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HomeMy WebLinkAbout1998-0252.Union.98-06-18 Decision J. ONrARJO EMPLOYES DE LA COURONNE I CROWN EMPLOYEES DE L'ONrARJO I . 1111 GRIEVANCE COMMISSION DE , SETTLEMENT REGLEMENT BOARD DES GRIEFS 180 DUNDAS STREET WEST SUITE 600, TORONTO ON M5G 128 TELEPHONErrELEPHONE (416) 326-1388 180, RUE DUNDAS OUEST BUREAU 600, TORONTO (ON) M5G 128 FACS/MILE/TELECOPIE (416) 326-1396 GSB #0252/98 OPSEU #98U069 IN THE MATIEROF AN ARBITRATION Under THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT Before THE GRIEVANCE SETTLEMENT BOARD BETWEEN OPSEU (Druon Gnevance) Grievor - and - The Crown m Right of Ontano (Mimstry of Natural Resources) Employer BEFORE KM. Petryshen Vice-ChaIr FOR THE G Leeb UNION Gnevance Officer Ontano Public SefV1ce Employees Uruon FOR THE S Kapur EMPLOYER Counsel, Legal Services Branch Management Board Secretanat HEARING June 8, 1998 June 11, 1998 '"t' DECISION In a grievance dated May 19, 1998, the Union claims that the Divestiture of Provincial Tree Nurseries Bid Package violates the collective agreement The Union alleges that the Employer has not made reasonable efforts as re9uired by paragraph l(a) of Appendix 9 It also alleges that the Employer has contravened paragraph 5 of Appendix 9, the employee bidding provision This decision addresses the reasonable efforts issue as well as a motion by the Union, both of which were heard on June 8, 1998 A hearing on the employee bidding issue will commence on June 22, 1998 At the commencement of the hearing on June 8, 1998, Mr Leeb argued that the Grievance Settlement Board (the II Board II ) should direct the Employer to extend the deadline for receiving bids for a month while settlement discussions continue On June 1, 1998, in the context of the Central Collections Services ("CCS") case, the parties began preliminary discussions to resolve certain Appendix 9 issues Although the parties wish to pursue these settlement discussions as soon as possible, it is unlikely that the process will be completed in the near future Mr Leeb argued that litigating this matter and other reasonable efforts issues scheduled to be heard in the next week or two would not be conducive to the settlement process Although not wishing to jeopardize the settlement process, the Employer took ~ 2 the position that a business as usual approach should prevail and that I should dismiss the Union's motion I agree with the Union's submission that the Board should endeavour to assist the parties in settling issues However, after considering the parties' submissions, it is my conclusion that the Union's motion must be dismissed It is the Employer's position that any delay in the hearing will have negative consequences and that proceeding with the few matters scheduled during the next couple of weeks will not adversely affect the settlement process In my view, each party must make its own assessment of the impact of litigating individual cases while there are settlement efforts ongoing It would be inappropriate for this Board to adjourn a particular case because the parties are engaged in settlement discussions unless both parties agree to the adjournment I will now turn to the merits of the reasonable efforts issue The Employer intends to sell three provincial tree nurseries located in Dryden, Swastika and st williams, ontario, by way of public sale The sale is under the control of the Privatization Secretariat Bids will be evaluated in three stages The first review will determine whether the mandatory requirements have been satisfied If the mandatory requirements are satisified, the second stage evaluation of the proponent's business plan and industry experience will occur If a proponent 3 makes it to the third stage, its bid will be evaluated on the basis of purchase price (80%), ease of implemention (10%) and a Human Resource Factor ("HRF") (10%) The HRF consists of mandatory requirements, rated requirements and a Human Resource Inc~ntive Fund It is mandatory that proponents make job offers to the affected ontario Government employees, that such job offers consist of at least eighty-five (85%) per cent of the employees' current salary and recognition of service of each employee for purposes of vacation and benefits, to the extent that benefits are available in the workplace Job offers shall not include any probationary period Proposals which do not satisfy these mandatory requirements will be disqualified At stage three, the quality of the job offers will be assessed by rating certain criteria The maximum score for the human resource evaluation criteria is 100 points The weighting of the criteria in the overall evaluation scheme is 10% The Employer intends to use the following evalution framework Salary (25 points) - 15 points = 1 point per % point over 85% 10 points = 100% Benefits (25 points) - 15 points = 1 5 points per benefit offered on list 10 points = highest % of benefit costs to salary scores all points, as long as % is over 18%, with other bidders receiving portion of 10 points No points below 18% (the list of benefits consists of 4 various benefits received by OPS employees) Termination (25 points) - 12 5 points = best notice period offered with other bidders receiving portion of points 12 5 points = best severance offered with other bidders receiving portion of points Terms and Conditions (25 points) GrievancejComplaint Resolution (3) = 3 points if indicate employees have access to a grievancej compliant resolution process Seniorty (6) = 6 points if agree to acknowledge employee's seniority for the purposes of lay-off and promotion Vacation ( 4 ) = 2 points if offer 3 weeks vacation plus 1 point for each additional week after three weeks up to an additional 2 points Paid Holidays (3 ) = 3 points if offer 11 paid days Salary Progression (3) = 3 points if provide salary progression to employees Hours of Work (6) = 4 points if between 36 25 and 44 hours Maximum points for 36 25 hours with other bidders receiving portion of points No points beyond 44 hours 2 points if overtime pay begins at 44 hours - The third part of the HRF is the utilization of the Human Resource Incentive Fund (up to approximatly $235,000) The amount in the Fund represents enhanced severance savings Following the closing of the bid, the Employer will enter into 5 negotiations with the preferred proponents in order to fulfill its reasonable efforts obligations Paragraph l(a) of Appendix 9 requires the Employer to make reasonable efforts to ensure that bargaining unit employees are offered positions with the new employer on terms and conditions that are as close as possible to their existing terms and conditions of employment Since job offers are a mandatory requirement in this case, the Union does not take issue with whether the Employer's obligation to make reasonable efforts to secure jobs for employees has been satisfied The focus here for the union is on whether or not the Employer has made reasonable efforts to obtain terms and conditions as close as possible to the terms and conditions currently enjoyed by employees It was submitted that the Employer in this instance has not complied with its reasonable efforts obligation The Union's submissions can be summarized as follows The Union argued that the 10% weighting for the rated criteria is an arbitrary figure and inadequate in the circumstances The Union argued that seniority, given its importance, should be a < mandatory requirement and, if not a mandatory requirement, it should be rated higher than 6 points out of 100 The Union also submitted that the dispute resolution provision should require a neutral third party adjudication with the power to reinstate ~ 6 Before addressing the merits, it is useful to provide a context to the submissions by reviewing certain developments that have occurred when tendering has been used to outsource work One of the first tendering cases to come before the Board was the Ministry of Transportation case decided by Vice-Chair Kaplan (GSB # 1344/96) The Request For Proposal~ ("RFP" ) issued in that case contained a HRF which was used to assess the overall bid The HRF did not contain any mandatory elements, nor did it provide for a fund that would be used to negotiate improved terms and conditions Job offers, service and matters such as salary were rated requirements For the reasons set out in his decision, Vice-Chair Kaplan determined that the RFP before him did not satisfy the Employer's reasonable efforts obligation The CCS case first came before the Board in an application for interim relief Since the RFP in that case was similar to the one before Vice-Chair Kaplan, the Union succeeded in obtaining a direction that the Employer not close the RFP until the merits of the application were heard See, Re Manaqement Board Secretariat and OPSEU, #1196/97 (Dissanayake) The Employer elected not to seek a determination of the merits of - that RFP Instead, it significantly amended the RFP by deleting the HRF The amended RFP provided as a mandatory requirement that proponents must commit to make job offers to all CCS employees and that such job offers consist of at least 85% of the employees current salary and recognition of service for purposes . 7 of vacation and benefits The job offers were not to include a probationary period The amended RFP also provided for a Human Resources Incentive Fund to be utilized by the Employer to enhance salary and other terms and conditions of employment The issue of whether the amended RFP satisfied the Employer's reasonable efforts obligation was rai~ed before me at a hearing on May 6, 1998 In a decision dated May 19, 1998, I concluded that the amended RFP did not satisfy the Employer's reasonable efforts obligation because of the absence of "some preference to bidders who are prepared to make job offers that contain terms and conditions of employment which are similar to those currently enjoyed by CCS employees II At page 4 of the decision I gave some examples of the terms which a bidder may be prepared to offer but would not receive any credit for in the bidding process and concluded that "an RFP which fails to differentiate between the quality of bids on relevant matters is not reasonable and does not constitute reasonable efforts as required by Appendix 9 of the collective agreement II Subsequent to the release of the May 19, 1998 CCS decision, the Employer further amended the RFP to include certain rated requirements similar to those that are present in this case Undoubtedly, the Employer will seek at some point a determination as to whether the most recent amendments to that RFP are sufficent to meet its collective agreement obligations As one can see, the Employer has moved a considerable y 8 distance in tendering cases in an effort to meet its reasonable efforts obligations The RFPs are now structured with mandatory conditions relating to job offers, salary and service The Employer has also included a method for evaluating the quality of bids in the areas of salary, benefits, termination payments and other terms and conditions And finally, the RFPs have a fund which the Employer will use to negotiate for terms and conditions which come as close as possible to those that currently exist The Union concedBs that the Employer has come a long way in tendering cases However, it is the position of the Union that the Employer has not yet fulfilled its reasonable efforts obligations As the foregoing review indicates, the issue of whether the Employer has made reasonable efforts is now being raised at arbitration at an early stage in the process In the CCS case the parties argued the reasonable efforts issue upon the amendment of the RFP, proir to it being issued The selection of the preferred proponents and the negotiation process had not yet occurred In my view, it is appropriate for the parties to obtain a reasonable efforts determination at the RFP stage If the Employer obtains an adverse decision at the end of the process, considerable time and costs are wasted An examination of an RFP at an early stage gives the parties an opportunity to address the relevant issues quickly and either settle the dispute or obtain a determination as to whether the collective agreement 9 has been contravened However, when reviewing an assertion at the early stage of the process that an RFP has not addressed certain terms and conditions adequately, one must keep in mind that the Employer's reasonable efforts obligations continue at least until the negotation stage I turn now to the merits of this matter The Employer contends that a 10% weighting of the rated criteria will have an impact on the bidding process The Union argues that the weighting should be a higher percentage and that the points should be allocated differently At this stage it is difficult to predict with precision what effect a 10% weighting will have on the bidding process However, it is not unreasonable that price would be given the highest priority in a sale situation Given the mandatory features of the HRF, I find that the 10% weighting of the rated criteria is not unreasonable in the circumstances of this case The HRF constitutes a reasonable effort by the Employer to give a preference to bidders who are prepared to make job offers that are qualitatively higher than they might otherwise be In making its submissions on seniority, the Union placed considerable reliance in the decision of Vice-Chair Roberts in Ministrv of Consumer and Commercial Relations and OPSEU, (1998) GSB #0559/97 Vice-Chair Roberts decided that "the employer is primarily obligated to pursue salary, service and seniorty . 10 protections offered by the collective agreement " and also determined on the evidence that the Employer "breached its reasonable efforts obligation by excluding from the scope of its efforts the full range of seniority protection offered in the collective agreement" Before me, the Employer took particular exception to Vice-chair Roberts' position on the seniority issue It is unnecessary for me to address the Employer's submission in this regard at this time I note simply that Vice-Chair Roberts' case involved a negotiated transfer, not a tendering situation, and he found that the Employer made no effort at all with respect to seniority In the case before me , the Employer has made some effort on seniority In my view, it is not unreasonable in the circumstances for the Employer to use seniority as one of the rated criteria, rather than making it a mandatory requirement, and to allocate to it the number of points that it did Proponents who are prepared to make job offers which include a seniority component will be given a preference In addition, whatever the impact of the rated requirements on the bidding ~rocess, the Employer must still make reasonable efforts with respect to seniority, as well as other terms and conditions, when it attempts to negotiate with the preferred proponent using the enhanced severance savings A similar response can be given to the Union's position concerning the manner in which the Employer addressed the complaint mechanism The Employer has made some effort to . r 11 address a complaint resolution process in the rated requirements and will be required to negotiate this matter with the preferred proponents In the circumstances, it is my view that this is not an unreasonable approach Knowing the Union's position on this issue should affect how the Employer deals with the matter at the negotiation stage It is my conclusion that the Employer has thus far met its reasonable efforts obligation in connection with the public sale of the three tree nurseries The process will involve the important mandatory requirement of job offers consisting of at least 85% of an employee's salary and recognition of service for vacation and benefits The other relevant terms and conditions of employment will be rated in order to provide some preference to proponents who are prepared to improve the quality of the job offers Finally, the Employer will utilize enhanced severance savings to negotiate with preferred proponents in order to attempt to achieve terms and conditions as close as possible to those that the employees currently enjoy Although Mr Leeb made his usual forceful attempt to convince me otherwise, I am satisfied that the Employer has structured this sale in a manner consistent with its collective agreemenf obligations in relation to reasonable efforts In reaching this conclusion I have had regard to Vice-Chair Kaplan's approach in Ministrv of Transportation, supra, where he wrote the following at page 30 reasonable efforts does not mean "all efforts II It does not mean "efforts to the point of undue ". ~ 12 hardship II It does not mean "every effort" What it means is efforts that are reasonable in the circumstances all things considered Having considered all of the circumstances of this public sale, I find that the Union has not demonstrated that the Employer has failed to make reasonable efforts up to this point in time In accordance with the agreement of the parties, I will remain seized of this matter If a dispute arises concerning whether the Employer has made reasonable efforts with respect to the remaining features of this divestiture, the Union should first raise any concerns it may have with the Employer Failing a resolution between the parties, the dispute may be referred to the Board for determination Dated at Toronto, this 18th day of June, 1998 L fJ0,~ I I K M Petryshen - Vice-Chair