HomeMy WebLinkAboutEmployer 15-02-24IN THE MATTER OF AN ARBITRATION
BETWEEN:
Algonquin College
of Applied Arts and Technology
-and-
Ontario Public Service Employees Union
Local 415
Employer grievance re: union release time
Lorne Slotnick, Arbitrator
Representing the Employer – Jock Climie
Representing the Union – Wassim Garzouzi
Hearing – Ottawa, Ont., January 30, 2015
[2]
PRELIMINARY AWARD #2
This is an employer grievance seeking payment of an invoice for more than $200,000 from the
union, related to release of employees for union business. The union has refused payment. In an
earlier preliminary decision (Re Algonquin College and OPSEU 2014 CanLII 67088 (ON LA)), I
found that the grievance was timely. This award addresses a second preliminary objection
brought by the union: that the amounts in the invoice were incurred too far in the past for an
arbitrator to order payment.
Background facts
Most of the relevant facts are recounted in more detail in my earlier award. The parties called no
witnesses on this preliminary objection, relying solely on the documents and testimony from the
earlier hearing.
The invoice at the centre of this dispute covers union leave for seven semesters over a period of
3½ years starting in 2010 and ending in the spring of 2013. The union leave provisions are
contained in the collective agreement between OPSEU and the College Employer Council for the
Colleges of Applied Arts and Technology covering academic employees. Under that agreement,
the college continues to provide regular pay and benefits to employees who are on leave for
union business, and the union is required to reimburse the college in accordance with a formula.
[3]
The invoice for the seven semesters, totalling $208,362.70, was not submitted to the union until
September 30, 2013, several months after the end of the last semester claimed. Earlier that
month, on September 3, the parties had discussed union leave, and the union advised it would not
pay for the accumulated seven semesters. After the invoice was sent to the union, the college
inquired about payment and the union repeated its position on October 23 that it would not pay.
The first preliminary decision focussed on the mandatory 20-day period for the filing of an
employer grievance “following the occurrence or origination of the circumstances giving rise to
the grievance.” This period cannot be extended by an arbitrator. The grievance is dated
November 6. I decided that because the collective agreement contains no details about the
procedure or timing of the reimbursement for union leave, the parties’ past practice was relevant.
That led me to conclude that the invoice was a key part of the process, and that the time for filing
a grievance by the employer began to run once the union advised it would not pay the invoice,
once it had been issued a few weeks prior. Therefore, the grievance was timely.
With respect to the parties’ past practice, I made the following findings: first, money was never
paid by the union until after an invoice was issued; second, there was always discussion and
revision of the initial calculation until a final number was settled; third, the billing and payment
were not semester-by-semester but rather for a period that lumped more than one semester
together; and fourth, the discussion and payments occurred well after the release time debt was
incurred.
[4]
Parties’ Arguments
As this was an employer grievance, the hearing was something of a role reversal: the union
raised preliminary objections, and relied on case law in which the employer generally prevailed;
the employer, on the other hand, relied on cases where the result favoured the union.
While the union does not directly dispute the findings above regarding the past practice, it also
says that the documents from 2006 to 2009 show that invoices went by calendar year and were
generally delivered to the union within the first four months of the following year. (Sometimes,
however, invoices were reissued later after discussion between the parties and revision of the
amount. In addition, the first invoice for 2008 was not issued until March, 2010, but there was
some evidence that the employer’s human resources representative who dealt with these matters
was on leave in 2009.) The largest of these invoices was for a little less than $80,000 and the
amount for 2009 – the last year before the invoice at issue here – was for less than $30,000.
Then, the union says, the college waited for 3½ years, with no communication, before issuing an
invoice for more than $200,000. This, the union argues, was a major departure from the past
practice.
Because of the long gap between the release time and the invoice for it, the union argues that the
mandatory time lines in the collective agreement release the union from payment of the entire
bill. Alternatively, even if the invoice is valid, an arbitrator has discretion the limit the college’s
remedy: the college may be able to argue that it can collect the debt for union leave for the
winter 2013 semester, but based on past practice, it cannot make a claim in late 2013 for
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anything earlier than that semester. There is no basis for a remedy stretching back 3½ years, the
union argues.
As a further alternative, the union points out that much of the invoice relates to union leave that
was taken under an earlier collective agreement than the September 2012 to August 2014
agreement under which the grievance was filed. It argues that any union leave under the earlier
collective agreement is not a proper matter for a grievance. For this argument, the union relies
on case law discussed below, and on the phrase “this Agreement” in Article 32.03 D of the
collective agreement, the relevant parts of which read as follows:
The arbitration board shall not be authorized to alter, modify or amend any part of the
terms of this Agreement nor to make any decision inconsistent therewith; nor to deal with
any matter that is not a proper matter for grievance under this Agreement…
The union referred to the following cases: Re Georgian College and OPSEU 2011 CanLII
99829 (MacDowell), which emphasizes that time limits and clauses such as Article 32.03 D, set
out above, are a conscious effort by sophisticated parties to limit the scope of litigation between
them; Re Conestoga College and OPSEU [1998] O.L.A.A. No. 542 (Mikus), where the arbitrator
makes the point that time limits allow the parties to deal with issues while memories are fresh
and before liabilities become too onerous; Re Fanshawe College and OPSEU, unreported, June
28, 1996 (H. Brown), which states that previous decisions under a collective agreement ought to
be followed unless they are manifestly wrong (relevant because of college decisions on the scope
of remedy cited below.)
The union also referred to Re FPC Flexible Packaging Corp. and Graphic Communications
International Union, Local 500-M (1998) 77 L.A.C. (4th) 198 (Bendel), where the remedy in a
[6]
dispute over an employee’s pay rate was limited to a “reasonable” period. The arbitrator in that
case said (at paragraphs 23 and 28),
The claim will not be allowed in its entirety, if too much time has elapsed, not because
the grievor has been knowingly sleeping on his rights, but because of the requirements of
“the efficient and expeditious conduct of labour relations or, what is much the same
thing, the proper administration of a collective agreement.” [quoting from Re General
Electric Co. and U.E.W. (1952) 3 L.A.C. 980 (Laskin)]
…
Arbitrators should be wary of allowing unions to assert claims going back months or
years since that could allow employees to reap windfall benefits and could impose on the
employer substantial costs for which it could have made no provision. This is not one of
the proper functions of the arbitration process.
The union also referred to Re First Air and CUPE [2005] C.L.A.D. No. 496 (Knopf), which has
some similarities to the case before me; the case involved an employer grievance over shortfalls
in the reimbursement for union release time. In that case, the employer billed regularly and the
union paid a smaller amount. While the employer’s position in the dispute prevailed, the
arbitrator limited the remedy to the period after the filing of the grievance because the grievance
was filed “many months after the dispute between the parties became apparent.” (paragraph 41)
Also referred to were the sections in Brown and Beatty’s Canadian Labour Arbitration related to
past practice (2:2221 and 3:4430); and Re Sifto Canada Corp. and Communications, Energy and
Paperworkers Union, Local 16-0 (2010) 198 L.A.C. (4th) 325 (Surdykowski), in which the
remedy for underpayment of long-term disability benefits was limited to the period from three
weeks before the grievance. While the union had asked for a remedy stretching back six years,
the arbitrator said the grievors were aware of the issue more than four years before the grievance
[7]
was filed. Here, the union argues, the college was well aware that the union was using release
time, and the union had no obligation to alert the college to the fact that no bills were being sent.
In support of its alternative argument that if there is any remedy, it must be limited to the union
release time incurred under the current collective agreement, the union referred to the following
college cases: Re Northern College and OPSEU (1992) 27 L.A.C. (4th) 98 (H. Brown), in which
the grievor was placed on the wrong step of the wage grid from his date of hire, but the
arbitration board ruled it had jurisdiction to grant a remedy only back to the start of the collective
agreement under which the grievance was filed; Re George Brown College and OPSEU 1988
CarswellOnt 5323 (Carter), which came to the same conclusion; and Re Fanshawe College and
OPSEU, unreported, March 10, 1993 (Swan), which came to a similar conclusion but allowed for
the possibility that an employee who was unaware of an issue might be able to file a grievance
against a breach of an expired collective agreement (page 9). Also referred to were Re Goodyear
Canada Inc. and United Rubber Workers (1980) 28 L.A.C. (2d) 196 (M. Picher), a leading case
stating the “fundamental principle that a board of arbitration can have no jurisdiction beyond the
collective agreement under which it is constituted” (paragraph 16), and Re Children’s Aid
Society of Toronto and CUPE Local 2316 (2002) 111 L.A.C. (4th) 43 (Devlin). In addition, the
union relied on Re York University and York University Faculty Association [2002] O.L.A.A.
No. 65 (Davie).
The college responds that the union is simply trying to use a technical argument to keep money
that rightfully belongs to the college. The union has no reason to be indignant about the fact that
the college did not send an invoice for 3½ years – the only impact of the delay is that the union
[8]
had an interest-free loan for a few years, the college says. The college argues that there is no
legal principle supporting the union’s contention that it cannot be ordered to pay the invoice.
The case is not about the proper conduct of labour relations, but simply about a debt that is owed
and not being paid, the college says, which is why cases such as FPC Flexible Packaging, cited
above, with its concern about a “windfall,” do not apply. Nor is there any allegation of prejudice
here, the college notes. In any event, the college says that because of my finding in the first
preliminary decision that the invoice was the crystalizing event, the only issue now is the exact
amount of money owed for the seven semesters. The First Air case is also inapplicable because
in that case the employer billed regularly and the union paid lower amounts every time; here,
there were no ongoing breaches, as the union’s obligation to pay arose only when the sole
invoice was issued, the college argues.
While the first preliminary decision in this matter made some findings about past practice, the
over-all pattern of the timing of reimbursement for union release time is inconsistent, the college
says. In any event, the union cannot use the past practice to impose an obligation on the
employer to send invoices at any particular time when the collective agreement itself is silent on
that point and the parties have made no other agreement on the matter. The union’s contention
that billing should occur each semester imposes an arbitrary time frame, the college says; in fact,
the debt is incurred each pay period, so that the college could send an invoice each time an
employee on union release is paid – or the college could wait 10 years between invoices if it
wished. Because the collective agreement does not address when an invoice is to be sent out, the
college retains its management right to send the bill whenever it sees fit, the employer argues.
Furthermore, if the union was eager to pay for release time at any point during the 3½ years, it
[9]
could simply have asked the college for a bill; in fact, the college says, the union is in just as
good a position to calculate the amount as is the employer, and notes that there is evidence that a
former union treasurer initiated the reimbursement process by providing a calculation to the
college.
With respect to the union’s argument that the employer’s remedy cannot extend back to any
period before the current collective agreement, the college relies on the Supreme Court of
Canada decision in Dayco (Canada) Ltd. v CAW-Canada [1993] 2 S.C.R. 230, with its statement
that vested rights can be enforced after the expiry of the collective agreement under which they
arose. Here, the college argues, there is no jurisdictional issue because the crystallizing event –
the forwarding of the invoice – occurred during the collective agreement under which the
grievance was filed. There was no breach of the expired collective agreement because there was
no invoice sent out during 2010, 2011 or 2012; there was only an accruing debt and a vested
right to the reimbursement, the college says. The employer refers to the following passages from
Dayco, a case in which the narrow issue was whether an arbitrator had jurisdiction to hear a
grievance over benefits for retired workers despite the expiry of the collective agreement (at page
270-271):
A collective agreement is rather like a contract for a fixed term. At the end of the term,
the contract or agreement is said to “expire” by mutual agreement. But the contract is not
thereby rendered a nullity. It ceases to have prospective application, but the rights that
have accrued under it continue to subsist. This termination or expiration can be
contrasted with the contractual notion of rescission, whereby the contract is rendered null
and void, and the parties have no obligations thereunder…Thus it should not be seen as a
novel concept that grievances can arise after the expiration of a collective agreement that
relate to rights accruing under that agreement.
…
[10]
The new agreement “displaces” the old one, which is no longer in force. But this is with
respect to the current employment relationship, and says nothing about the previously
accrued rights of the parties…I have found no case that suggests that accrued rights are
expunged once a new collective agreement is negotiated. Moreover, I see nothing
differentiating the promise to pay retirement health benefits from promises to pay regular
wages or vacation pay. All of these can be enforced after the termination of the
agreement. Any other conclusion would render meaningless a wide range of promises to
employee that might extend beyond the expiration of the collective agreement….
After referring to several cases, including Genstar Chemical Ltd. v. International Chemical
Workers Union, Local 721 [1978] OLRB Rep. Sept. 835), the Supreme Court added (at page
278):
As a simple principle of contract law, the enforcement of a contract can take place well
after the contract itself has expired. What is at issue in these cases is exactly that – the
enforcement of the collective agreement to rectify damage appearing after the expiration
of the agreement.
In addition to the comments on vested rights in Dayco and Genstar, the college also relied on Re
Manitoba and MGEU (2008) 180 L.A.C. (4th) 150 (Peltz) and Re 1441578 Ontario Ltd.
(Rougemount Carpentry) and LIUNA Local 183 2009 CanLII 39478 (ONLA) (Surdykowski).
Rougemount Carpentry contains a thorough review of both the Goodyear and Dayco lines of
cases; the arbitrator concludes that some of the cases relied on by the union here (Northern
College and York University) were wrongly decided. He adds (at page 28):
Why should a party or bargaining unit employee be denied the right to pursue a full
remedy in a single proceeding for a violation of vested collective agreement rights that
they could not reasonably be aware of on a jurisdictional basis … merely because the
alleged breach spans several collective agreements? …. On the contrary, why, as a
matter of law or policy, should an employer who purposely or inadvertently violates a
collective agreement to the detriment of the union or bargaining unit employees escape
its obligations in that respect merely because of the passage of time as a matter of
jurisdiction? Why isn’t (and shouldn’t) that be a matter for the application of time limits
and equitable principles which are within an arbitrator’s jurisdiction to determine?
[11]
The passage above from Rougemount Carpentry provides the answer to how long the employer
can go without issuing an invoice and still claim the full amount, the college says. That answer
is that, depending on the circumstances, there may a point at which arbitrator determines that
there has been prejudice to the union or a well-founded belief that the employer had waived its
right to the reimbursement. In that case, the arbitrator could use doctrines such as laches or
estoppel to limit the remedy. But here, the college says, there is no suggestion, even from the
union, that the union believed the employer was foregoing the debt or that the union was
otherwise prejudiced.
The union responds that despite the Dayco decision, the Goodyear line of cases is still good law,
as explained in the York University decision. In particular, decisions in the college sector follow
the Goodyear approach and that approach ought to be followed here unless it is determined to be
manifestly wrong.
Decision
I have already determined, in a previous award, that the employer grievance in this case was filed
in a timely manner. That is, it was presented “within 20 days following the occurrence or
origination of circumstances giving rise to the grievance,” to quote from Article 32.10 of the
collective agreement. The 20 days, a mandatory time limit, began to run when the union advised
the college on October 25, 2013, that it would not pay the invoice forwarded on September 30,
2013. That invoice, for $208,362.70, covered seven semesters of union release time, starting in
2010 and ending several months before the invoice, in the winter 2013 semester.
[12]
The union’s first argument in this second preliminary objection is that it has no obligation to pay
any of the bill, because of the lapse of time between the period covered by the invoice and the
date of the invoice itself. In my view, this argument has no merit. First, the argument seems to
conflate the 20-day time limit for filing a grievance with the amount of time that can be
encompassed in the claim asserted within a timely grievance. Unlike in some collective
agreements, such as the one in the Children’s Aid Society of Toronto case, there is nothing in this
collective agreement’s grievance procedure limiting the relief that can be granted. There is
language (Article 32.01) requiring employees with a complaint to discuss it with a supervisor
within 20 days of when the employee knew or ought to have known about the circumstances, and
there is language in the Article 32.10 regarding college grievances that provides for the filing of
the grievance within 20 days “following the occurrence or origination of the circumstances
giving rise to the grievance.” (This was the clause at the centre of my first preliminary award in
this matter on timeliness.) But none of this language specifies that claims cannot encompass
periods beyond 20 days from when the matter was raised. As noted in my earlier award, the
union has an issue with the 20-day limit on back pay the college is willing to provide when it
concedes in response to a grievance that it has misclassified an employee or placed an employee
on the wrong step of the pay grid. That issue, as I said in my earlier award, is legally irrelevant
to this dispute; while it is a real issue, it is an issue that would have to be decided in another case
based on the particular circumstances. Second, the idea that an invoice must be issued within 20
days of the end of the semester during which the employees were released for union business is
most certainly not how the parties have conducted themselves over the years. The evidence is
that the reimbursement by the union was never paid, billed or even discussed until at least a
[13]
month after the release time was used (usually later), and that each invoice lumped together at
least two semesters. As noted previously, the collective agreement is silent on any details of the
procedure and timing of the union’s obligation to reimburse for release time; therefore, there is
no basis in either the agreement or in the parties’ practice for the suggestion that the union is
required to pay only when the college sends an invoice within 20 days of when the union release
time is used.
Alternatively, the union says past practice dictates that the only portion of the invoice that the
union is obliged to pay is for union release time used during the winter 2013 semester. This
argument contains two assumptions: first, that the past practice was clear and consistent; and
second, that it had evolved into the kind of understanding between the parties that results in
adverse consequences if violated. In my view, this argument must also fail. I agree there is
some consistency in the pre-2010 practice relating to the forwarding and payment of invoices. I
have already made some findings about certain features of that past practice. In addition, it is
true that the invoices for union release time in the three years from 2005 to 2007 were all
forwarded in March or April of the following year. However, the practice before that is unclear,
and the invoice for 2008 was not provided until March, 2010, then later revised and not paid
until November of that year. The invoice for 2009 was also issued in March, 2010, then revised
in August of that year before it was paid. However, to the extent that there is a consistent past
practice, there is no basis for concluding that it created an obligation on the employer to provide
the invoice at any particular time, failing which the union would be released from its obligation
to pay. The practice did not give rise to an estoppel through detrimental reliance or any other
kind of prejudice to the union caused by the late forwarding of the bill for 2010 to 2012. On the
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contrary, the union benefitted from the college’s laxity in delaying the billing; the college’s
delay enabled the union to keep the money that it would otherwise have been obliged to pay
earlier. That is presumably why the union did not argue that it was prejudiced by the employer’s
failure to act for 3½ years. There was no suggestion that the union believed the college was
never going to invoice for those years, or that it had otherwise fully or partially waived the
payment. Nor was there any suggestion that the passage of time had impaired the union’s ability
to verify the college’s calculation of the amount owing. Simply put, there was no prejudice;
furthermore the union was able to retain the money that it was required by the collective
agreement to pay to the college for release time that it had requested and used years before.
While receiving a large bill for an accumulated debt can no doubt be irritating, had the union
wanted to reimburse the college earlier in order to avoid a large bill, it could have easily
requested an invoice from the college. In fact, the evidence was that the union local’s treasurer
prior to 2006 initiated the discussions about billing by sending his own calculation occasionally
to the college. But in the years from 2010 to 2013, the union said nothing to the college about its
mounting debt, while continuing to request union leave.
In this regard, it is noteworthy that, in the cases cited by the union where arbitrators imposed
limits on how long before the date of the grievance a remedy would apply, there is a rationale for
the time limitation (apart from remedies that would span more than one collective agreement,
dealt with below) – whether it be to prevent a windfall or unanticipated costs (FPC Flexible
Packaging) or because the issue was known or should have been known for a long time before
the grievance was filed (First Air, Sifto). Here, there is no equivalent legal principle that would
limit the employer’s remedy. Twice a year, every year, the union made a request to the college
[15]
to release some employees for union business. It knew, or could have easily calculated, at least
roughly, the cost of its request and the accumulated debt. This employer would not be reaping a
windfall by collecting the correct amount for the accumulated release time, nor was it aware until
late 2013 that the union might refuse to pay a bill for a debt that was incurred starting in 2010.
Therefore, aside from the question of whether a remedy can span more than one collective
agreement, I can find no reason to limit the employer’s remedy to only the winter 2013 semester.
The union’s final alternative argument is that the employer is not entitled to any remedy that
predates the September 1, 2012, effective date of the collective agreement under which the
grievance was filed. As set out above, the parties have provided me with what the arbitrator in
the Manitoba case called a “tangled web of jurisprudence” on this issue, including several
decisions that are difficult or impossible to reconcile with each other.
The union relies on the phrase “this agreement” in Article 32.03 D, set out above, a type of
clause commonly found in collective agreements that confines an arbitration board’s authority to
the provisions of the agreement. In my view, it is not possible to ascribe to the phrase “this
agreement” an intention to place temporal limits on remedies. The same argument has been
raised in other cases, including Rougemount Carpentry, which have drawn the same conclusion
as I draw here, although there is a contrary view in the York University and Children’s Aid
Society of Toronto cases.
The real question in this argument by the union is whether the portion of the debt that accrued
during the 2009-2012 expired collective agreement can be said to be “vested” and thus fully
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enforceable through a timely grievance under the current collective agreement. In other words,
the question is whether the reasoning in the Supreme Court of Canada’s Dayco decision applies
here. In my view, it does. Whether the debt accrued by semester, by pay period, by calendar
year, or by some other time period – no conclusion on this question is necessary for purposes of
this argument – the debt did accrue from early 2010. I cannot see any basis to conclude that the
debt to the employer that accrued under the 2009-2012 collective agreement was expunged
simply because the parties entered into a renewal collective agreement. In other words, the
accrued debt was “vested,” as the term was used in Genstar and Dayco, meaning that it was not
automatically extinguished by the expiry of the old collective agreement. As the court pointed
out in Dayco, any other conclusion would render meaningless the promises made under the
expired collective agreement. Here, until the college issued its invoice – albeit after a long delay
– and the union declared it would not pay, there was no breach or alleged breach of the collective
agreement; there was only a debt that was accruing over the course of two collective agreements
and a promise to pay that debt contained in those collective agreements. In my view, the debt
accrued under the former collective agreement was “vested” in accordance with the principles
expressed in Dayco.
It is worth noting that the college sector cases relied on by the union – Northern College, George
Brown College, and Fanshawe College – where arbitration boards said their remedial authority
was limited to the collective agreement under which the grievance was filed, were all decided
before the Supreme Court’s Dayco decision.
[17]
The union asks how long the college can go before issuing an invoice and expecting payment. It
is a fair question. In my view, the college has provided the proper answer, namely that, at a
certain point, depending on the circumstances, the delay will be so long that an arbitrator would
be able to apply doctrines such as laches or estoppel to prevent unfairness to the union. That is
the approach adopted in the Rougemount case, and I believe it is the correct approach. But here,
there is no victim of unfairness pleading for relief from the arbitrator. The union has not argued
prejudice or detrimental reliance in this case. It simply says 3½ years is too long for the
employer to wait before forwarding an invoice, without providing any principled legal basis or
fairness argument for limiting the employer’s right to collect the money. The union requested
the release time, it knew or should have known how much it would cost, and there is nothing
unfair in the college demanding reimbursement for it, as required by the collective agreement.
My conclusion is that this preliminary objection by the union must be dismissed. The only
question that remains – the “merits” of the grievance – is whether the employer’s calculation of
the money owed is correct. The parties are directed to discuss this question, and I will remain
seized.
____________________
Lorne Slotnick, Arbitrator
February 24, 2015