HomeMy WebLinkAboutUnion 93-12-21 IN THE MATTER OF AN ~BI~TION ~C~
BETWEEN:
ONTARIO COUNCIL OF REGENTS
FOR THE COLLEGES OF APPLIED ARTS AND TECHNOLOGY
- and -
ONTARIO PUBLIC SERVICE EMPLOYEES UNION
(FOR SUPPORT STAFF EMPLOYEES)
BOARD OF ARBITRATION:
JANE H. DEVLIN CHAIRMAN
DAVID W. GUPTILL COLLEGES NOMINEE
SHERRIL MURRAY UNION NOMINEE
Chris G. Riggs, for the Colleges
Ian J. Roland, for the Union
There are a number of grievances filed by the Union
under both the support staff and academic collective agreements
which deal with benefit coverage for retired employees of the
Colleges. The parties agreed to proceed initially with the
grievances under the support staff agreement and to hold in
abeyance the grievances under the academic agreement.
Under the support staff collective agreement, the
relevant provision is Article 8.1.12 which appeared for the first
time in the agreement covering the period from September 1, 1989
to August 31, 1991. This provision is as follows:
8.1.12 Post Retirement Extended Health Coverage
The Colleges agree to include eligible retired employees in
the Extended Health Plan at the option of the employee under
the following conditions:
1. The retired employee shall pay to the College quarterly
in advance, the full cost of the Plan from the date of
retirement.
2. Eligibility for such coverage shall be dependent
upon:
(i) the employee qualifying for benefits under the
College of Applied Arts and Technology Pension
Plan or the Teachers' Superannuation Plan;
(ii) the employee maintaining eligibility for benefits
under OHIP;
(iii) the employee commencing retirement on or after
date of ratification.
3. Insurable benefits payable under OHIP shall not be
payable under the Extended Health Plan.
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Extended health coverage for active employees is dealt
with under Article 8.1.5 of the colleotive agreement which
provides as follows:
8.1.5. Extended Health
The Colleges agree during the term of this Agreement, to
contribute one hundred (100) per cent of the present
premiums towards the current Extended Health Benefit Plan
subject to the eligibility requirements provided under such
Plan.
The balance of Article 8.1 provides for a number of other
benefits for active employees, including life insurance, short
and long term disability and dental coverage. In respect of some
benefits, such as basic life insurance and dental coverage, the
Colleges are required to pay 100% of the monthly premiums whereas
for supplementary life insurance (which is provided on a
voluntary basis) and long term disability, the Colleges are
responsible for a specified portion of the monthly premiums and
the balance is to be paid by employees by way of payroll
deduction.
It is also to be noted that in Appendix A to the
collective agreement, the parties have established a joint
insurance committee for the purpose of facilitating
communications between the Council of Regents and the Union with
respect to group insurance applicable to members of the support
staff bargaining unit. The committee is comprised of
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representatives of both parties and its duties include developing
specifications for the public tender of negotiated benefits;
making recommendations to the Council of Regents on the selection
of an insurance carrier or the renewal of existing contracts of
insurance, reviewing financial report~ on the group insurance
plan and making recommendations with respect to contentious
claims.
Apart from the collective agreement, the Board was
referred to the group insurance policy for which the carrier is
Sun Life Assurance Company of Canada. Prior to the fall of 1989
and the inclusion of Article 8.1.12 in the collective agreement,
the group policy provided that benefits would not extend beyond
age 65 or the date of retirement (except in cases where an
employee was on an approved early retirement program). Under the
heading "Premium Calculation", the policy provided as follows:
The amount of premium due on the effective date and on each
subsequent premium due date will be the aggregate of the
several amounts payable in respect of each employee then
insured, according to the premium rates then applicable.
The following premium rates are applicable to the policy at
its effective date and thereafter until altered by Sun Life.
Sun Life may change the premium rate for Employee Life
Insurance in accordance with the Method of Calculation on
the following page and may change any of the other premium
rates from time to time on any premium due date.
However, a premium rate may not be changed until it has been
in force for at least twelve months unless the terms of the
policy are amended or the amounts of benefits payable are
changed. Any changes in the premium rates arising from
policy amendments or changes in amounts of benefits payable
will be disregarded in computing the twelve-month period.
The policy then set out the premium rates for two extended health
plans (one of which included semi-private hospital coverage) and,
under each plan, the policy specified premium rates for single
and family coverage. In contrast to the premiums for both basic
and supplementary life insurance, thelrates for extended health
coverage did not vary with the age of the employee.
In the fall of 1989, as a result of the introduction of
Article 8.1.12, the group policy was amended to provide that
employees who retired subsequent to September 1, 1989 who were in
receipt of a pension from the policyholder or the teachers'
superannuation fund and who maintained coverage under O.H.I.P.
could elect to continue extended health benefits. Under the
policy, however, different premium rates were established for
retired employees than were applicable to active employees. In
fact, with the exception of the rates for vision and hearing
care, the single and family premiums for retired employees were
almost twice those for active employees. It is the Board's
understanding that the higher rates were based upon the increased
use of benefits generally associated with the age of the retiree
group. In any event, as a result of the higher rates charged to
retired employees, the present grievances were filed.
It was the submission of the Union that the phrase
"the full cost of the Plan" in Article 8.1.12 is intended to
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refer to the plan as it existed at the date of negotiations which
provided for uniform premiums for extended health coverage which
did not vary with the age of the employee. On this basis, the
Union contended the Colleges violated the collective agreement by
failing to require the insurance carrier to charge the same rates
to retired employees as are charged in respect of active
employees. It was the submission of the Colleges, however, that
Article 8.1.12 clearly provides that "the retired employee shall
pay ... the full cost of the Plan" and that, as a result, any
costs associated with providing coverage to retired employees are
to be borne by the employees and not by the Colleges. Moreover,
the Colleges contended that if the Union's interpretation were to
prevail, there would be an overall increase in premiums (based
upon the costs associated with coverage for the retiree group)
and that the Colleges would, in effect, be required to subsidize
the additional costs as the Colleges pay 100% of the monthly
premiums for extended health coverage for active employees. Such
a result, it was submitted, is contrary to Article 8.1.12 which
provides that responsibility for the full cost of the plan rests
with the retired employees.
While it was the initial position of both parties that
the language of Article 8.1.12 is clear and unequivocal, in the
alternative and in the event that the Board were to find that the
language is ambiguous, both parties introduced extrinsic evidence
as an aid to interpretation. The evidence introduced by the
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Union pertained to the negotiations which took place prior to the
inclusion of Article 8.1.12 in the collective agreement. The
evidence tendered by the Colleges related to the practice with
respect to retiree benefits under the academic collective
agreement which contains provisions similar to Article 8.1.12
which first appeared in the agreement covering the period from
September 1, 1987 to August 31, 1989.
Having considered the matter carefully, the Board
agrees with the initial position advanced by both parties and
finds that the language of Article 8.1.12 is clear and
unambiguous and, for this reason, it is not appropriate to have
recourse to extrinsic evidence as an aid to interpretation. In
construing Article 8.1.12, however, it is necessary to consider
the provision in the context of Article 8.1 as a whole. As noted
above, this Article provides for a number of benefits for active
employees which include, in addition to extended health, life
insurance, short and long term disability and dental coverage.
In each case, the collective agreement specifies the portion of
the monthly premiums which are to be paid by the Colleges as well
as the portion of the premiums, if any, to be paid by employees
by way of payroll deduction.
In contrast to the other provisions of Article 8.1,
Article 8.1.12 provides that the Colleges agree to include
eligible retired employees in the extended health plan at the
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option of the employee subject to certain eligibility
requirements, which are not in issue in this case, provided that
"the retired employee shall pay to the College quarterly in
advance, the full cost of the Plan from the date of retirement".
In the Board's view, the language of this Article is clear in
providing that responsibility for the cost of coverage rests with
the retirees and not with the Colleges. Moreover, while there
was some dispute between the parties as to whether the reference
to the "full cost of the Plan" is equivalent to the premiums
charged under the plan, in the Board's view, the reference to
"the full cost of the Plan" leaves no'doubt that the financial
obligation is to be borne entirely by the retired employees who
elect to be included in the plan.
Nevertheless, it was the submission of the Union that
the group policy, which is incorporated into the collective
agreement by reference, precludes the carrier from establishing
different rates for retirees than for active employees. In
support of its position, the Union relied on the provisions of
the policy relating to premium calculation as well as the fact
that, prior to the fall of 1989 and the introduction of Article
8.1.12, there were uniform rates in effect for extended health
coverage which did not vary with the age of the employee. In the
Board's view, however, there is nothing in the policy to which we
were directed which mandates uniform rates for extended health
coverage or precludes a higher rate based upon the increased
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costs associated with coverage for retired employees. On the
contrary, the group policy expressly provides for changes to
premium rates from time to time and although a premium rate may
not be changed until it has been in force for at least 12 months,
this does not apply in the event that the policy is amended as
was apparently required by the addition of extended health
coverage for retired employees. Moreover, although the Union
pointed to the fact that a separate deposit fund has not been
maintained by the carrier for surpluses derived from premiums
charged to retired employees, this is matter which might
appropriately be addressed in another forum but cannot affect our
interpretation of the clear language of Article 8.1.12 of the
collective agreement.
As well, if the interpretation advanced by the Union
were to prevail, presumably there would be an increase in premium
rates for all employees to cover the costs associated with
coverage for retired employees. In these circumstances, the
Colleges, which pay 100% of the monthly premiums for active
employees would, in effect, be required to bear a portion of the
costs associated with coverage of the retiree group which is
contrary to the language of the Article 8.1.12. This Article
places no financial obligation on the Colleges as a result of the
participation of retired employees in the extended health plan.
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In the alternative, however, and in the event that the
Board were to find that the language of Article 8.1.12 favours
the interpretation advanced by the Colleges, the Union took the
position that the Colleges are estopped from relying upon their
strict rights under the collective agreement. In support of this
submission, evidence was introduced relating to a bulletin issued
by the Union following execution of a memorandum of settlement by
the negotiating committees for the respective parties in early
October of 1989. The bulletin, which was signed by all of the
members of the Union's negotiating committee with the exception
of one (who issued a dissent), was intended to outline the terms
of the tentative agreement and to encourage employees to vote in
favour of ratification. Under the heading "Retirees", the
bulletin provided as follows:
Members who are retiring can maintain their benefits at
the colleges' group rate, at their own expense. This
includes members who retire between Sept. 1 1989 and
ratification of the contract.
Arlene Ryder, a member of the Union's negotiating committee and
the President of the Local at Confederation College, testified
that the bulletin reflected the Union's understanding that the
same rates would be charged to retired employees as those charged
in respect of active employees. She admitted, however, that in
some respects, the bulletin did not strictly conform with the
wording of the tentative agreement. In particular, while the
bulletin refers to retired employees being entitled to maintain
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their benefits, in fact, the tentative agreement provided that
they would be included only in the extended health plan.
In any event, the evidence indicates that copies of the
bulletin were forwarded to the Local Union Presidents for
distribution to the membership at each College. The Local
Presidents were evidently also instructed to make copies of the
bulletin available in reading rooms and on bulletin boards
throughout the Colleges. As well, the Board heard evidence from
both Ms. Ryder and Karry Gennings, the President of the Local at
Conestoga College, as to the procedure they followed in
distributing and posting the bulletin. Ms. Ryder also testified
that the bulletin was a frequent topic of discussion among
members of the bargaining unit and that, in all likelihood, it
came to the attention of management at the College. Mr. Gennings
testified that John Tibbits, the President of Conestoga College
and the Co-Chair of the Colleges' negotiating committee, was
generally apprised of the Union's position on various issues and,
for this reason, was undoubtedly aware of the content of the
bulletin. According to both Ms. Ryder and Mr. Gennings, however,
no member of management voiced any objection to the bulletin.
Based on the evidence, it was the submission of the
Union that the bulletin made it clear that it was the Union's
understanding that retired employees would be charged the same
rates as those charged in respect of active employees; that the
bulletin came to the attention of members of management within
the Colleges and that having failed to object to the bulletin,
the Colleges are now estopped from taking a contrary position.
It was the submission of the Colleges, however, that given the
nature and purpose of the bulletin, it would have been improper
for management to have made any commeht on its content.
Moreover, by the time the bulletin was issued, the parties had
already reached agreement on the language of Article 8.1.12 and
in the circumstances, management's silence could not be construed
as a representation of an intention on the part of the Colleges
to forego their strict legal rights.
In the Board's view, although the bulletin provided
that retired employees could "maintain their benefits at the
Colleges' group rate", this does not unequivocally point to an
understanding that retirees would be charged the same rates as
are charged in respect of active employees. Presumably, even if
retired employees were charged higher rates than active
employees, they would, nevertheless, obtain the benefit of a
group rate superior to that charged for individual coverage.
Furthermore, given the nature and purpose of the bulletin, we
cannot conclude that management's failure to object to the
wording of the paragraph outlined can be construed as a
representation of the Colleges' intention to forego their strict
rights. In the result, we find that the Union has not made out a
case for the application of the doctrine of estoppel.
Given the conclusion we have reached, it is unnecessary
to consider the Colleges' alternative argument which involved a
claim of estoppel against the Union. Accordingly, for the
· reasons set out, the grievances are hereby dismissed.
DATED AT TORONTO, this 21st day of December, 1993.
Chairman
"David W. Guptill"
Colleges Nominee
"Sherril Murray"
Union Nominee