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December 1, 2006 |
Issue No. 1 |
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— CONTENT— |
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UNIVERSITY'S SECOND TRY AT WORKLOAD REDUCTION PLAN STILL UNFAIR AND INEQUITABLE, ARBITRATOR FINDS When Laurentian University's Teaching Load Review Committee rejected the Dean of Social Work's new workload reduction plan, an arbitrator concluded for the second time that the plan was unfair and inequitable, and that it did not comply with the collective agreement. The university was ordered to bring workloads into compliance with the collective agreement immediately. Otherwise, the arbitrator reserved the possibility of forcing it to hire new full-time faculty to relieve the problem. Details below. DISPUTE OVER INSURED DISABILITY BENEFITS A MATTER BETWEEN THE EMPLOYEE AND THE INSURANCE COMPANY, ARBITRATOR RULES A British Columbia arbitrator has ruled that a dispute over the denial of insured disability benefits must be settled in court between the employee and the insurance company. The employee did not have the right to have a grievance heard by an arbitrator as the employer had fulfilled its obligation by paying the insurance premiums. Details below. See also section 3.9 of Leading Cases on Labour Arbitration. |
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— DETAILED REPORTS — |
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UNIVERSITY'S SECOND TRY AT WORKLOAD REDUCTION PLAN STILL UNFAIR AND INEQUITABLE, ARBITRATOR RULES The Facts: In their most recent bargaining round, Laurentian University and the Laurentian University Faculty Association amended the collective agreement to provide that, after July 1, 2006, the maximum normal teaching load in all faculties other than Science and Engineering would be reduced to 2.5 full courses, or 15 credits. They also agreed on a transition plan to the new teaching load norms for each unit whose load exceeded the new maximum. Article 2.10.13 of the collective agreement provided that, to facilitate the transition, "the Deans/Director of the Library will consult with all Units with teaching loads higher than the specified maximum norms for the purpose of developing a plan for achieving the teaching load reduction. The plans shall be determined by fair and equitable means and may only propose reasonable changes to class sizes in the Units concerned. The plans will not lead to an appreciable increase in full-time faculty complement. The new workloads developed under such plans shall be fair and equitable. Notwithstanding the foregoing, changes that are otherwise permitted under the terms of the Collective Agreement may still be used" (emphasis added). The agreement also provided that Deans had to produce an action plan to achieve the reduction in teaching load, which, if deemed unacceptable by the bargaining unit, would be referred for decisions to a new Teaching Load Review Committee, consisting of a nominee of the Administration and of the Faculty Association. On May 30, 2006, responding to a grievance that the Laurentian University School of Social Work's teaching load reduction plan for both its anglophone and francophone programs was not fair and equitable, as required by the collective agreement, Arbitrator William Kaplan ordered the university to draft a new plan and have it reviewed by the Teaching Load Review Committee. However, Kaplan refused to direct the university to hire an additional faculty member in each of the anglophone and francophone social work programs, as requested by the Faculty Association. On June 15, 2006, the Dean of Social Work issued a revised teaching load reduction plan for each of the two programs. The plan consisted primarily of a reduction in the number of credits required to complete the Master of Social Work program, the hiring of part-time instructors, and a reduction in coordination credits, which were allocated to faculty members for program coordination and administrative work in the francophone program. The anglophone and francophone units both rejected the revised teaching load reduction plan and the matter was referred to the Teaching Load Review Committee. When no consensus could be reached, the matter was referred to Arbitrator Kaplan. The Arguments: The Faculty Association argued that the only solution to the workload problem was to hire additional full-time professors in both the anglophone and francophone programs. It maintained that none of the university's plans would solve the teaching load problem, and that the only plan that could meet the requirements of the collective agreement was one that would be implemented by the start of the current academic year, and would have a predictable workload impact. The Association submitted that reducing the number of credits required to achieve a Master's degree would not be an adequate solution as there was no guarantee that the various decision-making bodies of the university would approve the change. In addition, the Association argued that the change could not be implemented in time for the current academic year, and even if it were approved, there was no guarantee that the reduction of credits would result in fewer teaching hours. The Association also objected to the university's proposal that part-time faculty be appointed in the anglophone program, as the hiring of part-time faculty would mean more work for full-time faculty. Moreover, in its submission, the reduction of coordination credits in the francophone program would not result in a decrease in workload as it was not accompanied by a reduction in coordination activities. Finally, the Association contended that the collective agreement provision stating that the arbitrator could "review and render a decision on" competing proposals empowered the arbitrator to order the hiring of additional faculty, as it was the only appropriate remedy in this case. The university responded that the revised plans were "fair and equitable," since they reduced teaching loads. In the university's submission, the timelines in the collective agreement for workload reduction were to be construed as guidelines only, and it would be unrealistic to expect implementation within the current academic year. The university argued that the arbitrator could not direct the university to hire a new faculty member for two reasons: (1) the arbitrator had no jurisdiction under the collective agreement to manage the affairs of the university in this way and was limited to making a declaration as to the fairness and equity of the university's plan; and (2) there was not enough time to initiate and complete the hiring process before the school year began. The Decision: Arbitrator Kaplan held that the university's revised plan to reduce teaching workloads was not fair and equitable within the meaning of the collective agreement. Kaplan found that the university's revised plan was uncertain and that it did not meet the negotiated timelines for reducing workloads. While he recognised that the negotiations may not have been realistic in hindsight, he directed, "unless the parties agree otherwise, that no professor be assigned a workload that exceeds the maximum. Any professor already assigned a teaching load in excess of the maximum, must immediately be given a new courseload assignment that reflects the agreed-upon limits. The employer may not, in respecting the agreed-upon limits and/or in making any changes to the assigned workload, make anything other than reasonable changes to the class size." However, Arbitrator Kaplan again refused, for the time being, to direct the hiring of new full-time faculty, as requested by the Association, noting that, "with weeks left until the start of the academic year, it is highly questionable, given the collegial nature of hiring and the importance of making good hiring decisions, that the process could be initiated and completed within the time remaining." Nonetheless, Kaplan ruled that it was not beyond his authority to order the hiring of new professors, stating: "[T]his is not to say that the association's proposal is beyond my jurisdiction or would otherwise necessarily and by definition be inappropriate. In my view, if the employer does not immediately comply with the direction set out in the previous paragraph, the conclusion will be inescapable that the only solution is the additional full-time hiring in each program." In order to avoid the situation being repeated next year, Kaplan further directed the parties, "at the earliest possible time after commencement of the new academic year, to begin meeting and reviewing plans for compliant teaching assignments for the next academic year." Kaplan added that he rejected the Association's argument that hiring additional part-time faculty would increase the workload of full-time faculty. He noted that experience in the sector indicated otherwise, but that insufficient evidence had been introduced on this point to make a determination. He also held that it was open to the university to reduce or otherwise change the system of "coordination credits"; however, he agreed with the Association's position that a reduction in coordination credits must be accompanied by a reduction in actual coordination activities, in order for the workload to be reduced. Comment: Although Arbitrator Kaplan refrained from ordering the university to hire new professors, he stated clearly that he had the jurisdiction to impose such a remedy and that he would be willing to do so if the university persisted in breaching its obligation under the collective agreement to reduce workloads. He held that he had this jurisdiction in spite of the absence of express language authorizing it in the collective agreement. In International Ladies' Garment Workers' Union v. Samuel Cooper and Co. Ltd. (1973), 35 D.L.R. (3d) 501, the Divisional Court confirmed the jurisdiction of Ontario arbitrators to make orders which ensure future compliance with the collective agreement, as arbitration was meant by the legislature to provide a final and binding settlement. Arbitrators have shown they are willing to grant this extraordinary form of relief where the record of the respondent shows that future breaches are likely to occur: see Canadian Union of Public Employees, Local 1712 v. Royal Crest Life Care Group Inc. (1993), 38 L.A.C. (4th) 250 (Carrier). Case Name: Laurentian University Faculty Association v. Laurentian University |
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DISPUTE OVER INSURED DISABILITY BENEFITS A MATTER BETWEEN THE EMPLOYEE AND THE INSURANCE COMPANY, ARBITRATOR RULES Sandra Clark, an instructor at Northwest Community College, became ill in December 2002. She made a claim for short-term disability (STD) benefits, but it was denied by Maritime Life Assurance Company, the private insurance carrier retained by the College to provide the disability benefits specified in the collective agreement (in December 2004, Manufacturers Life Insurance Company assumed the policy). The insurer informed Clark that, while she was totally disabled from November 8 to December 6, 2002, that period was within the 30-day waiting period for benefits, and that she was not totally disabled after December 6. The support of two doctors did not persuade the insurance company to change its mind. Clark filed a grievance on March 10, 2003, based on Article 9.3.2 of the collective agreement, which stated "that the College is to provide its employees with disability benefits." She sought full STD benefits for the period from December 6, 2002 to January 8, 2003, and 90 percent benefits for the period when she performed some part-time work, from January 8 to March 31, 2003 or to such date as her doctor advised her to return to work full-time. The Arguments: The union argued that the collective agreement required the College to specifically provide certain benefits, and the College's obligation was not changed by the involvement of a private insurance carrier. In the union's submission, the specific STD plan was incorporated into the agreement directly, or by reference, which meant that the College was liable for payment of the benefits. The College responded that its obligation ended with the payment of premiums and making available an STD plan, administered by a private carrier. It argued that, while Clark was unsuccessful in getting benefits from the private carrier, the College had no obligation under the collective agreement to provide her with benefits. The collective agreement provided only for the payment of premiums by the employer, and therefore the grievance was not arbitrable. As a result, the College contended that Clark must challenge the insurance carrier's decision in the courts. The Decision: Arbitrator John Steeves dismissed the grievance, agreeing with the College's objection that the dispute over eligibility for benefits was not arbitrable, and that Clark should seek her remedy directly from the insurance carrier in the courts. Steeves noted the dilemma presented by cases such as this. On the one hand, if the plan was characterized as forming part of the collective agreement, then it would be arbitrable, and the employer would have the "primary obligation" to pay the negotiated benefits, as was held in United Food and Commercial Workers Union, Local 1518 v. Wilpark Foods Ltd. (1991), 21 L.A.C. (4th) 441 by Arbitrator H.G. Ladner. On the other hand, as Steeves noted, "[i]f a plan is not part of the agreement then an employee, as a beneficiary of the plan, is left with seeking a remedy through litigation in the courts. The carrier of the plan would typically be the defendant and the employer would have minimal, if any, involvement." Reference was made to Arbitrator Ken Swan's formulation of the problem in Commercial Workers International Union v. Coca-Cola Bottling Ltd. (1994), 44 L.A.C. (4th) 151: "[T]he question in all of these cases is whether the employee is left to his or her rights in the courts against an insurance company under an insurance plan, or whether the employee may require the employer to pay the benefits directly, and pursue its own rights against the insurer." In making these decisions, Steeves noted that "it is well established that the presence of an insurer or private carrier alone, or the fact that a claim has been denied by an insurer, is not determinative of my jurisdiction over this grievance": see United Food and Commercial Workers Union, Local 1518 v. Canada Safeway Ltd. (1998), 44 C.L.R.B. (2d) 121 (BCLRB). Steeves referred to four categories, identified by Brown and Beatty in their text on arbitration, which assist in determining whether a benefit plan forms part of the collective agreement: (1) if the plan or policy is not mentioned in the collective agreement, the dispute about the plan is not arbitrable; (2) if the agreement specifically provides for certain benefits, the dispute is arbitrable; (3) if the agreement only provides that the employer pays premiums for the plan, the dispute is not arbitrable; and (4) if specific plans or policies are incorporated by reference into the agreement, the dispute is arbitrable. In British Columbia, the Canada Safeway award, cited above, further stated that "finding an employer liable for disability benefits, where the obligation does not arise either expressly or impliedly under the agreement, effectively alters the nature of the bargain between the parties. Arbitrators lack statutory authority to amend provisions of a collective agreement." Considering all of the above, Steeves had to decide whether categories two, three or four applied to the grievance. Neither party relied on category one. He found that the parties clearly intended to have a plan for short-term disability, which was reflected in Article 9.3 of the collective agreement. While the parties turned their minds to the plan, Steeves found it significant that they had not made the plan a part of the collective agreement; rather, he concluded it was a separate document. Pointing out that the agreement made only prospective reference to a benefits scheme to be "set out," that "will be an insured plan," Steeves held: "I cannot find that this language goes as far as the statement in the grievance that the employer has a contractual obligation to pay benefits." Steeves observed that there were important similarities between the provision in this case and the one in the Coca-Cola Bottling award, cited above, in which Arbitrator Swan held that the employer's obligation did not go beyond paying premiums. He noted the language of the collective agreement in this case that the plan "will include" certain elements, and concluded: "[I]t can be fairly stated that this detail is an 'outline of the kind' of benefits that the employer is required to provide rather than a description of the benefits the employer is required to pay." In short, the description of the plan's features did not "incorporate" the plan into the agreement. As stated in Canada Safeway, "[t]he fact that benefits are identified in the collective agreement does not give rise inferentially to a right in employees to hold the employer accountable under the grievance and arbitration provisions of the agreement for the payment of benefits as opposed to the payment of premiums." Steeves concluded that the parties had made an agreement that fit most comfortably into category three: the employer was required only to pay premiums for the plan. The prospective voice in the agreement indicated that "the plan itself was a future event. This ... supports a finding that there should be a separation between the plan and the collective agreement. All of this is consistent with an intention by the parties to put into effect a plan that is outlined.... It will be an insured plan and the Employer will pay the premiums.... But I cannot find that the collective agreement specifically provides for certain benefits as described in the second category...." Steeves also disposed of category four, finding that the plan had not been incorporated by reference into the agreement. The union cited Arbitrator Christie's decision in Coca-Cola Bottling Ltd. v. Retail, Wholesale, and Department Store Union, Local 1065 (1998), 76 L.A.C. (4th) 105 (to be distinguished from the Swan award), in which the collective agreement used prospective language to state that the employees "will" receive benefits in accordance with a group insurance plan. Arbitrator Christie held that a "natural reading" of the language took the reader directly to the disability provisions of the group plan, and that "without reference to these provisions, which are specifically referred to in [the provision], that paragraph has no meaning." Christie held that the plan was incorporated by reference into the agreement and that disputes were therefore arbitrable, and the union argued that the same was true in this case. Steeves disagreed: "I am unable to agree with the union's submission that the plan in this case has been incorporated by reference into the collective agreement. I note the statement in Nova Scotia Government and General Employees Association v. Nova Scotia Civil Service Commission (1980), 24 L.A.C. (2d) 319] that 'the mere acknowledgement in the primary document that another document exists or may come into existence does not constitute incorporation by reference.' It seems to me that the reference to an "insured plan" in Article 9.3.2. is an acknowledgement of that plan rather [than] its incorporation into the agreement." Finally, Steeves noted that his lack of jurisdiction to determine eligibility for benefits "does not foreclose the right of the union to grieve all issues relating to short-term disability." As the elements of the plan were negotiated, he held that a dispute over whether the employer was paying premiums as it agreed to do would be arbitrable. In conclusion, Steeves held: "[T]he dispute raised by the grievance in this case relates to a decision of a private carrier about eligibility under the plan. This is not a dispute about one of the elements of the plan as described in Article 9.3 and the employer is not responsible for payment of benefits, provided the plan is consistent with the elements set out in the collective agreement.... [T]he essential character of this dispute is one between the carrier who administers the plan [and the grievor], rather than between the employer and the grievor and I am unable to find that the dispute is one that expressly or inherently arises from the collective agreement." Comment: The "four categories" approach has gained wide acceptance among arbitrators, but they are only a guideline. As Arbitrator Swan noted in Coca-Cola Bottling Ltd., cited above, while the categories may be of assistance, the determining factor is the intention of the parties – did they intend the employer to be liable for the payment of benefits, regardless of the existence of an insurance plan, or could the employer meet its obligation simply by paying premiums? Swan also noted that "it is unlikely that the employer would willingly place itself in a position of both paying premiums to an insurer to have these benefits provided, while taking on primary liability for the payment of the benefits in any case." Arbitrator Steeves' holding is consistent with that of the British Columbia Court of Appeal in United Steelworkers of America, Local 9346 v. Elkview Coal Corp. (2001), 205 D.L.R. (4th) 80, in which the court found that the employer's only obligation was to pay premiums for an insurance policy, the scope of which was subject to the collective agreement. Any dispute as to the legality of the plan, the court held, was exclusively between the union and the insurer, and the matter was not arbitrable. By contrast, where an employer itself paid disability benefits under a self-insured plan, pursuant to the collective agreement, but contracted out the administration of the plan to a third-party insurer, courts have held that disputes over benefits are within the sole jurisdiction of an arbitrator: see the British Columbia Court of Appeal's decision in Ali v. Manufacturers Life Insurance Co., [2005] B.C.J. No. 1187 (QL) (see Lancaster's Labour Arbitration E-bulletin, Issue No. 45), and the Ontario Superior Court's decision in Duke v. Toronto District School Board, [2006] O.J. No. 1983 (QL) (see Lancaster's Education Employment Law News, July/August 2006). For more on third-party insured benefit plans and the employer's liability for benefits, see section 3.9 of Mitchnick and Etherington's Leading Cases on Labour Arbitration, published by Lancaster House (online edition). Case Name: British Columbia Government and Service Employees' Union, Local 712 v. Northwest Community College |
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