Thoughts from a Management Lawyer

CAW and CEP Looking to Merge

The Canadian Auto Workers and the Communications, Energy and Paperworkers Union are considering merging.  According to the CAW-CEP Discussion Paper:

After two decades of fighting mostly defensive battles against the pressures of globalization, employer aggression, hostile government policy, and public cynicism, the trade union movement in Canada faces an enormous and historic moment of truth.

The CEP-CAW New Union DiscussionProcess Protocol & Timetable states that the "purpose of the New Union Discussion process to develop and agree upon the main principles of a new Canadian union, with a new identity and structure."  While acknowledging that a bigger union doesn't equate with a better union, the Protocol calls for something innovative and different:

The formation of a new union must be founded on a desire and willingness to modernize our practices,to innovate with new models of organizing and servicing, and to rebuild our image with workers. 

In terms of timing, it seems that they will report to the respective conventions of CAW (in August, 2012) and of CEP (in October, 2012).

The merger of these two unions would result in a combined membership of more than 320,000 and establish the largest private labour union.

As you'd expect with such a huge story, there's lots of press:

• CAW, CEP talk possible merger by mid-2013
• CAW, CEP unions exploring merger
• Unions must change quickly to survive, says secret report by CEP/CAW
• CAW, CEP hold merger talks
• CAW, CEP unions considering merger Marriage would create largest in private labour
• CAW and CEP to Begin Talks on New Union
• Two major Canadian unions, CAW and CEP, exploring merger by mid-2013
  
  

Arbitration or Court? Another Jurisdiction Case

The issue of whether a court will assume jurisdiction over a claim brought by a unionized employee against his or her employer (and sometimes third parties) continues to come up from time to time.

Most recently in Paonessa v. Lifemark Health Management Inc. where a former employee sued his employer, various individuals and a company that had been retained by the employer to perform a Functional Abilities Evaluation to decide whether the plaintiff was physically capable of returning to work.

The employment relationship was subject to a collective agreement.  The employer and other defendants brought a motion strike the claim, arguing that the court had no jurisdiction to hear the action.  The issue to be decided was whether   The issue is whether the dispute in the lawsuit was one arising under the collective agreement.  If so, according to the principles in Weber v. Ontario Hydro, the court had no jurisdiction and the action would be dismissed.

The court observed that:

"There are situations in which the court has jurisdiction notwithstanding the existence of a collective agreement. For example, actions against insurance benefit providers have been allowed to proceed on the basis that the collective agreement requires the employer to pay the premiums, but not to administer the benefits: London Life Insurance Co. v. Dubreuil Brothers Employees Assn., [2000] O.J. No. 2609 (CA). On the other hand, where the collective agreement provides for arbitration of the administration of such benefits, the court will not have jurisdiction: Campos v. Sunlife Assurance Company of Canada, 2009 CanLII 43186 (ON SC), 2009 CanLII 43186 (ONSC, Lax J.). An action for malicious prosecution has been allowed to proceed when an employer caused criminal charges to be laid against an employee: Piko v. Hudson's Bay Co., [1998] O.J. No. 4714 (CA)."

The court concluded that the dispute arose "squarely from the collective agreement" and that the "plaintiff has an adequate remedy in the arbitration process".

The action was dismissed.   

TTC declared essential service

No huge surprise here.  The Ontario government passed Bill 150 declaring the Toronto Transit Commission an essential service and banning its workers from striking.   Lines were drawn before the legislation was passed, but the rhetoric has heated up (TTC declared essential service, union chief says won’t be ‘bullied’ by Toronto).  Here's some information on the Ministry of Labour website.

Technology and Union Organizing

The Word on Employment Law draws our attention to the subject  of technology and union organizing (Union Uses Blog to Organize Manufacturing Plant).  Not surprisingly, these organizing techniques are being used with increased frequency.  

Have a read of Organizing 2.0 Savvy Online Campaign Yields Victory for N.Y. Can Plant Workers:

"So organizers got crafty and set up a special blog strictly for the 164 employees to debate, strategize, air concerns and ultimately come together for victory, all while avoiding many of the union-busting tactics so common in most campaigns."

According to the article, the employer set up its own site "but it lacked two-way communication, only plugged the company’s talking points and fell flat with the work force".  

These are interesting times and technology is increasingly becoming part of the organizing landscape. In the end, its about getting your message out (whether your the union or the employer).  

 

Defining Strike Related Activity

The Ontario Labour Relations Board in the context of arranging a hearing into allegations that certain conduct amounts to an unlawful strike under the Ontario Labour Relations Act, 1995, discussed the "strike" provisions in the Act:

Strikes are permitted only where there is no collective agreement in force, and the bargaining parties have completed the compulsory conciliation process contemplated by the statute.  “Strikes” at any other time are unlawful; moreover, the definition of “strike” is quite elastic, and encompasses any work refusal by a group of employees “in concert, in combination, or in accordance with a common understanding”.  Those words have been held to encompass a broad range of collective activity including: slowdowns, “hot cargo arrangements”, “sympathy strikes” and a concerted refusal to cross picket lines as an expression of solidarity with the actions of another trade union.  The definition is intentionally cast in very broad terms, and has been so construed by both the Board and the Courts. 

* * *

... the Act guarantees that, once a collective agreement is signed, there can be no strike or lock‑out during its term of operation.  Moreover, the Act also prohibits behaviour on the part of a trade union or an officer, official or agent of a trade union that may counsel, procure, support or encourage an unlawful strike. 

As the Chair of the Board noted in General Motors of Canada Ltd.:

It suffices to say that if there is a work place dispute while a collective agreement is in operation, employees are obliged to use the grievance arbitration procedure to resolve that dispute. They cannot go on strike. Any work stoppage is unlawful. Moreover, an unlawful strike exposes the employees to discipline or discharge, and exposes the union to substantial damages for any production lost as a result of the strike.

These are tough cases, not for the legal principles, but for the broad repercussions they have on the workplace parties.  

When Can a Union Discipline a Member for Accepting Non-Union Work (in Alberta)?

This is not something I spend a lot of time thinking about, but I came across a case out of the Alberta Court of Appeal that got me asking (myself) some questions.  The case is Armstrong v. International Brotherhood of Boilermakers Local 146.  It's fact specific and may not be of broad application, but it's an interesting case.

The Court of Appeal considered:

1. the right of a union to discipline a member, in this case for taking non-union work, and 
2. the right of that member to a full and fair disciplinary hearing.

Armstrong, a union member, informed his union that he accepted a position as a construction superintendent (a management position) with a non-union contractor.  He did not seek their approval to his doing so.  Article 17.1.20 of the Union’s constitution "prohibits members from accepting employment with a non-union contractor without prior written approval of the business manager".    A hearing was arranged and, according to the Union's procedures, neither the Union or the member could be represented by an attorney (they could be represented by a member in good standing of the Union).  

Only Union members would be allowed in the hearing room.  Armstrong did not attend at the hearing. He was fined $5000 payable within 30 days and informed of his right of appeal.  He did not appeal and did not pay the fine.  He was suspended from the Union for failing to do so.  

Section 26 of the Alberta Labour Relations Code provides that:

No trade union shall expel or suspend any of its members or take disciplinary action against or impose any form of penalty on any person ... unless that person has been. . . 

 

(c)  afforded a full and fair hearing, including the right to be represented by counsel . . .

 

The Court of Appeal held that there was a breach of Section 26 in this case:We do not say that the Union bears a positive obligation to advise members of their right to counsel. However, the Union cannot explicitly mis-inform a member about those rights, as was done here, without running afoul of s. 26. The actions of the Union are in clear violation of s. 26(c) of the Code and the Board erred in concluding otherwise. Armstrong’s failure to attend the disciplinary hearing is, in all the circumstances, ultimately irrelevant.

Section 151(i)(ii) of the Code provides that a union cannot discipline a member: 

... for engaging in employment with an employer who is not a party to a collective agreement with the trade union if the trade union fails to make reasonable alternate employment available to that person within a reasonable time with an employer who is a party to a collective agreement with the trade union...

The Court found that "if a union fails to make reasonable alternate employment available with an employer with which it has a collective agreement, then it cannot discipline a member for taking employment elsewhere. "  However, the Court noted:

As the Union points out, it does not preclude Armstrong from pursuing a career in management; rather, it requires him to obtain prior approval in accordance with the Union’s constitution if he wishes to remain a Union member while pursuing that career.

Makes sense, but when I read the case, it sort of struck me as a little counter-intuitive.  

Armstrong didn't jump through the hoops of maintaining membership as set out in the constitution while he pursued non-union employment opportunities. I assume (though I don't know) that such requests would be common and where made would be granted as a matter of course?  Who wants to hold someone back in their career?  So maybe getting permission isn't a big deal.  

In the end, though, for failure to pursue the proper approvals he was fined $5,000 and, ultimately, suspended for failing to pay the fine. I suppose, the Union constitution being a form of contract, I can understand the suspension part - no question, they need rules that govern the relationship between the union and the members and among members .  But it's a bit of a struggle, for me at least, to get my head around a fine.  Maybe that was of concern to the court as well?  

 

Unionization Rates in Canada

Statistics Canada released a report on unionization rates in Canada:

On average, just over 4.2 million employees belonged to a union in Canada during the first half of 2010, up 64,000 from the same period last year.

Union membership rose at a slightly faster pace than total employment. As a result, the nation's unionization rate edged up from 29.5% in 2009 to 29.6% in 2010.

"Unionization 2010" is now available in the October 2010 online edition of Perspectives on Labour and Income.

The Law of Insubordination

Conduct amounting to insubordination sufficient to establish cause for dismissal was described half a century ago by Lord Evershed in Laws v. London Chronicle:

Since a contract of service is but an example of contracts in general, so that the general law of contract will be applicable, it follows that, if summary dismissal is claimed to be justifiable, the question must be whether the conduct complained of is such as to show the servant to have disregarded the essential conditions of the contract of service. It is, no doubt, therefore, generally true that wilful disobedience of an order will justify summary dismissal, since wilful disobedience of a lawful and reasonable order shows a disregard – a complete disregard – of a condition essential to the contract of service, namely, the condition that the servant must obey the proper orders of the master and that, unless he does so, the relationship is, so to speak, struck at fundamentally. [Emphasis added]

The law of just cause dismissals in a non-union setting has changed over the years with the Supreme Court of Canada setting out a "contextual approach" in McKinley v. BC Tel, but insubordination, when proven remains a disciplinable offence.  Whether termination is the right penalty will depend on the circumstances and the context.    

In some rare cases, a single act of insubordination can justify dismissal.  In Amos v. Alberta, the following factors were considered:

... it depends on a large mix of factors. It is not possible, from one fact alone, to conclude if insubordination in a particular situation can justify summary dismissal. Usually, one instance of insubordination will not be sufficient to summarily fire an employee. However, one incident of insubordination can be enough if:

• the insubordination is grave;
• it consists of wilful and deliberate disobedience of an order;
• work rules were made known to the employee;
• work rules were consistently enforced;
• work rules were clearly communicated to the employee;
• the work order was authorized, that is, that it came within the scope of the worker’s duties;
• the worker was made aware, unequivocally, that discipline is the penalty for disobedience;
• the work order was lawful and reasonable in content;
• the employee has no reasonable excuse for disobedience;
• the breach is serious.

In summary, the court must assess all relevant circumstances to determine if, in a particular case, insubordination justifies summary dismissal.

In a Union setting, a majority of a Board of Arbitration clearly and succinctly set out the law with respect to insubordination in Toronto Rehabilitation Institute:

When a clear direction is given to perform a task, a failure to comply with that direction may amount to insubordination.  Defenses to an allegation of insubordination may include health, safety or other legitimate grounds for refusal.  However, the general rule is that an employee must follow directions and then later grieve any perceived impropriety.

Insubordination undermines managements authority and ability to effectively lead the organization. Once proven, the turns to penalty.

Vale Workers Approve Collective Agreement

A few days ago I posted that Vale and Steelworkers Reach Tentative Deal and that this was subject to ratification.  Well, the Globe and Mail reports that the Nickel workers approve contract with Vale thus ending one of the longest strikes in Canadian history.  

Not Happy with Your Severance Deal.... Pick Your Forum Carefully

Many plant closures came out of the economic crisis.  In a unionized environment, the union and company will typically negotiate a closure agreement that will set out the manner in which the windup will be effected including, in some cases, severance.  Sometimes the employees want "more" and are not happy with the deal their union negotiated on their behalf.  They will try to get more - somehow, somewhere.

A number of employees sued their employer and union in Sidhu v. Affinia Canada Corporation claiming additional severance.  The employer brought a motion to dismiss the claim on the basis that the Court did not have jurisdiction over the subject matter of the dispute and that the proper forum for the resolution of the plaintiffs’ complaints was at arbitrator under the Collective Agreement or before the Ontario Labour Relations Board.

The company then met with Union representatives and negotiated a Plant Closure Agreement ("PCA") that included a provision dealing with severance pay that would be calculated in accordance with the Employment Standards Act, 2000.  Certain employees wanted more, and sued the union and employer.

The plaintiffs claimed that:

1. Affinia and the Union entered into the PCA secretly and without the knowledge and consent of Union members;
2. The defendants breached a duty of care to the plaintiffs;
3. The Union lacked the proper authority to enter into the PCA with Affinia;
4. The Union breached its “professional and fiduciary obligations” to the plaintiffs;
5. The negligence and breach of duty by the defendants caused losses to the plaintiffs; and,
6. The plaintiffs sought punitive damages against both defendants.

Counsel wrote asking that the plaintiffs discontinue their action on the basis that the Court had no jurisdiction.  The action was not discontinued and they brought this motion.

The leading case is Weber v. Ontario Hydro, written about numerous times on this blog.  The test according to the Supreme Court of Canada, is “where the dispute, regardless of how it may be characterized legally, arises under the collective agreement, then the jurisdiction to resolve it lies exclusively with the labour tribunal and the courts cannot try it.”

According to the Court, after analyzing the statement of claim:

"From these surrounding circumstances I conclude that, giving the Statement of Claim a broad and generous reading, the essential character of the plaintiffs’ complaint against Affinia is that they did not receive adequate compensation upon the termination of their employment."  

The Court went on to consider what was the effect of the PCA and stated:

"Although the PCA did not state that it formed part of the Collective Agreement, it is not possible to give meaning or operative effect to portions of the PCA unless it did."

In passing, I argued a case before the Ontario Labour Relations Board which concluded that the closure agreement, in the circumstances of that case, was a "collective agreement" within the meaning of the Labour Relations Act, 1995 because:

"The Closure Agreement, being a signed and dated written agreement governing the terms and conditions of work, which was ratified by a secret ballot vote of bargaining unit members, meets the basic statutory requirements of a collective agreement."

The Court in the Sidhu case concluded that it "has no jurisdiction over the plaintiffs’ claim against Affinia, and I therefore dismiss their claim against Affinia."

The plaintiffs also claimed that the union "had not represented them properly in respect of matters relating to the closure of the Plant".  The Court held that this claim fell within the exclusive jurisdiction of the Ontario Labour Relations Board.  For some reason, though, the union did not bring a motion to dismiss this claim and, in those circumstances, all the Court could do was "declare that this court lacks jurisdiction to hear the plaintiffs’ action against the Union."

When you're represented by a union, your recourse to the courts is very limited.  For example, as the Court noted in this case, "If a cause of action falls outside the collective agreement, such as a claim under a contract predating a collective agreement, the courts have jurisdiction over the claim."