COURT FILE NO.: CV-20-00000010-0000
DATE: April 30, 2021
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: CHRISTOPHER RICHARDSON, Plaintiff
AND:
HASTINGS AND PRINCE EDWARD DISTRICT SCHOOL BOARD, Defendant
BEFORE: Justice Patrick Hurley
COUNSEL: Christopher J. Edwards and Kent Williams, for the Plaintiff
Colin Dubeau, for the Defendant
HEARD: March 1, 2021
ENDORSEMENT
Introduction
[1] The issue in this motion is whether the court has jurisdiction over the plaintiff’s claim against his employer or whether it is subject to grievance and arbitration under his union’s collective agreement with the employer.
[2] The motion is brought under Rule 21.01(3)(a) which provides that a defendant may move before a judge to have an action stayed or dismissed on the ground that the court has no jurisdiction over the subject matter of the action.
[3] The record before me consists of the statement of claim and the collective agreement between the defendant Hastings and Prince Edward District School Board (“HPEDSB”) and Canadian Union of Public Employees (“CUPE”), Local 1022 for the period September 1, 2017 to August 31, 2019 (the “CA”).
[4] The plaintiff commenced the action on January 15, 2020. HPEDSB is the sole defendant and has not yet delivered a statement of defence.
The facts
[5] The following facts are taken from the statement of claim.
[6] The plaintiff, Christopher Richardson, is employed as an Educational Assistant with HPEDSB and is a member of CUPE, Local 1022. He started in September 2014 as a temporary employee. He became a full-time Educational Assistant in September 2017. As such, he was eligible for healthcare benefits under the policy held by HPEDSB including long-term disability benefits.
[7] Mr. Richardson completed the necessary enrolment forms and provided them to the principal of the school where he worked. In October 2018, he went on a medical leave of absence after he was diagnosed with a serious physical disability.
[8] In 2019 he applied for long-term disability benefits from the group insurance carrier, the Ontario Teachers Insurance Plan. After he did so, he was advised that he was not enrolled in the plan and therefore not eligible to receive benefits.
[9] He commenced this action against HPEDSB in January 2020 seeking damages of $300,000 for “negligent administration of benefits”. Mr. Richardson alleges that HPEDSB owed him a duty of care in administering the long-term disability plan and breached this duty of care in a number of respects, including failing to ensure that he was enrolled in the plan or advising him of the consequences if he was not. The requested damages are equivalent to the amount that he would be entitled to receive if had he been properly enrolled in the plan.
The collective agreement
[10] Under article 13 of the CA, a grievance is defined as a violation, or alleged violation, or question or interpretation, of the CA. If it is not resolved, it is referred to a sole arbitrator selected by mutual agreement.
[11] Article 21 sets out the benefit coverage. For long-term disability benefits there were three categories of employees referred to as Jurisdictional Groups ‘A’, ‘B’ and ‘C’. Mr. Richardson was in the ‘C’ category.
[12] Ss. 21.06 (b) provides:
Employees in Jurisdictional Groups “B” and “C” who are enrolled in the LTD plan shall pay the full premium cost of the LTD plan.
The Board shall add to the weekly earnings of each employee and Jurisdictional Groups “B” and “C” who are enrolled in the LTD plan, an amount equivalent to fifty percent (50%) of the billed premium of the LTD plan. It is understood that enrolling in the LTD plan is optional.
[13] Paragraph 8 of Appendix ‘A’ to the CA is entitled “Long Term Disability Benefits” and states:
Long Term Disability Benefits will be provided in accordance with the specifications of the plan referenced in Article 21.06 a) and b) of this Collective Agreement. Long Term Disability Benefits are available to employees in Group ‘A’ after one year, and to employees in groups ‘B’ and ‘C’ after 60 days from the first date of absence related to the disability.
[14] The only other article in the CA which refers to long-term disability benefits is C6.1(f) which restricts an employee’s eligibility for sick leave benefits if they are also receiving benefits under the Workplace Safety and Insurance Act or “ a LTD plan”.
The statutory framework
[15] The collective bargaining relationship between CUPE, Local 1022 and HPEDSB is governed by the School Boards Collective Bargaining Act, 2014, S. O. 2014, c.5 and the Labour Relations Act, 1995, S. O. 1995, c.1
[16] Ss. 43(1)(2) and (3) of the former states:
An employer bargaining agency or an employee bargaining agency may seek a decision through final and binding arbitration to resolve any difference arising from the interpretation, application or administration of any central term of a collective agreement.
Sections 48 and 49 of the Labour Relations Act, 1995 apply, with necessary modifications, to and in respect of the employer bargaining agency and the employee bargaining agency for the purpose of obtaining a decision of an arbitrator or arbitration board concerning a matter described in subsection (1).
Subsection (1) does not prevent a party to a collective agreement from seeking a decision through final and binding arbitration to resolve any difference arising from the interpretation, application or administration of any term of a collective agreement, including a central term.
[17] S. 48(1) of the latter provides:
Every collective agreement shall provide for the final and binding settlement by arbitration, without stoppage of work, of all differences between the parties arising from the interpretation, application, administration or alleged violation of the agreement, including any question as to whether a matter is arbitrable.
[18] The School Boards Collective Bargaining Act establishes two tiers of collective bargaining. One set of issues is dealt with by CUPE and an association of school boards. These are known as “central terms” and are referred to as such in the CA. The remaining issues are negotiated by Local 22 and HPEDSB and identified as “local terms”. The long-term disability benefits plan was a local term.
The governing legal principles
[19] In Skof v. Bordeleau, 2020 ONCA 729, Nordheimer, J.A. stated at para. 8:
The basic proposition applicable to r. 21.01(3)(a) can be stated fairly simply: either the Superior Court of Justice has jurisdiction over a claim or it does not. In deciding that issue, it must be remembered that the Superior Court of Justice, as a court of inherent jurisdiction, has jurisdiction over every conceivable claim unless (i) the claim does not disclose a reasonable cause of action or (ii) the jurisdiction has been removed by legislation or by an arbitral agreement: TeleZone Inc. v. Canada (Attorney General), 2008 ONCA 892, 94 O.R. (3d) 19, at para. 92, aff’d 2010 SCC 62, [2010] 3 S.C.R. 585.
[20] In Weber v. Ontario Hydro, 1995 CanLII 108 (SCC), [1995] 2 S.C R. 929, McLachlin, J. (as she then was) held that, in resolving the jurisdictional issue, the central question is “whether the dispute, in its essential character, arises from the interpretation, application, administration or violation of the collective agreement.” (para. 52)
[21] The Court of Appeal in Barber v. Manufacturers Life Insurance Company (Manulife Financial), 2017 ONCA 164 and London Life insurance Co. v. Dubreuil Brothers Employee Association, 2000 CanLII 5757 affirmed that the “Brown and Beatty” categories are important considerations in benefit entitlement disputes.[^1] These are:
where the collective agreement does not set out the benefit sought to be enforced, the claim is inarbitrable.
where the collective agreement stipulates that the employer is obliged to provide certain medical or sick pay benefits, but does not incorporate the plan into the agreement or make specific references to it, the claim is arbitrable;
where the collective agreement only obliges the employer to pay the premiums associated with an insurance plan, the claim is inarbitrable; and
where the insurance policy is incorporated into the collective agreement, the claim is arbitrable.
[22] The most recent appellate decision applying Weber in a dispute over long-term disability benefits is Hutton v. The Manufacturers Life Insurance Company c.o.b. as Manulife Financial, 2019 ONCA 975.[^2] In upholding the motion judge’s decision that the claim was subject to exclusive arbitral jurisdiction under the collective agreement, Chief Justice Strathy stated at para. 37:
The Brown and Beatty categories were described in London Life as “helpful”. However, while the categories can indeed be helpful, they should not mask the essential question, which is to determine whether benefit plans that are ancillary to the collective agreement “can be characterized as constituting or forming part of a collective agreement” so as to be enforceable by arbitration. This is primarily a question of interpretation of the collective agreement. As Brown and Beatty acknowledge, “it is necessary in every case to assess the particular provisions of the collective agreement which the parties themselves have negotiated, and to understand them in the general context of the collective agreement”: Brown and Beatty, at 4:1210, 4:1400 (citing Coca-Cola Bottling Ltd. v. U.F.C.W. (1994), 1994 CanLII 18671 (ON LA), 44 L.A.C. (4th) 151, at p. 155). While the categories can be of assistance in helping decision-makers understand the impact of their conclusions regarding the interpretation of a collective agreement, they must not distract from the primary exercise at hand: determining whether the essential character of the dispute arises either explicitly, or implicitly, from the interpretation, application, administration or violation of the collective agreement: Regina Police Assn., at para. 25.
[23] This issue – the proper forum of benefit disputes – remains a contentious one despite a surfeit of arbitration and court decisions. In GP Northwoods v. Unifor, Local 99-P, 2021 CanLII 26559 (ON LA), Arbitrator Goodfellow observed at pg. 9:
This is yet another case, among many hundreds over the years, in which an arbitrator is invited to parse, sometimes in excruciating detail, collective agreement disability benefits language in an effort to determine whether employee benefits claims may be pursued against the employer under the agreement that gave rise to the benefits – the collective agreement – or whether they must be pursued in court against the employer and/or a third party insurer or administrator.
Few areas of labour arbitration are as arcane.
On the one hand, there are the four Brown and Beatty categories, which address the uses that can be made at arbitration of so-called “ancillary documents”, including plans of insurance, which have long provided the lens through which such claims are viewed. On the other, there is the question, especially in the light of Weber and Pilon, how claims to benefits as central to most collective agreements as health and welfare could possibly not be enforced under the very agreement that gave rise to them and why a plan of insurance or the presence of a third party insurer should matter.
The positions of the parties
[27] The defendant submits that, if article 21.06 was the only provision in the CA, this case would be in category three of the Brown and Beatty taxonomy and the plaintiff could pursue his claim in court. But Appendix ‘A’ incorporates the LTD plan by reference and, under arbitral jurisprudence, this puts the claim in category four. Alternatively, the action should be stayed to permit an arbitrator to decide the jurisdictional issue.
[28] The plaintiff points out that the defendant is relying on decisions that have not been expressly followed in Ontario; rather, arbitrators in this province have opined that the collective agreement must contain language which clearly incorporates the terms of the LTD policy and that is not present here. This case, therefore, remains a category three. Further, I should follow judicial decisions on an employer’s negligent administration of a benefits policy which have found that they are properly the subject of a court proceeding. The plaintiff rejects the alternative option of the stay, arguing that this would only add unnecessary cost and delay.
Analysis
[29] There is much to be said for the approach adopted in Atomic Energy of Canada Ltd v. Power Workers Union, 2004 CarswellNat 6950, an arbitration decision relied upon by the plaintiff, that “clear language” is required to incorporate the terms of an insurance agreement into a collective agreement. As Hutton demonstrates, the parties can explicitly state that any dispute over benefits is to be resolved through the grievance arbitration process.[^3] Clarity in drafting a collective agreement in this respect should be easy to accomplish and the failure to do so seems inexplicable given the fecundity of legal disputes over the entitlement to benefits and which route has to be taken to resolve these disputes.
[30] Although clause 8 of Appendix ‘A’ states that LTD benefits will be provided in accordance with the plan referred to in article 21.06, I was not provided with a copy of the specific plan nor was there any evidence about how this plan was administered either by HPEDSB or the insurer. There are some provisions in the CA that touch upon the administration of benefits but nothing in relation to the LTD plan except for one situation - an employee’s eligibility for sick leave or short-term disability benefits if they are receiving LTD or WSIA benefits. It is not even clear that this provision refers to the long term disability benefit plan under the CBA given its use of the indefinite article. The statement of claim contains allegations about the enrollment procedure but I do not know if this was based on an ad hoc arrangement or contractual stipulation.
[31] I find that the essential character of the dispute involves the duties and responsibilities of the employee and employer in respect of enrolment in the LTD plan and not the terms of plan itself. The CA is silent on this issue. The subject matter of the legal action “does not engage the rights and obligations of the parties found expressly or by inference in the collective agreement”: Perfett Estate v. Riverside Healthcare Facilities Inc., 2005 CanLII 18184 (ON CA) at para. 29. See also Sunjka v. The Manufacturer’s Life Insurance Company, c.o.b. as Manulife Financial, 2010 ONSC 2900.
[32] The defendant asserts that as long as the collective agreement states that benefits “will be provided in accordance with” or “shall be available in accordance with” an insurance plan, any dispute, including one over enrolment in the plan is arbitrable.[^4] The plaintiff’s claim, because it is framed as the “negligent administration” of the plan, is a dispute over entitlement to benefits and therefore falls within the exclusive jurisdiction of an arbitrator.
[33] I disagree. If the parties intended that all conceivable legal disputes over long-term disability benefits were to be resolved through the grievance arbitration process, they could have plainly said so in the CA. I also note that, in many of the cases cited by counsel, there was evidence put before the decision-maker which explained the administration of the plan and what was communicated to employees both before and after the dispute arose. This can be quite helpful in interpreting the intent of the parties and the ambit of the collective agreement. There was no such evidence in this case. Unlike motions under Rule 21.01(a) and (b), evidence is admissible in a motion under ss. 3(a).
[34] In Claxton v. BML Multi Trades Group, 2003 CanLII 34634 (ON CA), the Court set aside the motion judge’s decision allowing an action to proceed and substituted a stay. Abella, J.A. stated at paras. 11-12:
The motions judge dismissed BML’s motion. He examined the evidence before him and concluded that Mr. Claxton was exercising managerial functions. As a result, he found him not to be an “employee” within the meaning of that term in s. 1(3)(b) of the Labour Relations Act S.O. 1995 c. 1. Because Mr. Claxton was not covered by the Collective Agreement, the motions judge concluded that the court had jurisdiction to hear the wrongful dismissal claim.
With respect, the motions judge lacked jurisdiction to embark on an inquiry into whether Mr. Claxton was exercising managerial functions. The only issue he ought to have considered was whether the core of the jurisdictional dispute before him was governed by the terms of the Collective Agreement. By assessing instead the merits of the dispute, namely, whether Mr. Claxton was an employee covered by the Collective Agreement, he was trespassing on arbitrable territory.
[35] She concluded at paras. 15-16:
The preliminary dispute between Mr. Claxton and BML is whether he is covered by the Collective Agreement. If he is, the dispute over his termination will be arbitrated. If he is not, it will proceed in the Superior Court of Justice as a wrongful dismissal action. But the issue whether the dispute is arbitrable, engages squarely the application and interpretation of the Collective Agreement and the motions judge, accordingly, had no jurisdiction to make that determination.
I would expect that the parties – and the union – will co-operate in facilitating a timely, arbitrated determination on whether Mr. Claxton exercised managerial functions or was an “employee” included in the bargaining unit. Thereafter, the appropriate forum for scrutinizing Mr. Claxton’s termination can be identified and his remedies pursued. Until that determination is made, it seems to me to be more appropriate to stay, rather than dismiss the action.
[36] I am not assessing the merits of the dispute nor have I engaged in any fact-finding inquiry as a preliminary step to interpreting the CA. Rather, my determination of the jurisdictional issue is based on an interpretation of the CA and the nature of the dispute between the parties. Therefore, the appropriate remedy is a dismissal of the motion and not a stay. As Laskin, J. A. said in Piko v. Hudson’s Bay Co., 1998 CanLII 6874 (ON CA):[^5] “Some disputes between employers and employees may not arise under the collective agreement; others may call for a remedy that the arbitrator has no power to grant. The courts may legitimately take jurisdiction over these disputes.” (para. 11)
Disposition
[37] The motion is dismissed. The plaintiff, as the successful party, is presumptively entitled to costs. If the parties cannot agree on costs, the plaintiff shall deliver written submissions not to exceed two pages, excluding dockets, case law and any settlement proposals made in writing within 15 days of the release of this decision. The defendant has 10 days in which to deliver reply submissions of the same length.
______________________________ Hurley, J
Date: April 30, 2021
[^1]: From Donald J. Brown and David M. Beatty, Canadian Labour Arbitration, 3rd ed. (Aurora, Ontario: Canada Law Book, 1998). [^2]: Leave to appeal refused: 2021 CanLII 1096 [^3]: The relevant article in the collective agreement in that case read: “Any dispute which may arise concerning an employee's entitlement to short-term or long-term benefits under HOODIP may be subject to grievance and arbitration under the provisions of this agreement." [^4]: Canadian Pacific Railway v. Unifor, Local 101R 2020, CLAS 147; Canadian National Railway v. Teamsters Canadian Rail Conference (X) 2019, 140 CLAS 60; Driol v. Great – West Life Assurance Co. 2010 BCSC 2002, aff’d 2011 BCCA; and Canada Post Corp. v. CUPW, [2000] CLAD 132. [^5]: Leave to appeal refused: [1999] S.C.C.A. No. 23