Article 4, clause 1, of the collective agreement between the Company and the Union reads as follows:

A dispute having risen because of the failure of the parties to reach agreement with respect to changes in methods of operation resulting from the introduction by the Company of reperforating switching equipment, the parties agreed to refer the dispute to an arbitrator appointed by the Minister of Labour of Canada for final and binding decision. By letter dated December 17th, 1957, the Minister appointed me the arbitrator.

My terms of reference, recommended by the Minister and accepted by the parties are as follows:

The parties presented their evidence and argument to me at hearings in Montreal on February 18th and 19th, 1958. On February 19th, accompanied by representatives of the parties, I attended at the Company’s offices in Montreal to view the operation performed by the automatic operators. On March 4th I visited the Company’s offices in Winnipeg, with representatives of the parties and viewed both the reperforator switching operation and the operation of the automatic operators.

The change in the method of operation effected by the introduction of reperforating switching equipment substitutes a mechanized operation for the manual operation hitherto performed by automatic operators. It affects the handling of relay message traffic only: messages which are not relayed to other offices, that is, terminal traffic, continue to be handled by automatic operators as in the past. Reperforating switching equipment has now been installed and is in operation at the Company’s offices in the following relay centres: Moncton Winnipeg and Vancouver. It is anticipated that it will be installed in Montreal in the course of this year. The Montreal equipment will involve a push-button operation installed in the other three relay centres.

The Company submits that employees operating reperforating switching equipment should not be included in the automatic operator rate of pay but that they should be given the new and separate classification of "reperforating switching operator" at a rate of pay below the automatic operator rate. It bases its case on the ground that the qualifications, training, skills and responsibilities required of an employee operating reperforating switching equipment are below those of an automatic operator, and submits that such criteria have for many years been accepted as a basis for determining differentials in wage rates. It points to the wage differential in favour of automatic operators under the collective agreement at Western Union.

The Company submits that the proposed rates of pay for reperforator switching operators are to apply to new employees in this classification. For the protection of existing employees, it "is prepared to maintain the Automatic Operator rate, on an incumbency basis for Automatic Operators employed as such in the classification at the office affected the day before the cut over who elected to transfer to reperforator switching work."

The Union submits that employees operating reperforating switching equipment should be included in the automatic operator classification at the automatic operator rate of pay on the grounds, inter alia, that agreement to this effect has been reached with respect to the operators employed by Canadian Pacific Telegraphs; that the work of the reperforator switching operator is not easier than that of the automatic operator, that it involves considerable responsibility and physically very tiring; and, that the Company is benefiting from substantial savings in costs as a result of the introduction of the more productive equipment and the employees should share such benefits through the maintenance of the Automatic operator rate of pay for the new operation.

Having considered the representations of both parties and the evidence of the witnesses and having viewed the operations performed by the automatic operator and by the operator of the reperforator switching equipment, I find that, while both groups of operators are engaged in the transfer of telegraph message traffic, the two operations are different; that the reperforator switching operation is considerably simpler, involves less tension, and requires less skill than the manual operation performed by the automatic operator; and, that the duties and responsibilities of the automatic operator are necessarily greater than those of the reperforator switching operator.

On the facts of the case my finding is, therefore, that, in relation to the manual operation, the change in method of operation resulting from the introduction of reperforating switching equipment is a change to a different and simpler operation with lessened duties and responsibilities on the part of the operator.

The possibility of changes in methods of operation and of new rates of pay for the employees affected was foreseen by the parties and they made provision therefore, in Article 4, Clause 1, of their collective agreement, reproduced above. The new rates would presumably be higher or lower than the rates for the existing operation depending upon the nature of the change.

The collective agreement also expresses the intention of the parties to relate wage differentials to differentials in duties and responsibilities. Article 14, Clause 4, reads as follows:

Considering my findings on the facts of the case and considering the foregoing provisions of the collective agreement, I find that employees engaged as operators of reperforating switching equipment should be given a new classification separate from the automatic operator classification at a rate of pay below the automatic operator rate, and I so award.

I have reached this decision after due consideration of the evidence submitted by the Union which shows that in the case of Canadian Pacific Telegraphs an understanding has apparently been reached under which teleprinter operators and reperforator switching operators will be interchangeable and the reperforator switching operation, when it is introduced, will be performed by teleprinter operators at rates of pay applicable to this group. My findings and award must, however, be based on the facts of the case before me and on the governing collective agreement.

I have also taken cognizance of the Union’s submission that the employees are entitled to share in the benefits resulting from the introduction of technological improvements. With this I agree. It does not follow, however, that the employees share should be allocated to the particular group whose operation is directly affected by the technological change. To allocate it on this basis, which is suggested in the Union’s brief, would have the effect of depriving the mass of employees of their opportunity to share in the benefits from increased productivity through general wage increases and improvements in working conditions.

Having found that employees operating reperforating switching equipment should be given a new classification separate from the automatic operator classification and at a lower rate of pay, I am required by my terms of reference to determine the rate of pay.

The automatic operator’s basic rate is as follows:

The Company proposes the following rate for reperforating or switching operators:

The proposed rate is slightly higher than the rate for telephone operators. Having viewed the respective operations of telephone operators and reperforator switching operators, and having examined the rates for other classifications, I find that a somewhat higher rate than that which is proposed is warranted for the new classification. Accordingly, I order and award the following rate of pay for the reperforator switching operator classification, subject to the protection proposed by the Company for existing employees:

Dated at the City of Montreal this 28th day of March, 1958.

Arbitrator