Reasons for decision

Teamsters Canada Rail Conference,

complainant,

and

Canadian Pacific Railway Company,

respondent,

and

Canadian National Railway Company; Unifor; United Steelworkers, Local 1976,

intervenors.

The Canada Industrial Relations Board (the Board) was composed of Ms. Ginette Brazeau, Chairperson, and Messrs. Richard Brabander and Norman Rivard, Members.

Appearances

Mr. Michael Church, for the Teamsters Canada Rail Conference;

Mr. Nizam Hasham, for the Canadian Pacific Railway Company;

Mr. Bob Fitzgerald, for Unifor;

Mr. Simon-Pierre Paquette, for the Canadian National Railway Company;

Ms. Shaheen Hirani, for the United Steelworkers, Local 1976.

These reasons for decision were written by Ms. Ginette Brazeau, Chairperson.

I. Introduction

[1] On August 18, 2014 the Teamsters Canada Rail Conference (TCRC or the complainant) filed a complaint with the Board, in which it alleged that the Canadian Pacific Railway Company (CP Rail or the employer) had violated section 94(1)(a) of the Canada Labour Code (Part I–Industrial Relations) (the Code) when it vetoed the reappointment of Mr. Michel Picher as the Chief Arbitrator of the Canadian Railway Office of Arbitration and Dispute Resolution (CROA). The union alleges that, by its actions, CP Rail has frustrated the grievance/arbitration process provided for in the parties’ collective agreements and has thereby interfered with the administration of the union and its representation of the employees in the bargaining unit.

[2] This unfair labour practice complaint was also accompanied by an application pursuant to section 19.1 of the Code, seeking an interim order confirming that there was an agreement to reappoint Mr. Picher as the Chief CROA arbitrator (Board file no. 30592-C).

[3] By letter decision 3288 dated September 23, 2014, the Board dismissed the request for an interim order for lack of jurisdiction over the terms of the remedy sought.

[4] The Board then scheduled an oral hearing into the unfair labour practice complaint and heard evidence and arguments with respect to this matter on April 9, 10, 13, 14 and 16, 2015.

[5] The Board has decided to dismiss this complaint on its merits for the reasons that follow.

II. Background and Facts

[6] CROA was established in January 1965 by a memorandum of agreement (MOA) between CP Rail, Canadian National Railway Company (CN Rail) and several of the unions representing their employees. Membership in CROA subsequently grew to comprise several other companies in the rail, trucking and telecommunications industries before returning to a membership limited to CP Rail and CN Rail and a number of unions representing their employees. The MOA was most recently amended in 2004 with the agreement of all parties. The various collective agreements between the railway companies and the unions contain provisions that reference CROA as the dispute resolution mechanism for the final settlement of grievances as required by section 57 of the Code. Given that the decision of the Board could potentially have an impact on the other parties to the MOA, several of them requested and were granted intervenor status in these proceedings.  

[7] In accordance with the MOA, an Administrative Committee (the Committee), comprised of representatives of each of the signatories, is responsible for the administration of the CROA office, including the appointment and reappointment of the arbitrators. The cost of maintaining the CROA office as well as the fees and expenses of the arbitrators are borne half and half by the employer signatories and the union signatories. Decisions of the Committee are made by consensus. 

[8] Since 2004, the MOA provides for the appointment of up to three arbitrators with one designated as the Chief Arbitrator who will act as a mentor for the second and third arbitrators on any matter related to the performance of their duties. The arbitrators are retained on the basis of a one-year contract, renewable upon the agreement of all members of the Committee. Mr. Picher has been the primary arbitrator since 1986 and was designated Chief Arbitrator of CROA in 2004.

[9] The Committee generally meets in March and November of each year to discuss budgetary and administrative issues as well as the appointment or reappointment of arbitrators. In March 2014, the Committee met and agreed to offer renewals of contracts to both Mr. Picher and Ms. Christine Schmidt with a 2% rate increase. Mr. Barry Kennedy, the representative of Unifor on the Committee, was tasked with approaching both arbitrators to discuss the renewal of their contracts. On July 11, 2014, Mr. Kennedy wrote to the Committee members to indicate that arbitrator Picher had questioned the proposed rate increase as it was his understanding that the average wage increase of the collective agreements in the railway industry was 3%. The Board heard that it had been the practice of the Committee in the past to offer the same rate increase at the time of contract renewal. A series of email exchanges ensued between Committee members about a 2% versus a 3% rate increase. 

[10] On July 14, 2014, at the same time as these exchanges were occurring amongst Committee members, Mr. Picher issued an arbitral award concerning a locomotive engineer at CP Rail in which he upheld the grievance and ordered the reinstatement of the employee. The Chief Executive Officer (CEO) of CP Rail publicly denounced and criticized Mr. Picher’s decision and the employer filed a judicial review application and sought a stay of the decision before the Quebec Superior Court. 

[11] The following day, on July 15, 2014, CP Rail’s representative on the Committee, Mr. Myron Becker, sent an email to Committee members indicating that CP Rail was not prepared to renew Mr. Picher’s contract.

III. Oral Evidence and Positions of the Parties

A.  TCRC

[12] The union alleges that CP Rail’s decision and conduct with respect to the renewal of CROA’s Chief Arbitrator has undermined the union’s ability and responsibility to represent members of the bargaining unit. It argues that CP Rail proceeded to “sabotage” CROA as retaliation against the union and as a reaction to an unfavorable decision rendered by the arbitrator against the employer.  

[13] In its evidence, the union presented statements made by the CEO during a Shareholder/Analyst call held on December 4 and 5, 2012 in which he characterizes the TCRC in an unfavourable light and suggests that he “owes them one” for the work stoppage that took place earlier that year.    

[14] The union contends that the statements made by the CEO made it clear that if the union, its leadership or members in anyway impede the ability of the employer to make record profits, they will be made to pay. It argues that the employer’s actions in relation to the non‑renewal of Mr. Picher should be seen in this context and amount to a direct and deliberate attack on the union.

[15] It also presented in evidence, public statements made by the CEO shortly after a decision of the CROA arbitrator, Mr. Picher, overturned CP Rail’s decision to dismiss an employee for testing positive to drug use after causing the derailment of a locomotive after it ran through a main line crossover switch. It demonstrated that the timing of CP Rail’s decision to withdraw its support for the renewal of Mr. Picher coincided with this unfavourable decision against the employer. The evidence suggested that there was no indication prior to July 15, 2014 of CP Rail’s intention not to accept the contract renewal for Mr. Picher.

[16] Mr. Doug Finnson, the President of the TCRC, provided an account of the state of the relationship between the employer and union since the change in leadership at CP Rail in 2012. Specifically, Mr. Finnson testified that the CEO’s comments during the CP Shareholder/Analyst Call on December 4, 2012, amounted to a declaration of war with the union and that this led to confrontation at all levels. He stated that subsequently, the collective agreement came under attack, discharges increased, and that grievances skyrocketed.

[17] Mr. Finnson indicated that at the time of the hearing the number of grievances was at an all time high and that the union was having difficulty dealing with a backlog of cases since the employer had decided that it was no longer granting automatic time limit extensions, which allowed for cases to be resolved before being referred to arbitration. As a result of this decision by the employer, Mr. Finnson indicated that essentially all grievances will now be referred to arbitration and that this will result in a large backlog that CROA will simply be unable to handle in a timely or cost effective fashion.  

[18] Mr. Finnson projected that there will be an unprecedented number of grievances sent to CROA and that the Office will be unable to handle the caseload as it was not designed to manage all grievances; the system was designed to expeditiously resolve only those cases that remain in dispute after an internal process of investigation and resolution between the parties had been completed.

[19] In his testimony, Mr. Finnson suggested that the lack of experience with the railway industry and the intricacies of the collective agreements will make it difficult for any new arbitrator to maintain an expeditious arbitration process resulting in the office quickly becoming paralysed by a backlog of cases.

[20] The union’s evidence was that the arbitration week scheduled in September 2014 by the CROA office was cancelled due to the fact that Mr. Picher’s contract was not renewed and that it was too late in July or August to find an arbitrator who would be available and acceptable to all parties.  

[21] On cross-examination, Mr. Finnson agreed that under the CROA rules, a party can refuse or reject arbitrators. When questioned about why the union objected to 10 proposed arbitrators on August 12, 2014, approximately one week before filing the present complaint, Mr. Finnson did not offer an explanation. Mr. Finnson admitted on cross-examination that there were three arbitrators hearing cases at the time of the hearing: Ms. Schmidt, Mr. John Stout, and Ms. Marilyn Silverman. He also discussed the union’s insistence on the need for a bilingual arbitrator.

[22] Although there were several exchanges of emails and copies of minutes submitted in evidence around the efforts made to find alternative arbitrators, the union admits that it did not agree to other arbitrators initially since it was of the view that there was agreement to renew Mr. Picher. It had filed a complaint with the Board seeking its intervention on an interim basis to confirm the agreement. In his evidence, Mr. Paul Boucher, TCRC’s representative on the Committee admitted that it was only after the Board declined to issue an interim order that the union considered alternative arbitrators for the CROA office.  

[23] Mr. Boucher testified that expertise at CROA is important. He further testified that CP’s change of mind regarding the renewal of Mr. Picher had created a backlog. Mr. Boucher also gave evidence regarding the need for a bilingual arbitrator and the limitation of Ms. Schmidt’s French language skills in this regard.

[24] Mr. Roland Hackl, the TCRC’s Vice President, testified that CP Rail’s decision to veto the renewal of Mr. Picher has limited the union’s ability to have cases heard. He stated that “justice delayed is justice denied” and that it has been difficult for the union to assist their members. He further stated that discharge cases are the only ones being heard and that other cases might take 2–3 years to get to a hearing. He indicated that grievance arbitration is crucial for the union: it is what the members need to see and it is the union’s way of serving them. CROA is the union’s mechanism for delivering that service. Mr. Hackl stated in redirect examination that he saw no issue with rejecting an arbitrator when it is done in a timely manner under the rules of the MOA.

[25] The union argues that the employer’s decision to withdraw its consent to reappoint Mr. Picher had nothing to do with the difference between a 2% or a 3% increase but was a direct attack by the employer on a system that has allowed the union to provide efficient and effective representation to its members. It submits that CP Rail’s decision hurts the TCRC more than any other bargaining agent, particularly at a time where the number of grievances is high and in light of the employer’s decision to refuse to grant extensions of time to advance them.

[26] The union also argues that the employer’s actions over the course of the past several months amount to a pattern of conduct that is contrary to the Code. It asks the Board to find that the employer’s decision to reverse its previously stated support for the renewal of Mr. Picher, the employer’s decision to refuse blanket extensions to deal with grievances, the number of decisions of this Board that found the employer in breach of the Code, and the timing of all of these distinct actions amount to an attack on the union’s representation of its members. The union argues that the Board should take the context and the history of the relationship between this employer and the TCRC and invites the Board to apply the provisions of the Code in a purposeful manner so as not to allow the employer to resile from agreements it reaches with the union.

[27] The union asks that the Board use its declaratory power to direct the employer to cease and desist from its interference in the CROA process in order to send a strong message to the employer that this type of conduct is contrary to the Code.

B. CP Rail

[28] CP Rail submits that the union has not met its burden of proof under section 94(1)(a) of the Code, as there is no evidence to suggest that the union’s ability to represent its members has been adversely impacted. It argues that even if the union takes issue with the employer’s actions and conduct it does not automatically make them an unfair labour practice and a breach of the Code. 

[29] The employer indicates that its participation in CROA is voluntary and that the Board has no role in assessing the decision of any member of CROA to accept to renew the contract of an arbitrator or not. It asserts that it did what it, or any member of CROA, was permitted to do under the MOA to accept or reject any arbitrator and that it had a business reason to do so.

[30] The employer points out that, the Committee had discussed and commenced work to identify and retain other arbitrators to replace Mr. Picher in 2012 and 2013. 

[31] It submits that, CROA is a private agreement between a group of participants but that it is not the only mechanism available for final arbitration of grievances as mandated by the Code. In support of this, it offers examples of ad hoc arbitration that have proceeded with other bargaining agents outside the CROA process.

[32] Mr. Becker, Assistant Vice-president of Labour Relations at CP Rail and the employer’s representative on the CROA Committee, testified about the reasons why he withdrew his support for the renewal of Mr. Picher’s contract in July 2014. He indicated that his initial support in March 2014 for the renewal of Mr. Picher was contingent on a rate increase of 2% and that when the issue came back as to whether the Committee would approve a rate increase of 3%, he was not supportive. Under cross examination, Mr. Becker then indicated that he had come to the conclusion that he had lost confidence in the arbitrator because of certain decisions, although some of the decisions cited were in fact in favour of the employer. He further testified that he was not aware that there was a possibility to discuss any process issues or other concerns within the CROA Committee so that changes could be implemented or directions given to arbitrators. Mr. Becker testified that following the decision to not renew Mr. Picher, he was focused on finding new ways to deal with the grievances.

[33] CP Rail takes issue with the fact that it has to provide reasons for its decision not to renew an arbitrator as none of the other signatories to the MOA have ever been asked to justify their rationale for not agreeing to offer or renew a contract for any arbitrator. 

[34] Mr. Douglas Fisher, Director of Labour Relations and Strategy at CN Rail has been CN Rail’s representative on the Committee since 2000. In testifying as a witness for the employer, he explained the process for renewing arbitrators or identifying new arbitrators. With his long history and experience with CROA, he provided a detailed account of how the Committee comes to decisions on the renewal of contractual relationships with arbitrators. He testified that the decisions related to the selection of new arbitrators or the renewal of contracts have always been made on a consensus basis and that at no time has any member of the Committee been asked to justify a decision regarding the appointment or renewal of an arbitrator.

[35] Mr. Fisher testified that the Committee discussed the issue of the rate increase for arbitrators Picher and Schmidt and agreed on offering 2% in an effort to rein in expenses. He stated that Mr. Kennedy was designated as the Committee’s delegate to negotiate the specific terms of renewal with Mr. Picher and Ms. Schmidt. Mr. Fisher testified that it was his belief that Mr. Kennedy did not speak to the two arbitrators before sometime in July 2014.

[36] In Mr. Fisher’s view, any member of CROA was free not to support the renewal of Mr. Picher. However, he testified that, given the timing of Mr. Becker’s decision, Mr. Fisher did call him to discuss the consequences of the decision and to clearly express a view that it left all members of CROA in a difficult position as it would leave them without an arbitrator and create gaps in the arbitration schedule given the timeframe that the Committee faced with the contract deadline.  

[37] Mr. Fisher also testified to the parties’ efforts to find alternative arbitrators and that none could be identified on consensus who would be available for the September dates. He stated that it was only after the Board rendered its decision on the interim application on September 23, 2014, that further names were considered in order to fill the remaining CROA dates. As a result, arbitration dates that were scheduled in September and December 2014 by the CROA office were lost due to the fact that the parties were unable to select an agreeable arbitrator that was available for the selected dates.

[38] The employer suggests that the union bears some responsibility for the lost arbitration dates for categorically refusing to collaborate in identifying replacement arbitrators between July and September 2014.

[39] Mr. Fisher also indicated that there were normally up to 22 cases scheduled for arbitration per month and that on average, 9 or 10 cases are heard and adjudicated. The others were settled, postponed or abandoned. He testified that as at the time of the hearing, there were approximately 60–70 cases at CROA awaiting arbitration and further testified that the highest level of pending cases at CROA was in 1992–1993 when the backlog reached 275 cases.

[40] CP Rail asks the Board to find that there was no agreement to appoint Mr. Picher and further that there was never an agreement between Mr. Picher and the parties for the renewal of his contract with CROA. It states that it cannot be held responsible for interfering with the union’s right to represent its members when the union itself walked away from Committee discussions on the appointment of arbitrators and has brought any failing to effectively represent its members on itself by its own actions.

C. CN Rail

[41] CN Rail’s stated interest in these proceedings is the CROA MOA and the preservation of the private nature of the agreement between its signatories. CN Rail urges the Board to be mindful of a decision that will impact on all the parties to the MOA and argues that it is not the role of the Board to interfere with the rules of governance that the parties themselves developed and incorporated in the MOA. It submits that CROA is not a creature of statute but rather a creation of the parties and therefore, it should be left to the parties to decide how to rectify any problems that arise with its processes. It reminds the Board that decisions of the Committee are made by consensus because that is how the parties designed the governance structure of CROA. 

[42] CN Rail affirms that CROA is a huge benefit to the labour relations system in the railway industry. It is a simplified and expedited arbitration process that works for the parties who agree to be bound by the CROA rules. However, it submits that the issues that have arisen are a result of the parties’ own decisions and design. CN Rail cautions the Board not to impose a requirement on the parties to provide reasons for accepting or rejecting an arbitrator as that would not reflect the parties’ MOA and would not be conducive to sound labour relations. The parties should be focused on the selection of arbitrators that are acceptable to all signatories as opposed to defending their decisions to accept or reject a particular arbitrator. 

[43] CN Rail argues that while the focus of the evidence submitted by the parties was placed on whether an agreement had been reached to renew the arbitrator or whether a contract had been entered into, there is nothing in the CROA MOA that prohibits a party from withdrawing its approval at anytime until the contract is confirmed and entered into with the arbitrator. CN Rail is of the view that the events of 2014 have now led the parties to examine the process but that it is the parties’ responsibility, not the Board’s, to find a solution going forward.  

D. Unifor

[44] In its written submission, Unifor states that it fully agrees with and supports the position of the TCRC. It presented no evidence or oral arguments at the hearing.

E. United Steelworkers, Local 1976

[45] Similarly, the United Steelworkers, Local 1976 essentially adopts and supports the TCRC’s position. It reiterates the effect of CP Rail’s actions on the unions’ ability to discharge its obligations of representing employees in the grievance procedure. It did not present any evidence at the hearing.

IV. Analysis and Decision

[46] The union alleges a breach of section 94(1)(a) of the Code and specifically alleges that the employer has interfered with its ability to represent the employees in the bargaining unit. Section 94(1)(a) reads as follows:

94. (1) No employer or person acting on behalf of an employer shall

(a) participate in or interfere with the formation or administration of a trade union or the representation of employees by a trade union; or

[47] There was no dispute between the parties that in a complaint made pursuant to section 94(1)(a) of the Code, the legal onus of proof rests with the complainant.    

[48] There is limited jurisprudence under the Code on the specific issue of whether the protection of section 94(1) extends to the union’s representation of employees at grievance arbitration. In ATV New Brunswick Limited (CKCW-TV) (1978), 29 di 23; and [1979] 3 Can LRBR 342 (CLRB no. 149), the Board offered the following comments with respect to section 94(1)(a):

Section 184(1)(a) (now 94(1)(a)) deals with the formation of a trade union, the administration of a trade union and the representation of employees by a trade union. In our view, this enumeration corresponds generally to the three basic functions embraced by this Code and are directed to the protection of these functions which are:

1. The formation of a union. This is the initial stage, and can be viewed as the first step towards collective bargaining. The trade union must have a recognized status.

2. The administration of the union. This is directed at the protection of the legal entity, and involves such matters as elections of officers, collecting of money, expenditure of this money, general meetings of the members, etc. in a word all internal matters of a trade union considered as a business. This is to assure that the employer will not control the union with which it will negotiate and thus assure that the negotiations will be conducted at arms length.

In the present case, the union contends that “administration” also includes the administration of a collective agreement, and that in this case the attempts by the employer to convince an employee not to grieve or not to attend any hearing, when the grievance is a union grievance thus going to the administration of the trade union, is interference with the administration. We do not agree with this interpretation. The word “administration” as used in section 184(1)(a) means administration of the union as an active collective bargaining entity – it simply does not include administration of the collective agreement. Another “facet” of the problem may arise when certain rights of the union, which may be contained in a collective agreement, are violated by an employer. This may be “an interference with the administration of a trade union”. There are certain instances where in such cases an unfair practice may lie. Such a situation, for example, could arise in a case where the employer would refuse to remit to the union the dues it deducted from its employees’ pay as provided for in the collective agreement. The union could grieve under the contract, but could also take an unfair labour practice complaint against the employer if it proves: 1) that the union dues are essential for its administration; 2) that there is anti-union animus on the part of the employer.

We are not concerned with such an issue and we will not comment further - the case having been used as an example to illustrate our view on the general interpretation of section 184(1)(a) as regard to interference with the administration of a trade union.

3. The representation of employees by a trade union. We are of opinion that “representation” as used here deals mainly with collective bargaining. The main objective of 184(1)(a) is to protect the bargaining rights of the bargaining agent to negotiate collectively. It is because of this subsection that the employer cannot negotiate working conditions directly with his employees, either collectively or individually, without the permission of the union. It is a necessary corollary to protect the rights of the union given to it by section 136(1) of the Code.

(pages 28–29; and 346–347)

[49] In Canada Post Corporation (1985), 63 di 136 (CLRB no. 544), the Board reviewed a number of cases dealing with section 184(1)(a) (now 94(1)(a)) and suggested that the protection from employer interference extends to all areas of the union’s duties and responsibilities:

These decisions illustrate the extent to which section 184(1)(a) is a necessary corollary to the basic right of an employee to join a trade union. It protects not only the exercise of an employee’s right to be represented, but also the right of his union to do its job and to represent him without interference from the employer. The union, moreover, has a statutory obligation to provide representation under section 136.1 [now section 37]. We are quoting the text of this section as it read at the time this complaint was filed and as it now reads:

“136.1 Where a trade union is the bargaining agent for a bargaining unit, the trade union and every representative of the trade union shall represent, fairly and without discrimination, all employees in the bargaining unit.”

(emphasis added)

In July 1984, the text was amended to read as follows:

“136.1 A trade union or representative of a trade union that is the bargaining agent for a bargaining unit shall not act in a manner that is arbitrary, discriminatory or in bad faith in the representation of any of the employees in the unit with respect to their rights under the collective agreement that is applicable to them.”

In both the old and new versions of section 136.1 and in section 184(1)(a), we find the words “represent” or “representation.”

(page 156)

[50] The objective of section 94(1)(a) of the Code is twofold: to protect the fundamental right of association enshrined in section 8 of the Code; and to protect the union’s exclusive role in representing employees in the bargaining unit. The Board’s analysis in Canada Post Corporation, supra, reveals that the type of representation that is protected by section 94(1)(a) is broad:

... This protection in fact mirrors the many constantly changing forms that the right to join a union may take, this right constituting, according to the title of section 110 of the Code, one of the “basic freedoms.” Section 184(1)(a) prohibits both deliberate and unintentional violation of this right. The protection it affords is aimed at both actions that seek to undermine the status of the bargaining agent and those that merely have this effect. It also extends to those actions that compromise the integrity of the bargaining unit which the union represents. Finally, this protection continues to apply both in the absence and in the presence of a collective agreement. This explains what we referred to earlier as the “omnibus” nature of the protection of section 184(1)(a).

(page 160)

[51] It is clear from the review of these cases, that the protection afforded by section 94(1)(a) of the Code is aimed mainly at ensuring the rights of employees who chose to be represented collectively can be exercised freely and without interference and ensuring the union’s legitimate status in its role as the exclusive bargaining representative of the employees in the unit is not impaired. See Canadian Imperial Bank of Commerce (North Hills and Victoria Hills Branches) (1979), 34 di 651; [1979] 1 Can LRBR 266; and 80 CLLC 16,001 (CLRB no. 173).

[52] The exclusive right of representation by the bargaining agent is normally considered to include the right to negotiate terms and conditions of employment for the employees in the bargaining unit it represents and to prohibit employers from negotiating other terms directly with the employees. However, the Board has held that the term “representation” should not be interpreted restrictively (Canada Post Corporation (1987), 71 di 215; and 87 CLLC 16,060 (CLRB no. 654)).

[53] The other aspect of the protection afforded by section 94(1)(a) is that the employer must not interfere with the union’s legitimate representation of employees. The determination of whether an employer’s action constitutes an unlawful interference is a factual one that will vary depending on the nature of each specific case. It is clear from the Board’s jurisprudence that interference will typically be found when the effect of the employer’s action is to undermine the status of the trade union or to compromise the integrity of the bargaining unit (Canadian Broadcasting Corporation (1991), 85 di 27; and 15 CLRBR (2d) 154 (CLRB no. 865)).

[54] In Canada Post Corporation, supra, the Canada Labour Relations Board (CLRB) found that the employer had interfered with the union’s representation contrary to the Code by denying employees the right to be assisted by a union representative. However, the CLRB did not find in favour of the union with regard to its allegation that the employer violated section 94(1)(a) (then section 184(1)(a)) when it failed to consult with the union prior to creating “new” non‑unionized positions, into which the employer hired the employees who had been doing these jobs within the bargaining unit under a different classification. Regarding the kind of employer driven change that would rise to the level of interference with the union’s representation of employees in the bargaining unit, the CLRB stated:

What changes are we talking about here?

To answer this question, we must necessarily rely on practical experience. Although we do not pretend to have an exhaustive or definitive answer, since each case must be considered individually, it seems logical to us that any change that is likely to have a drastic and substantial impact on the members of the bargaining unit or their bargaining agent would fall into this category. In short, we are not thinking here of routine matters or cosmetic changes. The closing of a business, the relocation of a plant, the contracting out to third parties of work performed by union members are all changes that could conceivably, depending on the circumstances, fall into this category. We would also include in this category a change in the organization of a business that results in the mass and permanent abolition of a large number of positions included in a bargaining unit, especially when accompanied by the creation of new positions outside the unit.

In the instant case, the change, which is being initiated by the employer, could have drastic repercussions for the bargaining agent, which is losing a quarter of its membership. In a single stroke, the bargaining unit, which comprises some 200 employees, is losing some fifty members. There are also drastic repercussions for the fifty employees involved, who stand not only to lose some of the working conditions they negotiated, but also to be excluded in future from any unit. Finally, this change would deprive them of the basic right to representation. ...

(pages 162–163)

[55] In TELUS Communications Inc., 2003 CIRB 222, the Board was asked to look at whether the employer’s unilateral implementation of new, strict performance measurement metrics was an interference with the union’s representation of employees in the bargaining unit. In finding that section 94(1)(a) had not been violated, the Board made the following comments regarding the impact of the effect of an employer’s actions on its conclusion:

[67] Lastly, the union alleged that the unreasonableness of the expectations and standards contained in the letters of expectations and the PPO demonstrated that it was improper. While the employer is free to set unreasonable expectations, the enforcement of those unreasonable standards may create problems for the employer under the collective agreement and before this Board or an arbitrator. However, the establishment of unreasonable standards does not constitute a breach of a union's ability to represent its members under section 94(1)(a).

[68] In summary, the Board finds no evidence that the revised Performance Management Program unilaterally implemented by TELUS could be considered as having a “drastic and substantial impact on the members of the bargaining unit or their bargaining agent.” It must be remembered that while the revised PDP may cause a degree of employee and union anxiety, it is not within the same category as the Board had noted earlier in Canadian Broadcasting Corporation (865), supra. ...

[56] Certainly, the Board holds a certified trade union to a high standard in its representation of employees in the bargaining unit. As a result of certification and the Rand formula, the union has a statutory duty, pursuant to section 37 of the Code, to represent all employees in the unit equally and in a manner that is not arbitrary, discriminatory or in bad faith. The role of the union in representing employees at arbitration is an important duty that the union has as the exclusive representative of employees in the bargaining unit. As a result of union representation, the employees have no individual right to file grievances or to seek other representation during the grievance process.   

[57] Given that the Board’s case law encourages a broad interpretation of what will constitute representation by a trade union as that term is used in section 94(1)(a), the Board is prepared in this case to accept that the union’s representation can extend to representing employees in the grievance arbitration process. However, this is not to be misconstrued as requiring the union to represent employees at grievance arbitration. The Board’s section 37 jurisprudence is clear that those decisions are within the exclusive purview of the union, provided they are not made in an arbitrary, discriminatory or bad faith manner.

[58] The question for the Board in this case is, therefore, to determine whether the employer’s actions have in fact interfered with the union’s ability to represent the employees at arbitration or undermined the union’s status as their exclusive bargaining agent.

[59] The union invited the Board to find that its ability to represent the employees in the arbitration process was directly impacted by the employer’s decision not to renew arbitrator Picher because that decision was a direct attack on a system that is crucial to the union’s ability to have grievances dealt with expeditiously. In the union’s view, this amounts to a breach of section 94(1)(a) of the Code. It argues that there was a consensus agreement of the Committee to renew arbitrator Picher’s appointment and that the employer’s decision to resile from its agreement to offer a renewal to Mr. Picher so late in the process left the parties with no arbitrator and, as a result, the scheduled arbitration dates in September had to be cancelled.

[60] The Board heard testimony from Mr. Finnson to the effect that a large number of grievances had been filed and that a recent decision of the employer to refuse to grant extensions would result in a large number of grievances being submitted to CROA for arbitration. However, the Board was not presented with any evidence to substantiate that this was in fact occurring. Mr. Finnson also testified that at the time of the hearing, CROA cases were proceeding with three arbitrators hearing cases.

[61] Although the union presented data suggesting that dismissal cases at CP Rail take up a higher proportion of the CROA caseload thereby making it difficult to have other cases heard, there was no evidence to suggest that there was a marked increase of cases filed overall with CROA at the time of the hearing. The union indicates that its members are furious at the employer and also at the union itself for not getting grievances through the process quickly enough. However, no direct evidence was provided to substantiate that statement.

[62] CROA was created through the agreement of the parties to the MOA as the mechanism to fulfill the requirement of section 57 of the Code to have a final and binding dispute resolution process for disputes arising during the life of the collective agreements. However, beyond that requirement, the Code does not mandate or guarantee a specific form or model of arbitration. Additionally, it does not dictate specific timelines for the hearing of grievance arbitrations. What the Code does offer is that when parties disagree on the appointment of an arbitrator, the Minister of Labour, not the Board, may select and appoint grievance arbitrators. 

[63] The Board accepts that it was CP Rail’s decision in July 2014 that it would no longer agree to the renewal of arbitrator Picher that resulted in the loss of consensus at the Committee regarding this renewal. The Board also accepts that this resulted in a change in who would hear arbitrations at CROA and when those arbitrations would proceed. However, the Board also notes the fact that when alternative options were being considered by the Committee, for a period of time the union would not agree to any other arbitrator. The Board accepts that the union objected to 10 proposed arbitrators and insisted that there was an agreement to renew Mr. Picher that should be enforced. The result of all of these actions was the loss of arbitration days in September and December 2014. 

[64] Despite its assertion that the loss of arbitrator Picher would create an untenable backlog of cases that would break the CROA system, the union provided no evidence of a significant backlog of cases that resulted from the cancellation of these dates. Mr. Finnson testified that there was a backlog of 56 cases at the time of the hearing. This number was corroborated by Mr. Fisher who testified that the backlog was 60–70 cases. Mr. Fisher also testified that the highest backlog was 275 cases in 1992–1993. Additionally, there was no evidence that the union was not able to discharge its responsibilities of representing employees.

[65] The Board notes that through the months that followed the employer’s decision not to support the renewal of CROA’s chief arbitrator, the union continued efforts to bargain collectively with the employer and the members of the bargaining unit exercised their right to strike on February 15, 2015. The parties subsequently agreed to refer their collective bargaining dispute to a mediation-arbitration process pursuant to section 79 of the Code. The Board finds that the union has in fact continued to represent the members of the unit forcefully and has been able to exercise its rights under the Code. Members may be frustrated with the employer’s response and the position it is taking on several issues, however, the union has repeatedly continued to represent the employees in the bargaining unit through the filing of grievances and representation at arbitration. The union has also represented them through the collective bargaining process and received a strong mandate from its membership to exercise their right to strike. Finally, there is no evidence that the non-renewal of arbitrator Picher undermined the status of the union or the employees’ faith in it.

[66] The Board is simply unable to conclude on the evidence before it that the employer’s decision to withhold its consent for the renewal of arbitrator Picher under the CROA system has had a drastic and substantial impact on the union’s ability to discharge its responsibility as the exclusive representative of the members of the bargaining unit. While the employer’s decision late in the day to withhold to its support for the reappointment of arbitrator Picher has caused all signatories to the MOA consternation over the future of CROA as an institution as well as some degree of anxiety for the TCRC and its members, the Board is of the view that it cannot be considered in the realm of interference that is contemplated by section 94(1)(a) of the Code.  

[67] Furthermore, the pattern of conduct alleged by the union in this case is simply not sufficient to find a breach. It is evident that the parties have a strained relationship. Similar allegations were raised in Air Canada, 2001 CIRB 131 and the Board addressed the issue of the labour relations context in the following terms:

[41] The union has argued that labour relations between the parties had become strained during the period leading up to the present complaint. This may be true, but strained relations between the union and the employer are not necessarily relevant to the legal test related to employer interference, unless that strain had the effect of increasing the union’s vulnerability to interference. The union has submitted that it did not trust the employer; again, this is not necessarily relevant. What must be examined is whether the relationship between the union and its members had become such that the members no longer trusted the union to represent their interests in negotiations with the employer, or at least felt a diminished faith in the union. The evidence presented in this complaint suggests that the union maintained a considerable control over its relationship with the members, during the period at issue, and that the membership turned to the union for guidance throughout. In spite of the difficulties in its dealings with Air Canada, there is nothing to indicate that CUPE was particularly vulnerable to interference with its representation of its members.

(emphasis added)

[68] Similarly, in this case, the labour relations between the two parties are difficult but the Board has not been persuaded that the members of the unit have lost faith in their union or their ability to represent them aptly in the grievance process or in collective bargaining.

[69] Most will recognize the critical role that CROA plays in disposing of grievances in the rail industry and that it has served the parties well for some 40 years. The model of a shared and expert arbitration office that provides expedited grievance resolution has been recognized as innovative and cost effective.  

[70] The timing and the cavalier manner in which CP Rail decided to withdraw its support for the renewal of CROA’s chief arbitrator did nothing to improve an already difficult relationship with the TCRC. As the Chief Arbitrator, Mr. Picher would not be easily replaced and the consequences of CP Rail’s actions were predictable to anyone familiar with the process and the industry.

[71] While the parties dedicated a significant portion of the hearing to presenting evidence regarding various discussions and decisions concerning the renewal, or not, of CROA arbitrators, the Board cannot and does not want to interfere with a private agreement that governs a consensual model for the appointment of arbitrators to hear grievances in the railway industry. As such, the Board will not determine whether or not there was an agreement to renew arbitrator Picher. And, it need not do so since the issue that the Board is concerned with in this case, is the conduct of the employer and whether that conduct has an effect on the union’s ability to represent the employees of the bargaining unit.  

[72] The Board is not persuaded that the employer’s actions, as objectionable as they may be to the union in these circumstances, have had an adverse impact on the union’s ability to file grievances on behalf of employees in the bargaining unit nor to advance those grievances to arbitration. Although the union urges the Board to conclude that the employer’s conduct and track record amounts to an unfair labour practice, the union did not meet its burden of demonstrating how the actions of the employer interfered with its ability to represent members as protected by section 94(1)(a) of the Code. 

[73] For these reasons, the Board dismisses the complaint.

[74] This is a unanimous decision of the Board.