OPSEU/SEFPO v. Canadian Blood Services, 2023 CanLII 93702

PAY EQUITY HEARINGS TRIBUNAL

PEHT Case No: 2721-22-PE

OPSEU/SEFPO, Applicant v Canadian Blood Services, Respondent

BEFORE: M. David Ross, Chair, Stephen Roth and Patricia Greenside, Members

DECISION OF THE TRIBUNAL: September 11, 2023

1. This is an application under the Pay Equity Act, R.S.O. 1990, c.P.7, as amended (“the Act”). This application was filed on March 10, 2023.

2. The dispute in this application involves the interpretation of Article H of the parties’ Minutes of Settlement dated January 19, 2010. Article H states:

H. Pay Equity Maintenance

18. Both parties acknowledge the obligation to ensure that pay equity is maintained for the bargaining units.

19. When a new position is created, or there has been significant change to a position, either the Union or the Employer shall advise the other party in writing and the parties will agree to meet to seek to resolve such issues in a timely way.

20. The only issue raised in the application is contained at paragraph 34 of Schedule A to the application:

The only issue before the Tribunal is whether the Employer must fulfill its obligation to the Union to perform joint maintenance in accordance with Articles H.18 and H.19 of the 2010 MOS.

4. It is important to note that this application does not include an allegation that pay equity has not been maintained by the employer, nor does it contain specific allegations that the respondent has violated Article H.

5. The applicant submits that Article H of the Minutes of Settlement obligates the respondent to complete pay equity maintenance jointly. The respondent disagrees and submits that this language does not obligate it to negotiate pay equity maintenance with the union.

6. By decision dated May 26, 2023, the Tribunal directed the parties to make written submissions pursuant to Rule 69 of the Tribunal’s Rules of Practice on whether the language of Article H constituted an agreement between the parties to negotiate pay equity maintenance.

7. In the May 26, 2023 decision, the Tribunal explained that the Court has confirmed that a bargaining agent does not have a statutory right to negotiate pay equity maintenance in 10 Community Care Access Centres, 2021 ONSC 5348; and also that it is well established in the Tribunal’s jurisprudence that if an employer and a union enter into an agreement to negotiate pay equity maintenance, such an agreement will be upheld by the Tribunal and the statutory obligation to negotiate in good faith applies to those negotiations. These principles were not challenged in the parties’ submissions.

Summary of the Parties’ Submissions

8. The applicant submitted that the language of Article H contains a latent or patent ambiguity and therefore, extrinsic evidence is needed to provide context to the interpretation of Article H. The applicant submitted that the “only possible meaning” that can be given to Article H is that it obliges the parties to negotiate pay equity maintenance.

9. The applicant filed three declarations on behalf of individuals who declared that they understood that the parties agreed to negotiate pay equity maintenance when the Minutes were signed.

10. The applicant submitted that the language of Article H is patently ambiguous because: the text does not refer to pay equity maintenance; the language of Article H.19 is wholly unclear; and there is no clear intended meaning of Article H.18.

11. In the alternative, the applicant submits that there is a latent ambiguity because pay equity is a highly technical and variable process.

12. The applicant relied on the following cases in support of its position: Labourers’ International Union of North America, Local 1059 v. Hydro One Inc., 2011 CanLII 35854 (ON LRB); Jovalco Group Corporation, 2013 CanLII 16825 (ON LRB); Sattva Capital Corp. v. Creston Molly Corp., 2014 SCC 53; Ontario English Catholic Teachers’ Association v. Ontario Catholic School Trustees’ Association, 2022 CanLII 24927 (ON LA); Ontario Power Generation, 2013 CanLII 87655 (ON LA); Hi-Tech Group Inc., 2001 CanLII 24049 (ON CA); Corporation of the City of London, 2013 52299 (ON PEHT); Au Chateau Home for the Aged, 2013 CanLII 67138 (ON PEHT); Ottawa Public Library Board, 2015 CanLII 6950 (ON PEHT); Notre Dame of St. Agatha (Township) v. Tucker, 2001 CanLII 28099 (ON PEHT); Thunder Bay (City), 2004 CanLII 60158 (ON PEHT); Revera LTC (Blenheim Community Village), 2011 CanLII 43568 (ON PEHT); Bhasin v. Hrynew, 2014 SCC 71; C.M. Collow Inc. v. Zollinger, 2020 SCC 45; 10 Community Care Access Centres, 2021 ONSC 5348; Canadian Broadcasting Corporation, [1997] C.L.A.D. No. 554; Re: Burrard Yarrows Corporation, Vancouver Division, [1981] B.C.C.A.A.A. No. 20; Toronto (City), 2021 O.L.A.A. No. 457; and Bluewater Health, 2023 CanLII 54283 (ON PEHT).

13. The respondent submitted that the language of Article H is clear and unambiguous, and in the absence of an ambiguity, extrinsic evidence is not generally admissible and cannot be used to overwhelm the wording of the parties’ agreement. Both parties relied on the excerpts pertaining to extrinsic evidence from Brown and Beatty.

14. The respondent submitted that Article H.18 is an acknowledgement about the obligation to maintain pay equity, which is the employer’s obligation, and Article H.19 establishes a process in which the parties meet when a new job class is created or substantially changed.

15. The respondent submitted that the Minutes of Settlement do not contain the word “negotiate” and that if the parties intended to negotiate pay equity, they could have agreed to wording to that effect. The respondent pointed to other instances where they explicitly used the term “negotiate” in the Minutes.

16. The respondent filed its own declarations in support of its position that it did not agree to negotiate pay equity maintenance with the applicant in Article H.

17. In reply, the applicant submitted that the language of Article H.19 obliges the employer to “meet and jointly negotiate with the Union” even though the language of Article H does not contain the word “negotiate”.

What is this Case About?

18. There is no allegation that pay equity has not been maintained, and there is no allegation particularized that the respondent has refused to meet and discuss issues relating to new and changed positions as agreed in Article H.19. So, what is this case about?

19. At its core, this case is about what language is necessary to be included in an agreement for the Tribunal to confirm that a bargaining agent and employer have agreed to negotiate pay equity maintenance jointly. If an employer has agreed to negotiate pay equity maintenance with its bargaining agent, then it is restricted on taking unilateral steps to ensure pay equity is maintained and must negotiate those steps with the bargaining agent.

20. For the reasons set out below, the Tribunal finds that Article H of the Minutes does not constitute an agreement by the respondent to negotiate pay equity maintenance or otherwise perform pay equity maintenance jointly with the applicant.

The Statutory Framework and Process Regarding Pay Equity Maintenance

21. It is well established that section 7 of the Act places the obligation to maintain pay equity solely with the employer:

Every employer shall establish and maintain compensation practices that provide for pay equity in every establishment of the employer.

22. This is consistent with subsections 2(3) and 8(5) of the Act, which also place the obligation to maintain pay equity solely on the employer. These subsections state:

2(3) Despite the fact that the employees of two or more employers are considered to be one establishment under subsection (1) or (2), each employer is responsible for implementing and maintaining the pay equity plan with respect to the employer’s employees

8(5) The requirement that an employer maintain pay equity for a female job class is subject to such limitations as may be prescribed in the regulations.

23. It is also well established that the Act provides no direction to employers about how pay equity is to be maintained.

24. The language above can be juxtaposed against other subsections of the Act which expressly require employers to negotiate pay equity obligations with their bargaining unit(s). One of these instances is found at section 14(2) of the Act, which requires the employer and the bargaining agent to negotiate the pay equity plan:

14(2) The employer and the bargaining agent for a bargaining unit shall negotiate in good faith and endeavour to agree, before the mandatory posting date, on,

(a) the gender-neutral comparison system used for the purposes of section 12; and

(b) a pay equity plan for the bargaining unit.

(emphasis added)

25. Other instances where the Act obligates the employer to negotiate pay equity with the bargaining agent are found in subsections 13.1(2), 14.1(1), and 14.3 of the Act.

26. The Court recently confirmed the Tribunal’s decision in 10 Community Care Access Centres, supra, which held that a bargaining agent does not possess the right to negotiate pay equity maintenance with an employer. In 10 Community Care Access Centres, the Court describes the limit to a bargaining agent’s right to negotiate pay equity maintenance and the process available to a bargaining agent where it believes pay equity has not been maintained.

27. In that decision, the Court reiterated that while it is desirable for employers and their bargaining agents to resolve pay equity issues between themselves, ultimately it is the Pay Equity Commission who has the final say about whether pay equity has been maintained. At paragraph 106 of that decision, the Court held:

The circumstance of the case being decided is different. The question of whether the Ontario Nurses’ Association has a right to negotiate the maintenance of pay equity is not a discretionary decision requiring the balancing of competing values. This is a matter of interpreting the legislation. It is important to remember that the Ontario Nurses’ Association is not attacking the constitutional validity of the legislation. It just wants it to be interpreted differently. The thrust of its submission is that imputing the intent of the statute as it sees it, and applying Charter values to that intent, requires the Court to infer that the right to negotiate is present in the legislation. Put bluntly, it wants the Court to read something into the words of the legislation that is not there. Be that as it may, it does not matter because, in any event, as has already been said, the intent of the legislation is not that a bargaining agent shares the responsibility for maintenance of pay equity with the employer and that issues surrounding this obligation are to be resolved between them. If they can agree that there is a problem and resolve it, that would be desirable, but if they cannot the issue passes to the Pay Equity Commission, the process of review and if necessary, a hearing by the Pay Equity Hearings Tribunal.

(emphasis added)

28. At paragraph 72 of that decision, the Court wonders aloud how compelling negotiation between a bargaining agent would be seen as a meaningful way to progress the issue of gender discrimination, which is the purpose of the Act:

The application to the Pay Equity Hearings Tribunal was with respect to one of the issues determined by the Review Officer. Was the employer obliged to negotiate with the bargaining agent? Really the question was whether the employer should be required to negotiate amendments to the existing plan or a new plan when it believed the existing plan to still be appropriate. One has to wonder how compelling a party to negotiate in such circumstances can be seen as a meaningful way to progress the issue of gender discrimination. This was dealt with by the parties as a labour relations disagreement. The union wants to manage the state of pay equity as it perceives it. If it has the right to negotiation as it claims, it need only provide notice that it is of a view that there is a changed circumstance and force the employer to the table. The employers began the process of negotiation but concluded that, in the situation they could not be compelled to do so. They withdrew. They do not want to bend to what they see as the unjustified “view” of the union. As it is, the determination to be made will not affect this situation. The merits have been dealt with. This is a case brought by the union to determine who is in control of pay equity issues as between the unions (bargaining agents) and employers. It is not either of the parties. Pursuant to the Pay Equity Act it is the Pay Equity Commission that is to deal with our collective concern for pay inequity based on gender. The Pay Equity Commission controls and directs the means by which the discrimination pay equity concerns represent is to be resolved if the parties are unable to acknowledge and agree that there is a problem and deal with it.

(emphasis added)

29. At paragraph 20 of that decision, the Court confirmed that while there is no positive obligation to provide a bargaining agent with the right to negotiate pay equity, the bargaining agent does have a role in ensuring pay equity is maintained:

What s. 7(2) provides is that those involved and affected are not permitted to negotiate or agree to contract out of the obligation to achieve pay equity as between similar male and female job classes. This may, as the Ontario Nurses’ Association suggests, impose a positive obligation not to undermine the establishment or maintenance of pay equity. It may, in effect, require the bargaining agent to play a role in ensuring that pay equity is maintained. What it does not do is impose an obligation on the employer or provide to the bargaining agent a right to collectively bargain where that supposed obligation or right is not otherwise provided for by the legislation. The bargaining referred to in s. 7(2) is not the process of establishing or maintaining pay equity. The reference is to the process of collectively bargaining compensation practices in the Collective Agreement which is or will be the foundation of the relationship between the employer and the union:

The only impact of certification, once pay equity has been established as in this case, is that the employer and the bargaining agent in their upcoming negotiations will have to abide by subsection7(2) of the Act, and are jointly obliged not to bargain or agree to any compensation practices that would disrupt the already provided for pay equity in the employer's establishment.

The Union's position also fails to take into account the breadth of the Employer's responsibilities for pay equity. The Employer must establish and maintain pay equity for female workers in each of its bargaining units and non-union unit. The Employer, having identified the relative ranking of male and female job classes, must now administer a pay policy free of gender bias. To do so requires that relative values be used to define and adhere to an equitable pay policy line encompassing all jobs. The Employer must accomplish this task within the limitations of its financial resources available for all jobs within its establishment. That is no doubt in part why subsection 7(2) exists; it is to bar those compensation practices which prevent the Employer from complying with the legislation.

30. Accordingly, the starting point for the analysis is that it is well-established that a bargaining agent does not have a right to negotiate pay equity maintenance with an employer, but that a bargaining agent has the right to file an application with Review Services if it believes that pay equity has not been maintained and the employer either refuses to discuss the issue or resolve a pay equity issue with it.

The Tribunal Will Uphold Parties’ Agreements

31. The Tribunal’s jurisprudence is also clear that notwithstanding that the Act does not confer a right to negotiate pay equity maintenance onto a bargaining agent, the Tribunal will uphold an agreement between the parties that expands the bargaining agent’s role as it pertains to pay equity maintenance.

32. However, given that these agreements are not grounded in the Act, these agreements are the exceptions to the general rule, and an agreement that purports to supplant a clear statutory obligation must clearly do so.

Decision and Analysis

33. The language of Article H.18 is clear and unambiguous to the Tribunal. Article H.18 states:

Both parties acknowledge the obligation to ensure that pay equity is maintained for the bargaining units.

34. The Tribunal finds that this language is an acknowledgement of the statutory obligation to ensure that pay equity is maintained. As set out above, the Act and the jurisprudence is clear that this obligation rests with the employer, and a bargaining agent has no authority to compel an employer to negotiate pay equity maintenance. The fact that the Court upheld the Tribunal’s decision of 10 Community Care Access Centres, supra, within the past couple of years does not change the fact that the language of the Act has remained the same since 2010, and there is no prior jurisprudence that stood for the position that a bargaining unit had an independent right to negotiate pay equity maintenance. As such, it cannot be said that the environment in 2010 when the Minutes were entered into is different than in 2023.

35. Article H.18 does not refer to “their obligation”, or a “joint obligation”, or a “shared obligation”, or any other terminology that could be read to confer an obligation on the respondent to negotiate pay equity maintenance with the applicant or otherwise complete the maintenance process jointly. It is strictly an acknowledgement of a well-understood obligation that rests with the employer.

36. The Tribunal finds that language of Article H.19 is also clear and unambiguous as it pertains to the negotiation of pay equity maintenance. Article H.19 states:

When a new position is created, or there has been significant change to a position, either the Union or the Employer shall advise the other party in writing and the parties will agree to meet to seek to resolve such issues in a timely way.

37. This language establishes a process for the parties to meet to seek to resolve issues where new positions are created or there has been a significant change to a position. The respondent must do what it agreed to when these instances arise, however, this language does not establish any process for how pay equity is to be maintained jointly, as there are more instances that could cause the respondent to review whether pay equity has been maintained than what is set out in Article H.19.

38. A review of both Articles H.18 and 19 when read together does not assist the applicant. The complete absence of the word “negotiate” in Article H which is the statutory term used to confer a right of negotiation to a bargaining agent throughout the Act, is an important indicator of intention in this case. Both parties relied on the principle of interpretation that stands for the proposition that “different words mean different things” and they chose to use the phrase “meet and seek to resolve” in Article H.19 instead of “negotiate”. As such, if the parties intended to negotiate pay equity maintenance, which is the statutory term, then the Tribunal expects that they would have used that word in Article H.

39. A review of the language in consideration of the entire agreement equally does not assist the applicant, and further confirms the Tribunal’s finding that the respondent did not agree to negotiate pay equity maintenance with the applicant.

40. The most obvious indicator is that the parties did use the word “negotiate” in other parts of the Minutes, but did not in Article H. The parties agreed:

AND WHEREAS the parties agreed to combine their efforts and engage in a process to negotiate and develop a Pay Equity Plan for each of the four bargaining units;

(emphasis added)

41. Another clear example of how the language of Article H is inconsistent with an agreement to negotiate pay equity maintenance is that Article H.19 only refers to “positions” and not “job classes”. This is far from a distinction without a difference. Section 1(1) of the Act expressly defines “job class” as something different than a “position” as it uses both terms:

means those positions in an establishment that have similar duties and responsibilities and require similar qualifications, are filled by similar recruiting procedures and have the same compensation schedule, salary grade or range of salary rates

42. The Act mandates that to ensure pay equity is achieved, job classes are compared against one another using a gender-neutral comparison system, not positions. This is reflected in both the Act and in the parties’ Minutes. Section 6(1) of the Act states:

For the purposes of this Act, pay equity is achieved under the job-to-job method of comparison when the job rate for the female job class that is the subject of the comparison is at least equal to the job rate for a male job class in the same establishment where the work performed in the two job classes is of equal or comparable value

(emphasis added)

43. It is possible for a job class to contain a single position, but that is the exception, and those words remain separate terms as set out in section 1(6) of the Act:

A job class may consist of only one position if it is unique in the establishment because its duties, responsibilities, qualifications, recruiting procedures or compensation schedule, salary grade or range of salary rates are not similar to those of any other position in the establishment.

44. In this case, the parties refer to “job class” throughout the Minutes when they described how they negotiated pay equity jointly. This language is consistent with the Act. Some examples where the parties refer to job class are:

• Article C.4 “the job classes covered by the respective plans are listed in alphabetical order in the respective appendices of each plan”

• Article D.5 “The gender dominance of each job class, determined in accordance with the criteria under the Pay Equity Act is identified in the appendices to each of the respective plans”

• Article F.7 “Once all job classes were evaluated, comparisons were conducted, in accordance with the requirements of the Pay Equity Act, using the job-to-job method of comparison where there was a male job class of comparable value or the proportional value method where no male comparator existed.

• Article F.8 “the following male job classes were agreed to be used as the representative group of male job classes when applying the proportional value method:”

• Article F.10 “Job rate is defined by the Pay Equity Act Section (1) as the highest rate for the job class.”

• Article F.11 “the parties further agree that the merit pay to which some non-union job classes are entitled is a permissible difference pursuant to section 8(1)(c) of the Pay Equity Act.

• Article G.17 “notwithstanding that no pay equity adjustment is owning for the following job classes, the parties have nonetheless agreed to the following: … b) Phlebotomist – workroom will receive the same adjustment as the other Phlebotomist job classes identified in the Pay Equity Plan for the Support bargaining unit.”

45. Conversely, the Tribunal could not locate another reference to the term “position” in the Minutes other than in Article H.19. Again, both parties relied on the principle of interpretation that different words used must mean different things. In this case, the parties expressly used the term “position” in Article H.19 and made no reference to the term “job class” which they used throughout the remainder of the Minutes of Settlement.

46. As such, it is not clear to the Tribunal that Article H involves evaluating job classes to ensure that pay equity is maintained, rather Article H.19 appears to obligate the parties to “meet to seek to resolve” issues relating to where new and changed positions are placed within the existing job class system. While ensuring positions are placed in the proper job class may be a part of the pay equity maintenance process, it does not cover several other instances where the employer may review whether pay equity has been maintained. For example, it does not account for the potential that a female job class and its male job class comparator have become inappropriate for any other reason than a newly created or change to a position such that pay equity adjustments must be made, or a new male comparator must be used. As such, it is clear and unambiguous to the Tribunal that a plain interpretation of Article H does not constitute an agreement between the parties to negotiate pay equity maintenance or otherwise complete pay equity maintenance jointly.

Extrinsic Evidence and Ambiguity

47. The applicant asserted that the Tribunal must consider extrinsic evidence to the Minutes of Settlement because Article H is ambiguous. The respondent disputed that Article H was ambiguous. Both parties made extensive submissions on the issue of whether extrinsic evidence should be considered in this case.

48. In Jovalco, supra, the Ontario Labour Relations Board succinctly summarizes the propositions regarding when extrinsic evidence should be considered. At paragraph 9 of Jovalco, supra, the Board held:

The following propositions are well-established in the Board’s case law:

a) Absent fraud or other exceptional circumstances, parties are bound to the written agreements they make;

b) A contracting party’s misapprehension as to the consequences of entering into an agreement does not make the agreement unenforceable against that party unless the misapprehension is the result of a misrepresentation by the other party;

c) Absent some ambiguity in the language of an agreement, parol or extrinsic evidence as to the parties’ intentions is not admissible for the purposes of the construction of that document.

49. As such, ambiguity in the language is a required precondition before the Tribunal should consider extrinsic evidence to provide meaning to written agreements.

50. The Supreme Court of Canada elaborated on the use of extrinsic evidence in Sattva Capital, supra and the purpose of the parol evidence rule. At paragraphs 57 to 59, the Court held:

51. While the surrounding circumstances will be considered in interpreting the terms of a contract, they must never be allowed to overwhelm the words of that agreement (Hayes Forest Services, at para. 14; and Hall, at p. 30). The goal of examining such evidence is to deepen a decision-maker’s understanding of the mutual and objective intentions of the parties as expressed in the words of the contract. The interpretation of a written contractual provision must always be grounded in the text and read in light of the entire contract (Hall, at pp. 15 and 30-32). While the surrounding circumstances are relied upon in the interpretive process, courts cannot use them to deviate from the text such that the court effectively creates a new agreement (Glaswegian Enterprises Inc. v. B.C. Tel Mobility Cellular Inc. (1997), 1997 CanLII 4085 (BC CA), 101 B.C.A.C. 62).

52. The nature of the evidence that can be relied upon under the rubric of “surrounding circumstances” will necessarily vary from case to case. It does, however, have its limits. It should consist only of objective evidence of the background facts at the time of the execution of the contract (King, at paras. 66 and 70), that is, knowledge that was or reasonably ought to have been within the knowledge of both parties at or before the date of contracting. Subject to these requirements and the parol evidence rule discussed below, this includes, in the words of Lord Hoffmann, “absolutely anything which would have affected the way in which the language of the document would have been understood by a reasonable man” (Investors Compensation Scheme, at p. 114). Whether something was or reasonably ought to have been within the common knowledge of the parties at the time of execution of the contract is a question of fact.

59It is necessary to say a word about consideration of the surrounding circumstances and the parol evidence rule. The parol evidence rule precludes admission of evidence outside the words of the written contract that would add to, subtract from, vary, or contradict a contract that has been wholly reduced to writing (King, at para. 35; and Hall, at p. 53). To this end, the rule precludes, among other things, evidence of the subjective intentions of the parties (Hall, at pp. 64-65; and Eli Lilly & Co. v. Novopharm Ltd., 1998 CanLII 791 (SCC), [1998] 2 S.C.R. 129, at paras. 54-59, per Iacobucci J.). The purpose of the parol evidence rule is primarily to achieve finality and certainty in contractual obligations, and secondarily to hamper a party’s ability to use fabricated or unreliable evidence to attack a written contract (United Brotherhood of Carpenters and Joiners of America, Local 579 v. Bradco Construction Ltd., 1993 CanLII 88 (SCC), [1993] 2 S.C.R. 316, at pp. 341-42, per Sopinka J.).

51. As such, the Supreme Court of Canada is clear in Satvva Capital, supra that extrinsic evidence should never be allowed to overwhelm the words of the agreement, that the interpretation must be grounded in the written agreement, and courts cannot use extrinsic evidence that effectively creates a new agreement. The extrinsic evidence must also be objective evidence which precludes the reliance on evidence of the subjective intentions of the parties.

52. The applicant submitted that the language of Article H is patently ambiguous in the following ways:

Article H is patently ambiguous in at least three ways. First, the text of the Article itself does not refer to pay equity maintenance. Second, Article H.19 itself is wholly unclear: what are the “such issues” are the Union and Employer agreeing “to meet to seek to resolve” in a timely manner?

53. With respect to the applicant’s capable submissions, none of these are ambiguities that are relevant to the question of whether the parties agreed to negotiate pay equity in Article H.

54. To reiterate, if parties wish to contract for something other than the clear statutory obligation, the agreement must be clear. To allow otherwise, only adds confusion and delay into the pay equity process which does not advance the purposes of the Act.

55. The fact that the parties chose not to refer to the term “pay equity maintenance” in Articles H.18 or H.19 does not cause Article H to have a double meaning or create doubt in its application. To the contrary, the omission of any agreement to maintain pay equity jointly, and the terms “negotiate” and “job class” makes it clear that this language does not confer a right of negotiation onto the bargaining agent.

56. The applicant’s submission that Article H.19 is “wholly unclear” does not assist it either. At paragraph 46 of its submissions the applicant acknowledged that it is a sophisticated party when it comes to pay equity. Its allegation that it agreed to unclear terms that do not represent its true intention (the Tribunal does not find it to be unclear) does not open a window for the Tribunal to rely on extrinsic evidence to overwhelm the language of the written agreement and change its meaning. In the Tribunal’s view, this would be the antithesis to the principles governing the parol evidence rule.

57. This is particularly in issue in this case, where it appears that the applicant knowingly agreed to Article H without any process in place because “they were just done and didn’t have the will to hash out a detailed maintenance process”. This statement is found at paragraph 5 of Jane Seymour’s declaration filed by the applicant:

In 2010, I was on the committee that finalized the pay equity process, and I signed the Memorandum of Settlement and the Pay Equity Plans. It was always my understanding that maintenance would be done collectively by the employer and union. There was never any real formulated process put into place, and I recall people from the Union side asking about that. “How will this be administered on a go-forward basis? Yes, we are pay equity compliant now but what about in five years?” But the pay equity process was so long and difficult, by the end, I think people were just done and didn’t have the will to hash out a detailed maintenance process.

(emphasis added)

58. The Tribunal cannot create an exemption to the parol evidence rule because a party (or both parties) to a written contract “were just done” and did not want to put the effort into properly drafting language that would supplant a clear statutory obligation.

59. The fact that the parties did not define what “such issues” constitute does not create an ambiguity as to whether language constitutes an agreement to negotiate pay equity. The declarations filed by the applicant are subjective, not objective, and the Tribunal cannot rely on these subjective declarations to overwhelm the clear language of a written agreement.

60. Likewise, the applicant’s submission that the terms of Article H are wholly unclear because processes for how the parties are to resolve any issues that arise “in a timely manner” does not assist the applicant. Rather, the applicant’s general argument that the parties were not precise about the terms of their agreement is more akin to an argument that essential terms of Article H (specifically Article H.19) have not been settled or agreed upon, which in contract law could constitute an “agreement to agree” and is not enforceable. Agreements to agree are generally considered not binding contracts because the parties have left material terms of the contract to be agreed in the future, therefore lacking the necessary consideration to constitute a valid contract. In Bawitko Investments Ltd. v. Kernels Popcorn Ltd. 1991 CanLII 2734 (ON CA), the Court reiterated this principle at page 13:

[W]hen the original contract is incomplete because essential provisions intended to govern the contractual relationship have not been settled or agreed upon; or the contract is too general or uncertain to be valid in itself and is dependent on the making of a formal contract; or the understanding or intention of the parties, even if there is no uncertainty as to the terms of their agreement, is that their legal obligations are to be deferred until a formal contract has been approved and executed, the original or preliminary agreement cannot constitute an enforceable contract. In other words, in such circumstances the “contract to make a contract” is not a contract at all. The execution of the contemplated formal document is not intended only as a solemn record or memorial of an already complete and binding contract but is essential to the formation of the contract itself.

61. Accordingly, the applicant’s assertion that there is a lack of agreement on essential terms to give meaning to the written language does not create an ambiguity, rather it supports the conclusion that there was no valid agreement to negotiate pay equity maintenance or otherwise maintain pay equity jointly.

62. The fact that the parties issued a joint communication that informed the employees that the bargaining agent and employer would continue to work together to ensure that pay equity was maintained does not assist the applicant. Again, there are many ways in which parties can work together to ensure pay equity is maintained, including, but not limited to, having meetings to review whether positions have been appropriately classified following changes to the job description or the creation of new positions (Article H.19), and reviewing job classes or positions during the collective bargaining process.

63. The Tribunal wishes to be clear that it encourages bargaining agents and employers to work together to resolve any pay equity issues in whatever form that may take. Again, especially given the Court’s comments in 10 Community Care Access Centres, supra, even though a bargaining agent may not have a right to negotiate pay equity maintenance, the bargaining agent always retains the right to proceed to file an application with Review Services if it believes pay equity has not been maintained and the employer refuses to address that issue or resolve it to their satisfaction.

64. The Tribunal also does not agree that the language of Article H.19 contains a latent ambiguity. As set out above, the Tribunal finds that the language is clear in what it purports to do. The argument that pay equity is “highly technical” does not create a latent ambiguity. Both parties acknowledge that they are sophisticated in pay equity issues and as such, a reasonable person would expect clear language to confer the right to negotiate pay equity maintenance to the applicant if that was the parties’ mutual intention of Article H.

65. The Tribunal notes that the applicant submitted that it believes that the Tribunal implicitly understood that extrinsic evidence would be required when it asked for any documents that the parties wished to rely upon to be filed in its May 26, 2023 decision. This statement was not an acknowledgement that extrinsic evidence was required, rather it was simply the Tribunal anticipating that one or both parties would raise the issue, and the Tribunal wanted to ensure that it had a full record of the parties’ submissions and documents so that it could consider the issue fully, and not have to bifurcate consideration of this issue. This is especially the case given that the analysis of whether a latent ambiguity exists is rather circular, and generally requires a review of the proposed extrinsic evidence to determine whether a latent ambiguity exists.

66. Accordingly, the Tribunal finds that extrinsic evidence is not required in this case as the language of Article H is clear and unambiguous in that it does not confer an obligation on the respondent to negotiate pay equity maintenance with the applicant.

67. However, if the Tribunal is incorrect in the above conclusion, the applicant’s extrinsic evidence does not support the applicant’s position either. The three declarations are subjective evidence, and the Supreme Court of Canada was clear that only objective evidence can be relied on as parol (extrinsic) evidence to provide meaning to written language.

68. Ms. Wallace’s declaration is particularly subjective and inconsistent with what actually occurred in this case. Paragraph 6 of her declaration states:

By 2010, I was an experienced pay equity professional for the Union, and always fought to have joint maintenance included in our Memorandums of Settlement. I consistently took the position that the Union would be very reluctant to sign a pay equity MOS or a collective agreement MOS relating to pay equity, unless it referenced a joint maintenance committee or process. This was also the directive given to any staff who would be responsible for such negotiations.

69. In the above paragraph Ms. Wallace acknowledged that she is an experienced pay equity professional. She also declared that she would be very reluctant to sign a MOS unless it referenced a joint maintenance committee or process. However, in the Minutes, there are no references to a joint maintenance committee or an established process set out as to how joint maintenance would be negotiated or completed jointly. Rather, the applicant made fulsome submissions about how it believes that the language is “wholly unclear” when it came to the process that was to be used. As such, while Ms. Wallace may have been confident in declaring that she normally insists on stronger language, it did not happen in this case. This may be because of what Ms. Seymour declared in her declaration about the “parties being done” and wanting to move on or another reason. What is known by the Tribunal is what Ms. Wallace declared about what she normally insists on did not manifest in the Minutes of Settlement relied on in this case.

70. The Tribunal does wish to address Ms. More’s declaration that no one said that the union would not have a role in pay equity maintenance. To be clear, the Tribunal has never held that a bargaining agent does not have a role in pay equity maintenance, and the Court in 10 Community Care Access Centres, supra, also reiterates this point. Bargaining agents have a very important role as being the party that ensures the employer is maintaining pay equity, and raising issues on behalf of its members when it has reason to believe that pay equity has not been maintained.

71. While the obligation to ensure pay equity is maintained does not include an obligation to negotiate with the bargaining agent, the bargaining agent retains the right, and obligation, to raise pay equity maintenance issues with the employer when identified, and to file an application with Review Services on behalf of its members if it has reason to believe that pay equity has not been maintained in accordance with the Act. The manner and forum of how these discussions occur can vary from bargaining relationship to bargaining relationship, but the bargaining agent, as the exclusive entity that can raise pay equity issues on behalf of its members to Review Services possesses an important role in maintaining pay equity.

Conclusions

72. The Tribunal confirms that the statutory obligation to maintain pay equity rests with the employer. The Tribunal confirms that a bargaining agent retains the right to raise pay equity maintenance issues with the employer and to proceed to Review Services if it has reason to believe that pay equity has not been maintained in accordance with the Act.

73. If a bargaining agent and employer agree to negotiate pay equity or otherwise jointly complete pay equity maintenance, clear written language is required. This includes using the statutory language in the agreement, such as “negotiate” and “job class” to avoid potential ambiguity, as those terms have specific meanings in the Act, and using different words to describe pay equity obligations gives rise to the interpretation that a different meaning was intended.

74. The Tribunal finds the language of Article H is clear and unambiguous that it does not confer an obligation on the respondent to negotiate pay equity maintenance or otherwise complete pay equity maintenance jointly.

75. The Tribunal finds that Article H.19 obligates the respondent to notify the applicant where there are any newly created or changed positions, and that they must meet to discuss and try to resolve any pay equity issues that may occur as a result. If the parties are unable to agree, the applicant retains the right to file an application with Review Services.

76. This application is dismissed. The Tribunal makes no findings as to any of the other issues raised in this application by the respondent.