BETWEEN:

(the "Company")

AND

(the "Union")

SOLE ARBITRATOR: Michel G. Picher

There appeared on behalf of the Company:

M. Delgreco – Director, Labour Relations

Keith MacDonald – Manager, Labour Relations

And on behalf of the Union:

David S. Kipp – General Chairman

A hearing in this matter was held in Toronto on October 16, 1989.

At the hearing the parties submitted the following statement of dispute and joint statement of issue:

The facts material to the dispute are largely uncontroverted. The bargaining unit includes a number of employees classified as hostlers, whose duties include moving locomotive units within shop track areas, and occasionally from shop tracks to and over yard tracks. The collective agreement has for many years contained separate rates of remuneration for hostlers whose movements are restricted to within shop track areas, known as "inside hostlers", and "outside hostlers" who move locomotives outside shop track areas. The outside hostlers are paid at a higher rate. It does not appear disputed that for a number of years, and in the Union’s estimation since 1969, at several locations on the Mountain Region hostlers have consistently been paid at the outside hostler’s rate, even on those occasions where their work has involved movements entirely within shop track areas. According to the Union, at one point in time the Company contemplated gaining greater flexibility in moving motor power units from shops or ready tracks onto their trains in yard locations. Having that work performed by hostlers gave the Company greater flexibility and savings in terminal delay payments. Apparently subsequent developments, such as unit train operations and assigned motor power sets did away with plans to move power into the main yards. Nevertheless, the outside hostler rates of pay were maintained for the B.L.E. hostlers on the Mountain Region.

In mid 1988 the Company decided to discontinue the hostling of engines to and from the shop track area and the running yards at Edmonton, Jasper, Kamloops and Greater Vancouver Terminal. The practical impact was that all hostling personnel would generally be restricted to moving engines within the shop track areas only, which is to say performing work as "inside hostlers" as contemplated in the collective agreement. The hostlers represented by the Canadian Brotherhood of Railway Transport and General Workers were given notice by the Company on September 15, 1988, pursuant to article 8 of the Employment Security and Income Maintenance Plan. At the same time a material change notice under article 123 of collective agreement 2.3 was provided to the hostlers represented by the Brotherhood that is party to this arbitration. It is the first position of the Company that it was not necessary for it to provide the article 123 notice, but that it did so in a spirit of fairness and equity, given that the C.B.R.T. & G.W. hostlers were entitled to the benefit of an article 8 notice.

Article 123 of the collective agreement provides for the negotiation of protections for employees in contemplation of a material change in working conditions. It provides, in part, as follows :

Following the notice provided to the Brotherhood by the Company on September 15, 1988 negotiations took place between the parties in October, November and December of the same year. During the course of the negotiations the Company offered to the Union the same maintenance of earning protections which are available to the C.B.R.T. and G.W. employees under the terms of their Employment Security Income Maintenance Plan. Essentially the offer of the Company is to provide for the maintenance of basic rates for a period of three years, and thereafter until such time as general wage increases applied on the basic rate erase the differential between the basic rate for inside hostlers and the incumbency level for outside hostlers.

The Union resisted that proposal at all stages of negotiations. Firstly, it submits that the Company should be estopped from changing the long-standing practice with respect to the treatment and payment of B.L.E. hostlers on the Mountain Region. Alternatively, it countered with a different proposal whereby a sum of 80 percent of the amount of monies that would be lost by the incumbents to age 65 be placed in a tax sheltered trust, annually, with the accumulated sum and accrued interest to be paid to the employee upon retirement or separation. In the event of the employee’s death the total sum due would be paid to his estate. The Company resists that proposal, noting that in some cases it could produce a lump sum payment as great as $70,000. More fundamentally it argues that the position of the Brotherhood fails to recognize the Company’s right to change its operations or revert to what it views as the appropriate application of the terms of the collective agreement. The dispute so joined proceeded through the Joint Board of Review without any change in the positions of the parties, as reflected in the separate reports of the management and union representatives dated April 20, 1989 and May 18, 1989 respectively.

In dealing with the merits of this dispute, the Arbitrator finds it unnecessary to determine whether what has transpired constitutes a material change within the meaning of article 23 of the collective agreement. Firstly, no exception is taken to the Arbitrator’s jurisdiction in this matter and, secondly, the Company has indicated its willingness for the purposes of settlement, of treating this matter under the terms of that article, given the benefits provided to the C.B.R.T. & G.W. employees who are subject to the same changes. Given that conclusion it is unnecessary to consider at length the analysis of the applicability of a provision such as article 123 as discussed in CROA 1167.

In the Arbitrator’s view the position advanced by the Company during negotiations is the more compelling. From an equitable standpoint, the collective agreement contemplates that the different rates of pay should attach to inside and outside hostler’s work. The collective agreement in no way limits the right of the Company to assign employees in the classes of service designated within it, and to make changes in assignments from time to time. The position of the Brotherhood is tantamount to asserting that the incumbents have a right of property in their established assignments and rates of pay. That is plainly not what is contemplated under the collective agreement. On the contrary, the agreement anticipates that changes may be made whereby employees are adversely affected. If it were otherwise article 123 would have no purpose.

In the Arbitrator’s view the interests of the Company and of the employees concerned are fairly accommodated in the proposal put forward during negotiations by the Company for effective red circling of the outside hostler’s rates until such time as they are overtaken by increases in the basic rate. This gives the Brotherhood the opportunity, without any prejudice to its interest, to attempt to renegotiate higher rates for the employee affected at the next round of bargaining. That is the most the Union could achieve even if its position on estoppel were accepted. For these reasons the Arbitrator awards the terms of the memorandum of agreement proposed by the Company, and appended as exhibit B to its brief before the Arbitrator as the terms of this Award. For the purposes of clarity the draft memorandum of agreement is attached hereto as Appendix "A" to this Award, with the only change being that rather than the effective date being the completion of the shift of 17th December 1988, it shall be effective upon the completion of the shift 30 days from the date of this Award.

DATED AT TORONTO, this 20th day of October, 1989.

CANADIAN NATIONAL RAILWAY COMPANY

MOUNTAIN REGION

MEMORANDUM OF AGREEMENT between the Brotherhood of Locomotive Engineers and the Canadian National Railway Company with respect to the Company notice dated 16 September, 1988 concerning the change of nine Hostler positions on the Mountain Region to reflect rate of pay of an Inside Hostler.

IT IS AGREED:

Signed at Edmonton, Alberta this ________ day of ________________, 1988

FOR THE COMPANY FOR THE BROTHERHOOD

________________________ ________________________

For : Senior Vice-President General Chairman

________________________

Asst. Vice-President

Labour Relations