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HomeMy WebLinkAbout1996-2779.UNION98_11_24 OwrARIO EMPLOYES DE LA COURONNE CROWN EMPLOYEES DE L'OwrARIO 1111 GRIEVANCE COMMISSION DE SETTLEMENT REGLEMENT BOARD DES GRIEFS 180 DUNDAS STREET WEST SUITE 800, TORONTO ON M5G 1Z8 TELEPHONf/7-ELEPHONE (416) 326-1388 180, RUE DUNDAS OUEST BUREAU 800, TORONTO (ON) M5G 1Z8 FACS/MILEfTELECOPIE (416) 326-1396 GSB #2779/96, 0141/97 OPSEU #97U008, 97U056 . IN THE MATIEROF AN ARBITRATION Under THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT Before THE GRIEVANCE SETTLEMENT BOARD BETWEEN OPSEU (Union Gnevance) Grievor - and - The Crown In RIght of Ontano (Mirustry of Commuruty & SOCIal SefV1ces ) Employer BEFORE S Stewart Vice-ChaIr FOR THE G Leeb UNION Gnevance Officer Ontano PublIc SefV1ce Employees Uruon FOR THE B Loewen EMPLOYER Counsel, Legal SefV1ces Branch Management Board Secretanat HEARING July 14, 15, 16, 1998 DECISION The issue before me is whether the Employer has fulfilled its reasonable efforts obligations in accordance with Appendix 9 of the Collective Agreement Appendix 9 provides as follows The Government is aware that its restructuring initiatives over th~ next two fiscal years (1996/97, 1997/98) could have a significant effect on employees, some of whom have served for a lengthy period Accordingly, commencing with the ratification of the collective agreement and ending on December 31, 1998, the Employer undertakes the following 1 ( a) The Employer will make reasonable efforts to ensure that, where there is a disposition or other transfer of bargaining unit functions or jobs to the private or broader public sectors, employees in the bargaining unit are offered positions with the new employer on terms and conditions that are as close as possible to the then existing terms and conditions of employment of the employees in the bargaining unit, and, where less than the full complement of employees is offered positions, to ensure that offers are made on the basis of seniority When an employee has been transferred to a new employer he or she will be deemed to have resigned and no other provisions of the Collective Agreement will apply except for Article 53 or 78 (Termination Pay) (b) Where the salary of the job offered by the new employer is less than eight-five percent (85%) of the employee's current salary, or if the employee's service or seniority are not carried over to the new employer, the employee may decline the offer In such a case, the employee may exercise the rights prescribed by Article 20 (Employment Stability) and/or paragraphs 2 to 5 of this Appendix The employee must elect whether or not to accept employment with the new employer within three (3 ) days of receiving an offer In default of an election, the employee shall be deemed to have accepted the offer The issue of the reasonable efforts obligation arises here in the context of the closure of a number of large facilities which provide services and treatment to persons with developmental handicaps It has been determined that the care of 2 the residents of these facilities will be transferred to community agencies, with the consequential closure of the facilities and the displacement of the OPS employees In a depision of Vice-Chair Kaplan, dated June 2, 1997, this Board determined that the Ministry efforts to that point did not fulfil its obligations under Appendix 9 At P 18 of the decision, Mr Kaplan concluded as follows Suffice it to say that the evidence amply demonstrates that the efforts management made were de minimus, at best Indeed, this conclusion is reinforced by the fact that there is evidence that the employer made the exact same efforts (if not more) for a group of employees to whom it owed no obligation whatsoever By any measure, holding a job information day, writing letters, making telephone calls to follow-up, and attending at meetings does not come close to complying with this provision of the collective agreement These are the kinds of actions many employers would take absent of a legal requirement that it do something proactive Accordingly, I can only conclude that this grievance must succeed and I so declare The decision goes on to set out a number of general principles including at p 18-19 the principle described as "first and foremost", that making reasonable efforts does not mean "every" effort or "all efforts" It means making efforts that are reasonable all things considered, and that will, given that this is a broadly worded clause of general application, depend on particular circumstances of individual cases The decision goes on to state, at p 20, that the employer must do more than simply inquire whether the receiving transfer payment agency is interested in hiring public servants The transfer of work, the policy indicates, is a negotiated one And 3 negotiation means give and take, not a simple request without even the obligation - again this case - that questions be answered The structure of Appendix 9 indicates, and this purpose does not appear to be fundamentally in dispute between the parties, that it was developed to create a financipl incentive to the employer to place public servants in jobs that met certain terms with avoidance of enhanced severance costs, and possibly more, the benefit to the particular ministries At a minimum - and, obviously each case will differ - amounts up to avoided costs should be used as an incentive to secure jobs for public servants, many of whom, Appendix 9 begins, "served for a lengthy period" It is quite conceivable that financial incentives could have been used to overcome some of the difficulties identified in this case that were said to make it difficult to directly place PEH employees The fact that the Ministry has not previously had to enter into negotiations with a BPS transfer payment agency, and possibly its union, to give just one example of how it might give effect to this provision and its reasonable efforts obligation, does not mean that it should not do so if its efforts in doing so would, in all the circumstances, be reasonable The decision concludes with the following directions 1 The Ministry is directed, in each of the facilities covered by this award, to hold bi-weekly meetings with the union to advise the union of its reasonable efforts and to enter into a dialogue with the union as to how to best meet its obligations These meetings should commence immediately 2 The Ministry and the union will meet forthwith in order to discuss how best to manage the closure of these facilities in light of the employer's obligations to make reasonable efforts and the requirement that employees be surplused on the basis of seniority The parties may, if they wish, request from the Board the assistance of a mediator Should the parties prove unable to agree on a framework within sixty days of the release of this award, they may return to the Board on an expedited basis and jurisdiction is specifically retained to determine this issue 3 The Ministry is directed to negotiate with the transfer payment agencies the placement of public 4 servants whose jobs will be lost as the result of the facility closures and work transfers These negotiations must include the offering of a financial incentive in accordance with the general principle set out earlier in this award 4 The Ministry is directed to keep careful records of all of its surplusing and divestment activities to date, and of all of its planned surplusing and divestment activities with respect to each of these facilities The union is to be provided with copies of these records There were some further decisions from Vice-Chair Kaplan, including a consent order dated August 25, 1997, in which the Employer agreed, among other things, to attempt to obtain job offers for employees, to attempt to obtain information from the agencies about available positions, to post such information in the facility and to forward the names of persons at the institution who identified themselves as interested in the position commencing in the late summer and fall of 1997, the Employer proceeded with certain actions which, in its submission, fulfilled its obligations under Appendix 9 of the Collective Agreement It is the position of the Union that the actions taken by the Employer are not sufficient to meet its obligations under Appendix 9 and that the Employer continues to be in violation of the Collective Agreement Although the hearing in this matter proceeded over twenty days, there was ultimately little dispute about the relevant facts In the course of its renewed efforts in the fall of 1997, the Employer gave consideration to the timing of reasonable 5 efforts negotiations with the agencies in relation to the placement process The placement process involves an independent third party planner who, with the involvement of the facility staff, the family and the resident to the extent possible, develops a g~neral service plan The plan is then forwarded to an agency or agencies viewed as appropriate for the resident Various factors come into play in determining the choice of agency, including proximity to family or facilities, the placement of other residents and the philosophy or religious orientation of the agency In certain instances choice is effectively limited, for example in situations where proximity to family is the priority concern and there is only one agency in the geographical location in which the resident's family resides When an agency has been chosen, the Ministry will then make the necessary funding and transfer arrangements The agencies receive funds from the Employer on the basis of services provided, pursuant to service contracts which are renewed on an annual basis It was determined that agencies would be approached about employment opportunites for OPS employees after placement had been finalized The Employer considered and rejected the idea of dealing with the agencies on resident placement and employment opportunities at the same time Similarly, negotiating the placement of residents subject to the agency agreeing to hire staff was rejected While these latter two approaches were viewed as having a greater potential for obtaining jobs for displaced employees, they were viewed as 6 undesirable from the point of view of the resident, placing the resident's interests secondary It was the Employer's position that the interests of the residents in obtaining their desired placement should be unfettered and it was not prepared to veto placement on. the basis of an agency's position on hiring displaced OPS employees Mr B Low and Mr T Magee testified regarding the actions taken by the Employer pursuant to the Board's June 2, 1997 decision Meetings were established with the Union as directed A template was established for negotiations and training was provided The Employer retained the services of Mr F Collict, who has extensive experience in labour relations, to assist Ms J Geisberger, a negotiator from Management Board, also had extensive involvement in the matter Previously, the hiring of OPS employees was one of a number of items on the agenda for a meeting with the agencies as a group This time, meetings were convened with each individual agency The template established for the negotiations with the agencies contemplated the offering of a financial incentive to the agencies to hire OPS employees, contacting union representatives as necessary and following up with agencies to determine how to overcome any barriers to obtaining jobs that were identified At the outset of the meetings with the agencies, it became apparent that there were formidable obstacles to attaining the 7 objectives of the process The wages paid by the transfer agencies were, virtually without exception, considerably lower than those paid to employees in the OPS Another major barrier was opposition to giving displaced OPS members preference for full-time po~itions over part-time employees already working at the agencies Where the agency was unionized, collective agreements gave preference to current employees for new positions Where the agencies were not unionized it was common that there was a policy providing for the hiring of current employees There was also opposition to recognition of seniority for OPS employees as this was viewed as disadvantaging current employees Evidence was adduced in relation to one agency, Pathways, where OPS service and seniority was given some recognition, however Ms M Lamb, executive director of Pathways, testified that there was nothing that could have been offered which would have compelled her to give OPS employees an advantage over current employees with respect to seniority as it relates to job security In her view, such action would have been damaging to the morale of her current employees and thus damaging to her organization Representatives of unions representing employees of the agencies, including OPSEU, were clear and adamant that they would not consent to displaced OPS members being given preferential treatment relative to the employees that they represented The agencies were also generally unwilling to give OPS employees an advantage over other applicants, although there were some exceptions Pathways, for example, did agree to hire 8 exclusively from the OPS and that in cases of relative equality of the applicants, they would be hired on the basis of their OPS seniority In a number of instances, families and residents were involved in hiring decisions Certain agencies required a particular r~ligious or philisophical commitment In certain instances, no new positions would be created, for example where there was already an opening or the needs of the new client could be met by existing staff In some instances there were laid off employees with recall rights who would fill any new positions resulting from the transfer of residents from the institutions There were few instances in which OPS employees identified themselves as candidates for the positions that were posted in accordance with the protocol agreed upon by the parties Aside from the fact that the pay of the positions was generally considerably less, many of the positions were outside the geopraphical area of the facilities, making the positions understandably undesirable The financial incentive offered by the Employer, ultimately based on the savings of severance at the OPS rates, was not an effective incentive Some agencies viewed it as "morally offensive" While the Union's position was that the financial incentive that was offered was less than that contemplated by Mr Kaplan's award, on the basis that there were additional amounts contemplated by the direction to offer saved costs, it was abundantly clear from the evidence that to be effective, a ,.- 9 financial incentive would have to consist of either an extremely large one time payment or, more likely, a commitment to increased funding on a permanent basis The predominant view of the agencies was that in order to provide displaced OPS employees with comparaple salaries it would require sufficient funding on an ongoing basis to compensate their current employees, as well as displaced OPS employees, at those rates All agencies receiving residents did come to agreements with the Employer, the terms of which were set out in confirming letters The agreements provided for the posting of positions at the facilities that were closing A number of agencies were amenable to job shadowing and visits from OPS employees Mr Leeb made reference to there being only one instance of an offer made pursuant to the terms of an agreement between the Ministry and an agency, the terms of which did not meet the criteria of l(b) of Appendix 9 Ultimately, the position was not accepted by the individual In one instance, the job competition was delayed by an agency in order that the OPS employees would be surplussed and thus there would be no issue as to their entitlement to receive their full surplus entitlement by virtue of having accepted a position, although, ultimately, a number of OPS employees were to be hired There is reference in the documentary evidence to other instances of jobs being offered, however there was no dispute that the results of the undertaking in relation to obtaining jobs for displaced OPS employees were 10 extremely disappointing There were three aspects to Mr Leeb's submissions He argued that the Employer did not do what it set out to do in relation to reasonable efforts In particular, with respect to the matter of providing a substantial financial incentive which would allow wages to increase across the board and, thus, most likely would provide an effective incentive for the agencies and their unions, Mr Leeb emphasized that senior Ministry officials could have, but did not, seek Cabinet approval for increased funding As well, it was submitted that the Employer's actions pursuant to its reasonable efforts obligation did not comply with Mr Kaplan's initial decision Mr Leeb also argued that the actions of the Employer simply do not meet the objective standard of reasonable efforts considered in light of the important employment interests in issue He submitted that the ultimate result could not have been what the parties bargained for and contrasted the outcome in this case with the outcome in other divestures As well, Mr Leeb emphasized the Employer's role in funding the agencies and its effective decision making power in relation to placement arising from its ability to determine whether it would fund a resident in the chosen agency In his submission the Employer should have, but did not, utilize the bargaining power that it possessed in order to compel the agencies to agree to terms more favourable to the displaced OPS employees 11 In his submissions, Mr Loewen emphasized that the Employer is dealing with the transfer of individuals who are among society's most vulnerable Accordingly, it was argued, the Employer acted most appropriately in determining at the outset that the choice of the individual resident must be given priority and should not be in any way intertwined with the reasonable efforts issue It was submitted that the other two alternatives considered would potentially result in inappropriate incursions into the resident's freedom of choice with respect to placement It was further argued that there was no justification for a conclusion that such an approach would have a different result In this regard, Mr Loewen emphasized Ms Lamb's testimony that there was nothing that the Ministry could have done to persuade her to recognize seniority of OPS employees in a manner which would put current employees at a relative disadvantage in relation to job security He also submitted that the cost of what might constitute a meaningful incentive goes far beyond that contemplated by the reasonable efforts obligation and argued that reasonable efforts do not include an obligation to provide substantial funding to increase existing wage rates Mr Loewen also emphasized the difference between the actions of the Employer which gave rise to the conclusion that the reasonable efforts obligation had not been complied with and its subsequent actions which are the subject of this proceeding In his submission, the Employer has fulfilled its obligation to make 12 reasonable efforts pursuant to Appendix 9 of the Collective Agreement The question of what constitutes reasonable efforts is, as noted in th~ excerpt from the Board's June 2, 1997 decision reproduced at the outset of this decision, to be determined on the basis of the particular circumstances that present themselves in connection with a divesture of operations As noted in that decision, as well as a number of other decisions of this Board, the reasonable efforts obligation does not require the Employer to make all possible efforts However, the obligation to make reasonable efforts must be interpreted in light of the very significant employee interests at stake I agree with Mr Loewen that that the approach of the Employer in the second round was markedly different from that at the time of the events giving rise to Mr Kaplan's award Rather than this matter simply being one of a number of items to be discussed with a group of agencies, a centralized strategic approach was developed, expertise in negotiations was sought and obtained, a process for ongoing communications with the Union was established, a financial incentive was offered and a protocol for the posting for and identification of interest in job opportunities was established While Mr Leeb is correct in pointing out that there were instances in which the Employer did not convene additional meetings and it did not identify solutions 13 to the barriers that were identified, as it commited to doing at the outset, I am ultimately compelled to the conclusion that this was not as a result of a de minimus or perfunctory approach, as Mr Leeb suggests, but rather, as a result of a recognition that the barrier~ were formidable and that any action which might have overcome the barriers that were present were actions beyond that contemplated by the reasonable efforts obligation The understandable reluctance on the part of agencies to agree to anything that would have diminished the rights of existing employees, along with the adamant response of the unions representing employees of the agencies, including OPSEU, to a similar effect, created a formidable barrier to job opportunities, aside from the issue of recognition of OPS seniority in relation to those opportunities It was clear from the evidence that the monetary incentive offered was not an effective incentive and that a truly effective monetary incentive would have been an extremely large one time payment or, more likely, a permanent commitment to significantly increased long-term funding of the agencies Such a commitment may well have influenced the agencies and the unions representing their employees to view the objectives of the reasonable efforts process in a more favourable light However, I am not persuaded that the Employer was agreeing to assume this kind of financial commitment in assuming the reasonable efforts obligation r 14 contained in Appendix 9 An interpretation of the reasonable efforts obligation which would require the Employer to substantially increase the funding to agencies on a permanent basis, essentially restructuring the existing wage economy of the agencies on p significant scale, would not, in my view, be reflective of the agreement that was reached between the parties Given that the quantum of the incentive required is clearly well beyond the ambit of what in Mr Leeb's submission constitutes saved severance costs and thus, in its most liberal interpretation, the ambit of Mr Kaplan's decision, I am unable to accept Mr Leeb's submission that the Employer's failure to seek additional funds for the incentive constituted a violation of its reasonable efforts obligation It is therefore unnecessary for me to decide whether the Employer's determination as to what constituted saved severance costs was correct Mr Leeb argued that in determining that the matter of job opportunities for displaced OPS employees would be raised only after transfers had been finalized, the Employer failed to employ the bargaining power available to it in dealing with the agencies and thus failed to fulfill its reasonable efforts obligation In my view, the Employer's justification for its approach on the basis of the interests of the residents being paramount is understandable Moreover, even if the Employer were to have attempted to conduct itself with the agencies in this manner, I am not persuaded that there is any real likelihood that the I 15 ultimate result would have been different I have the same view with respect to the suggestion that the Employer ought to have wielded its power in relation to the renewal of contracts in its dealings with the agencies to advance the interest of displaced OPS employee~ It was readily apparent from the evidence that the traditional market assumptions in relation to motivation were not present The mandate of the agencies is not expansion or profit A more aggressive approach on the part of the Employer in its dealings with the agencies would not have overcome the fundamental barriers to job opportunties for OPS employees affected by this divestment and thus is unlikely to have changed the ultimate result I fully agree with Mr Leeb that the ultimate result of the Employer's efforts in this instance is striking, both in absolute terms and in the context of the favourable opportunities that exist for employees affected by divestments in other areas of the public service However, after reflecting on all of the evidence in light of the authorities provided to me and the submissions of the parties I am unable to conclude that the Employer has failed to fulfill its obligation to make reasonable efforts pursuant to Appendix 9 of the Collective Agreement The reasonable efforts obligation is applicable to a large variety of circumstances across the public sector and those different circumstances will compel different results The result in this instance arises from the very unusual circumstances existing here To effect a 16 change in the result would require actions on the part of the Employer that are well beyond what is contemplated by the agreement of the parties that the Employer would make "reasonable efforts" . There was an issue between the parties as to whether accepting a position with an agency which has entered into a reasonable efforts agreement which does not meet the Appendix 9, 1 (b) criteria affects the employee's entitlement to severance payments This matter was alluded to but not fully argued In the event that this issue remains in dispute, the matter may be dealt with by any Vice-Chair upon request to the Registrar Dated at Toronto, this 24th day of November, 1998 m!uJVt 1 s L stewart - Vice-Chair