AD HOC 257

AWARD

DISPUTE:

Failure to reach agreement on measures to minimize adverse effects on employees in Winnipeg affected by the Company notice dated 3 March, 1988 to introduce the Hump Hard Improvement Project at Symington Yard in Winnipeg.

JOINT STATEMENT OF ISSUE:

On 3 March 1988, the Company served notice pursuant to Article 139 of Agreement 4.3 to introduce the Hump Yard Improvement Project at Symington Yard in Winnipeg. Negotiations with the Union resulted in a tentative Agreement being signed January 24, 1989 on measures to minimize adverse effects on employees pursuant to the provisions of Article 139.1 (a) of the Agreement. However, the employees represented by the United Transportation Union in Winnipeg failed to ratify the Agreement.

The following issues are therefore submitted to the Arbitrator in accordance with Article 139.1(d) of Agreement 4.3.

COMPANY ISSUE:

1) Crew Consist

UNION ISSUES:

1) Via Formula

2) Health and Welfare Benefits

3) Retirements credits

4) The Ripple Effect

5) Articles 82 and 83

6) Crew Consist

7) Increased rate of pay

8) Define zones and limits for hump engine and crew

9) Lunch time

10) Hours on duty

11) Penalty provision for violation of agreement

12) Use of Company Officers

13) Protection date through attrition

14) Provide for a final and binding procedure to the consultation process in regards to the working conditions on the hump.

I. HISTORY OF THE DISPUTE

This arbitration is in the nature of an interest dispute, whereby the arbitrator is required to establish the terms and conditions to apply to a group of employees adversely affected by a material change in working conditions, as contemplated under article 139 of collective agreement 4.3 which governs the parties in respect of the services of trainmen and yardmen on the prairie and mountain regions. As noted in the Joint Statement of Issue, the employees affected are employed in yard service at Symington Yard, a major rail switching facility operated by the Company at Winnipeg.

On March 3, 1988 the Company served notice upon the Union, pursuant to article 139 of agreement 4.3, of its intention to introduce the Hump Yard Improvement Project (H.Y.I.P.) at the Symington Yard. The notice informed the Union of the impending abolition of eight car retarder operator positions as well as eight yard foremen positions. It is common ground that an earlier notice had been served upon the Union on 30 December 1983, culminating in a Memorandum of Agreement between the parties dated August 10, 1984 which, ultimately was not ratified by the Union membership. Before that matter could mature for the purposes of any further proceedings under article 139 the Company eventually reassessed the H.Y.I.P. project, deciding to change its original plans in respect of the automation of its Hump Yard at Symington. While it is unnecessary to dwell on the detail of that evolution, it appears to be common ground that the Company decided to introduce a somewhat less sophisticated system than was originally planned. The Union was kept aware of this change in the Company’s [plans] and, ultimately, the material change notice of March 3, 1988 issued.

It is useful at this point to reproduce article 139 which governs the respective rights of the parties when the Company initiates a material change in working conditions which adversely affects employees:

ARTICLE 139

Material Changes in Working Conditions

139.1 The Company will not initiate any material change in working conditions which will have materially adverse effects on employees without giving as much advance notice as possible to the General Chairman concerned, along with a full description thereof and with appropriate details as to the contemplated effects upon the employees concerned. No material change will be made until agreement is reached or a decision has been rendered in accordance with the provisions of this paragraph 139.1.

(a) The Company win negotiate with the Union measures other than the benefits covered by paragraphs 139.2 and 139.3 to minimize such adverse effect of the material change on employees who are affected thereby. Such measures shall not include changes in rates of pay. Relaxation in agreement provisions considered necessary for the implementation of a material change is also subject to negotiation.

(b) While not necessarily limited thereto, the measures to minimize adverse effects considered negotiable under sub-paragraph (a) of this paragraph 139.1 may include the following:

(1) Appropriate timing

(2) Appropriate phasing

(3) Hours on duty

(4) Equalization of miles

(5) Work distribution

(6) Adequate accommodation

(7) Bulletining

(8) Seniority arrangements

(9) Learning the road

(10) Eating en route

(11) Work en route

(12) Layoff Benefits

(13) Severance pay

(14) Maintenance of basic rates

(15) Constructive miles

(16) Deadheading

The foregoing list is not intended to imply that any particular item will necessarily form part of any agreement negotiated in respect of a material change in working conditions.

(c) The negotiations referred to in sub-paragraph (a) of this paragraph 139.1 shall be conducted between the regional Vice-President (or his delegate) and the General Chairman and shall commence within 20 days of the date of the notice specified in this paragraph 139.1. If the negotiations do not result in mutual agreement within 30 calendar days of their commencement, the issue, or issues, remaining in dispute shall, within 7 days of the cessation of negotiations, be referred to the Assistant Vice-President, Labour Relations, of the Company and the Vice-President of the Union for mediation by a Board of Review composed of two senior officers from each party. Such referral shall be accompanied by a Joint Statement of Issue, or Issues, remaining in dispute together with a copy of the notices served by the Company on the Union under this paragraph 139.1 and a summary of the items agreed upon.

In the event neither party desires to submit the issue, or issues, remaining in dispute to a Board of Review the dispute shall be referred to the Arbitrator as provided in sub-paragraph (d) of this paragraph 139.1.

(d) The Board of Review shall, within 20 days from the date of reference of the dispute, make its findings and recommendations. If the Board is unable to arrive at a decision within the time limits specified herein or such extended time limits as provided for in sub-paragraph (e) of this paragraph 139.1, or if its recommendations are not agreeable to either party, a Joint Statement of Issue, or Issues, remaining in dispute may be referred within 7 days by either party to a single arbitrator who shall be the person from time to time occupying the position of Arbitrator for the Canadian Railway Office of Arbitration.

In the event that the parties do not agree upon a Joint Statement of Issue, or Issues, remaining in dispute, either or each may submit a separate statement to the Arbitrator in accordance with the procedure outlined above for the Joint Statement and the other party will be provided with a copy thereof.

The Arbitrator shall hear the dispute within 30 days from date of the request for arbitration and shall render his decision together with reasons therefor in writing within 15 days of the completion of the hearing.

At the hearing before the Arbitrator, argument may be presented orally or in writing and each party may call such witnesses as it deems necessary.

(e) Time limits specified in sub-paragraphs(c) and (d) of this paragraph 139.1 may be extended by mutual agreement, or upon request of the Arbitrator, in respect of time limits specified for the hearing and the rendering of the decision.

(f) The decision of the Arbitrator shall be confined to the issue or issues placed before him which shall be limited to for minimizing the adverse effects of the material change upon employees who are affected thereby, and to the relaxation in agreement provisions considered necessary for the implementation of the material change, and shall be final and binding upon the parties concerned.

(emphasis added)

Negotiations between the parties began in April of 1988 in an effort to reach agreement on the measures to minimize the adverse effects on employees resulting from the material change in working conditions at Symington. The notice to the Union and the ensuing process of negotiation was prompted by the introduction of a computerized Process Control System (PCS) at Symington Hump Yard. Whereas the assembly and dis-assembly of train consists at the Yard used to require a two-person crew consist of one yard foreman and one car retarder operator, working in tandem with a locomotive Engineer, the automated PC system allows one person, working with the assistance of a computer and occupying the newly-designated classification of Hump Foreman, to work alone, along with the locomotive engineer, to perform the functions previously accomplished by two yard employees. Although it is not material to this dispute, it is common ground that eventually, with the introduction of fully automated locomotives in the Hump Yard, it is contemplated that the Hump Foreman will perform the function of all three employees, controlling the movements of the locomotive by means of a portable remote control mechanism.

Following the notice of March 3, 1988, extensive negotiations took place between the parties. These finally broke down on November 4, 1988, at which time the issues remaining in dispute were referred to a Board of Review. The Board of Review, composed of two members of management and two union representatives heard submissions from both parties. On December 6, 1989 the Board of Review made a number of recommendations which were accepted by the two negotiating committees and incorporated into a Memorandum of Settlement dated January 24, 1989. It does not appear disputed that the memorandum of agreement reached between the parties contained some improvements exceeding the recommendations of the Board of Review. On February 8, 1989 a ratification vote was conducted among the membership of the Union’s local at Symington. It appears that, depending on the number of active employees, between 150 and 175 members were eligible to vote. Of the 99 who attended the ratification meeting 75 cast votes, 69 of which were in favour of rejecting the Memorandum of Settlement. By means of a joint letter to the arbitrator from the parties dated February 16, 1989 the dispute came on for arbitration in accordance with the provisions of article 139 of the collective agreement.

11. JURISDICTIONAL ISSUES

Several issues arise with respect to the arbitrator’s jurisdiction in this matter. The Company takes a restrictive view of what may be dealt with under the terms of article 139 of the collective agreement, maintaining that a number of the demands tabled by the Union are outside the purview of that article and, therefore, not within the arbitrator’s jurisdiction to award. The Company’s representative stresses that under the terms of article 139.1(a) the parties may deal with issues other than benefits covered by paragraphs 139.2 and 139.3 which are relocation expenses and early retirement allowance, respectively. He also notes that changes in rates of pay are likewise not to be addressed. On that basis it is the Company’s position that the arbitrator has no jurisdiction to deal with a number of the requests made by the Union including those in respect of early retirement separation allowances, health and welfare benefits and the wage rate to apply to the newly established classification of Hump Foreman.

A further issue of a jurisdictional nature is raised by one of the positions taken by the Union. It submits that the Company is without authority to establish any crew consist for yard service which does not include the positions of Yard Foreman and Yard Helpers, which positions it maintains are established by the terms of articles 82 and 83 of the collective agreement. The Company’s representative maintains that the application of articles 82 and 83 of the collective agreement is a matter for grievance arbitration and not for proceedings under article 139 of the collective agreement.

I deal firstly with the objection with respect to the application of articles 82 and 83. Article 82.1 is as follows:

ARTICLE 82

Consist of Crews - Yard Service

82.1 A yard crew shall consist of not less than a Yard Foreman and two Yard Helpers, except as provided in article 83 or where special arrangements are made by the appropriate officer of the Company and the General Committee.

The pertinent provisions of article 83 are the following:

ARTICLE 83

Consist of Crews - Yard Service

83.1 The provisions of this article shall modify article 82 as it applies to yard service crews whether manned by yardmen or roadmen, and shall supersede any agreement provision in conflict therewith.

83.2 The Company shall notify the General Chairman and the Local Chairman of the Union in writing of its desire to meet with respect to reaching agreement on a reduced consist of one Yard Foreman and one Yard Helper for crews in any class of yard or transfer service. The time and place for the Company and the Union representatives to meet shall be agreed upon within 15 calendar days from the date of such notice and the parties shall meet within 21 calendar days of the date of such notice.

The foregoing provisions are clearly made in contemplation of the continuance of the positions of Yard Foreman and Yard Helpers. They do not, however, address the right of the Company to abolish those positions, or any number of them within its operations. In the Arbitrator’s view the Company’s right to abolish the positions described within articles 82 and 83 is not foreclosed by any provision of the collective agreement. Moreover, if it were accepted that the terms of article 82 are intended to establish a minimum number for crew consists, by its own terms that article 9 contemplates the making of “special arrangements” between the parties. The latter exception is clearly outside article 83 and would, in the Arbitrator’s view, absent any indication to the contrary, include exceptions either negotiated or arbitrated as a result of material changes in working conditions under article 139 of the collective agreement. For these reasons the Arbitrator cannot accept the position of the Union that articles 82 and 83 of the collective agreement stand as an impediment to the ability of the Company to abolish either Yard Foreman or Yard Helper positions or establish a one person crew consist staffed by an entirely new classification, and involving neither a Yard Foreman or Yard Helpers.

In the Arbitrator’s view the other jurisdictional objections raised by the Company can be dealt with in the terms of this Award disposing of the dispute upon its merits. I find it unnecessary to conclusively resolve the objections advanced by the Company, insofar as it remains open to the Arbitrator to, at least as an initial step, render an award which is conditional upon its acceptance by the Employer, such acceptance to be without prejudice to its jurisdictional objections. In that way the Company may become bound by an Award which deals with areas which it maintains are beyond the Arbitrator’s jurisdiction without compromising its own position with respect to the arbitrability of those matters. To these observations one additional note may be added. While the framing of a conditional Award makes it unnecessary to do so, the Arbitrator would be prepared to rule on the issue of the Company’s objection with respect to the establishing of a wage rate applicable to the classification of Hump Foreman. It is common ground that that classification has not existed in the past, and therefore no wage has attached to it. If it were necessary to resolve the issue, I would in the circumstances conclude that the establishing of an entirely new classification and wage rate relating to it does not constitute a change in wages within the contemplation of article 139 of the collective agreement. In the instant case there is no suggestion of a reduction of the wage rate applicable to the position of Yard Foreman nor to that of car retarder operator. For these reasons, I would therefore find that there is no impediment to the arbitrability of the wage rate payable to the Hump Foreman, insofar as the establishing of that position is intrinsic to the material change and its impacts on the employees affected.

III. DECISION

I turn to consider the merits of the dispute. The issues raised are of substantial importance to both parties. The ability of the Company, on the one hand, to implement technological and organizational changes to keep its enterprise efficient and safe while maximizing profitability is no less a legitimate concern than is the Union’s desire to ensure that employees adversely impacted by such changes are afforded the greatest possible protection in the face of the dislocation that is ultimately inevitable.

The complexity of the issues is itself reflected in the extensive detail of the Memorandum of Settlement and the appended Letters of Understanding which were tentatively agreed to between the parties prior to their rejection at the ratification stage. The principal agreement and its appendices are some twenty-nine pages long, in addition to a further twenty pages covering the conditions and rates of pay as well as a series of letters of understanding on a substantial number of separate headings. Those familiar with the process of collective bargaining must appreciate the extent of hard work and compromise involved in the negotiation of so far-reaching a document. In the Arbitrator’s view great care must be taken before lightly dismissing the achievement that the parties’ extensive Memorandum of Settlement represents. While it is the right of the Union’s voting membership to reject the terms recommended by their duly appointed officers, they must appreciate that both the circumstances of a tentative agreement and its rejection at ratification are factors which may be examined by a board of arbitration which is ultimately charged with resolving the dispute. It is a truism that the best settlement is always one of the parties’ own making. Adjudicated outcomes may be necessary on occasion, but they are never optimal insofar as they involve in some degree a removal from the parties of the ability to shape their own contractual duties and obligations.

In the circumstances of this case I am greatly impressed with the fact that the parties, through the process contemplated in article 139 of the collective agreement, including the efforts the Board of Review in arriving at unanimous recommendations were able to reach a tentative agreement. Should that agreement now be disturbed? In approaching that question I am satisfied that the onus should be on the party that seeks to set the agreement aside. While, as noted above, it is the Union’s right to pursue a dispute to arbitration, it is an arbitrator’s obligation to ensure that the process is not abused by a referral to arbitration that is, in effect, an attempt to explore the limits of the Company’s generosity by purporting to negotiate a tentative agreement, and thereafter throwing the matter to arbitration to see what more can be gained. The Board of Review is an important part of the process as contemplated under article 139, and, absent compelling reasons, a board of arbitration is naturally inclined to give great weight to a settlement which results from the unanimous recommendations of that joint body. It is the parties themselves, working through the Board of Review who are best able to shape the negotiated outcome that maximizes their respective interests, within the admitted limits of some inevitable compromise on both sides.

In considering whether the negotiated settlement should be disregarded, the Arbitrator is faced with few, if any, cogent reasons. Firstly, it is not surprising that the voting membership who are affected by the terms of the Memorandum of Agreement are not pleased with the prospect of the material changes in working conditions which will affect them, or with all aspects of the protections negotiated within the Memorandum of Agreement. They have not asked for these changes, and would obviously prefer that they never happen. Similarly, whatever may have been negotiated on their behalf, there will always be some among their ranks who will want more. Those facts alone, however, do not of themselves constitute persuasive grounds to totally disregard the unanimous recommendations of the Board of Review and the negotiated settlement that resulted.

Nor is the ratification vote itself overly impressive. Of a voting constituency which is estimated at a minimum, to number 150 employees, and may in fact number as many as 175, no more than 69 voted against the proposed settlement. As all members had notice of the terms of the settlement, it is not unlikely that the ratification was more heavily attended by those who had particular displeasure with the agreement tentatively reached between the Company and the Union. While it is impossible to know the thinking of those who did not attend, it is not unfair to conclude that they were not sufficiently displeased to go to the ratification meeting and vote the settlement down. The most that can be said, in the end, is that 69 employees out of a group of 150 to 175 voted to reject the settlement. The overall impression created by those numbers is that the union membership at Winnipeg stands divided on the issue, and that, whether by their vote or their inaction, a substantial number of the members appear willing to accept the terms of the Memorandum of Settlement.

The Arbitrator has heard and reviewed the submissions put forward by the Union. I do not, in the circumstances of this case, find them persuasive. For the reasons related above, I am satisfied that, while no outcome can be ideal from the standpoint of either party, the negotiated settlement which emerged from the unanimous recommendations of the Board of Review does represent a fair and workable result for both parties. Subject to the condition hereinafter stated, I therefore adopt as the order of this Board of Arbitration all of the terms of the agreement previously reached between the parties, including the supplementary agreement on conditions and the Letters of Understanding, which are attached to this Award and identified as Appendix A. The order of this Board shall be treated as effective in the same manner as the agreement of the parties, dated January 24, 1989, would have been. The entirety of this Award is, however, conditional upon the acceptance by the Company of each and every term of the tentative agreement now incorporated into this Award, including those terms which it maintains are beyond the Arbitrator’s jurisdiction. Should the Company agree to allow the Award to stand, including all of the terms in respect of which the Company raised jurisdictional objections, without prejudice to the position advanced by the Company, this conditional Award shall become executory and binding upon the parties. Should the Company refuse to abide by that condition, which it may do by notifying the Union and the Arbitrator in writing within thirty days of this Award, the matter shall be remitted to me for final resolution of the issues of arbitrability, as well as all other issues outstanding in this dispute. I continue to retain jurisdiction in this matter.

DATED at Toronto this 2nd day of May, 1989.

(signed) MICHEL G. PICHER

ARBITRATOR