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HomeMy WebLinkAbout1975-0006.Noble.77-03-08Before: D. M. Beatty Chairman G. K. Griffin Member S. R. Hennessy Member For the Grievor: G. Richards, Ontario Public Service Employees Union For the Employer: N. Pettifor,, Ministry of Transportation and Communications Hearinq: February 21, 1977 Suite 405, 77 Bloor Street West Toronto, Ontario CROWN EMPLOYEES -~ ‘416 964-6426 suite 405 GRIEVANCE SETTLEMENT 77 Bloor Street Kit E0AR0 TORONTO, Ontario M5.S lM2 IN THE,MATTER OF AN ARBITRATION Under The CROWN EMPLOYEES COLLECTIVE BARGAINING ACT Before THE-GRIEVANCE-SETTLEMENT BOARD Between: .Mr. S. C. Noble And Ministry of Transportation & Communications -2: In an earlier award between these same two parties this Board articulated its conclusion on the merits of Mr. Noble's grievance against his dismissal in the following terms: .%n&g faiZed to prove some culminating or final incident for which discipline could properly be imposed, it necessarily folkms that the gr-ievor must be exonemted of any wrongdoing. In the resuZt, and for the reasons given we wouZd order the gr-ievor to be reinstated, forthz-ith, to the position of Highway Equipment Operator 3, in the Ministry ‘6 Listmel Branch, with fuuZ1 compensation, benefits and service credits from the date of his dismissal less any monies he would not othemise have received but for his dismissal. In the wztikely event the parties have diff<culties in the implementation of this award, this Board will remain seized of those inatters. Re Noble 6/75. Although, as we anticipated, the parties did not have any difficulty in agreeing upon the governing principles by which Mr. Noble's compensation was to be calculated, or upon the major heads of compensation that flowed therefrom, two narrow and very specific points of detail have created some differences between the parties and have caused them to submit those matters to us for our determination. Both of these issues flow from and concern the employment the grievor was able.to secure with E. and E. Seegmiller Limited following his dismissal and prior to his reinstatement by this Board. In that regard it was agreed between the parties that Mr. Noble was hired by this company as a Heavy Equipment Operator -3-' during the period from September 8, until December 3, 1975. Moreover, on the evidence adduced before this Board it is agreed that in this capacity Mr. Noble was paid on a bi-weekly basis and that his hours of work, as calculated on that basis, varied between a maximum of 98 and projected minimum of 61. As well, and again on the agreement of the parties, it is a matter of record that in travelling to and from his home td this employment, Mr. Noble was required to drive some 5,576 miles, exclusive of those miles that he would normally have been required to drive had he been reporting for his regular employment with this Ministry. Against those specific facts, the parties have submitted to this Board the following points of difference. Firstly, the parties were unable to agree whether Mr. Noble should be entitled to exclude from those "monies he would not otherwise have received but for his dismissal" the earnings that may be credited against those hours he worked for E. and E. Seegmiller Limited, in excess of eighty, in each two week period, as being in excess of the normal hours of work that prevail in the Ministry. As to the second matter, the parties were divided as to what rate of compensation should be paid to Mr. Noble for the transportation costs associated with his travels to and from his place of employment during the interval he was obliged to remain off work from the Ministry. As noted above and these two specific issues aside, the parties themselves were able to agree upon the governing principles, against which the amount of compensation that was due and owing to Mr. Noble following our order of reinstatement was to be settled. However and their consensus notwithstanding, we think it important, both for the guidance of others, and to put in its proper context our decision in this particular case, for us to -4- generally outline the principles on which the damages that flow to a person who has been improperly dismissed ought to be calculated. In doing so we would note that these principles have been derived from and reflect the principles of the cormnon law pertaining to the compensation that ought to be paid generally by persons who have breached their contracts. As such it is not surprising that these principles have been uniformly accepted by arbitrators in the private sector with respect to breaches of collective agreements. Essentially, it was and remains the overriding and governing perception of the common law jurisprudence that in cases of breach of contract, of which the collective agreement is but one example, the purpose of an award of damages is to put the aggrieved party in the same position he would have . 'been in had there been no breach of contract. Thus and.as stated by one board of arbitration: Stated in tke abstract, the relevant principZe is quite clear. The purpose of dcnnages for breach of contract is not to punish but to compensate, and the function of compensation is to place the aggrieved party in a monetary position as near as possible to that in which he would have been had the contract been perfoned. Re Canadb Johns'ManviZZe Co; Ltd. 11971) 22 L.A.C. 396, 397-6 (Weilerl. Against that general principle however,the common law in general, arbitrators in particular, have engrafted certain basic qualifying or limiting rules. of these, the, principle that requires the aggrieved party to make reasonable efforts to reduce and mitigate his losses is relevant to the issues separating these two parties. This principle, again derived from the comnow law, has been described in the following terms: -5- The principZe upon which the appeal ought to be decided is expounded at Zength in the ju&ment of Lord Balckzne in British Westinghouse Electric Co. v. Underground Electric Railways Co., 1191a ,A.C. 673, at pp. 689 and 690. After stating the general principle that when a contract is broken the injured party is entitled generally to receive such a sum by my of damages, as wil2, so far as possible, put him in the same position as if the contract had been performed - the d&ages being Zimited to those that are the natural axd direct consequences of the breach - his Lordship proceeded as foZlovs:- "But this first principle is qualified by a second, which imposes on the plaintiff the duty of taking all reasonabZe steps to mitigate the loss . ..'I r, . . . this second principte does not impose on the plaintiff an obligation to take any step which a reasonabZe and puaknt man would not ordinarily take in the course of his business." Re Cockburn vi 'Trusts and Guarantee'Co. (1917) 37 D.L.R. 701 at p.702, 55 S.C.R. 264, quoted in Re Vulcan Containers 'lCaMda'Ltd. 119701 21 L.A.C. 167, 170 (Christie). Applied to the circumstances of dismissal cases, it is this duty which obliges the employee to make reasonable efforts to reduce his losses by searching for alternate employment."-%-Canadian Salt Co. Ltd. 119741 7 L.A.C. l2dl 197 (Fergusonl; Re~CiviZ Service Association of~Caada (1972) 24 L.A.C. 26 lBrml. However and while the law imposes a duty on the employee to make such reasonable efforts to mitigate his losses, it is also, generally recognized that he will be entitled to offset against the compensation received from such alternate employment those~expenses which he necessarily and reasonably incurred in searching for and maintaining that alternate employment. ~Re~Canadiar~Pacific RaiZw@'Co. (1964) 15 L.A.C. 160 Gaskin). Against those overriding considerations it follows that as -6- a general proposition all of the monies earned by Mr. Noble in his,employment with E. and E. Seegmiller Limited are monies which, but for his dismissal, would not have been earned by him and should therefore be deducted from the compensation that he would have earned had he remained with the Ministry during the period in question.' 'Re ~Capitat'Wire'Cloth~Ltd. (1975) 10 L.A.C. 12dl 151 (Abbott); Re Board of Governmwbf Riverdale Hospital 11974) 7 L.A.C. 12dl 414 @rownl; Re ~Firestom'SteeZ Prodtits of ~Camda'Ltd. 6 L.A.C. (2dl 16c'WeathmiZZ). Were it otherwise, and were the grievor entitled to claim the compensation that he otherwise would have received had he not been dismissed and simultaneously retained his earnings from E. & E. Seegmiller, the grievor would have been put in a better position than if the contract had been performed. Put somewhat differently, if one were not to deduct the monies that were earned by the grievor and which would not otherwise have been earned but for his dismissal, the very purpose of requiring an aggrieved person to seek out alternate employment would be frustrated and the duty to mitigate would be rendered superfluous. Accordingly it follows from these principles that in the absence of any evidence by which one could distinguish or segregate any of the hours worked by Mr. Noble for E. and E. Seegmiller Limited, this Board must treat all of the earnings received by him from that employment as earnings that he would not otherwise have received but for his dismissal. As such, it follows from the principles noted above that all such sums must be deducted from the amount of money he would have earned had he not been dismissed from the Ministry. Put somewhat differently, and while we do not wish to be taken as expressing any opinion on this issue, even if ) -7- an argument could be made that Mr. Noble would not, under the rubric of a duty to mitigate, be obliged to work more than forty hours per week, nevertheless the fact remains that he did work the hours indicated and did receive straight time earnings therefrom. As such, without attempting to fully delineate the nature of the duty to mitigate, those earnings are monies which are relevant to defining the grievor's actual loss and accordingly must be taken into account in determing the sum of monies due and owing to him. In short and while we express no opinion onwhether someone such as Mr. Noble would be required, under a theory of mitigation, to work all overtime hours offered to or requested of him, in the circumstances of this case, if Mr. Noble is to be placed in the same position as if the collective agreement had not be violated, then all of the monies actually earned by him from that alternate employment must be deducted from the compensation that he otherwise would have received had he not been discharged. On the second issue, we have already noted that it follows from the duty that is imposed on a claimant to mitigate his losses, that he is entitled to deduct those expenses necessarily and reasonably incurred in discharging that duty. Indeed, in the circumstances of the instant case, there is no evidence before this Board to substantiate nor did the employer in any way advance the claim that the transportation cost associated with the grievor's efforts to mitigate his, losses was either an unnecessarily or unreasonable expense. Nor did the employer offer any evidence or present any argument that alternate means of transportation were available to this employment which were more economical. To the . . __I -a- contrary, drawing on a distinction apparently recognized in the Federal Public Service between an employee using his own private automobile for government business at his own behest rather than at the employer's request, the employer in this case argued that an allowance, reflecting only the "operating costs" (e.g. gas, oil, maintenance, etc.) associated with his travelling and excluding such other "costs of ownership" as depreciation, insurance and licence fees, finance charges, etc. was the proper basis on which the expenses Mr. Noble incurred in mitigating his losses should be calculated. In~our view and whatever merit the distinction drawn by the employer may have in other contexts for other purposes, it is simply not relevant to the issue before us. Very simply and even on the employer's own terms, it is clear that it was as a result of the duty imposed by law on the grievor to mitigate his loss and not on the basis of any personal predilections that Mr. Noble was obliged to make use of his car. Moreover and more critically, given the issue before us, to the extent that there was no suggestion that this travelling expense was either unnecessary or unreasonable, then it follows that all of the costs associated with the travelling to and from his place of alternate employment were a part of the actual loss tliat the grievor suffered as a result of his dismissal and he is entitled to be compensated for them. Put succinctly, there is simply no basis, given the issue before us, on which we would justify allowing the grievor tom deduct from the earnings he secured from his alternate employment only his "operating" costs and r? ,.; -9- not those other "costs of ownership". In short, there is, in our view simply no basis for excluding any part of the grievor's actual costs of transportation which were incurred in his attempt to mitigate his losses. In our view, once proven, all of those costs were "necessarily and reasonably" incurred in his attempt to reduce his losses. Accordingly and in the circumstances of this case, we would order that the grievor be allowed to deduct from the earnings he received'from E. and E. Seegmiller Limited the total costs incurred in travelling to and from the place of employment which may be computed on the basis of nineteen cents a mile for the first five thousand miles travelled and fourteen cents per mile for the remainder. In our view such a sum fairly represents the total costs, both "operating" and "ownership" that were necessarily and reasonably incurred in earning his wages at E. and E. Seegmiller Limited. In selecting these figures as fairly and accurately reflecting the costs of transportation that are associated with the use of a private automobile, we would note that we have used as our guide Article 28.1.2 of the current collective agreement between the union and the employer. That is, in our view and by the parties' own agreement, such figures represent a fair and accurate assessment of the average total costs in operating and maintaining an automobile. Accordingly, and in the absence of any evidence or suggestion that the grievor's costs materially or substantially differed from that norm, we are disposed to accept the rates agreed to by the parties themselves. In the result, and for the reasons given, this Board orders that: a) the grievor be required to credit towards the "monies he would not otherwise have received but for his dismissal" all of the earnings he received during the course of his employment with E. and E. Seegmiller Limited; and b) the grievor be entitled to deduct from those "monies he would not otherwise have received but for his dismissal" as reasonable and necessary expenses incurred in earning those monies a sum to be calculated at the rate of nineteen cents per mile for the first 5,000 miles and fourteen cents per mile for each succeeding mile, to cover the costsof '. transportation associated with his securing and maintaining that alternate employment. Dated at Toronto this 8th day of March, 1977. I co- G K Griffen Member .r concur S. R. Hennessy Member