Maitland Manor Health Care Centre v. Mattuci, 2015 CanLII 67576

Pay Equity Hearings Tribunal

PEHT Case No: 2783-09-PE

Maitland Manor Health Care Centre, Applicant v Rick Mattuci, Lori Stephens, Denise Lockie, Natalie Miltenburg, Amanda Beddow, Becky Jarvis, Angela Leggatt, Beth Sorensen, Crystal Agombar, Karen Eckenswiller and Joan McDougall, Respondents v Pay Equity Office, Intervenor

Before: Patrick Kelly, Alternate Chair, Ann Burke and Carol Phillips, Members

Decision of the Tribunal: October 19, 2015

1This is an application under the Pay Equity Act, R.S.O. 1990, c. P.7 as amended (“the Act”).

2The applicant, Maitland Manor, takes issue with an Order issued by a Review Officer on November 12, 2009 (“the Order”), in which the Review Officer concluded that the applicant’s non-union proxy pay equity plan (“the non-union PPEP”) failed to comply with the Act. The applicant contends that the non-union PPEP complied with the Act. Furthermore, the applicant says that the delay by which the anonymous employee complained about the non-union PPEP, as well as the delay occasioned in the processing of the complaint after it was received by the Pay Equity Commission, should lead to one of two remedies which will be described below.

3This application has taken a few twists and turns. A Pre-Hearing Conference took place on April 26, 2010 in which the applicant, its counsel, and two respondent employees - Rick Matucci and Lori Stephens - participated. The participating parties agreed on a framework for the exchange of lists of documents and they agreed that the hearing into the application should be scheduled in September 2010.

4The matter came on for hearing before the Tribunal on September 9, 2010. Only the applicant and its counsel attended the hearing. The applicant made a motion on that date to revoke the Order and to obtain a permanent stay of the 2004 complaint of the anonymous employee to the Pay Equity Commission¹. The Board heard oral evidence in support of that motion, and reserved its decision. On October 12, 2010, before the Tribunal issued a written decision, the Pay Equity Office (“the PEO”) sought standing as an intervenor in the proceeding. Maitland Manor strongly opposed the PEO’s request. The Tribunal considered the written submissions of the applicant and the PEO, and on November 5, 2010 rendered a decision granting the PEO status to intervene.

5In its intervention, the PEO sought to strike certain portions of the application dealing with the allegations of delay/abuse of process aimed at Review Services. The PEO also sought the preliminary dismissal of the application on the basis that it failed to disclose a prima facie case for the relief requested. The Tribunal heard oral submissions over the course of two days (October 24, 2011 and April 12, 2012), and considered further written submissions of the PEO after the last day of hearing. The Tribunal issued a decision dated August 29, 2012 declining the PEO’s motions.

6A number of dates were scheduled in 2013 for the purpose of discussing settlement and, when that proved elusive, for case management of the hearing on the merits. Ultimately, no settlement involving the respondent employees was reached, but eventually - after a rather protracted period of time - the applicant and the PEO reached an agreement on their own that resulted in the narrowing of the issues raised by the application, as well as the PEO’s withdrawal from the case. Essentially, the applicant (on a without prejudice basis) and the PEO agreed on a new non-union proxy pay equity plan (“the new PPEP”) which both parties contend complies with the Act. The applicant is not bound to the new PPEP, but it will post the new PPEP if, after hearing the submissions of the applicant and any responding party who wishes to participate, the Tribunal determines that the applicant is entitled to treat all non-union wage adjustments that have been granted by the applicant to the non-union employees since 2005 as pay equity adjustments under the new PPEP. In the alternative, the applicant and the PEO agreed that the applicant could petition the Tribunal for a revocation of the Order and a permanent stay of the proceedings before the Pay Equity Commission.

7The case came back on for hearing on August 25, 2015 for the purpose of dealing with the applicant’s position regarding the treatment of post-2005 wage increases, and its alternative position that the Order should be rescinded. The respondent employees were given ample advanced notice of the subject matter of the hearing on August 25, 2015 and they were provided with all of the written materials upon which the applicant relied, including a factum setting out the applicant’s legal argument, a copy of the new PPEP, and affidavits of the applicant’s key witness, Bob Bass. Three respondent employees – Lori Stephens, Amanda Beddow and Gail McDougal – filed written submissions with the Board. Ms. Stephens and Ms. Beddow filed a joint submission which essentially argues that the new PPEP does not comply with the Act. Ms. McDougal’s submissions, authored by her representative, Stephen Huff, support the Order and also assert that Ms. McDougal’s job class under the new PPEP is undervalued and should be paid a higher rate of pay.

8On August 25, 2015 only the applicant, its counsel and Mr. Huff were present at the hearing.² At the outset of the hearing, we gave Mr. Huff an opportunity to cross-examine Mr. Bass on his affidavits, and Mr. Huff did so. No other witness aside from Mr. Bass testified. In setting out the facts below, we have taken into account Mr. Bass’s oral testimony as well as the contents of his affidavits.

9Maitland Manor is a licensed long-term care home. It is a public sector employer within the meaning of the Act. The respondent employees are current and former non-union employees of the applicant.

10By order dated June 30, 1995, the Pay Equity Commission determined that the applicant was a “seeking employer” under the Act, and as such, Maitland Manor was required to post pay equity plans for its union and non-union employees using the proxy method of comparison. Proxy pay equity plans were developed by the applicant in 1995 first for its union employees, followed by a non-union PPEP for the non-union employees. The non-union PPEP was modelled on the PPEPs for the union employees, which resulted in a $1.50 per hour pay equity adjustment in the wages of all the employees in the period between 1994 and 2004.

11Although it has been suggested over the course of this proceeding by some of the respondent employees, including Ms. McDougal, that they were unaware of any non-union PPEP being posted in the workplace, the uncontradicted evidence adduced by the applicant at the hearing on August 25, 2015 is that the non-union PPEP was posted in the workplace on October 16, 1995. We so find. On November 8, 1995, Maitland Manor notified the Pay Equity Commission in writing that it had posted its PPEPs.

12None of the non-union employees submitted comments to Maitland Manor concerning the PPEP that applied to them within the 90-day period prescribed by subsection 21.21(2) of the Act. Accordingly, within seven days following the 90-day review period contemplated by subsection 21.21(2), the applicant posted a notice pursuant to subsections 15(6) and 21.21(3) of the Act to advise that the non-union PPEP as posted on October 16, 1995 had not been amended.

13No non-union employee filed any objection to the PPEP with the Pay Equity Commission within the 30-day period prescribed by subsections 15(7) and 21.21(3) of the Act.

14Having received no comments or objections with respect to the non-union PPEP, the applicant implemented the pay equity wage adjustments under the PPEP over the next ten years, until they were paid out in full.

15On March 11, 2004 the Pay Equity Commission opened a file concerning a complaint received from an anonymous non-union employee of Maitland Manor. Just over two years later, on March 28, 2006, Review Officer Diane Parson (“Ms. Parson”) contacted Maitland Manor to request documents regarding its PPEPs, but did not reveal the existence of the anonymous employee complaint. The applicant provided the requested documents, and after reviewing them, Ms. Parson contacted the applicant on June 14, 2006 to raise concern about the non-union PPEP.

16On August 21, 2006, Ms. Parson communicated her view to the applicant that the non-union PPEP did not comply with the Act, and requested revisions to bring it in compliance with the Act. The applicant developed an amended non-union PPEP, provided it to Ms. Parson, and posted it in the workplace on August 25, 2006. No employee made any comments or objections to the amended PPEP.

17Carriage of the Pay Equity Commission’s file on the anonymous employee’s complaint was transferred from Ms. Parson to Review Officer Tiziana Isgro (“Ms. Isgro”) on or about January 2, 2008. On March 26, 2008, Ms. Isgro advised the applicant that neither the non-union PPEP nor the amended PPEP complied with the Act. Over the span of the next six months, Ms. Isgro and Mr. Bass, on behalf of the applicant, engaged in a series of communications concerning the non-union PPEP and its compliance or lack of compliance with the Act. In November 2008, Mr. Bass requested a final decision from Ms. Isgro. On November 12, 2009, a year later, Ms. Isgro issued the Order. Maitland Manor filed its application with the Tribunal on December 14, 2009.

18Maitland Manor’s position is that, given the excessive delay by the Anonymous Employee and the PEO, and the resulting substantial and irreparable prejudice to Maitland Manor (as outlined below), it should be permitted the opportunity to mitigate any potential pay equity liability by having the Tribunal grant an order allowing it to retroactively characterize the lowest wage increase in the job classifications for the non-union employees from 2005 onward as pay equity adjustments. In the alternative, the applicant seeks recission of the Order and a permanent stay of proceeding.

19Maitland Manor and the PEO are in agreement that if the Tribunal varies the Order by permitting Maitland Manor to retroactively characterize wage increases provided to the non-union employees from 2005 onward as pay equity adjustments, Maitland Manor will post the Draft Plan.

20If the Tribunal is not inclined to grant an order permitting Maitland Manor to retroactively characterize wage increases provided to the non-union employees since 2005 as pay equity adjustments, Maitland Manor will face a greater pay equity liability to the non-union employees. Therefore, in the alternative, Maitland Manor requests that the Order of Review Officer Isgro be revoked and the proceedings before the Commission be permanently stayed. The withdrawal by the PEO effectively means that it does not oppose the alternative remedy.

21In support of its position, the applicant referred us to the following authorities: Cheryl Elliott, Ontario’s Equity Laws, Vol. 1 (Toronto: Thomson Reuters, 2013); Blencoe v. British Columbia (Human Rights Commission), [2000] 2. S.C.R. 307 (QL); Brampton (City) v. Professional Firefighters Association, [1994] O.P.E.D. No. 35 (Pay Equity Tribunal); Cozzi v. Cordeiro, [2009] O.J. No. 3914 (Div. Ct.)(QL); Hurst v. Société Nationale de L’Amiante, [2008] O.J. No. 4857 (C.A.)(QL); McNeil v. Kirkland Lake (Town), [2002] O.P.E.D. No. 20 (QL); Ontario Nurses Assoication v. Lady Dunn General Hospital, [1991] O.P.E.D. No. 69; Queensway Nursing Home v. Group of Confidential Employees 2010 CanLII 56873 (ON PEHT), request for reconsideration denied [2010] O.P.E.D. No. 34; Ratzlaff v. British Columbia (Medical Services Commission), 1996 CanLII 616 (BC CA), [1996] B.C.J. No. 36 (C.A.)(QL); Regional Nursing Services v. Magno, [2015] O.P.E.D. No. 8 (QL); Toronto (City) v. C.U.P.E., Local 79, 2003 SCC 63, [2003] 3 S.C.R. 77 (QL); Warren v. Criminal Injuries Compensation Board, [2005] O.J. No. 5205 (Div. Ct.)(QL); and Windibank v. Windsor (City), [2008] O.P.E.D. No. 2 (QL).

22Mr. Huff, on behalf of Ms. McDougal, took the position that, as of August 21, 2006, when Ms. Isgro informed the applicant that the non-union PPEP did not comply with the Act, Maitland Manner should have taken steps to secure all past pay records of the non-union employees. Furthermore, Mr. Huff submitted that part of the delay in 2008 (from April 16 until October 6) was due to the time Mr. Bass took to review Ms. Isgro’s opinion that the non-union PPEP did not comply with the Act. Moreover, regardless of who bears the responsibility for the delay, the non-union employees should not as a result lose any entitlements under the Act. Finally, Mr. Huff submitted that, as of the date of the application – December 14, 2009 – Maitland Manor had an opportunity while this proceeding unfolded to establish a monetary reserve to cover any pay equity liability that it might incur ultimately. Therefore, the Tribunal should reject the applicant’s request to treat post-2005 wage increases as pay equity adjustments under the new PPEP. In Mr. Huff’s submission, Ms. McDougal’s pay equity adjustments, either under the non-union PPEP or the new PPEP, should be made retroactive to 1994.

23Mr. Huff did not refer us to any authorities in support of Ms. McDougall’s position, nor did he make any submissions concerning the authorities cited by the applicant.

24The issues raised for determination in this decision are:

(a) Has there been unreasonable and inordinate delay in this case resulting in substantial and irreparable prejudice to Maitland Manor, amounting to an abuse of process?

(b) Has there been unreasonable and inordinate delay in this case which would bring Ontario's pay equity system into disrepute? and

(c) What is the appropriate remedy in this case?

25The statutory provisions relevant to the determination of the above three issues are subsection 23(1) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S22 (“the SPPA”) and subsection 25(2)(d) and (g) of the Act. Subsection 23(1) of the SPPA reads:

23. (1) A tribunal may make such orders or give such directions in proceedings before it as it considers proper to prevent abuse of its processes.

26Subsections 25(2)(d) and (g) of the Act read:

25. (2) The Hearings Tribunal shall decide the issue that is before it for a hearing and, without restricting the generality of the foregoing, the Hearings Tribunal,

(d) may confirm, vary or revoke orders of review officers

(g) may order a party to a proceeding to take such action or refrain from such action as in the opinion of the Hearings Tribunal is required in the circumstances

27Clearly, subsection 23(1) of the SPPA confers upon the Tribunal the power to make orders or give such directions as it considers proper in order to prevent an abuse of the Tribunal’s processes. The doctrine of abuse of process includes unwarranted delay. The Supreme Court of Canada has stated that an unacceptable administrative delay may amount to an abuse of process when significant prejudice results to a party, even where the fairness of the hearing may not be compromised.³ Whether a delay amounts to an abuse of process depends on contextual factors, such as the nature of the case and its complexity, the facts and issues in dispute, the purpose and nature of the proceedings, whether the party asserting delay contributed to the delay, and the various rights at stake in the proceedings.⁴ We turn to these factors below.

28First, with regard to the nature of the case and its complexity, the PEA clearly sets out a specific 90-day review period for employees to comment on an employer's pay equity plan, and a further 30-day objection period for employees to make objections regarding the pay equity plan to the Pay Equity Commission. The process for employees to make timely complaints about a pay equity plan is not complicated. In addition, the issue raised by the Complaint (i.e. whether the 1995 Non-Union Plan was compliant with the PEA) was not a matter of such complexity as to justify a further 5-year delay in issuing the Order. Indeed, as the Tribunal noted in the Queensway Nursing Home, the $1.50 plan upon which the appliclant’s non-union PPEP was based was used in numerous nursing homes throughout Ontario and was well known to the Pay Equity Office and its Review Officers. There was simply no satisfactory reason advanced in this proceeding to explain any of the approximately 14-year delay.

29The applicant has not contributed meaningfully to the delay in this case. When information and documentation was requested of Maitland Manor by the PEO, the applicant provided it in a timely fashion. Mr. Huff submitted that the applicant contributed to the delay in 2006 by taking six months to reflect upon and review Ms. Isgro’s opinion that the non-union PPEP failed to comply with the Act. In our view, this was not unreasonable. In any event, to the extent it constitutes a contributory delay, it was a disproportionately small fraction of the overall delay by the PEO in issuing the Order.

30We are satisfied that the rights of Maitland Manor have been considerably and irreparably prejudiced as a result of the unexplained delay in this case. The significant prejudice to Maitland Manor includes the following:

• Firstly, given that timely comments and/or objections to the 1995 Non-Union Plan were not made by any of its employees within the periods prescribed by the Act, it would have been reasonable to conclude that (and to conduct one’s business affairs as if) the non-union PPEP was valid and deemed approved. As a result, over the next ten years, Maitland Manor completed pay equity wage adjustments based on the non-union PPEP. If the non-union employees had commented on or objected to the non-union PPEP within the prescribed periods, Maitland Manor could have amended that Plan as necessary at the time and recast the general minimum wage increases paid to these employees from 1994 to 2004 as pay equity adjustments to be phased-in on an annual basis until pay equity was achieved. Instead, years later, Maitland Manor faces a potentially substantial financial liability if it is required to make retroactive pay equity adjustments and pay interest on these amounts.

• Furthermore, due to the considerable delay in this case, Maitland Manor no longer has the payroll records which would allow it to retrieve complete data with respect to the wage increases paid to the non-union employees from 1994 to 2004. Therefore, the applicant is unable to request that the Tribunal permit it to retroactively characterize the wage increases during this period as pay equity adjustments – again resulting in substantial and irreparable prejudice to it.

• In addition, Maitland Manor has given wage increases to the non-union employees since 2005 which it could have characterized as pay equity adjustments had it been informed of the anonymous complaint and the PEO's position in that regard in a timely manner. In particular, Maitland Manor could have characterized the lowest wage increase in the job classifications for each year as pay equity adjustments. With timely disclosure of the anonymous complaint, the applicant could have mitigated nearly all of its potential liability by characterizing these wage increases as pay equity adjustments.

• Alternatively, rather than providing differential wage increases to the non-union employees, Maitland Manor could have deferred wage increases and paid the employees only the minimum pay equity adjustment based on one percent of the previous year’s payroll pursuant to the non-union PPEP until the applicant’s potential liability was determined. With the knowledge of a potential pay equity liability, Maitland Manor could have used its wage adjustment reserve (built from having deferred wage increases) to pay any wage gap determined by the Tribunal in order to achieve pay equity.

31As we have indicated, Mr. Huff argued that, once the applicant learned of Ms. Parson’s concern about the non-union PPEP on June 14, 2006, it ought to have taken immediate steps to secure employee pay records and consider establishing a monetary reserve. This overlooks the fact that, by this stage, approximately 11 years had passed since the posting of the non-union PPEP under which all pay equity adjustments (supplemented by other wage increases) had been paid out. In the absence of any known employee objection to the non-union PPEP for eleven years, the applicant would not have been put on notice to secure its pay records for the entirety of that period. Furthermore, there is no express provision of the Act stipulating a minimum record retention period.

32Abuse of process arising from delay will be found not only in cases where the delay is found to be prejudicial, but as well in instances where the dispute resolution system itself would suffer disrepute. There is a strong public interest in promoting the timely and final resolution of pay equity disputes. The workplace parties are entitled to have their disputes resolved without undue delay. Delay multiplies costs and causes unfairness and frustration. Although the Act itself does not impose any particular time frame for the referral of an application to the Tribunal, it does require employees to raise concerns about posted pay equity plans in a timely fashion. If the Tribunal allows the anonymous employee’s complaint to proceed in this case, there is a real risk that other complainants will feel emboldened to raise objections long after a pay equity plan has been “deemed approved”. The Tribunal should discourage the raising of such ghosts from the past.

33The issues at play in this matter were considered by this Tribunal in a decision a few years ago that bears a striking resemblance to the facts before us: Queensway Nursing Home, supra In Queensway, the employer, like the applicant, was a licensed nursing home. Like the applicant, the employer posted a non-union proxy pay equity plan in 1995 that was modelled on the unionized pay equity plan, resulting in the same $1.50 per hour pay equity adjustment that was implemented incrementally over the same ten-year period as in the case before us. No employees of that employer raised any objection within the statutory limits under the Act, and thus the non-union pay equity plan was “deemed approved”. The Pay Equity Commission received an anonymous complaint in 2003; the existence of the complaint was not brought to the attention of the employer until a year later (after all the pay equity adjustments had been paid out under the impugned proxy pay equity plan), and the order of the Review Officer finding that the proxy pay equity plan was not in compliance with the Act followed four years later, in 2008. The total delay in Queensway was 13 years. The total delay in this case is approximately 14 years.

34The employer in Queensway advanced a number of reasons why the Tribunal should revoke the Review Officer’s order, including abuse of process occasioned by unreasonable delay. The hearing panel reviewed the factors set out (and described above) in the Blencoe decision of the Supreme Court of Canada, supra, and agreed with the employer that the delay not only compromised the employer’s right to a fair hearing but amounted to an abuse of process, “contrary to the conduct of a fair and efficient legal system” (¶ 56). Accordingly, the Tribunal revoked the Review Officer’s order.

35There is very little to distinguish the instant matter from the facts in Queensway. Although the Tribunal is not bound to follow its own decisions, no party has advanced any reason why we should not adopt the analysis in the Queensway decision.

36Accordingly, we find that an unexplained delay of fourteen years between the posting of the non-union PPEP and Ms. Isgro’s Order is seriously prejudicial to the applicant, and tends to bring the system of pay equity into disrepute, thus amounting to an abuse of process.

37This brings us to the issue of remedy. The Blencoe decision makes clear that the remedy for delay that amounts to an abuse of process is not necessarily a stay of proceeding. In this case, the applicant’s preferred remedy is that it be permitted to treat wage increases since 2005 as pay equity adjustments under the new PPEP. In such a scenario, Maitland Manor would be very close to achieving pay equity in accordance with a pay equity plan that it and the PEO believe complies with the Act.

38At first blush, the applicant’s preferred remedy is attractive on a practical level. The new PPEP would replace the 1995 plan that, on its face, does not appear to meet the technical requirements of the Act’s provisions dealing with the proxy method of comparison. Moreover, the new PPEP stands to provide some employees with further pay equity adjustments, over and above those already provided under the 1995 plan, while minimizing the prejudice to the applicant caused by the excessive delay.

39On the other hand, there is nothing preventing the applicant from implementing the new PPEP and characterizing all post-2005 wage increases as pay equity increases. Of course, such an approach, if implemented, may be subject to a legal challenge. That is what the applicant is trying to avoid here, by obtaining the Tribunal’s support for its proposal. In our view, the Tribunal should be very cautious when asked to issue its imprimatur in such circumstances. It is not the role of the Tribunal to insulate parties from the legal consequences of their proposed actions. We are satisfied that the circumstances of this case do not warrant such an extraordinary remedy, assuming we have the jurisdiction to grant it.

40Nor are we persuaded on the basis of the applicant’s argument that we can, or should, stay the proceeding (i.e., the complaint of the anonymous employee) before the Pay Equity Commission. It is not apparent to us that we can stay any proceeding other than a proceeding before the Tribunal. Subsection 23(1) of the SPPA permits the Tribunal to take appropriate measures to prevent abuse of its process. It does not expressly grant the Tribunal the power to prevent abuse of the process of other administrative entities. In any event, what remains of the anonymous employee’s complaint to the Pay Equity Commission that requires a stay? The complaint was processed and finally dealt with through the issue of a Review Officer’s order. The Order marked the end of the process before the Pay Equity Commission and the Pay Equity Office. A stay, in our view, would serve no purpose.

41Accordingly, the appropriate remedy in this matter is the rescission of the Order, and we so order.

Dated at Toronto, Ontario this 19th day of October, 2015.

"Patrick Kelly" Patrick Kelly, Alternate Chair

"Ann Burke" Ann Burke, Member

"Carol Phillips" Carol Phillips, Member

Footnotes

1. 1The applicant gave notice on or about September 3, 2010 to the respondent employees of its intention to argue the motion on September 9, 2010.
2. 2Ms. Stephens and Ms. Beddow advised the Tribunal on August 21, 2015 that, for different reasons, they were not able to attend the hearing. Neither of them requested an adjournment.
3. 3Blencoe v. British Columbia (Human Rights Commission), supra, at ¶ 115.
4. 4Ibid., at ¶122