Lisa Smith et al v. The Crown in Right of Ontario (Ministry of Community Safety and Correctional Services), 2014 CanLII 48098

P-2012-4155

IN THE MATTER OF AN ARBITRATION

Under

THE PUBLIC SERVICE ACT

Before

THE PUBLIC SERVICE GRIEVANCE BOARD

BETWEEN

Lisa Smith et al

Complainant

• and -

The Crown in Right of Ontario (Ministry of Community Safety and Correctional Services)

Employer

BEFORE

Kathleen O’Neil

Interim Chair

FOR THE COMPLAINANTS

Robyn Kasha, Lisa Smith, Bill Johnston and Monty Verlint

FOR THE EMPLOYER

Peter Dailleboust Ministry of Government Services Legal Services Branch Counsel

HEARING

February 21, 2014

Decision

1This decision deals with preliminary objections made by the employer, asking for the dismissal of the grievance of Lisa Smith, and others in the group for whom she is the named complainant, on the primary basis that it relates to pay for performance, a matter outside the Board’s jurisdiction. The complainant takes the contrary view, arguing that the matter is not properly considered a complaint about pay for performance, as it is focused on equity and transparency in respect of Managers’ wages.

The Factual Context

2The facts necessary to this decision are not substantially in dispute. It is primarily the legal conclusions that flow from the facts that are the subject of debate, as will be discussed below. In the case of any disputed facts on preliminary motions such as this, the Board takes any asserted facts relied on by the complainants as true and provable just for the purposes of the motion, without making any findings of fact at this stage.

3The complainants are contesting certain aspects of their compensation and/or that of others of their colleagues for the fiscal year 2011/2012, which they see as arbitrary, inequitable, and contrary to their legitimate expectations. As employees excluded from collective bargaining, they are covered by the Management Compensation Plan (MCP), which is set by a combination of directives issued by Management Board of Cabinet and government-wide compensation policies consistent with them, rather than by collective negotiations as is the case for members of bargaining units. For several years prior to 2012, employees such as the complainants have been able to increase their compensation by only one route: a favourable pay for performance rating from their superiors. Those ratings were translated, according to annually set policy, into a range of percentage increases. A zero percentage rating was reserved for those with problematic performance ratings, and a person covered by the MCP who met or exceeded performance expectations received an increase in each of the years leading up to this complaint. That changed in 2011/2012 because of fiscal restraint, when the range of performance awards was set at 0%, basically freezing wages, regardless of whether performance was worrisome or wonderful. In the policy dated September 28, 2012 which describes this, one reads that performance pay for the 2011-12 year is set at zero percent for non-bargaining unit Ontario Public Service employees, and that “the earnings of non-bargaining unit employees, who were eligible for performance pay, are to remain at 2011 levels.”

4The focus of this complaint is what appeared to some as an exception to the general wage freeze. Despite the general lack of increases, some members of the Management Compensation Plan received lump sum payments in the end of 2012, while others did not, and it is this difference that the complainants are seeking to remedy. The employer sees the lump sum payments as a way to ensure that the managers who received them did not experience a decline in their basic annual earnings, while the complainants see them as an arbitrary favouring of the group of employees already at the maximum in 2011, by giving them a payment which was unavailable to others. The payments were provided on December 20, 2012 and were equal to the amount of lump sum performance awards paid in 2011. Many of the complainants were not at the maximum of the grid in 2011, and thus did not receive a lump sum in 2012, while others of the complainants were, and received the disputed lump sum payments.

5In order to understand this preliminary dispute, and before discussing the relevant legal framework below, it is necessary to go back to how the pay for performance plan was structured just prior to the restraint measures of fiscal year 2011/2012. Jobs covered by the Management Compensation Plan are compensated according to a wage grid, with a minimum and a maximum of yearly wages, through which employees could move by means of their performance-related awards, rather than by length of service, or across-the-board increases. Once any such movement brought the employee to the maximum of the pay grid, any remaining entitlement to a pay for performance award for those in the “outstanding” and “fully effective” categories was paid out in a lump sum payment, rather than a corresponding additional increase in base salary. For example, if members of the Management Compensation Plan close to the maximum of the pay grid, received a performance award of 3%, whatever portion of that increase was necessary to bring them to the maximum would be “used up” in a salary increase, and the remainder would be paid out in a lump sum. So, if it took 1% of the 3% award to get to the maximum of the pay grid, that employee’s annual wages would be increased by 1%, and then he or she would receive a 2% lump sum award that was not rolled into the annual salary rate. For purposes of this award, the sum of the salary determined by the grid maximum and the amount of the lump sum, if any, will be referred to as an employee’s “basic annual earnings”. That basic scheme remains in place in the policies relating to pay for performance, but with the percentage set at zero for the fiscal year 2011/2012, no one moved on the grid for that fiscal year.

6The employer’s view of the lump sum payments paid for the fiscal year 2011/12 is that, rather than representing an increase in compensation denied to others, it was a payment to prevent a decrease as compared to the year before for those who were eligible to receive it. This is explained in the relevant policy referred to above:

For employees who were at the maximum of their salary range on April 1, 2011, the application of the 0% performance pay may result in a reduction of their earnings in 2012 from the 2011 level.

A reduction in earnings occurs when an employee’s earnings (comprised of annualized base salary and variable re-earnable incentive payment) for the fiscal year starting April 1, 2012 are less than their annualized salary for the fiscal year starting April 1, 2011.

In these instances, the employees may be eligible to receive a payment to maintain their earnings at their previous year’s level.

The amount of the payment is an amount up to the variable re-earnable incentive payment in respect of the 2010-2011 performance cycle.

The payment does not alter the employee‘s annual base salary or salary-based benefits and is not included in pensionable earnings calculations.

Employees who received a base salary adjustment, but not a variable re-earnable incentive payment in respect of the 2010-11 performance cycle are not eligible for a payment.

A Variable Re-earnable Incentive Payment is defined in the same policy as follows:

Performance related payment, paid as a lump sum, to employees at the maximum of their salary range. The payment of a variable re-earnable incentive does not alter the employee’s annual base salary or salary based benefits and is not included in pensionable earnings calculations.

The policy also provides an exception to the receipt of the payment in cases where an employee is not performing at an acceptable level or the employee is/has been subject to disciplinary measures in the previous fiscal year.

7The complainants’ view is that these lump sum payments were unfair because they were not paid to everyone. As well, no prior notice was given of the change. Further, many up to the level of superintendent were unaware of the employer’s intention to pay lump sum payments until well after they were paid. For the complainants, this is a breach of their legitimate expectations. From the employer’s perspective, retroactive pay changes are a fact of life in government compensation, and not a breach of any identifiable term or condition of the complainants’ employment.

8According to the employer, Pay for Performance and lump sum payment information was made available to affected employees through senior management and human resources staff, and if employees had any specific questions regarding their pay for performance or eligibility for the lump sum payments they were advised to speak with the manager and/or human resources advisor. To the extent that this is a disputed fact, I take the complainants’ assertions of lack of prior notice as true and provable for the purposes of this motion.

9Other undisputed facts important to the employer’s motion include that the source of the remedies the complainants are seeking is in large part government policy on Pay for Performance, linking the complaint directly to pay for performance and putting it beyond the Board’s jurisdiction, in the employer’s view. As well, the Management Compensation Plan’s Pay for Performance Operating Policy provides that the decision on the MCP Pay for Performance Grid for the performance cycle year will be made following the end of the performance cycle year, building retroactivity into the MCP. Further, the policy states that performance awards may or may not be approved for any performance year meaning the possibility of years with zero percentage performance awards is part of the complainants’ terms and conditions of employment.

10The details of the complaint and the remedies requested will be discussed below.

Excerpt from regulation 378/07

11The following excerpt from regulation 378/07 under The Public Service of Ontario Act, 2006 is most pertinent to this preliminary issue:

Complaint about a working condition or a term of employment

4. (1) Subject to subsection (2), a public servant who is aggrieved about a working condition or about a term of his or her employment may file a complaint about the working condition or the term of employment with the Public Service Grievance Board,

(a) if the public servant is eligible under sections 5 and 7 to file such a complaint;

(b) if the public servant gives notice in accordance with section 8 of his or her proposal to file the complaint; and

(c) if the public servant complies with the filing requirements set out in section 10. O. Reg. 378/07, s. 4 (1).

(2) The following matters cannot be the subject of a complaint about a working condition or about a term of employment:

1. The term or duration of the public servant’s appointment to employment by the Crown.

2. The assignment of the public servant to a particular class of position.

3. A dismissal without cause under subsection 38 (1) of the Act or a matter relating to such a dismissal.

4. The evaluation of a public servant’s performance or the method of evaluating his or her performance.

5. The compensation provided or denied to a public servant as a result of the evaluation of his or her performance. O. Reg. 378/07, s. 4 (2).

[the bolded paragraph is the main focus of the employer’s objection]

Issue and Submissions

12The principal issue raised in this preliminary motion is whether the complaint is beyond the Board’s jurisdiction because of section 4(2), paragraph 5, set out above. In other words, is the subject of the complaint the compensation provided or denied as a result of the evaluation of the complainants’ performance? Such matters are not permitted to be included in complaints over which the Board has jurisdiction, so that if the answer to that question is yes, the complaint is not something the Board has the power to deal with, and it must be dismissed, unless there are severable portions within the Board’s power to remedy.

13The employer has reserved the right to make other preliminary objections, such as relating to the timeliness of the complaint, and which individuals remain in the group of employees included in this complaint, should it not be successful on this motion. Those issues are not dealt with in this decision.

14Before getting to the parties’ arguments, it is appropriate to begin by looking in more detail at what the complaint contains. It begins with a general claim that the employer has treated its MCP employees in an unfair, unequal and inequitable manner. It goes on to say that each year since the implementation of the Pay for Performance Operating Policy, MCP employees who have completed all of the mandatory requirements for their Performance Management Plan have received both the merit increases allowing them to progress through the salary range and performance incentive awards in the form of lump sum payments. Further, the complainants rely on the fact that the 2011/2012 year was no different in terms of expectations, so that employees in good faith continued to comply with the performance management policy, in ignorance of the fact that the employer would retroactively change things so that the performance management plan was not directly linked to their level of compensation. In reference to the 2012 lump sum payments described above, they claim they were arbitrarily and secretly issued to some but not all managers covered by the MCP. The complaint is further detailed in four numbered paragraphs, as follows:

Complaint

1. The arbitrary lump sum payments issued on December 20, 2012 do not meet any existing compensation directives; policies or OPS legislation. In written and oral statements received by MGS Human Resources staff, these lump sum payments were based on pay for performance ratings for employees at the maximum (max) of their salary bands as of March 31, 2011, however, they were “not based on performance”.

2. The employer made a decision to pay a financial bonus to MCP staff at the max of their salary range based upon expired performance ratings. However, the employer has also arbitrarily made a decision to financially penalize MCP staff who are not at the max of their salary grid, notwithstanding that they continue to work diligently and in good faith. These decisions constitute an unfair labour practice and create an unequal wage compensation strategy for MCP staff in the OPS.

3. The undersigned believe that we perform equal work of equal value, but have not received equal pay. To date, all of the payroll compensation directives, policies and legislation speak to principles of equity, fairness, transparency and merit based compensation.

4. The bonus payments received by some MCP staff on December 20, 2012 are without precedent, and are outside the previous years’ established Management Compensation practices. As stated in an ESA decision March 21, 2011, concerning pay for performance for the City of Toronto non-bargaining unit employees, there is an expectation that employees receive notice of a substantial change in terms and conditions of their employment, especially one concerning merit pay and compensation. No such notice has been received to date announcing the continuing entitlement to bonuses solely for current and former staff already at the max of their salary grid.

15As remedy for the above complaint, the complainants write:

We are asking that steps be taken to immediately address this inequity.

We are asking for transparency, fairness and equity in the management compensation strategy for both the 2011/2012 fiscal year and going forward.

We are asking for equal pay for equal work.

Full redress sought is to either provide payments based on previous compensation policies and practices, or issue an equal bonus payment to all MCP staff.

16Basically, it is the employer’s position that the entire complaint relates to pay for performance and is thus beyond the jurisdiction of the Board. Counsel emphasizes that the employer values the hard work that the complainants do. Nonetheless, this case is about a pay freeze that the Board has no authority to remedy, in the employer’s submission. Other arguments relate to its position that the complainants have failed to: establish that any term or condition of the their employment has been breached, establish that the Board has authority to give the remedies they request, or to entertain a complaint as it relates to members of a bargaining unit among the complainants, a group not permitted to bring complaints to this Board.

17As the alleged breaches set out above relate to the Employer’s method of compensation administration and since there is no other compensation structure for MCP employees to move through their salary range other than Pay for Performance, then this complaint cannot be about anything other than Pay for Performance, in the employer’s view. Further, the policy on pay for performance makes clear that there is no entitlement to an award in any given year, further linking this complaint to pay for performance.

18Specifically addressing the additional details in the four parts of the complaint set out above, employer counsel argues that the policies now in evidence establish that the lump sum payments in question do meet with compensation policy and directives, contrary to the allegation in the first paragraph set out above. The most relevant term and condition of employment was basically that MCP employees were entitled to the same basic earnings as in 2011, and there has been no asserted fact that establishes a breach of that. No one was to advance, or to go backwards from that point. The managers who received the 2012 lump sum were basically red-circled, in counsel’s submission. It is of note that the complainants did not suggest that the employer lacked authority to implement a wage freeze, or to red-circle wages to prevent a decrease.

19Turning to the second paragraph of the complaint, it states that the decision to pay a financial bonus to MCP staff who had been at the maximum of their salary range in 2011, based on expired performance ratings, was arbitrary and penalized those who were not then at the maximum. Employer counsel maintains that contrary to that allegation, the policy makes clear that everyone was frozen at the level of their basic earnings in 2011. Moreover, the pre-existing policy on pay for performance explicitly states that performance awards may or may not be approved for any performance cycle, so that the allegation is not sustainable, both as a matter of jurisdiction over pay for performance, and as a matter of there being no alleged breach of the pay for performance policy or other existing terms and conditions of employment related to compensation.

20As well, that same pre-existing pay for performance policy, submits employer counsel, provides that the decision as to the level of pay for performance will be made after the performance cycle year. Again, both as a matter of lack of jurisdiction over complaints about pay for performance and failure to establish any breach of a term or condition of employment, counsel argues the second paragraph of the complaint should not go forward.

21Turning to the third paragraph, which complains of lack of equal pay, as well as fairness, transparency and merit-based compensation, counsel submits it should not go forward, as no breach has been shown, and the policies supporting the lump sums are in evidence.

22The fourth paragraph of the complaint says that the lump sum payments were outside the previously established MCP compensation practices, and there was no notice of such a substantial change, especially concerning merit pay and compensation. Reference was made by the complainants to this being of a breach of The Employment Standards Act requirement that an employer pay earned wages. Without conceding that performance awards similar to previous years amount to earned wages, counsel notes that part V of The Employment Standards Act, which was the basis of the decision on which the complainants are relying, does not bind the Crown.

23Counsel argues further that the remedies requested make ever more clear that the matter should not proceed, as they are either requests for different pay for performance, or for the Board to set new terms and conditions of employment, neither of which it has the authority to do.

24In support of his argument employer counsel relies on the following case law:

Gary Sumner et al and the Crown in Right of Ontario (Ministry of Health and Long-term Care), PSGB# P-2006-1143 etc., (O’Neil); Robert Younger and the Crown in Right of Ontario (Ministry of the Environment), PSGB# P-2006-2458, (O’Neil); Anthony Hill et al and the Crown in Right of Ontario (Ministry of Community Safety and Correctional Services), PSGB# P-2004-3699, (O’Neil); Garratt et al and the Crown in Right of Ontario (Ministry of Health and Long-term Care) P-2003-1670, (O’Neil); Tyrrell et al and the Crown in Right of Ontario (Ministry of Community Safety and Correctional Services, PSGB# P-2003-2687 etc., (Carter); Berenbaum and the Crown in Right of Ontario (Ministry Labour), PSGB# P-2007-0407(O’Neil).

25The complainants, of course, see the matter differently, arguing that the Board has jurisdiction. They submit that this complaint is not about pay for performance. In argument, it was made clear that they do not dispute the 0% performance rating for 2011/12, despite concerns of lack of notice until the grievance was in process. They focus on their view that the 2012 lump sum payment was arbitrary, being applied to only some in the MCP category. Further, they maintain that their complaint is viable as the Board has jurisdiction to remedy matters that are in bad faith, arbitrary, discriminatory or in violation of governing legislation. The following cases are cited in support: Kanga and the Crown in Right of Ontario (Ministry of Health), P/0003/85 (Simmons); Scott et al. and the Ministry of Transportation P/0001/96 et al. (Lynk) concerning jurisdiction over salary matters, Non-union Staff of the City of Toronto and the City of Toronto ; Claim #s 70063991-1, etc., a decision of Employment Standards Officer Rick Richards, dated March 21, 2011, and Drakos and the Crown in Right of Ontario (Ministry of Community Safety and Correction Services), PSGB# P-2012-1193, etc. (O’Neil).

26Acknowledging that the employer has the right to set a percentage for pay for performance annually, it is the complainants’ position that the 2011/12 policy was different in that the compensation set had nothing to do with performance. They argue that none of the pay for performance elements were done except the 0% rating. The pay policies in 2011/12 are separate from the pay for performance policy, and thus the complaint is within the jurisdiction of the Board, in the complainants’ submission.

27The complainants maintain that their complaint is also within the Board’s jurisdiction in that it was arbitrarily instituted and applied without any notice to the employee group that it was impacting. The policies now in evidence were not previously made available to the group impacted, and efforts to obtain all of the applicable documents were resisted, requiring a Board order for disclosure. Part of the arbitrariness complained of is that the policies were not made readily available to the employees impacted by them. This constitutes a separate breach of the policies which require transparency, which is within the Board’s jurisdiction, in the complainants’ submission. As to the content of the policy, the complainants say it is also arbitrary because the employer did not consider all relevant considerations, such as fairness and equity, and considered only irrelevant factors.

28Further, the complainants still have questions as to whether there was authority for the policy change, as the document giving Management Board of Cabinet approval has not been provided. In argument, it was said that the complainants are at a loss as to whether there has been an amendment to the MCP, or whether it is something separate and distinct, and therefore not part of the limitations under the Public Service of Ontario Act. If it is somehow connected to the MCP, then the Board has jurisdiction to hear the complaint, as a violation of the complainants’ terms and conditions of employment, in the complainants’ submission. An example of this, in the complainants’ view, is that the Pay for Performance Operating Procedures provides that an employee cannot receive more than one performance award for the same period of time. The complainants argue that the employees who received the lump sum payments in 2012 received more than one performance award for their performance in the period 2010/2011.

29As to the employer’s arguments that the remedies requested concerning a different pay policy for 2011/2012 were outside the Board’s jurisdiction, the complainants maintain that there are other remedies requested especially as to fairness and transparency that are within the Board’s jurisdiction.

30As to the equal pay argument, the complainants maintain that it is discriminatory to pay a lump sum on the basis that those employees were at the top of the pay grid, and thus disadvantage those who were not. The complainants rely on portions of the Drakos decision, cited above, to the effect that allegations that treatment is arbitrary and in breach of the Ministry’s statement of ethical principles are within the Board’s jurisdiction. All these policies speak to the principles of trust, fairness, equity and responsiveness, in the complainants’ submission, and were violated by the sudden change to compensation, implemented in an arbitrary manner.

31Responding to the case law relied on by the employer, the complainants distinguish the decisions cited by the employer on the basic that the facts are not similar. While acknowledging that the Board’s decision in Sumner, cited above, speaks of management routinely announcing compensation changes on a retroactive basis, the complainants make reference to indications in that decision that the changes had been communicated to those concerned in advance. The Board is invited to find, in line with case law such as Kanga, cited above, that they should be able to proceed with their complaint that they were not treated fairly and equitably.

32Moreover, the complainants rely on the fact that the Compensation Policy and Eligibility Procedures effective September 28, 2012, which describes the 2012 change, establishes that the lump sum payment was not part of the pay for performance scheme. The complainants argue that the payments have nothing to do with pay for performance, as the amounts paid were not related to performance in the relevant year. Accordingly, in the complainants’ view, the Board has jurisdiction to hear their complaint, and to accept their submission that the employer made a decision to pay a lump sum payment for arbitrary reasons, not related to pay for performance.

33Addressing the employer’s argument that the complaint falls within the exclusion of complaints whose subject is performance evaluation, or the compensation granted or denied as a result of their performance, the complainants concentrate on the manner in which the pay change in 2012 was applied.

34As well, the complainants refer to the decision of this Board in Gleason v. Ontario (Ministry of Transportation), 1998 CanLII 13294 (ON PSGB) which took jurisdiction in a case which at first blush may have seemed to have been outside its jurisdiction as relating to the classification of a position, another subject matter excluded from the Board’s jurisdiction. The Board found that the grievor in that case was not simply asking for the Board to review the employer’s decision to set appropriate pay levels according to qualifications and job responsibility. Rather, the Board took jurisdiction over the issue of whether there was a policy related to the relationship between the salary of supervisors and those they supervised, or salary compression, in effect at the relevant time, and whether it had been consistently and fairly applied.

35In reply, employer counsel submits that even if the policy provisions for pay for performance policy were breached, as the complainants argue, by paying a lump sum twice for the same period, it is still pay for performance, and therefore a subject matter over which the Board has no jurisdiction. Nonetheless, the employer does agree that the lump sums paid in 2012 to those at the top of the grid in 2011 were not paid for performance, but were paid to maintain their level of earnings from the previous year.

36As to the case law relied on by the complainants, employer counsel points out that in Drakos, among other things, the Board found a breach of the Statement of Ethical Principles, which applies only to the Ministry of Community Safety and Correctional Services, but does not apply to the Ministry of Government Services which determines the salary policy. In reference to the Gleason case, which was essentially dealing with the misapplication of a policy, rather than the content of the policy, employer counsel said that a person who was at the maximum in 2011, and did not get the lump sum might have a grievance, but that was not the claim before the Board at this point.

Considerations and Conclusions

37Before getting to the details of this complaint, it is appropriate to take a look at the arc of the decided cases referred to in argument about the impact of the employer’s transition to merit-based pay increases for management employees in light of the prescribed limitation on the Board’s jurisdiction concerning pay for performance. There have been various aspects of this series of policy changes which have generated complaints resolved by decisions cited above: retroactive recharacterization of lump sums as progress on the grid (Sumner and Pedder), failure to take into account a retroactive reclassification in the implementation of the pay for performance policy (Berenbaum), cap on the number of employees who could receive an “exceeds” rating, failures to follow the policy in regards to evaluation of performance, failure to recognize employees who participated in a labor disruption by not awarding “exceeds all” ratings, the creation of pay inequities between pay classes (Tyrell), and failure to conduct a performance evaluation in the manner expected, or with the anticipated results (Younger), for instance. The Board has consistently found under the regulations in place since 1990, that it did not have jurisdiction over complaints about the process of evaluation or its fruits in terms of either the level of the performance evaluation or the compensation granted or denied in relation to performance.

38The complainants in this case, clearly having taken notice of the above case law, steadfastly maintain that the complaint is not about pay for performance, and they focus on the fact that the 2012 lump sum payments described above were not tied to performance, and were paid only to people at the maximum of the grid in 2011, and not to others. As well, they emphasize the lack of advance notice, and lack of transparency.

39The undisputed fact is that failure to pay any such lump sum payments flows from the decision to set the performance pay awards at 0% for 2011/2012, and to freeze the basic annual earnings of MCP employees at the level they had reached in 2011. Further, and despite the complainants’ characterization of the lump sum payments as arbitrary, it is also undisputed that the lump sum payments maintained the annual earnings of those who were at the maximum of the pay grid in 2011 at the level they had achieved as a result of the application of pay for performance levels for the fiscal year 2010/2011. Thus, the uncontested facts establish that the compensation policy for 2011/2012 treats both sets of employees the same in terms of leaving them all at the level of basic annual earnings they had achieved in 2011. For those who were at the maximum of the pay grid in 2011, the 2012 payment served to maintain their level of basic annual earnings, rather than limiting them to the maximum of the pay grid, with no additional remuneration, which the policy defines as a decrease in annual earnings.

40It is also uncontested that, with the exception of the proviso that the lump sum payment could be withheld for those who were not performing at an acceptable level or had been subject to disciplinary measures in the previous fiscal year, the level of payment for fiscal year 2011/2012 was not related to the level of performance in the preceding year. Regardless of how good one’s performance was in that year, compensation could be no higher than the level warranted by performance up to the end of the previous fiscal year. This aspect of the complainants’ argument has some appeal as an avenue to escape the limitation on the Board’s ability to deal with complaints about pay for performance, since it is true that the pay for fiscal year 2011/12 was not related to performance in the preceding year, and the lump sum they claim for those who did not receive it in 2012 was a payment which was not tied to the level of performance in the preceding year.

41Despite that appeal, my considered conclusion is that this complaint is, in substance, all about the denial of pay for performance in the fiscal year 2011/12 and therefore beyond the Board’s jurisdiction. The nub of the complaint is the failure of the employer to pay those not at the maximum of the pay grid in 2011 a lump sum payment in 2012. The basic fact that those not at the maximum of the pay grid in 2011 stayed there, and had no way to increase their basic annual earnings is because they were denied pay commensurate with their performance in that fiscal year. Although the requests for relief do not explicitly claim pay for performance, it is clear that what is wanted out of this complaint is more pay for those who did not get the bonus payment in 2012. The most specific request for redress, i.e. a return to previous compensation policies and practices, would require the Board to award pay for performance as provided in previous years, which the employer decided to deny in fiscal year 2011/2012.

42I also agree with the employer’s position that the other requests for remedy are tantamount to asking the Board to set the managers’ terms and conditions of employment, rather than enforce already existing ones, something that the Board does not have the authority to do either. The claims for equity in compensation strategy in 2011/12 and going forward, or an equal bonus payment to all MCP staff, all fall within the category of requests for different terms and conditions of employment than those offered by the employer, rather than a claim that existing terms and conditions of employment were breached.

43There also appears to be a theme in the complaint that because compensation for fiscal year 2011/12 was different from recent years, it was improper. The compensation policies in evidence are full of explicit provisions giving the employer the flexibility to change compensation from year to year, so that I do not find this submission to contribute to the viability of this complaint.

44There is also the claim for equal pay for equal work, including the statement that the arbitrary bonus payments violate the spirit of the Pay Equity Act. This aspect of the complaint has the ring of an allegation of an illegal compensation provision. And if there were anything in the alleged facts that established a viable basis for such a claim, the Board would have the jurisdiction to let the claim proceed. However, there is nothing in the material before me that constitutes a viable case of a violation of any policy or legislative provision as to equal pay for equal work. It can be seen from the provincial legislation providing for equal pay for equal work, and equal pay for work of equal value, that the kind of unequal pay that is illegal is that based on gender or sex discrimination. See, in particular, s. 42 (1) of The Employment Standards Act and section 8 of the Pay Equity Act where it is made clear that differences in compensation which are the result of compensation policies which do not discriminate on the basis of sex or gender do not constitute failures to pay equal pay in the sense prescribed by Ontario law. More generally, there is no suggestion of any gender-based disparity here, or of discrimination in wages on the basis of any other ground prohibited under the Ontario Human Rights Code. The only discrimination alleged is between those at the maximum of the pay grid in 2011, and those who were not. There is nothing in the material before me that persuades me that this is a viable claim of a breach of the complainants’ terms and conditions of employment, as there is no statute, policy or other term and condition of employment in evidence which arguably prohibits that kind of difference.

45Further, while I accept the complainants’ submission that the Board could award other remedies than the ones requested, in this case the remedies claimed are markers of what the complaint is really about, and persuade me that the matter is beyond the Board’s authority to remedy.

46I have also carefully considered the viability of the claim that the complainants had a legitimate expectation that they would be paid pay for performance or receive reasonable notice of a change in that respect. Reference was made in this regard to the decision of an Employment Standards Officer in respect of the non-unionized employees of the City of Toronto, cited above. Quite apart from the undisputed fact that Part V of The Employment Standards Act, relied on as the basis of that decision, does not bind the Crown, I find the facts of that case sufficiently different that the decision lends little support to the complainants’ case. The findings of fact included that the employer, by way of a vote at City Council, had authorized the performance payments in question, and then tried to withdraw them after the employees’ right to them had vested. In this case, there is no evidence that the payments sought had been authorized for those who were not at the maximum of the grid in 2011. As well, although there is little doubt that the pay for performance policy is a term and condition of the complainants’ employment, just as it was for the non-union City employees, there is nothing in the City of Toronto decision that indicates that part of the City’s policy was an express provision that the pay for performance could be denied in any year. No doubt, the fact that performance awards had been made in all recent years distracted from employees’ concentration on the part of the policy that allowed the employer to refrain from approving performance awards for any given performance cycle. More basically though, there is no limitation, either in The Employment Standards Act or in any term and condition of the City’s employees mentioned in the decision, on the consideration of complaints related to pay for performance, as there is in this Board’s governing regulation.

47There is also the allegation that the 2012 compensation provisions were arbitrary, and based on irrelevant factors. When asked in argument whether the complainants were aware of specific irrelevant factors, or they were reasoning backward from their view that the result was not fair and equitable, the complainants’ spokesperson said keeping the salary the same as in 2011 did not take into account the impact of that policy on the complainants. Further, she said there were concerns that there were errors made that some people not at the maximum received the lump sum anyway. I note that this latter claim is not part of the complaint, so that this point is not necessary to deal with. As well, remedying such an error would presumably require the Board to remove pay from those in such a situation, which was not requested in the complaint.

48As to the more general claim that the compensation scheme in 2012 was arbitrary, it is true that the Board has taken jurisdiction over claims that terms and conditions of employment were applied in an arbitrary manner. However, where the claim was tantamount to a request that the Board create different terms and conditions of employment, the Board has declined to proceed with such complaints. See, for instance, the Garratt decision, cited above. I find that this request is, in substance, also a request for the setting of a new term and condition of employment as to compensation for fiscal year 2011/2012 and beyond, and is outside of the Board’s power for this reason as well as being related to the denial of pay for performance.

49The complainants also raised a concern as to whether the policy provisions here in issue had the authority of Management of Board of Cabinet. Given that there are no asserted facts which raise a viable claim for the relief requested in any event, it is not necessary to deal further with this concern. In any event, it was not part of the original complaint.

50The complainants also rely on case law such as the Kanga decision cited above, to urge the Board to take jurisdiction on the basis of statements in policy, to the effect that the employer has agreed to treat employees in a fair and equitable manner, ensuring equality in the treatment of people. Although the Board’s decision in Kanga does stand for the proposition that policy such as the administration manual is part of terms and conditions of employment, it is not determinative in this matter. It did not deal with an argument based on the regulatory exclusion from the Board’s jurisdiction over pay for performance which has been in the regulation, at least since 1990. There was no suggestion in the Kanga decision that it was argued that the remedy requested in Kanga was beyond the Board’s jurisdiction to give. In any event, I do not find there to be a factual basis in the material before me to constitute a viable claim in respect of the claims for equity flowing from policy either. The policy statements as to equality and equitable treatment do not require that all employees be treated the same and the undisputed pay provisions create differences based on many factors such as classification and service. The complainants do not argue that all jobs should be paid the same, regardless of qualifications, responsibilities, etc., although that might accord with some people’s idea of equality. The claim is that the employer should grant everyone an equal lump sum payment, which has been dealt with above, and constitutes a request to create a new condition of employment, which would erase differences related to previous performance, something that does not seem consistent with the rest of the complaint, in any event.

51There is also the allegation about transparency. Although it may be that specific communication earlier on might have given the complainants better understanding of the lump sum payments, and allayed concerns expressed in this complaint, there is nothing in the material before me that establishes a viable complaint of a violation of a specific term or condition of employment as to transparency, or specific amount of notice. As to the fact that the employer set the performance percentage at 0% after the performance year, the facts do not establish a viable case of a breach of the policy in this respect. The complainants had notice, in the longer standing pay for performance policy of the employer’s practice of setting the level of the performance award, if any, after the performance cycle, even if their attention was not specifically drawn to it before the compensation freeze at issue in this decision. More generally, as in the Garratt decision, cited above, the allegations concerning transparency and fair and equitable treatment concerning wages are inseparable from the elements of the complaint which essentially ask the Board to set different terms and conditions of employment. I am not persuaded that they make out a viable allegation that is within the Board’s remedial authority.

52In its written statement to the complainants outlining the preliminary motion it intended to bring, the employer submitted that for 30 of the complainants, the remedial requests are moot since those complainants have received a payment which amounts to what would have been pay for performance for 2011/12 had it not been set at 0%. It is not necessary to deal with this submission, or the employer’s assertion that some of the complainants were members of a bargaining unit and therefore not entitled to complain to this Board, as the complaint is dismissed on other grounds.

53For all of the above reasons, the Board finds that the complaint must be dismissed as beyond its jurisdiction as it relates to the denial of pay for performance and in respect of its claims for the setting of new terms and conditions of employment. The Board remains seized to the extent necessary to resolve any residual disputes as to the composition of the group of complainants, which the parties are unable to resolve themselves.