AH – 21




(the "Company")



(The "Brotherhood")




SOLE ARBITRATOR: Judge R. H. Reville


There appeared on behalf of the Company:

H. Abbott – Assistant Manager, Labour relations

P.A. McDiarmid – Labour Relations Assistant

W. S. Hodges – Labour Relations Assistant

T. H.Holmes – Comptroller, Purchasing and Stores Accounting Centre


And on behalf of the Union:

R. Henham

Paul Emile Jutras



A hearing in this matter was held at Toronto on 13th November 1964.




On Friday, the 13th November, 1964, at 10.00 a.m., I presided as Sole Arbitrator to consider two grievances brought by Mr. M.L. Recchi and Mr. J.G. Walker, respectively, and at the hearing, which took place in the Union Station, Toronto, there appeared for the company Mr. H.Abbott, Assistant Manager, Labour relations, Mr. P.A. Mcdiarmid, Labour Relations Assistant, Mr. W.S. Hodges, Labour Relations Assistant, and Mr. T.H.Holmes, Comptroller, Purchasing and Stores Accounting Centre, and for the union Mr. R. Henham and Mr. Paul Emile Jutras. I now propose to dispose of the grievances as follows:

Grievance NO. 2 – re J. G. WALKER

The brotherhood is contending on behalf of the grievor, Mr. Gordon Walker, that the company acted without cause when it demoted him for alleged unsatisfactory work performance in his job of invoice checker, Purchasing and Stores Accounting Centre, Montreal, on the 24th of July, 1963.

The circumstances leading up to this grievance are as follows:

The grievor was first employed by the company as an office boy in the Stores Department at Montreal on December 7th, 1959, and was subsequently assigned the position of invoice checker on October 6th, 1961. As an invoice checker, the grievor was required to check and complete invoices for purchases by the company, and his duties consisted of processing invoices in Class 11 (nuts, bolts, screws), class 15 (steel plates and bars) and Class 36 (a), (b) and (c) - (miscellaneous; for example, furniture, moving expenses, fire extinguishers). Originally, the grievor checked and processed only classes 11 and 15, but he was assigned class 36 in January of 1963 on his own request because he required more invoices to process in order to get his production up to a standard of fifty per day. This standard had been established as a special target of production by company officers of the Invoice Approval Section of the Purchasing and Stores Accounting Centre established in January of 1959. In May of 1963, the invoice production targets were revised as more experience was gained in the new Accounting Centre function, as company officers appreciated that invoices from some supplier firms and for certain classes of material were more complex than others and required more time to process, and consequently that reviewed the production quota of invoices for each invoice checker on this basis. The revised quotas ranged from 75 invoices per day down to 45 invoices per day, and Mr. Walker’s assignment continued with a production standard of 50 invoices per day. This daily quota was an average based on production per month, and the quota system so instituted was not an incentive scheme, but only a gauge to measure a reasonable production per day per invoice checker.

In the year 1964 the brotherhood made representations to the company to abolish the form of quota system in the belief that higher production could be achieved thereby. The brotherhood General Chairman, P. Jutras, contended that employees would be inclined to restrict output to the established quotas. To test this theory, the company agreed to cease the official quota system in June, 1964, and did so, but had, of necessity, to continue to keep records to assure that acceptable standards were being met. Evidence establishes that up to the present time, there has been no notable increase or decrease in the production figures as the result of the abolition by the company of the official quota system, which continues to average between 45 invoices per day and 75 invoices per day.

The production record of the grievor, filed as Exhibit 5 to the company’s brief, which was not disputed by the brotherhood, indicates that over the period October 26th, 1961, to July, 1963, both dates inclusive, his daily average production on a monthly basis ranged from a minimum of 25 invoices processed per day during the month of December, 1969, to a maximum number of invoices per day of 46 in the months of September and October, 1962. It will be seen, therefore, that the grievor never did equal the production standard set for him of 50 invoices per day. The grievor’s employment record as an invoice checker, which again was not disputed by the brotherhood, shows he received periodic warnings about his failure to meet production quotas. Thus, on December 19th. 1961, the grievor was given a written warning about his low production, with an offer by the supervisors to discuss methods to assist him in his work. It will be recalled that this was the month when his production record was at its lowest. Some improvement was noted immediately thereafter, in that his production rose from 25 invoices processed per day in the month of December, 1961, to 30 invoices processed per day in January of 1962, but in as much as it was still far below his production quota, a meeting of management and union representatives, with Mr. Walker in attendance, was held on February 5th, 1961, to consider his production problem. The company proposed taking the grievor off the job, but upon the request of the brotherhood, it agreed to grant a further trial period of two weeks. After this meeting, the grievor’s production record again improved somewhat, in that he achieved a production record of 36 invoices processed per day in the month of February, 1962, and a further improvement was noticed the following month when he increased his production record to 39 invoices processed per day. However, in April of 1962 his production decreased to 33 invoices processed per day and he received a further verbal warning about his production. The grievor than improved his production record by processing 40 invoices per day in the month of May, 43 in the month of June, 42 in the month of July, 45 in the month of August, 46 in the month of September and 46 in the month of October, being his highest rate of production during his entire career as invoice checker. However, in November of 1962 his production fell to 40 invoices per day and, as a result, the company issued a written warning to the grievor on the 4th of December, 1962, in reference to his fallen production in November of 1962. This warning was contained in a letter to the grievor from V. Hopwood-Jones, Supervisor, Invoice Approval Section, filed as Exhibit 6 to the company brief, which reads as follows:

I have, on several occasions, warned you that your work performance was not satisfactory. In reviewing your work performance during the last month, I find that instead of improvement your work performance has deteriorated. I do not feel that you are doing the work you are capable of doing. On previous occasions when you have been warned of your poor performance you have made a temporary effort to improve, then fallen right back to a continued poor performance. You do not seem to be doing anything to help yourself, as an example of this. Your frequent lates.

This will serve as your final warning that if you do not improve your work performance in the present month and continue to maintain a satisfactory performance, I have no alternative but to recommend that you be removed from your present position of Invoice Checker.

As I have informed you on previous occasions, if there is any assistance that you require from me, I shall be only too willing to help.

Please be guided accordingly.

It will be noted that the letter states that this warning is a final warning and advises the grievor that if he does not improve his work performance in the month of the letter, and continue to maintain a satisfactory performance, it will be recommended that he be removed from his position of invoice checker. Once again, the grievor improved his production record so that he processed 45 invoices per day in the month of December, 1962, but his production immediately fell off and continued to fall off in the ensuing months of January, February, March and April of 1963, sprinted ahead slightly in May of 1963 and fell off materially in June of 1963. On June 10th, the company again wrote to the grievor, pointing out that his production was still below the acceptable standard of 50 invoices per day. No doubt, due to the grievors material retrogression insofar as production was concerned in the month of June, 1963, the company sent a letter to the grievor dated the 5th of July, 1963, advising him that a formal investigation would be held to inquire into a charge of unsatisfactory work performance. The hearing was held on July 9th, and as a result the grievor was removed from his position of invoice checker as of the 24th of July, 1963. for unsatisfactory work performance, and he was demoted to the position of stores labourer in the Stores Department at Montreal at a lesser rate of pay. It was this action by the company which gave rise to this grievance.

The brotherhood contends that the company violated Article 24.2 of the collective agreement in that its notice to the grievor that a formal investigation would be held to inquire into a charge of unsatisfactory work performance was defective because it did not contain the modifying expression ‘alleged ‘, in connection with the charge of unsatisfactory work performance, and it did not contain detailed and specific charges against him in this connection.

Dealing with this contention, Article 24.2 reads in part as follows:

Investigations in connection with alleged irregularities will be held as quickly as possible. An employee may be held out of service for investigation (not exceeding three (3) working days). He will be given at least one (1) day’s notice of the investigation and notified of the charges against him.

It will be seen that there is no specification in this article concerning the form of the notice of the investigation required to be given to the grievor, nor of the details which must be included in the notice, other than that he must be notified of the charges against him. In the instant case, the charge against the grievor was unsatisfactory work performance. The whole object of this article is to prevent an employee being summoned for an investigation without knowing what the investigation is about and what charges are to be met. In the instant case, the record discloses that on five separate occasions the grievor had been warned about his low production and his failure to meet production standards, and consequently, when he received the notice dated the 5th of July, 1963, advising him that an investigation was going to be held to inquire into a charge of unsatisfactory work performance on his part, he could have been in no doubt whatsoever as to what charges he had to meet. He knew as far back as December 19th, 1961, that he had failed to meet the production standards set by the company and he knew that he had never achieved the production standard set by the company at any time since his appointment to the position of invoice checker. Consequently, while it might have been preferable, as a matter of form, for the company to have given more details in its notice dated the 5th of July, 1963, it cannot be held that the notice was defective because it did not contain such details in the light of all the evidence. In any event, the grievance before the arbitrator is that the grievor was unjustly demoted, not that the discipline and grievance procedure was incorrectly followed, and consequently, while the brotherhood’s contention might form the subject matter of another grievance, it cannot enter into this grievance. The brotherhood’s main contention contained in its brief is that the company did not have the right to set the grievor’s production standard at 50 invoices per day, consequently his failure to meet such a production standard did not constitute just cause to demote him, and the brotherhood cites the provisions of Article 4.4 as supporting this contention. This article reads as follows:

Where it has been the practice for monthly rated employees to work less than eight (8) hours per day, that practice shall be continued unless changes on account of conditions beyond the control of the Company. Should conditions occasionally demand, employees working such reduced hours may be required to work eight (8) hours per day and overtime will not accrue until after eight (8) hours’ service has been performed. To take care of regular requirements such employees may be required to work extra hours on certain days and overtime shall only accrue after eight (8) hours ‘service has been performed.

To understand the provisions of this article, it is necessary to refer to Article 4.1, which provides:

Except as otherwise provided in Article 4.2, 4.3, and 4.5 and in the Wage Scale, eight (8) consecutive hours of service, exclusive of the meal period, shall constitute a day’s work.

The grievor’s assignment, of course, comes within the provisions of Article 4.4 because in his position he was required to work seven and one-half hours per day, not eight hours per day as set forth in Article 4.1. The brotherhood in its brief argues that Article 4.4 merely sets the maximum number of hours which an employee must work in a given day and does not authorize the employer to establish the amount of work which the employee must perform during the working day. This contention is, of course, correct because it is clear that Article 4 is merely concerned with establishing the length of the working day and has no application whatsoever to the quantum of work which an employee may be required by the company to perform during that working day.

A careful perusal of the collective agreement between the parties reveals no limitation whatsoever on the company’s right to set the work load for its employees nor to set production standards and, indeed, these prerogatives have always been held to rest exclusively with management unless there is some specific limitation to the contrary in the collective agreement. Thus, in the case of UAW vs DeHavilland Limited, 7 L.A.C. 31, the Arbitrator Board upheld a company’s right to introduce new and improved production methods, even though the work load of employees was increased thereby. Similarly, in the case of the International Brotherhood of Operative Potteries and Americain Standard Products Limited, 8 L.A.C. 247, another Arbitration Board held that it was an exclusive right of management to set the work load for its employees. If management, in the exercise of this prerogative, was guilty of discriminating against an individual employee vis-à-vis other employees, then, of course, such discrimination might form the subject matter of a grievance. In the instant case, there is not the slightest evidence that the company discriminated against this particular grievor in setting his production standard at 50 invoices per day, but, on the contrary, there is ample evidence that other employees were able to achieve the same and higher production standards. Indeed, Exhibit 7 attached to the company’s brief, which was not disputed by the union, indicates that a Mr. Arseneau, who was assigned to fill the position from which the grievor was demoted, achieved an initial production standard of 25 invoices per day in the month of August, 1963, and rapidly improved this to 41 in the month of September, 1963, and surpassed the production quota by achieving 51 in October and 53 in November of 1963. Mr. Arseneau then vacated this job, and the work previously done by the grievor and subsequently by Mr. Arseneau was done by various invoice checkers during regular hours and overtime, but in April of 1964, Mr. Gangin was permanently assigned to the job and achieved an initial production standard of 47 invoices per day in the month of April, 1964, and up to the end of September, 1964, he never fell below 50 invoices per day and achieved a maximum of 53 invoices per day in the month of September, 1964. On the evidence, it is obvious that it cannot be found that the company discriminated against the grievor in setting his production standard at 50 invoices per day.

It is only fair to state that, despite the contentions in the union’s formal brief, Mr. Jutras conceded in his summation that the brotherhood was not challenging the company’s right to set production standards, but was merely contending that, despite the warnings which the company gave to the grievor, it left him in the job and consequently it must be implied that the company was not sure of the fairness of its production standard which it had set for the grievor, and therefore the Arbitrator should come to the conclusion that the production set for the grievor was not fair. The mere fact that this company obviously bent over backwards to be fair to this grievor and give him every conceivable opportunity to improve his work performance, can surely not be interpreted in the matter suggested by the brotherhood. This company had the right to set production standards for its employees, including this grievor, and the evidence is overwhelming that the production standard which it set for this grievor was not unreasonable, and is equally overwhelming that the grievor, despite repeated offers to assist him to meet production standards and repeated warnings for his failure to do so, never did meet the production standard imposed by the company.

The Arbitrator, therefore, has no hesitation whatsoever in finding the grievor guilty of an entirely unsatisfactory work performance over a very long period of time, and that the company had every justification in removing the grievor from his position as invoice checker and demoting him to a lower rated job.

One further point remains to be considered. At first blush, it is difficult to understand the brotherhood’s insistence in supporting the grievance in the light of all of the facts. However, this becomes understandable in the light of certain negotiations which took place in September of 1964 between the brotherhood and the company during the grievance procedure in an attempt to find a solution to the grievance. The brotherhood requested the company to give the grievor another chance in his job as invoice checker, and the company agreed to do so under certain conditions. These conditions were that the grievor would remain frozen as an invoice checker for one year; that he would be expected to meet the production requirements of his job, observe proper office discipline and improve his attendance and starting time record, and if he failed to measure up to these conditions, such would be considered as just cause to discharge him without reference to the grievance procedure. It was suggested by the company that an officer of the union agreed to this solution on these terms, but the grievor refused to accept reinstatement on these terms and conditions, and subsequently the brotherhood as a whole rejected the proferred solution. It is quite understandable under the circumstances why the company suggested this rather drastic proposal for settlement of the grievance in the light of the union’s request, and it is equally understandable why the union as a whole felt it was unable to accept the solution, and why it felt it must support and pursue Mr. Walker’s grievance to arbitration. Nevertheless the company’s suggested method of settling this grievance short of arbitration can have no bearing on the grievance before the Arbitrator, and can in no way affect his decision that the company was justified in demoting this grievor.

This grievance, therefore, will have to be dismissed.

Dated at the city of Brantford, Ontario, this 27th day of November, A.D. 1964

R. H. Reville

Sole Arbitrator