeed curious outcomes if the Tribunal were to accept the evidence that the Applicant was not required to make any compensation adjustments to achieve pay equity, and that the Applicant’s salary scheme has been the same for the last twenty-five years: long before the enactment of the Act. More specifically, if this was a pay equity compensation adjustment, why is it not effective from January 1, 1990? Why should the increase be classified as a “promotional increase”? And, why should the “promotional increase” be charged against the “local merit funding” because this is not a merit increase? At the very least, these observations raise suspicion that there is something inadequate with the Applicant’s pay equity practices.

27. Second, the witness states that Ford determines a salary grade based on three factors: “responsibility, complexity and content of the position.” Yet, the Plan and the amended plan indicate that the system the Applicant used in determining job value is a composite of the four statutory components, namely: skill, effort, responsibility and working conditions: (Exhibits 4 and 5).

28. The Act requires that for the purpose of pay equity, “the criterion to be applied in determining value of work shall be a composite of skill, effort and responsibility normally required in the performance of the work and the conditions under which it is normally performed.” (Subsection 5(1): emphasis added). The inconsistency between the oral and documentary evidence does incline the Tribunal to ask what are the real pay equity compensation practices at the Applicant’s establishments?

29. The Applicant failed to lead any oral or documentary evidence to show that none of those changes had an impact on, at least any female job class or male comparator, in the Plan before September 1992 and after November 1993, or in 1995, when it completely reopened Plant II.

30. The Tribunal pauses to comment on a third observation. In the Order, the Officer impugned the “original” Plan. However, the Applicant states in its evidence that it amended the Plan effective April 1, 1990 to deal with female job classes, namely the Occupational Health Nurse positions. While this may not actually affect the outcome of the Tribunal’s conclusion, it does raise the concern whether the Review Officer was made aware that the original pay equity plan posted January 1, 1990 had been amended effective April 1, 1990.

31. The Applicant’s counsel submits she tried, but failed, to obtain disclosure and production of particulars from the Officer and the Respondents to determine the specific nature of the allegations. Also, she sought to obtain disclosure and production of particulars by motion before the Tribunal, but there is no Respondent left in these proceedings.

32. In principle, disclosure and production of particulars would have met the obligation of allowing the Applicant to know precisely what case it had to meet. But in this case, Review Services’ and the Respondents’ failure to disclose and produce particulars hardly excites remedial sympathy for the Applicant’s self-perpetuated plight.

33. The Tribunal infers from the original allegation the group of anonymous employees made to Review Services that this was a complaint under paragraph 22(2)(b) of the Act. Indeed, the Order does not state specifically the precise nature of the contravention; it does not identify the job classes affected because of the “changed circumstances”; it does not state precisely how any job class has been affected. It merely states that the Officer is “…of the opinion …that the [Applicant] has failed to maintain pay equity in a timely manner and is in contravention of subsection 7(1) of the Act.”

34. The Applicant launched this Application under subsection 24(6) of the Act. The Applicant filed this Application after the Review Services had cautioned it that the matter would be referred to the Tribunal if the Applicant failed to comply with the Order within a specified time. In the Tribunal’s view, if the Applicant wished to convince the Tribunal that it diligently maintains compensation practices it would have adduced sufficient evidence.

35. It is a trite proposition that, as the party who initiated this Application, the Applicant bears the burden of proof and it must make out a prima facie case. As noted earlier, it has not discharged that onus. Further, as the Employer, the Applicant is in the best position to adduce evidence to show what occurred at its Windsor establishment between September 1992 and November 1993, and whether the changes had any impact on the Plan. It has not done so. The Tribunal is not convinced that the Applicant is in compliance with the Act.

36. For the reasons stated above, the Tribunal dismisses this Application. Yet, the Tribunal is not inclined to conclude that confirming the Order is the appropriate pay equity result in this matter. Nor does the decision to dismiss the Application result automatically in confirming the Order: that is not the inevitable result. The Tribunal does not have enough evidence to determine whether that would be the appropriate pay equity redress.

37. Despite the foregoing, without convincing evidence, the Tribunal is not inclined to conclude that those changed circumstances affected the Plan in such a way that it is no longer appropriate.

The Order

38. On one end of the spectrum, the Tribunal has concluded the Applicant has not established a prima facie case. Nor is the Tribunal convinced that the Applicant is in compliance with the Act, or that confirming the Order is the proper pay equity result. On the other end of the spectrum, the Tribunal finds that the Order is vague. Because it is vague, the Tribunal is unable to confirm, revoke or vary it.

39. In the Tribunal’s view, faced with a subsection 24(6) application, it is open to the Tribunal to scrutinize it in determining whether or how to exercise its power under paragraph 25(2)(d). In such an exercise, the Tribunal will consider the merits of the Application, the remedy sought, and the merits of the order. In so doing, the Tribunal must be satisfied that the Applicant has established a prima facie case; that the order is the correct pay equity result for the alleged contravention of the Act; and. that the impugned order is consistent with the purpose and the statutory scheme of the Act.

40. Support for the proposition that the Tribunal can scrutinize a Review Officer’s order in a subsection 24(6) application may be found, by necessary implication, by reading subsections 24(5.2) and 25(2) together, in juxtaposition with subsections 24(6) and 25(2).

41. Subsection 25(2) of the Act confers power on the Tribunal to decide the issue before it for a hearing, and without limiting the generality of that power, and directs the Tribunal to confirm, vary or revoke orders of review officers: (paragraph 25(2)(d) - emphasis added). By contrast, in a subsection 24(5) referral, the Act states, specifically, that the Tribunal shall not consider the merits of the order that is the subject of the reference: (subsection 24(5.2) – emphasis added). No such prescription is found about a subsection 24(6) application. In that type of application, the Tribunal is directed also to confirm, revoke or vary a review officer’s order.

42. In a subsection 24(6) application, the party seeking to confirm, revoke or vary an order must convince the Tribunal that confirming the order is the correct pay equity result. In exercising its power, the Tribunal vouches that the order has met its scrutiny; that it is consistent with the statutory scheme; and its conclusion is the correct pay equity result. It is the Tribunal’s decision or order that is enforceable by filing it with the Superior Court of Justice under section 19 of the Statutory Powers Procedure Act R.S.O. 1990, c. S.22.

43. In this case, a subsection 24(6) Application, the Tribunal is of the view that the authority conferred on it under paragraph 25(2)(d), allows it to scrutinize this Order in the hearing on the merits before it can sanction it.

44. With respect, in considering the Order, the Tribunal has some difficulty understanding exactly what it ought to enforce. It is helpful to reproduce the relevant parts of the Order below, verbatim:

ISSUE:

The sole issue in dispute is the Employer’s requirement to maintain pay equity in accordance with subsection 7(1) of the Pay Equity Act.

BACKGROUND

Ford Motor Company of Canada posted a job-to-job pay equity plan in 1990 as required of private sector employers with more than 500 employees. The plan covered all non-union employees employed in the Company’s Windsor Operations. In September 1992, the company underwent a major restructuring. In addition a new plant was built and in November 1993 employees moved in. Due to the restructuring the job classes reflected in the original 1990 plan had changed significantly: job class titles had changed, job class content had changed, and, new job classes were created. A group of employees filed a complaint with the Commission that because of the changed circumstances in the establishment the original plan was no longer appropriate for their job classes.

DISCUSSION AND ANALYSIS:

Subsection 7(1) of the Act requires that pay equity be maintained. Therefore, changes to job classes must be monitored for their pay equity implications.

Subsection 24(2.1) of the Act stipulates that if a review officer is of the opinion that because of changed circumstances a pay equity plan is no longer appropriate, the office may order the employer to amend the plan.

I was assigned Review Officer to investigate a complaint from a group of non-union employees regarding Ford Motor Company’s failure to maintain its non-union pay equity plan at the Windsor Operations. On June 19th, 1999 I met with Mr. Donald L. Wood, Site Manager, Human Resources and Bev Newransky, Human Resource Supervisor, at the Ford Motor Company offices in Windsor. At the meeting Mr. Wood provided me with a copy of the original pay equity plan prepared and posted in 1990. A further meeting was scheduled. Prior to the meeting I was contacted by a lawyer, Ms. Julie O’Donnell who informed me that she represented Ford Motor Company regarding the pay equity complaint. I had one meeting with Ms. O’Donnell and have had a number of telephone conversations with her, however, I have not obtained any firm commitment that the employer intends to amend the pay equity plan.

On December 22nd 1999, I sent a letter to Mr. Donald Wood with a copy to Ms. O’Donnell, requesting that Ford Motor Company conclude and post an amended pay equity plan by no later than 31st March, 2000. The plan would be retroactive to November 1993, which was the date that the employees allege all changes had been completed. I instructed Mr. Wood to let me know by January 23rd 2000, if Ford Motor Company intended to amend the plan. I have had no firm commitment from Ford Motor Company that an amended plan will be prepared and posted.

I am of the opinion, therefore, that the Employer has failed to maintain pay equity in a timely manner and is in contravention of subsection 7(1) of the Act.

ORDER

Pursuant to subsection 24(3) of the Act, I order Ford Motor Company to prepare and post an amended pay equity plan within 90 days, in accordance with subsections 13 and 15 of the Act, reflecting any changes since November, 1993.

Pursuant to subsection 24(3) of the Act, if the terms of this Order have not been met within 90 days of the date of this Order, I may refer this matter to the Pay Equity Hearings Tribunal for enforcement.

Dated this Seventh day of February, 2000, at the City of Toronto, Ontario.

45. Specifically, the Officer does not define the pay equity problem at the Windsor establishment. The Officer notes that there are changed circumstances. However, the Officer does not state precisely what the changed circumstances are or whether the “changed circumstances” resulted in any change to any job class. Even if one presumes, given the purpose of the Act, that “female” job classes or male job classes that were used as comparators were affected by the changed circumstances, the Officer does not state what “job class titles had changed” and how the change affected those job classes; specifically what “job class content had changed” and the affect on those job classes; nor identify the “new job classes [which] were created,” or why the Plan is no longer appropriate.

46. The Tribunal hastens to add that it has considered at length that this Application began as a case where the identity of some Respondents had to remain anonymous. Yet, the Tribunal is not convinced that to preserve the anonymity of a complainant, an order must be inevitably or necessarily vague. In the Tribunal’s view, the statutory authority to preserve the anonymity of a complainant ought to be used as a shield and not a sword. Thus, that power cannot be used to frustrate or tie the hand of the Tribunal in carrying out its statutory duties.

47. The Tribunal concludes that it does not compromise the anonymity of the Respondents, which at some juncture of a hearing may become a mere fiction, or the jurisdiction of a review officer by requiring a clear order. A decision that is clear and specific will enhance the Tribunal’s efforts to enforce it.

48. Certainly, because these are de novo hearings, the Tribunal derives help from a review officer’s order that is clear, especially where as here, there is only one party to the proceedings. As well, an order that is clear is helpful in the situation where the party or parties are unrepresented. In this case, a clearer order, more than likely, would have been helpful to the Tribunal in framing the issue, analysing the position of the Applicant and deciding whether to confirm, to revoke or vary the Order is the proper pay equity result. Further, because the Order is vague, while it has been subjected to the Tribunal’s scrutiny, it cannot be said to have met the Tribunal’s scrutiny.

49. Therefore, the Tribunal concludes that absent the key touchstones mentioned above, it is unable to confirm, revoke or vary this Order.

CONCLUSION

50. The Tribunal concludes that to revoke the Order would be the inappropriate pay equity result in this matter. The Applicant has failed to establish a prima facie case. It failed to convince the Tribunal that it is in compliance with the Act. As the Applicant, Ford Canada was in the best position to establish that the changed circumstances did not constitute such change to affect any job class so that the Plan is inappropriate for the non-bargaining unit employees.

51. In addition, the Tribunal concludes that to confirm, revoke or vary the Order would not be the proper result in this matter because the Order is vague. However, the Tribunal is hopeful that Ford Canada, as a large employer, who no doubt takes it social responsibility seriously, would comply with the Act. Specifically, the Tribunal is hopeful that Ford Canada would establish and maintain compensation practices that provide for pay equity in all of its establishments in Ontario.

Dated at Toronto this 22nd day of January 2003.

Patricia E. DeGuire, Vice-Chair

Margaret Kvetan, Member

Pauline R. Seville, Member