HomeMy WebLinkAboutGrievor 21-07-05IN THE MATTER OF AN ARBITRATION
BETWEEN:
ALGONQUIN COLLEGE
(the Employer or the College)
- and -
ONTARIO PUBLIC SERVICE EMPLOYEES’ UNION, LOCAL 415
(the Union)
Re: Implementation of Settlement
AWARD
Paula Knopf – Arbitrator
Appearances:
For the Employer: J.D. Sharp
For the Union: Gabriel Hoogers
The hearing into this matter was conducted electronically on June 21, 2021 .
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For over ten years, the Grievor worked three days a week and was paid 100% of the
full-time salary rate. In early 2019, the Employer put the Grievor on notice that it was
reducing her wages to 60% of the full-time rate, effective April 2019. A grievance was
filed, alleging that the Employer had failed to accommodate the Grievor and failed to
permit her access to sick leave benefits. The grievance proceeded to arbitration before
me, but was eventually resolved by the Parties in March 2021 when they agreed to a
number of terms that included the continuation of the Grievor’s salary on the basis of
60% of a full-time rate and the Grievor’s agreement to resign effective June 2021.
There are other terms that are not relevant to the issue at hand, other than the fact that
this Arbitrator was left seized with regard to any issues concerning “terms or the
implementation” of their settlement.
After the settlement was achieved, the Grievor discovered that the Employer had also
reduced its contributions to her pension to 60% of its previous level in April 2019. The
Union asked for the hearing to reconvene to resolve a dispute over the Employer’s
pension obligations. Accordingly, this Award deals with the issues of implementation of
the following terms of the Memorandum of Agreement (MOA):
1. The Parties agree that the Grievor shall remain employed under the current
arrangements in place for hours of work and payment on the date of execution of
this Agreement until June 30, 2021 at which time the Grievor shall retire, effective
on that date. For greater certainty, the Grievor’s “current arrangements” require
her to work three (3) days per week and to be paid at the rate equivalent to sixty
percent (60%) of the applicable full-time rate, less the usual and necessary
deductions. It is understood that this does not constitute a change in the
Grievor’s job classification.
5. The Parties agree that this Memorandum of Agreement constitutes a full and
final settlement of the Grievance.
8. The Grievor has reviewed this Memorandum of Agreement and is in
agreement with its terms. The Grievor agrees that she has been fully and fairly
represented by the Union with respect to this matter, including in the settlement
of the Grievance.
9. . . . . The Union and the Grievor agree that the terms of this Agreement fully
and finally resolve any and all outstanding issues with respect to the Grievance.
The Union and the Grievor agree that in respect of the Grievance all monies du e
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and owing have been paid and that they have no further claims pursuant to the
Collective Agreement, the common law, the Employment Standards Act, the
Labour Relations Act, the Occupational Health and Safety Act, the Pension
Benefits Act and the Human Rights Code, and further agree that they will not
commence or support such a claim in any forum and acknowledge that such a
claim would fail due to the operation of this Agreement.
12. . . . . The parties further agree that Arbitrator Paula Knopf shall rem ain
seized with respect to any issues arising from the terms of this Agreement or its
implementation.
The dispute between the Parties is whether the Employer was obliged to continue to
make pension contributions on the basis of 100% or 60% from April 2019 up to the time
of her retirement.
When the College gave the Grievor notice that she would begin receiving only 60% of
her full-time rate in 2019, she made inquiries with Human Resources to ascertain the
effect of the changes on her holidays and other benefits. The Grievor asked the
following questions and received the following replies on March 19, 2019:
Q. Assuming I can use my sick days starting October 15, I would start reduced
Salary on January 6 [2020]. Could you please let me kno w exactly what my
salary will be starting at that time? Will my salary be reduced per day based on a
12-month year? Essentially I would like to know whether my holidays, benefits or
pension will be reduced as well?
A. STD days are not to be utilized to offset reduce permanent reduced work
schedule. [sic]
Your salary will be set up prorated based on working 60% (three days a week).
There is no change to pension and benefits.
Further questions from the Grievor prompted the following responses from Human
Resources on March 22, 2019:
Q. So the College will pay their share of my pension and benefits as though I was
working full time?
A. Connie [Power - the Human Resources Manager] has confirmed that pension
and benefit contributions remain the same by both parties.
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The change in the Grievor’s pay led to a grievance being filed and protracted
negotiations between the College and the Union leading up to a hearing in March 2021.
During those discussions, the issue of the Grievor’s retirement and pension entitlements
arose. To decide if she was in a position to retire, the Grievor used the pension plan’s
calculator in early 2021, factoring full-time service up until June 2021 in reliance on what
she had been told by Human Resources in early 2019. Her calculations gave her the
confidence to accept the terms of the MOA cited above that included her retirement
effective the end of June 2021. The Union and the Grievor assert that they relied on the
answers from Human Resources in agreeing to the terms of the MOA, believing that the
Grievor was receiving and would continue to receive pension contributions on the basis
of a full-time salary rate, up until her date of retirement.
However, the Grievor did not realize that when her salary was reduced to 60% of the
full-time rate in April 2019, the Employer also reduced the pension contributions by the
same proportion. Although pension contributions are indicated on employees’
electronic pay information and are readily available to them, the Grievor did not notice
the change. That is understandable to some extent because she used vacation credits
and other credits after April 2019 to prolong the time she would receive 100% of her
salary.
The Grievor only became aware of this change as she was preparing for her retirement
in May 2021. When she contacted the pension plan, she discovered that the
Employer’s pension contributions had been reduced to 60% of the full-time rate to
reflect the number of hours that she had been working since April 2019.
The Union asserts that the College mislead the Grievor into thinking that it would
continue to make pension contributions on the basis of the full-time rate. The Union
also submitted that the emails from Human Resources in 2019 are the representations
that formed the basis upon which the term “current arrangements” in paragraph 1 of the
MOA should be understood. The Union asserted that the Grievor “trusted the College”
and that there was an “inequality of knowledge” between the Parties at the time of
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signing. Further, the Union argued that there is an implied term of honesty and good
faith in the MOA. Therefore, the Union is seeking an order requiring the Employer to
pay the pension contributions based on 100% of salary from April 2019 to June 2021,
as well as any penalties or charges that may be incurred as a result of the situation.
The College has responded to the Union’s claim by asserting that nothing in the MO A
suggests that the College was obliged to make pension contributions based on 100% of
the Grievor’s salary rate. It was stressed that the pension issue was foremost in the
Parties’ minds when they were trying to resolve the accommodation and sick pay
grievance and that the MOA was structured to ensure that the Grievor’s pension would
not be negatively affected because of her not working full time for ten years. This was
achieved by the College and CAAT reaching the understanding contained in the
following letter, shared with the Union prior to entering into the MOA:
….. the CAAT Plan’s understanding is that for the period from roughly 2010 -
2019, [she] was working for three days per week but receiving compensation as
if she had been working five days per week.
With regard to the member's pension record and the conversations had between
the CAAT Plan and Algonquin College, the CAAT Plan recognizes the two days
per week not worked as paid leave, meaning that no retroactive changes or
adjustments to the member's record are necessary in terms of earnings, service,
contributions, or Pension Adjustment-related matters. Therefore, based on the
information noted above and assuming there are no future amendments to the
same, the CAAT plan will consider this matter closed.
The College pointed out that but for this arrangement to treat the two days a week as
“paid leave”, CAAT might have imposed significant pension adjustments. Given the
Union’s and the Grievor’s knowledge of this, the Employer suggested tha t it is
“disingenuous” for the Grievor to now claim full pension contributions after April 2019
when she was only working and being paid for three days a week. It was also stressed
that since the electronic pay records were always available to the Union and the
Grievor, they were either aware, or could or should have been aware, before signing the
MOA, that the “current arrangements” in March 2021 included pension contributions on
the basis of 60% of the applicable full-time rate. Further, it was asserted that any
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consideration of fairness or good faith should also take into consideration the fact that
neither the Union nor the Grievor ever raised any questions during the settlement
discussions about whether the Grievor was getting 100% pension contributions while
she was receiving 60% of her salary. It was suggested that if there were any questions
about this, they should have been raised directly with the Employer before the MOA
was finalized.
Acknowledging that the Grievor and the Union might have relied on the emails from
Human Resources issued before the Grievor’s salary was reduced to 60%, it was
submitted that the advice given to her was correct “at that time”. Nevertheless, the
Employer pointed out that when the MOA was signed in March 2021, the Union and the
Grievor had “full knowledge” of the fact and that CAAT was no longer allowing her to
accrue 100% service credits after April 2019 when she was working and being paid on
the basis of 60% of full-time employment. The Employer also stressed that it believes
that it mistakenly overpaid the Grievor hundreds of thousands of dollars for the ten
years that she received a full salary and accrued full-time service credits prior to 2019
while she worked 60% of the time. It was argued that once the situation was addressed
and arranged with CAAT to protect her pension for the period before April 2019, the
Grievor cannot rely on the emails cited above when she and the Union knew, or had the
ability to know, the actual “current arrangements” with respect to pension when the
MOA was signed in March 2021.
By way of reply, the Union stressed that the email exchange that the Grievor had with
Human Resources in 2019 gave her “forward looking” assurances about her pension
and provided her with promises that the Employer would continue to make pension
contributions at the rate of 100% of salary. Since these emails formed the basis of the
Union’s and the Grievor’s understanding of “current arrangements” at the time the MOA
was signed, this was said to create a “clear representation” that should inform the
reading and application of the MOA.
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The Decision
Although no evidence was presented in this proceeding, the following analysis is based
on the assumption that the MOA was negotiated and signed in good faith by the
College, the Union and the Grievor. There is nothing to suggest otherwise.
The MOA is clear on its face. In March 2021, the Parties agreed that the Grievor would
continue to be employed “under the current arrangements in place for hours of work and
payment” until June 30, 2021, at which time she would retire. The MOA clarified the
meaning of “current arrangements” and specified that she would work three (3) days per
week and be paid “at the rate equivalent to sixty percent (60%) of the applicable full-
time rate, less the usual and necessary deductions.” The MOA also provided that its
terms resolved any possible outstanding issues related to the accommodation and sick
leave grievance, including claims pursuant to the Collective Agreement and pension.
Since the arrangements in place at the time the MOA was signed were that the College
was paying 60% of the Grievor’s full-time rate and 60% of the full-time pension
contributions, a strict application of the MOA would force the Grievor’s claim for pension
contributions based on 100% of the salary rate to fail.
The emails from Human Resources in March of 2019 are the only basis upon which the
Grievor can claim an obligation for the Employer to pay pension contributions at the rate
of a full-time salary after April 2019. When the Grievor was told that she would no
longer be paid at the full salary rate and asked a bout what the effect of this would be on
her pension and benefits, she was told:
“Your salary will be set up prorated based on working 60% (three days a week).
There is no change to pension and benefits”.
and
“ . . . pension and benefit contributions remain the same by both parties”.
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These emails are not very clear. Did they mean that the total amounts would remain
the same or that the College’s and the Grievor’s respective obligations to contribute
would remain the same? In fairness, these emails certainly gave the impression that
the amount of pension contributions would remain unchanged. However, the pension
contributions were reduced in April 2019 in the same proportion as her salary was
reduced.
The Union grieved when the changes came into effect. The Parties then began
protracted negotiations designed to protect the Grievor from incurring any negative
pension adjustments that might have been applied by CAAT due to the fact that she had
only been working three out of five days a week for ten years. The College and CAAT
agreed to retroactively treat the two days a week as a “paid leave”, thereby paving the
way for the considerations granted in the MOA and pension protections that enabled the
Grievor to agree to retire in June 2021.
Had the College not reduced the pension contributions when it reduced the Grievor’s
salary in April 2019, her claim would now succeed. However, one cannot ignore the
plain wording of the MOA, the specific clarification of the term “current arrangements”
and the fact that the specifics of those ‘arrangements’ were easily accessible for the
Grievor and the Union in her electronic pay records before finalizing the MOA. The
grievance had challenged the reduction in pay and all its implications on the Grievor,
including her pension entitlements. Before the MOA was signed, the Grievor was made
aware that CAAT only treated the two days a week she had not worked for ten years as
unpaid leave as a result of an understanding achieved with the College for a period
ending in April 2019. Further, the email exchange between the College and CAAT that
was shared with the Union made clear that after 2019 the College and CAAT no longer
considered the Grievor to be on “paid leave” two days a week. This indicated that
service and pension credits stopped accruing at a full-time rate in April 2019. The MOA
resolved all the issues arising from the grievance. It is very unfortunate that there was
no discussion about the Employer’s pension contributions, nor was there any request to
further clarify what the “current arrangements” were when the MOA was signed. If there
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had been any deception during the negotiations or any attempt by the College to mask
the changes implemented in April 2019, this would have to be remedied. However,
given that the information about her “current arrangements” was easily available at the
time the MOA was being negotiated and signed, it cannot be concluded that the emails
from Human Resources two years earlier amount to a representation that overrides the
clear and unambiguous terms of the MOA. The MOA specified that the Grievor had
been paid all monies owing to her “pursuant to the Collective Agreement, common law”
and any other applicable statutes. That provision must be given effect. It
acknowledged that any claim that the Grievor might have had arising from the
representations from Human Resources was satisfied in return for the consideration she
obtained under the MOA.
Pension issues are complicated at the best of times. The Grievor’s confusion and
disappointment are understandable. However, the Union and the College went to
considerable efforts to maximize her pension rights and the MOA provided
consideration that paved the way for her dignified retirement. Her misunderstanding of
the situation was unfortunate. However, the clear wording of the MOA must prevail.
For all these reasons, the Grievor’s claim for the Employer to make further contributions
to her pension must fail.
Dated at Toronto this 5th day of July, 2021
____________________________
Paula Knopf - Arbitrator