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HomeMy WebLinkAbout1980-0498.Policy.81-06-04Setween: IN THE !dATT&R OF AN ARBITRATION Under The CROWN EIWLOYEES COLLECTIVE BARGAINIXG ACT Before THE -GRIEVANCE SETTLE~YIBLENT SOARD Ontario Liquor Boa.&% Employees' Union (Policy Grievance) - And - The Crown in Right of Ontario (LLqugr Control Board of Ontario) c 3efore: Xr. R. L. Kennedy Vice Chairnxn Xr. J. McManus Member MS. H. J. Laing Member For the Union: .- Mr. P. Cavalluzzo, Ccunkl Golden-Levinson For -,he Employer: Mr. R. :i. Drmaj, Cowxel --- Hicks, Morley, Ramiltcn, StewS;rt k S+orin c - 7 ‘. : -2- ,=* I AWARD The grievance in this matter, filed September lath, 1980, is a policy grievance on the part of the Union alleging that the Employer is in contravention of the Memorandum of Agreement of June 26th, 1980, which document settled the termsand conditions of a Collective Agreement between the parties to continue until June.30thr 1982. A substantial portion of the factual background to this grievance is not in dispute and may be summarized as follows: On or about the 26th day of June, 1980, after negotiations c: between the partiFs involving the assistance of a Mediator, a Memorandum of Agreement was ~signed, which document contained, inter aiio, the~following'provision: 2. CLASSIFICATION STEP Adjustment Prior to,the implementation of any increases to the classi- fications.for.Full-Time employees Liquor Store Clerk Grade 3,shall be amended by, adding.1~ additional step in the existing range. As well the same concept applies to the Warehouseman Grade 4. (i.e. Liquor Store Clerk Grade 3 $14,464 - $15,265 ~~$15,850 - $16,347) Warehouseman Grade 4 $14,676.- $15,265 $15,580 - $16,437) The increase to the additional step shall be in accordance with present established procedures (i.e. on future anni- versary date except those employees in the maximum position for 1 year or more - effective August 1, 1990.) The prior Collective Agreement between the parties for the two classifications,' Liquor Store Clerk Grade 3 and Warehouseman Grade 4,.grovided for a three step salary range and the fourth step therefor came into existence for the first time as a re: sult of the &lemoranduin of Agreement. The Collective Agreement itself was subsequently signed August 21st, 1980, and in Schedule f -3- "A'! to that Agreement setting out the Liquor Store salary and classification schedule, the two classifications in question are listed as Four Step Salary Ranges with the quantum of salary as specified in the Memorandum of Agreement of June 26th, 1980, and the effective rate increases that were also provided for in that Memorandum. The balance of the language oft Section 2 Classification Step Adjustment above set out that was contained in the'Memorandum of Agreement is not, ,C' ,,t in any' form however, reproduced in the Collective Agree- . . ..The only other Section of the Collective~Agree- ment.as executed tlhatwas referred to by the parties reads as follows: , ARTICLE~.~XVI ~' .Assignments 'and ~iob Postings ' "16 .l.;,~~Employee~s shall~,~,pro&ess ,through ~.the' steps' of, the ', : .. - salary.ranges of~their classificaticn in accordance with the procedures.of the Boards; as established_from time to time, on the basis of satisfactory written recom; mendations and subject to the approval of the Salary Com- mittee of the Boards. The~Boards agree to permit employees to examine the said writtenrecommendations upon therr ,com- (II‘ pletion by the Supervisor or Department Head and will pro- . vide a copy of the Assessment Report if so requested." As of August lst, 1980, there were a total of 743 employees in the classification Liquor Store Clerk Grade 3 who had been at'Step 3.of that salary progression for one year or more. Of those, 664 were granted the increase to Step 4. ,With respect to the classi- fication Warehouseman Grade 4 there were 119 employees who had been at Step 3 for one year or more and of those, 114 were granted the increase to Step 4. It was agreed between the parties that the w -4- ’ procedure that was ineffect at the time of the Memorandum. of June 26th, 1980, for progressing to the next step in the salary range was followed with respect to those employees who received the progression to the 4th step and those who were denied it, apart from the fact that the review did take place as of August Ist, rather than on an employment anniversary date as was the . usual procedure under.Article 16.1.. The position being asserted.'by the Union on this Arbitration is that.the'correct.construction of ,the Collective Agreement and of the Memorandumof.Agreement dated the 26th day of.'June, 1980,,.- /' is that.~the',progression': to. Step:'4.~0f .the salary sc,ale was' to be. automatic as 0f'August 1st: 1980,'forall incumbents: in 'that classification'~who had b'eeti at S'tep 3 for one year orb-more. I+L ,' is the positionof then Union'that'the ~exe'&ted~Collec~tive A~gree-':,. ',~ . ment does not supersede' the provisions of the Memorandum and. *hat the two must be taken together. ,,The Union position is'that the meaning of the language is that the progression is automatic fork those employees at the maximum position for a year or more as of August lst, 1980, and that the language will reasonably bear such an interpretation. The Union argues that in the event there is considered to be ambiguity, either latent or patent, in either or both of the Collective Agreement and the Memorandum then, to the extent that the ambiguity is in the Collective Agreement, the Memorandum of Agreement can be considered as extrinsic evi- dence to explain it and with respect to both of those documents J (c. - 5 - the negotiation history between the parties is further relevant as extrinsic evidence to assist in the interpretation of the language. It was the position of the Employer that the Memoran- dum of June 26th, 1980, had no further force and effect upon the execution of the formal Collective Agreement between the parties and that there was no ambiguity in the language of the Collective Agreement. In the alternative, and even if reference could be. I~ 6~:~. made to the Memorandum of Agreement, the language was, again, per- pi' fectly clear and not susceptible to the meaning attrib~uted..to it ~T"~ ._/ .? L, by the tinion. '.In those circumstances. it'ias argued .by~ the Employer '~ .that there was no basis for the Board-tom consider extrinsic evi- :: .' dence as an aid to,~interpretation. ..Inthe intekests.of-expediency and.with the agreement .of the parties,‘ the extrinsic,'evidence which ; .;.; .~. the Union wished to present was heard subject~,to hearing ~argument , _. . and-ruling on the objedtion as to itsadmissibility. .I. &Hr.. Cavallutzo, in his argument, ~suggested several basest C~:: upon which the Memorandum of Agreement of June 26th, 1980, cou,ld properly be considered by this Board. Firstly, he referred to Section 12(l) of the Crown Employees Collective Bargaining Act, 1972, S.0, 1972, C.67 as amended, which provides as follows: "Where, during the bargaining under this Act, or during the proceedings before the Soard, the parties agree on all *matters to be included in a Collective Agreement, they shall put them in writing and shall execute the. document, .and thereupon it constitutes a Collective Agreament under this Act." Therefore, he argued that by Statute the dot-ument in question -6- constituted a Collective Agreement between the parties. He argued that the same principle in the normal industrial rela- tions context was expressed in re Alcan Foils (1976) 11 L.A.C; (2d) 352 (Shiff) and on the principles enunciated in that case we were entitled to look at the Memorandum of Agreement. He further referred to the combined effects of Section 18(2) and lO(l2) of The Crown Employees Collective Bargaining Act as .c:;~ giving a much wider jurisdiction to this Board to hear evidence‘ than'was available under The Labour Relations Act. He argued that'under,the authority,of that Section wee coul~d accept any / evidence we considered fairand?.reasonable,.rather than having ,' to m&et the test .of propriety established under~Section.37 of The. Labour Relations Act.:~'.~',In:.theI further',alternative;.,here- ~.' :,, '. ferred to Section 17(2) of The Crown Employees Collective , Bargaining Act as conferring on fan employee a very wide right to grieve and that in substance this grievance'related to an c'. allegatiofi by employees that they had~been improperly appraised. He argued that with such a right to grieve, the governing prin- ciples and standards would have to'go beyond the Collective Agreement and include the Xemorandum of Settlement and what had occurred in the negotiating history between the parties. ‘Mr . Cavalluzzo's fourth argument with respect to the admissibility of the Memorandum rested cn the specific language of Section 16.1 and the fact that the progression through the classifications :had to be in accordance with procedures of the 3GardS as estab- lisked from time to time. The very ianguage of the section requires -7- that we go outside the four corners of the Collective Agreement to determine the procedures, and since there had been an acknow- ledged departure from those procedures dealing with a review on August lst, rather than on an anniversary date, the effect, therefore,of the Memorandum of Agreement must be considered to establish procedures for progression as at that date. It is our view that the authorities as to the status of a ratified Memorandum of Agreement are correctly summarized in I Brown. and Beatty, Canadian"Labour Arbitration,~at page 141~ in 'the following words: :?Often a formal collective agreement is preceded -by a written,~ signed.and ratified memorandum of agree- ment and normally then execution of the collective' agreement will cause. the memorandum to be merged.into the agreement unless t.he'parties manifested an inten- tion to ,the contrary." i Asauthority for that proposi,tion'the authors~quote from re Canada Bread Co. Ltd. (1970)'.22 L.A.C. 98, (Christie) at page 103 as follows: Vherk a Union and a Companv have agreed in writing on some of the terms and conditions of employment in a memorandum of settlement of a strike, and have sub- sequently signed a full collective agreement, the pre- liminary document will not normally be considered part of the collective agreement. This is so because, un- less there is some indication to the contrary in the subsequent document (some incorporation by reference of the memorandum of settlement, perhaps) an arbitrator would assume the memorandum of settlement was intended .only to represent a stage'of negotiations and could not stand in contradiction with the final agreement. But, on the other hand, where no final agree.ment .was made, and the requisite intention was deemed to have been ,:.z .I:,.:. ‘:.: . . . . ,L. .:: ;:, ,j>;.. ‘. _ r -: .: ;.,; c, (1 ~. -8- manifested, such memoranda have been held to constitute collective agreements." The Memoran.dum of Agreement executed between these parties June 26th, 1980, clearly on its terms envisaged the completion of a~ more formal document as in numerous paragraphs there is simply a sketchy outline of the substance of what had been agreed upon.. In some cases the specific nature of amendment was specified in tine Memorandum but, .in others there~was simply a specification that a (..: new clause would.be included and a general outline of the sub- stance of that clauses contained in the,Memorandum.. In addition, paragraph 26.on page 8 of the Memorandum provides that all others areas will be as per agreement~during, the negotiations, and '&en some seven reference5 'follow. The parties have,~ subsequently, executed a formal collective. agreement and ~that agreement contains no references to'the Memorandum of Settlement,to which either party drew our attention. We are satisfied that the Memorandum of Settle- ment oer se cannot constitute part of the Collective Agreementdocu- (:. mentation between the parties and we find that totally consistent with the provisions of Section 12(l) of The Crown Employees Collective bargaining Act. That Section provides that when the oarties agree on all matt ers to be included in a collective agree- ment they shall put them in writing and execute the document and thereupon it constitutes a collective agreement under this,Act. That is not to say that each and every document which might come within the language of that Section continues to be a collective agreement for the purposes of arbitration under the Act and, had c ’ - 9 - the parties not executed the subsequent formal Collective Agreement it might, indeed, be arguable that the Memorandum of June 26th, ' 1980, constituted a collective agreement. Once the formal agree- ment is executed, however, then both in the normal industrial ne- lations context and within The Crown Employees Collective Bargaining Act that document constitutes the collective agreement. .~ With respect to Mr. Cavalluzzo's second argument that the Memorandum is admissible under the wide authority of-the Board to accept an'y evidence considered fair' and reasonable we would not con- sider it fairand reasonable under that authority to'classify as "evidence" something that is substantially an addition to the Collective Agreement. It,would,~ further, be our view 'batthe con- cept of "fair and reasonable" requires in an adjudicative context that~ we admit only evidence- upon which it is reasonable~~in accord- . ante with the normal principles of the admissibility of evidence to rely. With reference to Nr. Cavalluzzo's third argument under Section 17(2) of The Crown Employees Collective Bargaining Act we, again, cannot classify this as a situation of an alleged improper a-,praisal. It is clear that as of August lst, 1980, the employer did appiy the normal procedures of appraisal to the employees who had been in the maximum position for one year or more, and if any of those employees were dissatisfied with the appraisal procedures, the usual grievance process would have been availabie. The issue here is not the valid- ity or otherwise of t‘ne appraisals, but rather whether the Employer . . ? ( ~’ - 10 - was entitled to apply the appraisal procedures, or whether the pro- motion to the fourth step was ,automatic for the employees invo,lved. On Mr. Cavalluzzo's fourth argument, however, it is the con- clusion of this Board that consideration must be given to the pro- visions of &-he Memorandum of Agreement. Article 16.1 in the Coiiective Agreement provides,that the progression through the steps is in, accordance with the procedures of the Employer as established from time to time on the basis of satisfactory written recommenda- (!..' ., ~JZ tions and subject to the approval of the salany committee- of the Employer. The Collective Agreement does.not provide what are those pro‘cedures and they'must, therefore, be determined from some other .. : 'source; We would stress that this is not a case of ambiguity with- in t&Collective Agreement language; as this is not a situation where the clause is -susceptible .to two reasonable: inteqretations. ,.~ The clause itself is perfectly clear in that specific &rocedures~ are referred to and it is;further, clear that in the normal con: tractual context between these parties there is no issue bet'rieen (I'. '- them as to what those procedures are. In the words of Arbitrator Shiff from the Alcan Canada Foils case previously cited at page 356: "We recognize, as the Union argued, that collective agree- ments not uncommonly incorporate prevailing practices by specific reference without detailing what the practices are.....To the best of our knowledge no one has ever argued that the absence of written elabo:ation in those, instances denies qualifications to the relevant pro- visions as enforceable collective agreements. Of course, a provision incorporating wholly oral terms leaves open a wider area for identification by evidence than pro- visions incorporating. prevailing practices or unc?ef:ined , 2 . . c:.- - 11 - job classifications. In that light the breadth of what must be identified might be the touchstone of the difference." In this case, then, we are required in order to a~djudicate upon this grievance to determine what the "procedures of the Boards as established from time to time" were as of August lst, 1980. It is clear on the evidence that as of that date the Employer departed from the usual procedures in that employees who had been F’ at the top step fora years or more were appraised on that date \.I, .rather than onthe anniversary of employment date as contemplate!d in the usual procedures. As recognized by Arbitrator Shiff the evidentiary problem,before us is in establishing what procedures .' ~. were intended to be incorporated into the Collective Agreement aa, in that regard, the parties have reduced to writing their '. signed Agreement as ~to 'the precedures to be foll~owed. It is our view that that Memorandum must be considered inaccordance with the normal. principles of contractual interpretation and that in (i.: the event it is clear and unambiguous on its language, we would not be entitled to look to extrinsic evidence such as the evidence of negotiating history led by the Union. It is our conclusion that the provisions of paragraph 2 of the Nemorandum of Agreement are, in fact, clear and unambiguous. After providing for the additional step, it states specifically that the increase to that additional step shall be in accordance with the present established procedures. It goes on to identify one of those procedures, namely, that it is on the future anniversary date and then provides in the c,. - 12 - same bracketed Section that there is an exception to future anni- versary date and that that exception applies~to employees who have been in the maximum position for one year or more. For them the date of August lst, 198O;is substituted for future anniversary. date. We do not think that~the Section can reasonably be construed as constituting specific modification to the other established pro- cedures which were acknowledged by the parties without some language that, reasonably gives rise to an inference that such change was in- (l;.- tended., We think that,the situation that is before us is correctly categorized as one wherein the settlement as it has been reduced,to writing by the~parties does not reflect one of the items which the i ,&ion thought it had obtained in the negotiations, rather than one“ of ambiguity in the language which was actually signed by the parties. In those circumstances we do not think it proper.to consider the ex-.. trinsic evidence.of negotiating history urged by the Union. The final argument placed before us. by the Union was to the effect that the Employer was, by reason of the circumstances, es- topped from asserting the strict contractual rights of appraisal with respect to the employees involved. Prior to ratification the Union prepared and issued to its members a newsletter incorporating the language of the Memorandum of Agreement with some supporting text. That newsletter was recei-vred and read by representatives of the Employer and the Union was not advised that the Employer con- sidered that the newsletter was,, in any way, in error. In the course of cross-examination at the Eea:ing the Employer IS Staff Relations Officer conceded that one,paragraph in the newsletter could lead members to thinking that the advancement to Step 4 was automatic. He stated, however, that it was not his job to correct Union bulletins. We would'note that with respect to the specific newsletter, the language relied 'upon by the Union reads as follows: I "All Liquor Store Clerk 3's and Warehouseman 4's will have an extra step added to their classification and c..: will be able to advance to that step.....For those who have been at the ma!ximum step for one year or more the advance to the new step will take place on August lst, 1980. All others at the maximum will move on their respective anniversary dates as at the current practice . . ..over a two year, period this equates to approximately 24%. For those who are Liquor Store Clerk 3's and Warehouseman 4's and will be advancing to the new step in their respective classification this equates to. approximately a 29% increases over a two year period." .d ~'~It is; again, to.be.noted that even in t5at language there is no indication specifically that for a certain group of employees &e promotion' is automatic. It is conceded by the Union that tlhere was no intention that the move to.Step 4 be automatic for those c at Step 3 with less than a year at that step. Yet,in the news- letter the statement is made "all others at the maximum will move on their respective anniversary dates as is the current ?'ractice. The language of the newsletter is equally consistent with the con- cept that the relevant'change to promotion procedures relates only to the d'ate upon which those procedures will be implemented rather than to the substance of what is invol?ied. In addition, the Union argument on estoppel made reference to the negotiations and what t'xe parties considered t.he positions to have been, an-d to discussions - 14 - .,. that took place prior to the signing of the formal Collective Agreement. In all of that evidence we can find no indication of 'conduct on the part of the Employer that would bring the Employer within the principles of estoppel by conduct as reflected in re ,CXC? Telecommunications (Beatty, unreported, February lzth, 1981) which was 'relied upon by the Union. The issue before us is .not one where it can be argued that then Employer has represented in '- any way that strict rights under the Collective Agreement will not (4,:. be relied upon. Rather, the issue is very clearly what are tie rights that the parties have created within their Collective Agreement. In the result it is'our conclusion that ~this grievance. must be dismissed. Dated this .4th ,.~.. t :. I concur I concur day of June, 1981. -/m7 Ross L. Kennedy ;/ "J. McManus" J. ZlcManus . "H. Lainq" H. Laing