HomeMy WebLinkAboutGrievor 16-11-21IN THE MATTER OF AN ARBITRATION
BETWEEN:
Community Living Sudbury
and
OPSEU, Local 676
Implementation of Minutes of Settlement)
Before: William Kaplan
Sole Arbitrator
Appearances
For the Employer: Kathleen Stokes
Weaver Simmons
Barristers & Solicitors
For the Union: Dan Hales
Grievance Officer
OPSEU
The matters in dispute proceeded by conference call on November 21, 2016.
Award
On September 14, 2016, the parties entered into Minutes of Settlement. In those
Minutes, the parties agreed to sever the grievor's employment relationship. The
relevant terms of the Minutes were as follows:
1. The Employer and the Grievor agree to sever the employment relationship for
unsuitability." The effective date shall be September 12, 2016. September 12,
2016 will be indicated on both the letter of employment and the ROE. The
Employer shall indicate on the ROE that your employment was terminated for
unsuitability." The Employer will not allege just cause.
2. The Employer shall pay to the Grievor notice in the sum of $7500, less statutory
deductions and inclusive of all amounts required to be paid under the
Employment Standards Act, on or before September 26, 2016.
After these Minutes were signed, an implementation dispute arose. It proceeded
by conference call on November 21, 2016. Both the union and the employer made
submissions, as did the grievor.
In brief, the grievor argued that the employer was acting maliciously and that
was reflected in the tax treatment of the $7500. In the grievor's view, that amount
should have been treated as a retiring allowance/ severance payment, not notice,
and only subject to 20% withholding, not as ordinary employment income, and
subject to the grievor's higher marginal rate. The grievor sought reimbursement
of the monies unnecessarily withheld along with punitive damages. The grievor
notes that the employer changed the ROE. The first one it issued indicated
severance pay, while the second indicated pay in lieu of notice. This was further
evidence of the employer's failure to abide by the terms and spirit of the
Minutes. The grievor also took the position that he was not terminated as he
initiated the settlement discussions and the decision to sever the employment
relationship was mutual. The word "notice" was part of a template and did not
indicate the discussions and understandings of the parties. For all of these
reasons, and others, the grievor and the union asked that the motion be
successful and an appropriate remedial order issued.
For its part, the employer acknowledged making a mistake on the first ROE, a
mistake that it immediately corrected. The Minutes did not provide for
severance, they provided for an all-inclusive amount of notice for everything
potentially owing under the Employment Standards Act. The employer paid those
monies that were taxed in the usual way. The employer had acted in accordance
with the Minutes; there was no evidence, only allegations of bad faith, and no
reason, in the circumstances to grant the motion. The employer asked that it be
dismissed.
Decision
Having carefully considered the extensive documentation filed in advance of the
hearing, along with the submissions made at the hearing including the grievor's
testimony, I am of the view that the union motion must be denied. The evidence
establishes that the parties agreed on a notice payment of $7500 inclusive of
everything potentially owing under the Employment Standards Act. The use of the
term "notice" is significant and dispositive. Moreover, by indicating that the
payment was on behalf of everything and anything potentially owing under the
Employment Standards Act, the parties must be deemed to have included vacation
pay, which the grievor made reference to during the course of his testimony.
Very simply, the parties did not provide that the $7500 payment be made as a
retiring allowance or severance. Reading the Minutes it is clear that monies are
notice" and as such must be treated for tax purposes as ordinary income with
ordinary deductions, exactly what occurred. There has been no breach of the
Minutes of Settlement and the union's motion must, therefore, fail.
Conclusion
Accordingly, and for the foregoing reasons, the unions motion is denied.
DATED at Toronto this 21•- day of November 2016.
William Kaplan"
William Kaplan, Sole Arbitrator