2000 S.H. No. 165509 IN THE SUPREME COURT OF NOVA SCOTIA [Cite as: Delta Sydney and Canadian Auto Workers Canada, Local 4624 Sydney, 2001 NSSC 18] IN THE MATTER OF: THE ARBITRATION ACT, R.S.N.S., 1989, c. 19 -and- IN THE MATTER OF: AN ARBITRATION PURSUANT TO COLLECTIVE AGREEMENT and IN THE MATTER OF: AN APPLICATION BETWEEN: DELTA SYDNEY and CANADIAN AUTO WORKERS CANADA, LOCAL 4624 SYDNEY DECISION HEARD BEFORE: The Honourable Justice Robert W. Wright, in Chambers on December 11, 2000 at Sydney, Nova Scotia WRITTEN RELEASE OF DECISION: February 2, 2001 COUNSEL: Counsel for the Applicant Nancy F. Barteaux Counsel for the Respondent Blaise MacDonald WRIGHT J. INTRODUCTION [1] This is an application for judicial review of the decision of a labour arbitrator released on July 21, 2000 in respect of a grievance arbitration heard in Sydney, Nova Scotia on May 10, 2000. The arbitration involved the interpretation of certain seniority provisions of collective agreement between the parties which was effective on October 1, 1999 and expires on September 30, 2002. [2] The grievor was Ms. Kathy Fraser. She was member of the respondent union and had been employed at the Delta Sydney hotel since 1989 in various capacities. At the time of the grievance, she was employed in the front desk department of the hotel. [3] The essential facts surrounding this matter are not in dispute. After working full-time in various capacities in the hotel for some ten years, Ms. Fraser, through successful grievance, acquired part-time position in the front desk department on or about May 31, 1999. [4] Upon taking up her new position in the front desk department, Ms. Fraser was placed at the bottom of the departmental seniority list behind Kim MacMaster, Judy McPhee and Lisa Clamp. She recognized this when she took the job. Her hotel seniority, of course, remained unchanged which was greater than that of each of the three above named employees. [5] It was only about two months later that Ms. MacMaster (who had the most front desk departmental seniority) went on maternity leave. Her departure, along with another at about the same time, enabled Ms. Fraser to work more hours and by the time the seniority lists were circulated around February 1, 2000 she had become full-time employee in that department. [6] On February 8, 2000 Ms. MacMaster returned to work from her maternity leave maintaining, of course, her top spot on the departmental seniority list. This resulted in a reduction of the hours of work allotted to Ms. Fraser by the hotel, based on its application of the departmental seniority list under Article 14:05. That is to say, Ms. Fraser was the first to experience reduction of work hours in the front desk department where she placed fourth on the departmental seniority list behind Ms. MacMaster, Ms. McPhee and Ms. Clamp. [7] Ms. Fraser considered that any reduction in work hours should instead have been predicated on hotel seniority which she held over all three of these employees in her department. She therefore filed a grievance on February 17, 2000 which reads as follows:I was given less hours than Lisa, Judy and Kim who all have less hotel seniority than me. Therefore, the person with the less hotel seniority was the one who should have their hours reduced, not me. [8] Ms. Fraser alleged that the reduction of her work hours based on departmental seniority constituted a violation of Article 9 of the collective agreement. Through her grievance, she sought allotment of work hours based on her hotel seniority and recovery of her loss of wages attributable to the reduction in her hours since Ms. MacMaster’s return from maternity leave. [9] At the outset of the Decision segment of her award, the arbitrator stated that she was left with the task of trying to balance for the parties the interests of departmental seniority and hotel seniority. In doing so, she referred to the three key Articles in the collective agreement which are at play here. They are as follows: Article Seniority 9:01 The purpose of seniority is to afford preference to senior employees in recognition of length of service. Hotel seniority shall mean the total length of service with the hotel, from the most recent date of hire. When an employee is faced with lay-off (as defined in article 11:01), that employee may bump another employee, with less hotel seniority (as defined in article 11:02), from their position provided the employee has the ability to perform the work involved in that position. In the event of an indefinite reduction of hours within department, the person with the least hotel seniority within that department will be reduced. When an employee exercises this bumping right, his or her hotel seniority will determine their departmental seniority. 9:02 Departmental seniority shall mean the length of service with hotel department, from the most recent date of assignment to department. The departments within the hotel shall be as follows: 1. Front Desk ... Departmental seniority determines maximizing of hours, promotions, overtime assignments, and vacation allocation within that department. The fitness center will be excluded in “overtime assignments”. Article 14 HOURS OF WORK AND BREAKS 14:05 All employees shall be allotted and will have preference of hours up to forty (40) hours per week on the basis of their departmental seniority standing. [10] The arbitrator also referred to Article 11:01 which defines lay-off as an indefinite discontinuation of employment and to Article 11:08 which provides an employee with the opportunity to displace less senior employee within their departmental group in the period of October 15 to April 15 of the following year (the hotel’s slow season) for the purpose of restoring or maximizing hours, precluding overtime. [11] The latter provision is really of no consequence here because there was never an attempt by Ms. Fraser to invoke it. The arbitrator did make the finding, however, that this was not lay-off situation. She therefore turned to the question of whether or not this was situation where there had been “an indefinite reduction of hours within department” which would trigger the application of hotel seniority under Article 9:01. [12] In addressing that question, the arbitrator found that the return to work by Ms. MacMaster from maternity leave did result in reduction of available hours of work for employees with less departmental seniority and that Ms. Fraser was the first to thereby experience reduction in her work hours. She further found that the return to work by Ms. MacMaster did not result in reduction of total hours available for work assignments within the department. She then nebulously stated her belief that the wording of Article 9:01 is wide enough to encompass this situation, thereby effectively finding that the hotel had breached Article 9:01 by reducing hours of work for employees on the basis of the departmental seniority list rather than the hotel seniority list. [13] The core of the arbitrator’s decision is reproduced as follows: Is the return of Ms. MacMaster to her employment an “indefinite reduction of hours within department”? Her return had not resulted in reduction of the total hours available to be assigned for work within the department, and that cannot be disputed. Her return has resulted in the reduction of available hours for work for employees who have less departmental seniority than she. believe the wording of the clause is wide enough to encompass this situation. Further because the reduction has been caused by personnel change, it is “indefinite”. It is as indefinite as if there was the elimination of position in department. This interpretation also adheres to the long held principle that “the purpose of seniority is to afford preference to senior employees in recognition of length of service”, and also preserves the purpose of departmental seniority. [14] The hotel has now applied for judicial review of the arbitrator’s decision, seeking to have it set aside under s.15(2) of the Arbitration Act R.S.N.S. 1989, Ch. 19. STANDARD OF REVIEW AND POSITIONS OF THE PARTIES [15] It is now well established and accepted that where labour relations tribunals or arbitrators are called upon to interpret or apply collective agreement under the umbrella of privative clause, reviewing court can only intervene in the case of patently unreasonable error (see, for example, Canada Safeway Ltd. v. Retail, Wholesale and Department Store Union, Local 454 1998 CanLII 780 (SCC), [1998] S.C.R. 1079 and the authorities therein cited). Both counsel acknowledged that this was the standard of review to be applied in the present case. [16] Counsel for the hotel argues, however, that the arbitrator has committed patently unreasonable error by interpreting Article 9:01 in manner which its language cannot reasonable bear. It is argued that by interpreting the words “indefinite reduction of hours within department” as being wide enough to encompass the situation where the grievor’s work hours were reduced because of the return to work from maternity leave of another employee with greater departmental seniority, the arbitrator has, in effect, amended or added to the language of Article 9:01. It is contended that this was beyond the jurisdiction of the arbitrator. [17] Counsel for the hotel further submits that the clear language of Article 9:01 confines its application to the situation where there has been an indefinite reduction of hours overall within department which was not the situation here at all. It is argued that there is no evidentiary foundation for the interpretation of Article 9:01 adopted by the arbitrator and that it renders nugatory the language of Article 14:05 which provides that hours of work are to be allotted in accordance with departmental seniority. [18] It was also pointed out by counsel for the hotel that the interpretation of Article 9:01 adopted by the arbitrator was not even argued before her. Rather, the Union argued at the arbitration hearing (at which stage it was unrepresented by legal counsel) that Article 9:01 applied because “an indefinite reduction of hours within department” had occurred, not by reason of Ms. MacMaster’s return from maternity leave, but rather by scheduling surrounding the hotel’s slow season. [19] With this application for judicial review having been made, the Union retained legal counsel who essentially argued that there were two linguistically possible interpretations between which the arbitrator could choose in interpreting Article 9:01. More specifically, it was submitted that the arbitrator had to decide whether “hours” within Article 9:01 referenced hours of individual employees within the department or the total overall hours assigned by the employer to the employees collectively within that department. It was submitted that the arbitrator’s interpretation that the clause refers to reduction of work hours of an individual employee within the department, and not the total overall hours within the department, is not only permissible interpretation but the correct one. It was urged upon the court that even if the wrong interpretation was chosen by the arbitrator, her interpretation could not be said to be patently unreasonable and hence the court ought not interfere with her decision. Counsel also points to the deemed privative clause provisions under s. 42(2) of the Trade Union Act and to s. 5(h) of the Arbitration Act. WAS THE ARBITRATOR’S AWARD PATENTLY UNREASONABLE? [20] The Supreme Court of Canada has on number of recent occasions endorsed policy of judicial restraint with respect to the review of decisions of consensual arbitrators. It is recognized that courts should not interfere with an arbitrator’s decision where it involves an interpretation of collective agreement (and they should be even more hesitant to do so where the arbitration is consensual), unless the interpretation given is patently unreasonable so as to demand intervention by the court. As reiterated in Safeway, this is very high standard which will not easily be met. [21] The Supreme Court of Canada has also endeavoured in number of recent cases to redefine what is meant by reasonableness, notably in Canada (Attorney General) v. P.S.A.C. 1993 CanLII 125 (SCC), [1993] S.C.R. 941 and again in Toronto (City) Board of Education v. O.S.S.T.F., District 15 et al. 1997 CanLII 378 (SCC), [1997] S.C.R. 487. In the latter case (at p. 508), Cory J. reiterated what constitutes patently unreasonable decision as follows: In PSAC No. 2, supra, it was put in this way at pp. 963-64: It is said that it is difficult to know what “patently unreasonable” means. What is patently unreasonable to one judge may be eminently reasonable to another. Yet any test can only be defined by words, the building blocks of all reasons. Obviously, the patently unreasonable test sets high standard of review. In the Shorter Oxford English Dictionary “patently”, an adverb, is defined as “openly, evidently, clearly”. “Unreasonable” is defined as “not having the faculty of reason, irrational, not acting in accordance with reason or good sense”. Thus, based on the dictionary definition of the words “patently unreasonable”, it is apparent that if the decision the Board reached, acting within its jurisdiction, is not clearly irrational, that is to say evidently not in accordance with reason, then it cannot be said that there was loss of jurisdiction. This is clearly very strict test. Yet courts also have duty to protect parties from decision which is patently unreasonable. [22] This excerpt was again quoted by Cory and McLachlin JJ. in the Safeway case, supra, (at para. 61) who then went on to say: In order to justify judicial intervention, the arbitrator’s decision must be more than simply unreasonable. In Canada (Director of Investigation and Research) v. Southam Inc., 1997 CanLII 385 (SCC), [1997] S.C.R. 748, at para. 57, Iacobucci J. described the difference between an unreasonable and patently unreasonable decision as follows: The difference. lies in the immediacy or obviousness of the defect. If the defect is apparent on the face of the tribunal’s reasons, then the tribunal’s decision is patently unreasonable. But if it takes some significant searching or testing to find the defect, then the decision is unreasonable but not patently unreasonable. reviewing court cannot intervene simply because it disagrees with the reasoning of the arbitration board or because it would have reached different conclusion. To do so would be to usurp the power of the administrative tribunal and to remove from it the ability to arrive at erroneous conclusions within its area of specialized expertise. [23] Reference is also made to the discussion of the patently unreasonable test in United Brotherhood of Carpenters and Joiners of America, Local 579 v. Bradco Construction Ltd. 1993 CanLII 88 (SCC), [1993] S.C.R. 316 at pp. 340-41. [24] It follows that the courts must be careful to focus their inquiry on the existence of rational basis for the decision of the tribunal, and not on their agreement with it. The emphasis should be not so much on what result the tribunal has arrived at, but on how the tribunal arrived at that result (see CAIMAW v. Paccar of Canada Ltd. 1989 CanLII 49 (SCC), [1989] S.C.R. 983 at p. 1003). [25] With that direction, have focused my inquiry on how the arbitrator arrived at the result she did. Her essential findings of fact can be summarized as follows: (a) This was not lay-off situation; (b) Ms. MacMaster’s return from maternity leave did result in reduction of available hours of work for employees in the front desk department with less departmental seniority and the grievor was the first to experience such reduction; (c) Ms. MacMaster’s return from maternity leave did not result in reduction of total hours available for work assignments overall within the department; (d) The reduction in the grievor’s work hours was “indefinite” because it resulted from personnel change. [26] She then concluded that the wording of Article 9:01 is wide enough to encompass this situation. [27] It is difficult to follow the arbitrator’s reasoning in reaching this conclusion. As referred to in the Brown Beatty text on Canadian Labour Arbitration (3rd. ed.) at section 4:2100, it has often been stated that the fundamental object in construing the terms of collective agreement is to discover the intention of the parties who agreed to it. The function of the trier of fact is to ascertain what the parties meant by the words they have used. [28] Article 9:01 (and the application of hotel seniority) can only be triggered where there is first finding that there has been an “indefinite reduction of hours within department”. In my view, the plain meaning of that threshold clause is that it refers to an indefinite reduction of hours overall within department. The object of the clause, grammatically speaking, is hours within department and it cannot be reasonably construed as being intended to apply to the situation where an individual employee’s work hours are reduced because another employee with greater departmental seniority returns from maternity leave. do not see any logical basis upon which words of that import can be read into the language of Article 9:01. [29] Nor can support for such an interpretation be otherwise found from the context in which the subject clause appears or from the language of the collective agreement as whole. The framework of the collective agreement contemplates that hotel seniority shall apply whenever there is lay-off or whenever there has been an “indefinite reduction of hours within department”. These two provisions are found one after the other under Article 9:01. They are to be contrasted with Articles 9:02 and 14:05 which contemplate that maximizing of hours and the allocation and preference of hours up to 40 hours per week will be based on departmental seniority standing. It would be an incongruous result if the allotment and maximizing of individual employee work hours within department were based on departmental seniority while reduction of an individual employee’s hours of work within department were based on hotel seniority, especially where precipitated by the expiry of another employee’s maternity leave. [30] Neither can support for the arbitrator’s interpretation be found in the evidence recited in her award. There were only two witnesses called at the arbitration hearing, namely, the grievor Kathy Fraser and the hotel’s front desk manager, Denise Duffy. Their evidence does clearly support the findings of fact made by the arbitrator which have summarized in paragraph 25 of this decision. With respect to the application of Articles 14:05 and 9:01, however, the grievor’s evidence is recited in the arbitrator’s award as follows (at p. 7): In relation to Article 14:05 she stated that departmental seniority applied and if an employee had more departmental seniority and if they applied under Article 14:05 they would be able to maximize their hours within the department. Further, they would be able to pick their vacations ahead of her and obtain promotions ahead of her. Article 9:01 however only speaks to overall hotel seniority in relation to bumping rights for an indefinite reduction of hours within department. She stated in her re-direct that scheduling and maximizing hours for overtime assignments and vacations were dealt with by way of departmental seniority and the reduction of overall hours within department was dealt with by way of hotel seniority. [31] The evidence of Ms. Duffy was that as front desk manager, it is her responsibility to do the scheduling. The relevant part of her evidence on this point was recited in the arbitrator’s award as follows (at p. 9): When asked what documents she referred to when she did her scheduling she advised she referred to Exhibit “3" [the seniority list for the year 2000] and the departmental seniority column. As to how she determined who got what hours the witness stated she would start at the top of the clerks’ seniority within the department and work her way down. She also stated that this was how it had been done in previous years and in other departments. [32] That evidence, limited as it may be, only serves to reinforce that in the administration of the collective agreement, it is departmental seniority standing that governs when it comes to allotment and scheduling of hours of work for individual employees whether they are being maximized or reduced. It lends no support to the arbitrator’s conclusion that hotel seniority standing should govern under Article 9:01 in the situation where an individual employee’s work hours are reduced because another employee with greater departmental seniority returns from maternity leave. [33] Another dimension to be considered in this analysis is the anomalous result which theoretically could have been produced by the arbitrator’s conclusion, namely, that someone like Ms. MacMaster (and the other employees with more departmental seniority than the grievor) might be detrimentally affected by the maternity leave while the grievor might benefit therefrom in terms of allotment of work hours. Ms. MacMaster was not actually at risk of that happening in this case because she was next highest in hotel seniority to the grievor as well as the most senior employee on the front desk departmental seniority list and there are always at least two persons required to staff the front desk. However, if similar case were to arise where the employee returning from maternity leave was farther down the seniority list, such an anomalous result could occur. This is inconsistent with the presumed intention of the parties. [34] The arbitrator briefly alluded to this at page 13-14 of her award when she posed the question: Further, if Ms. MacMaster was out on extended sick leave, and her date of return was not clearly anticipated, should the Grievor be in effect penalized upon her return? [35] With respect, the question to be posed in this analysis is not whether the grievor should in effect be penalized in this situation, she having had the benefit of working additional hours in the front desk department during Ms. MacMaster’s maternity leave. The question to be asked is whether Article 9:01 can reasonably be given an interpretation that has the potential to detrimentally affect employees returning from maternity leave, depending on their standing of seniority. In my view, it cannot. CONCLUSION [36] For all the above reasons, I find that the arbitrator’s conclusion that the wording of Article 9:01 is wide enough to encompass the situation at hand is patently unreasonable. Her conclusion ascribes meaning to that clause which its words cannot reasonably bear and which interpretation was apparently not even argued before her at the arbitration hearing. Although there is clear evidentiary support for her essential findings of fact, I am unable to determine the existence of any logical process by which the final conclusion drawn from the evidentiary foundation was made. This patent defect, and the arbitrator’s implicit finding that the hotel violated Article 9:01 of the collective agreement, is such that it warrants the intervention of the court on judicial review. [37] Accordingly, the application is granted and an Order will be issued setting aside the award of the arbitrator. The applicant hotel is also entitled to its costs of the application which are hereby fixed in the amount of $1500 plus taxable disbursements.
The grievor was employed in the front desk department of a hotel and her hours of work were reduced when another employee from the same department returned from maternity leave. The latter had greater departmental seniority than the grievor but less hotel seniority. The grievor filed a grievance claiming that under the collective agreement any such reduction of hours of individual employees should be based on hotel seniority, rather than departmental seniority. The arbitrator upheld the grievance and the hotel applied for judicial review. Application allowed; the arbitrator's interpretation of the collective agreement was patently unreasonable and her award should be set aside. The court's focus must be on the existence of a rational basis for the decision of the tribunal and not on whether it agrees with the decision. Although there was evidentiary support for the arbitrator's essential findings of fact, no logical process could be ascertained by which the final conclusion drawn from the evidentiary foundation was made.