Thoughts from a Management Lawyer

Does the Court Have Jurisdiction? A Common Question in Labour Relations

Where do you go for a remedy?  This is a question I get asked frequently by my students and clients.  It is one that is sometimes difficult to answer, but with increased clarity, courts and administrative tribunals have carved out their turf and the rules that will be applied to determine whether they, or another body, hav jurisdiction to deal with the substance of the complaint.

The most recent case, is Cumming v. Peterborough Police Association, 2013 ONSC 1544 (CanLII) released on March 13, 2013.  The Police Association brought an motion to dismiss the applicant’s claim on the basis that this court has no jurisdiction over the subject matter of the action.  

The Court reviewed the statement of claim and concluded that the plaintiff “asserts, in essence, a breach of the Police Association’s Duty of Fair Representation”.  

The Peterborough-Lakefield Community Police Services Board and the Association are parties to a collective agreement which applies to the plaintiff, and the Association is recognized as the “exclusive bargaining agent” for certain employees, including the plaintiff.

Following the Supreme Court of Canada decision in Weber v. Ontario Hydro, [1995] S.C.J. No. 59 (S.C.C.), the Court nicely summarized the questions it had to determine:

The question to be determined is whether the dispute in its “essential character” arises from the interpretation, application, administration or violation of the Collective Agreement and or the legislation the Collective Agreement incorporates as part of the Collective Agreement.

In order to determine the “essential character”, reference must be made to the wording set out in the pleadings, which in this case is the Statement of Claim.

If the “essential character” of the dispute arises explicitly or implicitly, from the interpretation, application, administration or violation of the Collective Agreement, the dispute is within the sole jurisdiction of an arbitrator to decide.

This analysis must proceed on the basis of the facts surrounding the dispute between the parties and not necessarily on the basis of the way the legal issues may be framed or pled. Whether an arbitrator can hear the dispute and grant the remedies as claimed by the plaintiff, the appropriate form is for the matter to proceed by way of arbitration.

Following an analysis, the Court concluded that “the damages and relief sought by the plaintiff relate to his allegation that the defendant Police Association did not fully discharge their duty to provide him with fair representation” and the exclusive jurisdiction rested with the arbitrator.  The allegations “relate to his employment” where:

The essential character of the dispute ultimately concerns an interpretation, application, administration or alleged violation of the provisions of the Collective Agreement, and in particular the duty which [the plaintiff] claims was owed to him, to represent him in a proper and complete and fair manner.

The Court dismissed the action, in its entirety, on the basis that the Court lacked jurisdiction.

Courts will assume jurisdiction in limited circumstances where the issues arise out of the employment of a unionized employee.  They have taken an expansive, though reasoned, approach to the “essential character” analysis and have dismissed a variety of claims brought by unionized employees.  That is not to say that there are “no” claims over which the court will assume jurisdiction where a unionized employee is the plaintiff, just that there is a developed body of cases that discuss the approach they will take in deciding the jurisdictional issue.

Is an employee entitled to be paid the wage of a higher-rated classification?

This is a common question in unionized workplace and the answer will depend, of course, not only on the particular wording of the collective agreement but on the underlying facts.

The recent case Nova Scotia arbitration award in Canadian Union of Public Employers, Local 3698 v Colonial Community Services, (2013) CanLII 10166 (NS LA) considered a grievance alleging that an employee in a lower rated classification should have been paid at the higher rate when temporarily assigned to a higher rated classification.  

The Collective Agreement provided:

23.02   When an employee is temporarily assigned to perform work in a classification inside or outside the bargaining unit paying a higher rate, he shall receive the rate for the higher classification. If a grid is in place, he/she shall be placed at the rate immediately above his/her current rate in the higher classification to which he/she was assigned.

In the Colonial Community Services case, a Residential Care Worker (“RCW”) came to work on the day shift in place of the Cook. She was paid her regular RCW rate of pay for that shift.  A grievance was filed alleging that the grievor “worked in cook’s position ... [but] did not receive the cook’s wages”.  

There was a practice in place in the workplace where a RCW replacing a cook would be paid at the RCW’s rate for the first two consecutive days of that replacement. If the replacement lasted longer than two days, the RCW would be paid at the Cook’s rate for the third and every following day in that sequence.

There were overlapping duties and responsibilities between the RCWs and the Cooks.  According to the Arbitrator:

But where the tasks that are being performed in one position are the same as those performed in another, the question arises as to whether the parties to the collective agreement intended by such clauses that the employee who normally performs those duties for a lower rate of pay should be able to claim the higher pay rate of the classification into which he or she has been temporarily assigned

 The Arbitrator summarized some of the principles

1. performing duties that are found in both lower-paid and higher-paid job classification does not in itself entitle a grievor to claim the higher rate of pay; and
2. the grievor performing duties in the higher-paid job must be carrying out the essential or core duties of that higher job classification: Re Fairview Nursing Home Inc and London and District Service Workers’ Union, Local 220 (1983), 9 LAC (3d) 342 (Rayner), cited in Ivaco Rolling Mills and USWA, Local 7940 (2002), 104 LAC (4th) 126 (Bendel).

Following a review of the job descriptions and the evidence, and while finding that the RCW replacing the Cook performs some tasks of the Cook, the Arbitrator nonetheless found that the grievor had not performed the “essential or core duties of the Cook when she filled in for the Cook”.  In particular, the grievor was “ simply following the orders and duties that had been mapped out for her by the Cook when she created the menu.”

The Arbitrator also observed that the longer the RCW fills in for the Cook, the more likely that the essential and core duties of the Cook will have to be performed by the RCW.  That being said, there was no need to decide that “tipping point” in this case.

Conclusion

The case is the most recent review of the age old question of when and under what circumstances should a lower paid employee be paid at the higher rate of pay when filling in temporarily for a higher rated position.  The key principles are succinctly summarized and, since many collective agreements address this issue, a careful read of the case is called for both in interpreting the language and when drafting job descriptions.

Standard of Proof in Labour Arbitration

While it may seem somewhat academic, the applicable standard of proof to which the parties to a labour arbitration will be held is an important consideration and one that can have a significant impact on the outcome of the case.  That said, since the Supreme Court of Canada decision in F.H. v. McDougall  (2008) SCC 53 (CanLII), this issue was settled, or so it seemed.

The issue was recently considered by the Ontario Divisional Court in Toronto District School Board v. Elementary Teachers’ Federation of Ontario, (2013) ONSC 594 (CanLII).

In this case, the grievor, an elementary school teacher, was dismissed on May 18,  2011 on the grounds that “he had struck a student’s hand against a desk, and he had refused to allow a female student to leave the classroom to adjust her hijab, insulting her religion at the same time.   These events occurred around June 10, 2010 when the grievor was acting as a supply teacher in the students’ classroom.”

The arbitrator held that the Board had not established that either event of misconduct occurred, and he ordered the grievor reinstated.

The Applicable Standard of Proof

In discussing the applicable standard of proof, the arbitrator noted:

The appropriate standard against which the Employer must prove its case is proof on a balance of probabilities.  In applying this standard, the seriousness of the allegations are taken into account.

He observed that teachers, as professionals, are held to a higher standard of conduct than non-professional employees and then observed that “there may be degrees of probability within the civil standard, depending on the subject matter” and, in quoting from another arbitration award where it was stated that “a high degree of probability” is required where a teacher’s professional reputation is at stake.   The arbitrator then observed:

I agree in the above approach to consideration of the evidence in the instant case.  Thus, given the serious nature of the allegations against the grievor and the seriousness of the consequences, the evidence concerning the students’ allegations must be carefully considered to determine whether or not the events occurred.  Accordingly, there must be clear and convincing proof the grievor did slap Student A’s hand and did inappropriately remark upon Student B’s religion.

The Arbitrator concluded that:

On review of all the relevant evidence before me, I find, on a balance of probabilities, the evidence is not clear and convincing so as to establish the grievor slapped Student A on the hand on June 10, 2010, or, to establish the grievor made an inappropriate comment about Student B’s religion.

Based on the totality of the relevant evidence before me, I find that the Employer has not borne the onus on it to prove, on a balance of probabilities, on clear and convincing evidence, the grievor slapped Student A’s hand on June 10, 2010, and, around June 10, 2011 [sic], made an inappropriate remark about Student B’s religion.

The Divisional Court considered the Supreme Court of Canada decision in F.H. v. McDougall  (2008) SCC 53 (CanLII) (which was not cited to the arbitrator).  This case held that there was one standard of proof in civil matters and that standard of proof was on a balance of probabilities.   As Justice Rothstein put it:

In the result, I would reaffirm that in civil cases there is only one standard of proof and that is proof on a balance of probabilities.  In all civil cases, the trial judge must scrutinize the relevant evidence with care to determine whether it is more likely than not that an alleged event occurred.

As to the cogency of the evidence, he stated:

Similarly, evidence must always be sufficiently clear, convincing and cogent to satisfy the balance of probabilities test.  But again there is no objective standard to measure sufficiency.

The Court found that, given McDougall, the arbitrator erred in suggesting an intermediate standard of proof, though the Divisional Court held that this error was not fatal to the decision that he reached because, looking at the reasons as a whole, the arbitrator did not apply that wrong standard:

When the reasons of this arbitrator are read as a whole, I am satisfied that he did not apply the wrong standard of proof.  Notably, he stated twice, in his summary at the end of the award, that he was applying the balance of probabilities test.  In his opinion, the evidence presented by the Board was not sufficiently cogent and convincing to establish the Board’s allegations against the grievor.

The language of “clear and convincing” evidence does not indicate that the arbitrator made an error in law.  Indeed, the fact he sought clear and convincing evidence in order to decide whether the employer met its burden is fully consistent with the instructions from McDougall that evidence “must always be sufficiently clear, convincing and cogent to satisfy the balance of probabilities test” (at para. 46).   The arbitrator is not to be faulted because he examined the evidence very carefully in the present case, where credibility was so important and where there were many inconsistencies in the evidence.

The Arbitrator was very concerned with the credibility of the Board’s key witnesses and the inconsistencies in the evidence that became pronounced.

Conclusion

The Divisional Court affirmed that the standard of proof in civil cases is on a balance of probabilities.  The Court read the arbitration decision as a whole, and found on that liberal reading, it was saved from the errors that the Court found to have been made.  Further, because the Arbitrator reached his decision as a result of credibility findings and determinations that some of the Board’s witnesses were unreliable, matters uniquely within his abilities, the Court concluded that “his conclusion was within a range of possible, acceptable outcomes, given the evidence before him”.  The Board’s application for judicial review was dismissed.

Intersection of Deemed Termination Clause and ESA Emergency Leave

There are only a handful of cases that deal with the intersection between a ‘deemed termination’ clause and the emergency leave provisions found in Section 50 of the Employment Standards Act, 2000 (the “ESA”).   The most recent case is Revera Retirement LP, (2013) CanLII 9071 (ON LA).

The grievor was employed as a housekeeper.  She started working for the employer in 1989.  The employer regularly employs 50 or more employees.

On April 3, 2012, the crown on one of her teeth became dislodged and fell off. She was in significant pain, but completed her shift and called her dentist at the end of her shift to schedule an appointment.  Unfortunately the dentists office was closed for the day.  The following day, April 4, 2012, the grievor scheduled an emergency appointment with her dentist at 3 pm.  According to the arbitrator:

The Grievor was scheduled to work on April 4, 2012 from 8:00-4:00; however, she swiped out and left the premises at 2:17.  She did not ask permission from or inform any manager prior to leaving.  The Grievor did advise her colleague, Debbie Philips, that she was leaving to attend the dentist prior to departing the workplace.  Ms. Philips was employed as a Housekeeping Supervisor by the predecessor employer to Glynwood.  Ms. Philips has not had any supervisory responsibility over the Grievor in more than ten years.  Ms. Philips did not report the Grievor’s early departure to any member of the management team.

The dental appointment was necessary to deal with an emergency.  The Grievor was having chronic and worsening pain as a result of a loose crown.  The grievor failed to follow the proper procedures for reporting her absence from work.

A meeting was convened with the grievor on April 5, 2012 during which "the Grievor admitted to leaving her shift early and acknowledged that she did not inform a manager prior to doing so".  Following a pre-approved vacation, the grievor was placed on a leave of absence and then terminated by letter dated May 22, 2012.

The collective agreement contained a deemed termination provision:

An employee shall lose all seniority and shall be deemed to have quit the employ of the Employer and the employment of the employee shall be deemed to have been terminated without further notice for any of the following reasons:

(f) leaving the Employer’s premises during regular working hours (not including meal breaks) without the permission of the Employer;

Furthermore, the collective agreement provided that "The Employer will comply with the requirements of the Employment Standards Act with respect to maternity leave, parental leave and emergency leave."

The Decision

Absent the application of section 50 of the ESA the deemed termination clause would be strictly enforced.  The effect of this would be to oust the arbitrators jurisdiction to mitigate against the "harsh consequences" of the clause.

Relying on a few earlier cases, Arbitrator Hayes concluded that "delay in providing the requisite note does not, however, vitiate the Grievor’s entitlement to a leave of absence under the ESA."

In Ryding-Regency Meat Packers Ltd. (2006) 155 L.A.C. (4th) 382 (Crljenica), the arbitrator considered the interaction between a deemed termination clause and the emergency leave sections of the ESA.  The grievor failed to obtain company permission for his absence from work in circumstances where the emergency leave provisions would apply.  The arbitrator held that a deemed termination provision could not be strictly construed where an employee brought him or herself within the scope of the emergency leave provisions in the ESA.  Specifically:

Arbitrators have construed deemed termination clauses strictly [authorities omitted].  Thus to comply with article 10.5(d), the employer had to establish that the grievor was absent for two or more days (which has been made out), and that he was absent without company authorization.   In my view, it cannot meet this requirement as, on the facts of this case, s.50 creates an absolute right to an emergency leave, without the need to obtain authorization from one’s employer.  The need for the company’s authorization necessarily implies the right to deny authorization, which cannot occur under s.50.  Thus, in accordance with the reasoning in Parry Sound, if Mr. Kelesis met the requirements of s.50, the employer could not rely on article 10.5(d), as it is more onerous than s.50 by adding an additional requirement of obtaining the company’s authorization.

The Arbitrator in Revera found that "the Grievor’s situation here presents a particularly sympathetic fact pattern" especially where "no question has ever been raised about the legitimacy of her requirement for emergency medical leave".

The failure to provide notice of the absence could, depending on the circumstances, attract discipline, but that does not remove the employee's absolute right to emergency leave under the ESA where the employee is able to establish that his or her circumstances fit within the four corners of that section.  In other words, according to the Ministry of Labour's Policy and Interpretation Manual:

Any discipline for failing to provide notice in situations where such notice is required under section 50(3) (i.e., where section 50(4) does not apply) would have to be appropriately linked to the failure to give advance notice and must not, in effect penalize the employee for exercising the right to leave.  The motive for any discipline that the employer does impose must clearly be the employee’s failure to give advance notice and not the taking of the leave itself.

In other words, as was accepted in Revera and  Ryding-Regency a grievor "could be disciplined for failing to give notice, but he did not lose his entitlement to the emergency leave."

Conclusion

Deemed termination provisions are common in collective agreements.  That said, they will generally have to give way to the leave provisions of the ESA where these are found to apply.  Furthermore, the fact that the employee failed or delayed in providing timely notice of the leave, while opening the employee up to appropriate discipline, did not result in a loss of entitlement to the leave.

Employers would be well advised to fully investigate a matter before applying the arguably harsh consequences of a deemed termination clause.  Automatic termination is not automatic where the ESA applies and care and patience are called for when applying a deemed termination provision.

Horseplay Serious but did not Support Discharge of Long Service Employee

Horseplay can have dire consequences and for that reason, among others, most employers prohibit any sort of rough, boisterous, or rowdy play in the workplace.

A recent case involving the termination of a long-service (35 year) employee considered whether, on the facts of that case, discharge was appropriate in a proven case of horseplay.  The grievor, a foreman, walked by another employee who was standing at the front counter, took out his lighter and lit the employee’s safety vest on fire and exited the building to assist a customer.  Another employee, seeing that the safety vest had caught on fire, rushed over and tried to pat out the flames, burning his hand in the process.

 According to the Arbitrator:

The Employer has a comprehensive Safety Management System. Safety meetings are held monthly. One section of the Manual states that horseplay “is forbidden and may result in disciplinary action”.

 The employer’s approach to horseplay was described as “zero tolerance”.

 The Arbitrator disagreed:

 I am not persuaded by the Employer’s argument that there is zero tolerance to horseplay. Although I have no examples that demonstrate otherwise, the manual itself states that horseplay “may result in disciplinary action” (emphasis added).

The Arbitrator applied the long-standing approach to discipline in Wm. Scott and Co. Ltd. And Canadian Food & Allied Workers Union, Local P-162, [1977] 1 Can L.R.B.R. 1 (“Wm. Scott”) where the arbitrator asks three questions.

1. Has the employee given just and reasonable cause for some form of discipline by the employer?
2. If so, was the discharge an excessive response in all the circumstances of the case?
3. Finally, if the discharge is considered excessive, what alternative measure should be substituted as just and equitable?

The Union, in this case, conceded that just cause was present and that some form of discipline was warranted.

 In reviewing the appropriateness of the penalty, the Arbitrator will consider:

1.  The previous good record of the grievor.
2. The long service of the grievor.
3. Whether or not the offence was an isolated incident in the employment history of the grievor.
4. Provocation.
5. Whether the offence was committed on the spur of the moment as a result of a momentary aberration, due to strong emotional impulses, or whether the offence was premeditated.
6. Whether the penalty imposed has created a special economic hardship for the grievor in light of his particular circumstances.
7. Evidence that the company rules of conduct, either unwritten or posted, have not been uniformly enforced, thus constituting a form of discrimination.
8. Circumstances negativing intent, e.g. likelihood that the grievor misunderstood the nature or intent of an order given to him, and as a result disobeyed it.
9. The seriousness of the offence in terms of company policy and company obligations.
10. Any other circumstances which the board should properly take into consideration.

While the Arbitrator found that the incident was serious, the grievor did not act in a manner that was malicious or reckles.  The grievor did act carelessly and stupidly, according to the Arbitrator, but his actions were not premeditate.  Furthermore, he was a long-service employee.  The Arbitrator concluded that, “in the circumstances of this case”, discharge was excessive and substituted a suspension, without pay, from the date of termination until approximately one (1) week after the date of the Award.

Pending Criminal Charges and Arbitration

A employee was charged with sexual assault.  Among his bail conditions, he could not act as a paramedic, nor could he attend at his employer's headquarters and communicate or associate with certain named co-workers.  He was placed on an administrative leave and a meeting with the employer was scheduled.  The employee's lawyer wrote the employer saying:

"I have advised [the employee], in order to protect his constitutional rights and the integrity of the criminal case, that he is to respectfully decline to answer any questions touching upon the allegations that are before the criminal courts. I cannot contemplate an interview, as described in your letter, which would not trespass into this area."

The employer noted that it could not, in the circumstances, complete the investigation.  Further, the employee "was informed by management that he was being placed on an "indefinite authorized leave of absence without pay" and that "your bail conditions preclude you from acting as a health care or first aid provider, among other conditions, and as a result you are unable to perform the duties of your job." 

The Union grieved and the central issue was whether the employer had the right to suspend the employee in light of the criminal charges.  

The arbitrator observed that:

It is now generally accepted that the right to suspend an employee who has been criminally charged must be assessed in the light of a balancing of interests between the employer and the employee:

The employee, of course, has a legitimate interest in being considered innocent until he has been proven guilty. If, however, the alleged offence is so related to the employment relationship that the continued employment of the employee would present a serious and immediate risk to the legitimate concerns of the employer as to its financial integrity, security and safety of its property and other employees as well as its public reputation, then indefinite suspension until the charges have been disposed of would appear to be justified. In determining the nature of the legitimate interests of the employer, it is necessary to look at the nature of the offence, the work being performed by the employee, and the nature of the employer's business...The board has carefully considered the cases to which we were referred and from those cases, we would extract the following general principles:

1. The issue in a grievance of this nature is not whether the grievor is guilty or innocent, but rather whether the presence of the grievor as an employee of the company can be considered to present a reasonably serious and immediate risk to the legitimate concerns of the employer.
2. The onus is on the company to satisfy the board of the existence of such a risk and the simple fact that a criminal charge has been laid is not sufficient to comply with that onus. The company must also establish that the nature of the charge is such as to be potentially harmful or detrimental or adverse in effect to the company's reputation or product or that it will have a harmful effect on other employees of the company or its customers or will harm the general reputation of the company.
3. The company must show that it did, in fact, investigate the criminal charge to the best of its abilities in a genuine attempt to assess the risk of continued employment. The burden, in this area, on the company is significantly less in the case where the police have investigated the matter and have acquired the evidence to lay the charge than in the situation where the company has initiated proceedings.
4. There is a further onus on the company to show that it has taken reasonable steps to ascertain whether the risk of continued employment might be mitigated through such techniques as closer supervision or transfer to another position.
5. There is a continued onus on the part of the company during the period of suspension to consider objectively the possibility of reinstatement within a reasonable period of time following suspension in light of new facts or circumstances which may come to the attention of the company during the course of the suspension. These matters, again, must be evaluated in light of the existence of a reasonable risk to the legitimate interests of the company ( Re Ontario Jockey Club and SEIU, Local 528 ,17 LAC (2d) 176 (Kennedy) at 178-9).

The employer was directed to determine whether there are other employment opportunities for the grievor and to engage in that process in good faith and on an on-going basis pending the outcome of the criminal charge.  

The employer sought judicial review of this Award which application was recently dismissed by the Divisional Court.  In so doing the Court noted:

"This jurisprudence requires that in a situation where the employee is precluded from performing his or her normal duties due to pending criminal charges or for other reasons, the employer must attempt to identify an appropriate temporary position for the employee, consistent with the employer’s reasonable interests."

The Court rejected the argument that these principles did not apply because principle is inapplicable because "the employer’s actions were in response to the bail restrictions imposed following the employee’s arrest".

 

All Words Have a Meaning (at arbitration and everywhere)

Arbitrators get their jurisdiction from the collective agreement between the Union and employer, and their task is to interprete the words negotiated by the parties.  There is a presumption that in construing a collective agreement, all of the words used were intended to have some meaning.  The words must be interpreted in a manner that makes sense.  This requires that the words be read, understood and interpreted.

In Hospital for Sick Children, the issue was whether an employee had lost seniority and his employment deemed terminated under the following provision:  

“An employee shall lose all seniority and service and shall be deemed to have terminated if he:  

… (d)         is absent from scheduled work for a period of three (3) or more consecutive working days without notifying the Hospital of such absence and providing to the Hospital a satisfactory reason.

This case was heard on three (3) days and an evening by a tripartite Board of Arbitration.   While the Award allowing was a short 6 paragraphs long,  the lessons emerging from the Award are many.  

The employee (grievor) was off work for three (3) months starting October 5, soo8.  He supplied the employer with medical notes substantiating his absence from work.  His sick leave entitlement expired shortly after he started his medical leave.  In these circumstances:

As such, there is no question that the Hospital was notified of Mr. Baker’s absence. What there is a question about is whether Mr. Baker was “absent from scheduled work” and, if so, whether there was a “satisfactory reason” for that absence.

The Board of Arbitrator had no problem quickly finding that the first condition was "clearly not met" and there was no need to go on to consider whether the proferred reason for absence was satisfatory.  

Given that the employee was absent from work for three (3) months, if the employer now wanted to invoke article 9(3) of the Collective Agreement, it had to meet the terms of the article.  Here's where the Board of Arbitration provides some direction:

Here, that meant more than simply advising Mr. Baker, after a request for further (and detailed) “clarification” from his physician (on which Mr. Baker had not been copied) made substantially over the Christmas/New Year’s period, did not generate a response within the stipulated deadline, that he was now, for the first time in three months, considered to be “absent without authorization” and that his employment “may be in jeopardy” unless he responded to that request within three days; leaving aside any concerns one might have as to the “fairness” of that approach, or as to the legal or factual ambiguity of the message, it required both that Mr. Baker actually be scheduled for work (so that he could have some “scheduled work” from which he could properly be said to be “absent”) and that he be so advised.  In this case, there is no evidence that either of those things happened and, for that reason alone, the termination cannot stand.

Before invoking the consequences of a clause of this nature (realy any collective agreement provision), pause and step back.  Here's some questions (there are more):

1. Read the article that you're trying to bring yourself within - what does the article say (i.e. what are the agreed to words?)
2. What do all of the words mean (alone and together)? How will this provision be interpreted?
3. Are there other collective agreement provisions that might impact one way or the other on the interpretation of the article on which you intent to rely?
4. Now that you've read the collective agreement, and the specific article in question, and understand it, what are the circumstances of your specific case and how should you reasonably deal with those circumstances to bring the situation into the clause?  In fact, can you bring yourself within the terms of the collective agreement at all?

Trying to fit a square peg into a round hole, rushing, or ignoring the collective agreement language or the particular circumstances of the case, greatly increases the odds that the case will end badly.  

In the Hospital for Sick Children case, the Board of Arbitration allowed the grievance, and reinstated the grievor with no loss of service or seniority, and with full compensation and all lost salary and benefits.

Costs in Labour Arbitration

One party seeking its costs in labour arbitration under a collective agreement is a rare occurrence.  That's not to say that it doesn't happen, it just doesn't happen all that often.  

The general rule was succinctly stated in the leading text by  Brown & Beatty Canadian Labour Arbitration (4th) at paragraph 2:1430:

Collective agreements customarily provide that the costs of the arbitrator and the arbitration proceeding are to be borne equally by the parties.  Counsel fees and legal costs, however, are rarely, if ever, dealt with by the collective agreement and the general view is that an arbitrator has no jurisdiction, in the absence of an express provision in the agreement, to order that such costs be paid by the losing party.  Rather, arbitrators have assumed that, in view of the long-standing practice of each party bearing its own costs , an express provision granting the arbitrator such a power would be required to support making such an order. [Emphasis added]

An excellent recent review of the law of costs in arbitration is found in Weeneebayko Health Ahtuskaywin (a case where the Canada Labour Code applied). The following basic principles were expressed and accepted by the parties to the arbitration:

1. Normally, the costs of an arbitration hearing are borne equally by the Union and Employer;
2. Costs of a labour arbitration proceeding are not ordered to follow the cause;
3. Costs will not be ordered in a labour arbitration matter as a punitive measure;
4. Costs may be ordered in granting an adjournment, as the exercise of arbitral authority to control the process;
5. It is generally accepted arbitral thought that only exceptional circumstances will give rise to an order for costs; and
6. Arbitral discretion to award costs have been exercised rarely, and only in cases in which it appears that the party seeking the adjournment had reasonable control over the circumstance that caused the need to adjourn. (As, for example, in Hawker Siddeley Canada Inc. And I.A.M. Lodge 1922, [1989] O.L.A.A. No. 67, 7 L.A.C. (4th) 172, (Gorsky), in which an employer had ability to alter the vacation schedule of key witnesses, and assure their availability for hearing).

After reviewing the governing legislation (the Canada Labour Code) the arbitrator noted:

The Code specifies the elements of the authority of the board of arbitration to control its own procedure. Unlike the related provision of the Ontario Labour Relations Act, R.S.O., c. 228, s.45, (which only requires that the parties share equally the cost of the arbitrator when appointed by the Minister), the Code requires that regardless of the manner of appointment, each party shall bear its own costs, and shall pay the fees and expenses of the arbitration board, unless the collective agreement provides otherwise.

In this case, neither the Canada Labour Code nor the collective agreement conferred jurisdiction upon the arbitrator  to award costs and the arbitrator refused to do so.

The case is instructive on the (limited) circumstances in which costs will be awarded and the policy reasons for a restrictive approach.

Costs Award at Arbitration - Not So Much

Can an arbitrator award costs against one or the other of the parties (the Union or Company)?  

Each party to a labour arbitration bears their own costs and then split of costs of arbitration.  Such costs would include, for example, the arbitrator's fees and expenses associated with the hearing (for example, the cost of the hearing room).  This is normal and usual, in fact, most collective agreements address this specifically.

In Shoppers Meat Markets Arbitrator Solomatenko stated that "as a general rule, costs of an abortive hearing should only be awarded where there are extraordinary factors", such as where there has been an abuse of process.  He noted:

"The overriding consideration, however, must be the labour relations context itself. It is a long-established principle of the labour relations process that each party shares equally in the cost of the procedure, regardless of its success in the matter. Whenever costs of an aborted hearing are awarded as a term of granting an adjournment, it should still be in the context of this historical principle that the parties normally share all costs"

There must be some "extraordinary circumstances" present.  

In Community Addiction and Mental Health Services of Haldimand-Norfolk [2010] 101 C.L.A.S. 304 (Chauvin), despite the following unusual provision, the Arbitrator nonetheless refused to grant costs against the Union where it was found that the "extraordinary circumstances" were not present:

The Parties to this collective agreement shall pay the fees and disbursements of their respective appointees to the Board of Arbitration and shall share equally in the fees and disbursements of the Chair. The Parties further agreed that, in the event of any cancellation fees being levied by the Board of Arbitration members, the Party responsible for such cancellation shall be solely responsible for all such fees.

Most recently, Arbitrator Stout considered the matter and, in refusing to award costs against the Union noted that the employer:

.... has sought an order for their costs thrown away.  The costs associated with my fees and expenses are addressed in the collective agreement, see article 7.15.  This is not unusual in labour relations.  In fact, the splitting of costs is normal. It is only in exceptional circumstances that an arbitrator may order costs, see Community Addiction and Mental Health Services of Haldimand-Norfolk v. Canadian Union of Public Employees, Local 4700 (MacLeod Grievance) [2010] O.L.A.A. No. 183.  I would add that it is only where a clear abuse of process has occurred that an arbitrator should depart from what the parties have agreed to in the collective agreement. I am not satisfied that extraordinary circumstances exist. Further, I do not find that the adjournment request is an abuse of process. 

And, according to Brown and Beatty's leading (and fantastic) text Canadian Labour Arbitration (paragraph 2:1430 Ordering costs):

... even where the cause of the delay and the resultant abortive hearing could be attributed to one party, most arbitrators have expressed the view that they had no authority to order that the costs associated therewith be paid by that party.  One arbitrator, however, ordered costs to be paid where the party had persistently refused to produce relevant documents when ordered to do so,  and another ordered that the employer pay a portion of the union's share of the cost of an arbitration where it was required to take such proceedings to enforce the award.  The costs associated with adjournments made at the request of one party may be awarded as a term of granting the adjournment.  As well, at least one arbitrator has compelled the posting of security, on a motion to adjourn.

So, costs awards are a rare occurrence at labour arbitration.  Leaving aside the fact that arbitrator's are reluctant to award costs, simply making the request and pursuing that request to arbitration can have some practical consequences on the party advancing the argument.  Labour law is about give and take, not just take.  The old adage of "what goes around comes around" comes to mind.

 

Take Care When Drafting Discipline Letters

It pays to spend time drafting disciplinary letters.  Failing to do so can have some serious consequences at least in the Unionized workplace.  A recent case discusses the matter in helpful terms.  In this case, the employer was able to dodge the Union's bullet. 

The discipline letter was broadly drafted and included sweeping statements in support of the discipline imposed.

The Union argued that, despite that the only ground specifically referred in the discipline meeting and relied upon by the employer in imposing discipline was was that of double reimbursement.  Accordingly, they argued that the Aerocide Dispensers Ltd., (1965) 15 L.A.C. 416 (Laskin) applied:

"The board is justified in a case of challenged discharge to hold the employer fairly strictly to the grounds upon which it has chosen to act against an employee who consequently feels himself aggrieved. This is not to say that the board should be overly technical in assessing an assigned cause of discharge but it does mean that it ought not to permit an assigned cause to be performed into one different from it merely because the evidence does not support the assigned cause but rather one something like it."

Accordingly, as a general rule, the employer may not alter the grounds cited for discipline once those grounds have been advance.  In Carter Carburetor Division of A.C.F. Canada Ltd. (1977) 16 L.A.C. (2d) 166 (Adams)Arbitrator Adams (as he then was) said that the employer is "limited to the grounds upon which it first replied in discharging or disciplining an employee". 

In Brown and Beatty, Canadian Labour Arbitration review the topic of the alteration of grounds of discipline and the Aerocide case and write:

"The principle that an employer cannot justify disciplining an employee on grounds that are different from those it gave when the penalty was actually imposed is, however, neither absolute nor inviolable. Many exceptions and limitations have been recognized."

There are numerous exceptions to this general statement of the "rule".  In Toronto (City) (2003), 121 L.A.C. (4th) 362 (Brown), the arbitrator held:

"The cases reviewed in the preceding section demonstrate my task is to strike an appropriate balance between the dictates of fairness and the mandate to resole the real issue between the parties.  Fairness and natural justice require that an allegation of misconduct, resulting in discipline, be made in a timely fashion so that an accused employee is able to gather exculpatory evidence before it is diminished or lost through the passage of time.  An employer's failure to satisfy this requirement of natural justice can cause significant prejudice to a grievor."

The issue was put as follows by Arbitrator Munroe in Canadian Airlines International Ltd. (1988), 35 L.A.C. (3d) 66 (Munroe):

"...the true justification for the rule, if such it be, lies in the unyielding requirement of a fair hearing on the real substance of the parties' differences. To carry the rule further, and to refuse its relaxation even where there is no threat to natural justice and no real prejudice to anyone would be the sort of mistaken symbolism that tends to bring the system into disrepute. We also believe that to be the modern arbitral consensus..."

More recently in Inventronics Ltd. (2010), 101 C.L.A.S. 34 (Wood), the arbitrator concluded that the "test which has developed is more complex than that sought to be applied from the Aerocide Dispensers Ltd.  decision".

To the same effect is the arbitrator's conclusion in Toronto District School Board decided a couple of weeks ago and the springboard to this post.

In short, while arbitrators have shown a willingness to be somewhat flexible when looking at the grounds for discipline where fairness demands it and where no real prejudice results.  This being said, employers would be wise to consider their words (and their grounds) carefully when drafting disciplinary letters.