AH – 219




(the “Railway”)



(the “Union”)

GRIEVANCE RE Donald Russell Smith Arbitration



SOLE ARBITRATOR:                H. Allan Hope, Q.C.



There appeared on behalf of the Company:

David Cox


And on behalf of the Union:

Robert Dhensaw



A hearing in this matter was held at Vancouver, B.C., on May 30, 1991.




The grievor in this dispute, Donald Russell Smith, seeks to set aside a permanent demotion imposed on him on November 12, 1987 in response to what was perceived by the Railway as an act of insubordination. (In actual fact, the grievor was unilaterally reinstated by the Railway approximately one year later, on October 11, 1988). The grievor was demoted from the position of foreman in the bridge and building department. Thereafter he exercised his seniority to claim a position as a bench carpenter in the same department. Prior to his demotion he was working in the bridge and building shop in Squamish and the bench carpenter position into which he bid was located in the same shop. The incident giving rise to the demotion arose out of a derailment at a bridge at Chekamus Canyon. The bridge site is approximately 58 miles north of Vancouver.

The incident began on October 31, 1977 when Larry Griffin, a supervisor in the bridge and building department, attended the bridge site with J.S.C. Frost, the bridge engineer. The two officials attended the site in the early morning hours on October 31 to assess the bridge damage. The damage was substantial. In addition, the derailment had resulted in varying degrees of damage to 12 rail cars, some of which had been wrecked and some of which contained burning sulphur that continued to burn when the two officials arrived on the scene.

The situation was considered to be an emergency because it had cut the main rail line and, in effect, had closed down the railway operations. The well-established routine in the case of an emergency is for all forces to perform whatever work is necessary to restore operations. October 31, 1987 was a Saturday, which was an off-duty day for the bridge and building department. Ordinarily the grievor would have been at his home. The grievor’s wife, whom he had not seen for several weeks, was visiting him in Squamish and he was looking forward to spending the weekend with her. In addition, it was Halloween and two members of the grievor’s crew were looking forward to taking their young children out on Halloween rounds.

At the bridge site Mr. Griffin and Mr. Frost assessed the damage and Mr. Griffin then took steps to alert the bridge and building crew in Squamish to the situation and to instruct them with respect to the assembly of the materials and equipment which would be necessary to complete repairs to the bridge. At the same time, other departments were commencing the cleanup of the area of damaged rail line north of the bridge. Mr. Griffin concluded that it would be necessary to repair and replace a number of the 300 ties used on the bridge deck. Ultimately it was concluded that 80 ties would have to be replaced. The bridge incorporates a curve with the result that preparation of the ties would require a process called dapping. In that process the ties are slotted to fit on steel stringers incorporated in the deck. Dapping is done with hand tools and the depth of the slot varies to meet the changing elevation required to accommodate the curve on the bridge deck. The process takes some time.

Mr. Griffin calculated the measurements necessary to perform dapping on 72 of the 80 ties, but was unable to get complete measurements for the remaining eight ties because of sulphur smoke emitting from the cars that continued to burn at the site. When he had compiled as much information as possible, he contacted the grievor as foreman of the closest bridge and building crew and instructed him to prepare replacement ties. It was anticipated and understood by the grievor that his crew would prepare the material and equipment necessary to complete repairs to the bridge deck and would then travel to the site and effect the necessary repairs. It was also understood by the grievor that it was an emergency situation in which it was anticipated that his crew, along with any other forces required, would continue to work until operations were restored on the main line.

Mr. Griffin contacted the grievor from the bridge site. That contact was made by radio through the railway operator at Squamish. He placed a telephone call to the grievor on the instructions of Mr. Griffin and advised him to contact Mr. Griffin by radio. As stated, it was an off-day for the grievor and he was staying at a local hotel with his wife. The operator reached him there and he returned to the Railway to contact Mr. Griffin by radio as instructed. I digress to note that the Railway has at least two radio channels used in its operations. Channel 1 is a line of sight channel which has limited range. Channel 2 provides general access through repeater stations. It was on Channel 2 that Mr. Griffin contacted the operator that morning and it was on Channel 2 that the grievor contacted Mr. Griffin. The significance of those facts will become apparent shortly.

Mr. Griffin gave the grievor instructions with respect to the materials that would be needed, which included the fact that elevation measurements for eight of the replacement ties would not be available until the burning cars had been extinguished and the site was fully accessible. He indicated that those measurements would be available later in the day. On the basis of those instructions, the grievor called out his crew and work commenced. By 5:00 p.m. the work had been completed on all but the last eight ties for which additional measurements were required. The grievor then made the decision to send the crew home. He conceded in his evidence that there were options available to him which included contacting Mr. Griffin to obtain the needed dimensions. In addition, it was available to him to assemble the remaining eight ties in preparation for dapping when the measurements were obtained.

The grievor did attempt to contact Mr. Griffin by radio at the suggestion of Josef Tischler, a member of his crew who acted as relief foreman. However, for no reason that became apparent, he made his attempt on Channel 1 rather than Channel 2 and, not surprisingly, was not able to contact him. In the meantime, Mr. Griffin had concluded his work at the site and returned to the bridge and building shop at Squamish. He arrived at approximately 7:30 p.m. (1930 hours) and found the shop locked. He concluded that the crew had gone for dinner so he left the shop and returned later to discover that it remained locked. Mr. Griffin concluded that the crew had gone home, although it was not made clear in the evidence whether he surmised that fact or was informed by someone. At some stage he asked the railway operator to attempt to contact the grievor with instructions to have the grievor contact him. He was informed by the operator that the grievor was not in his room and that a message had been left for him. The grievor said in his evidence that he did not receive any message from Mr. Griffin.

In any event, Mr. Griffin attended at the bridge and building shop the following morning at approximately 7:00 a.m. (0700 hours), where he encountered Mr. Tischler. He had a brief discussion with Mr. Tischler during which he inquired where the crew had been the previous night. Mr. Tischler advised him that the crew had gone home. As stated, the crew had been sent home by the grievor at 5:00 p.m. (1700 hours) the previous night and instructed to return at its regular starting time of 7:30 a.m. (0730 hours). The crew began arriving prior to 0730 hours.

When the grievor arrived, Mr. Griffin engaged him in a discussion which was described as heated and as involving loud voices and shouting. By all accounts, it was a confrontation between the grievor and Mr. Griffin. Evidence of what transpired was given on behalf of the Railway by Mr. Griffin and on behalf of the Union by Mr. Tischler and the grievor. In addition, statements taken from employees by the Railway at the time the incident occurred were filed in evidence. Those statements are as follows:

The following notes are from interviews held with B&B 102 on November 2nd and 3rd, 1987.

Joe Tischler - Acting Foreman/Carpenter 102

Saturday afternoon Joe heard Tom Ross ask [the grievor] for a measurement to complete dapping the remaining 8 ties required for the derailment at the 56.3 mile. Joe didn’t think [the grievor] tried to contact Larry Griffin for the measurement as shortly afterwards [the grievor] sent the crew home (1700 Hrs.).

Joe was under the impression that the ties were not required urgently and could be done in the morning as after some discussion [the grievor] set the starting time at the usual 0730 Hrs.

Sunday morning Joe arrived at 0630. He said Larry Griffin walked in around 0715 and was agitated that Don and the crew had not started work or completed the ties. At this point Joe got on the forklift and started work. He saw Larry and [the grievor] argue but he did not hear what was said.

Tom Ross - Carpenter 102

Tom was called into work at 10:00 a.m. Saturday morning. He was given 3 sketches to dap 24 ties (8 of each). Towards the end of the day Tom told [the grievor] one sketch was missing a measurement that he required to complete the last 8 ties. Tom said [the grievor] did not seem concerned and shortly afterwards the crew was finished f or the day. Sunday morning [the grievor] had already left when Tom arrived.

Bruce Smith - Labourer

Bruce was told to come in at 0730 hrs. and arrived in the shop at about 0720. Larry was already in the shop and Bruce proceeded to change into his work clothes. [the grievor] came in the door and Larry began talking to [the grievor], but Bruce did not hear since he was a distance away. [The grievor] “blew up” and began “yelling and screaming” at Larry. [The grievor] said: “This is my shop and I’ll run things the way I want!”. Every time Larry would start talking, [the grievor] would interrupt and not let him speak. It was obvious to Bruce that Larry was controlling his temper as he did not reciprocate by yelling at [the grievor]. He turned his back on [the grievor] and walked out of the shop, with [the grievor] in pursuit still yelling at him: “I’ll get the Union after you!” Bruce did not track the conversation as Larry used a normal tone of voice and could not be heard. Larry then came back in with (the grievor) in pursuit still arguing and Larry said in an elevated tone of voice: “That’s it, that is enough, go home!” [The grievor] then continued arguing. Then Larry said: “That’s it … You are out of service”.

Mark Blackburn - Plumber 102

Mark was under the impression work on the ties could wait till Sunday morning. [The grievor] did not express any urgency about the work so Mark left with everyone else at 1700.

Sunday morning Mark arrived at work as [the grievor] was leaving. He asked him what the matter was and [the grievor] replied that he had been dismissed.

Mark and I discussed a previous (3 weeks ago) altercation between himself and [the grievor], but its relevance to this incident is negligible.

The witnesses called in this hearing were at a disadvantage in the sense that they were required to give evidence about events that had occurred more than three years ago. The reasonable presumption is that the statements, which were taken immediately after the events in issue, represent a more accurate recollection of the events. The Union submission is that the notes taken are hearsay and should not be received as evidence of the facts in dispute because the Railway did not call the bargaining unit employees who gave the statements as witnesses in the proceedings.

The statements were taken at the time the events occurred by William Steller, a supervisor in the bridge and building department, who was assigned to conduct an investigation into the incident that gave rise to the demotion. A representative of the Union was present during the interviews and there was no indication in the evidence that the statements were repudiated at the time or at any subsequent time prior to this hearing. Mr. Tischler was called by the Union to give evidence and he did not allege that the statements attributed to him were inaccurate. He gave evidence of facts that went beyond the scope of his statement but he did not contradict the statement.

The significance of the statements became apparent in the evidence of the grievor. In particular, he contradicted the evidence of Mr. Griffin with respect to what transpired. The grievor admitted that he had a confrontation with Mr. Griffin that became, at the very least, a heated discussion. The evidence of Mr. Griffin was that the grievor initiated the confrontation by means of an aggressive response to an inquiry Mr. Griffin made as to why the crew had been sent home the previous evening rather than continuing the work. The evidence of the grievor was that the confrontation was initiated by Mr. Griffin by reason of his accusatory and aggressive manner in which he challenged the decision of the grievor to send the crew home.

A further difference between the grievor and Mr. Griffin arose with respect to how the confrontation acted itself out. Mr. Griffin said that he attempted to break off the encounter by leaving the shop area but that the grievor followed him with the result that he found it necessary to suspend the grievor and send him home. The term used by the Railway is, “out of service”. There is no dispute on the facts that there was a confrontation between the grievor and Mr. Griffin which resulted in Mr. Griffin taking the grievor out of service. But the grievor’s recollection was that he did not pursue the issue with Mr. Griffin. He said the incident occurred because Mr. Griffin was agitated when he arrived and that he confronted him immediately and began berating him in front of the crew without seeking an explanation. When asked who it was that walked away, he said that he walked away, “because I know me”. I took that comment to mean that he knew he had a temper and was capable of losing it in confrontations.

In assessing those differences in the evidence, I agree with the submission of the Union that statements taken from bargaining unit members who are not called as witnesses should not be used as proof of disputed facts. For that reason, I did not rely on the statements in that context. However, they do assist in placing the events in perspective with respect to facts which were not in dispute. Further, as stated, Mr. Tischler did give evidence and did not challenge his statement.

On the issue of how the confrontation between Mr. Griffin and the grievor acted itself out, it is clear that the incident commenced in the shop, that there was a loud exchange, and that Mr. Griffin walked out of the shop, followed by the grievor. The grievor himself said, “both of us were yelling”. He then retracted that and said, “I don’t call it yelling. It was loud talking; a heated discussion; two people are at each other; a heated discussion”. He said earlier in his evidence that he was not surprised to see Mr. Griffin present when he arrived at the shop, but he was surprised by his aggressive manner. He said, “there was a raising of voices. I’m not sure who did it first”.

In his evidence Mr. Griffin denied raising his voice, but did agree that he was somewhat agitated by the fact that the crew had not been kept available to complete the preparatory work the night before. All parties agreed that it was an emergency situation with the main line blocked and that it was standard procedure to work continuously until the line was cleared. He found it incredible that anyone would knock off a crew while there was still work to be done.

I pause to note that one of the peculiarities of the law of evidence is that the statements taken from the bargaining unit employees, while they are not evidence in proof of disputed facts against the grievor, can be used as evidence against the Railway as the party preparing the notes adducing them in evidence. In that context I note that Mr. Tischler was recorded as having observed that Mr. Griffin was agitated when he arrived at the shop. He said in cross-examination that he was “kind of shocked (to find the grievor) gone and things not done”. He said that when he approached the grievor, he “just wanted to know why the work wasn’t done”.

In reconciling the conflicting evidence, I repeat that the witnesses were speaking of events that had occurred years before they gave evidence. Hindsight offers a benign perspective at the best of times. Where the events at issue are capable of distortion or exaggeration in the memory of credible witnesses, the predictable result is that their recollection will favour their interests. It was clear that Mr. Griffin had reason to be agitated by what he perceived as laxity on the part of the grievor in an emergency situation. His demeanour indicated that he was capable of expressing himself forcefully when he considered that the circumstances warranted it. He conceded, for example, that during the discussion he said to the grievor, “If you are not in a good mood, take the day off”, but he conceded that in expressing that thought, he said, “Why don’t you just get the fuck out of here”. He said that the grievor’s response was to say, “Don’t tell me to fuck off”, and that he said something about getting the Union involved. Mr. Griffin said that it was at that point that he told the grievor he was out of service.


My conclusion is that a pointed and somewhat heated discussion took place between Mr. Griffin and the grievor and that Mr. Griffin sent the grievor home. He did so on the basis of what he perceived as a challenge to his authority and disrespectful conduct, particularly in circumstances where crew members were in a position to observe an apparent conflict between two of their supervisors. I do not find in the evidence any basis for concluding that Mr. Griffin provoked the grievor’s response in the sense contemplated in the arbitral authorities. Undoubtedly Mr. Griffin was critical in his approach to the grievor and perhaps it may have been more circumspect of him to take the grievor aside before speaking to him. But those facts do not condone the grievor’s response.

The inference invited by the facts is that the grievor, with his extensive experience, calculated that leaving the remaining work to the following morning would not delay opening the main line. On the evidence, that estimate would appear to have been correct. There was a great deal of repair work to be done beyond the repairs to the bridge. In fact, it would appear that the bridge repairs were completed before the remainder of the work required to reopen the line. That finding is reinforced by the fact that the demotion letter, which I will set out shortly, did not include an allegation that the grievor’s actions had delayed the reopening of the line.

However, that finding is irrelevant. The decision not to keep working was not for the grievor to make. He agreed that standard procedure required that work continue in an emergency until the line is reopened. It was clear on the evidence that he had compelling personal reasons to want the night off. The implication is that he made the decision to send the crew home without consulting Mr. Griffin because he was concerned that Mr. Griffin might not agree. The grievor said that when he arrived at work, he did not expect criticism from Mr. Griffin and, in effect, he considered his approach to be unfair. On the facts, the grievor was extraordinarily naive if he did not expect a negative response from Mr. Griffin. When he came in the following morning he should have expected an adverse reaction from Mr. Griffin. Certainly, the evidence does not support a finding that Mr. Griffin’s criticism justified the grievor’s extreme response. That response constituted a serious act of insubordination.

However, in assessing the incident the facts diminish its seriousness to some extent. That is, while the conduct of Mr. Griffin fell far short of constituting provocation in the arbitral sense, the fact that he did not take the grievor aside to question and admonish him is a factor to be weighed in considering whether a disciplinary demotion was appropriate. Similarly, the fact that the grievor had not seen his wife for some time and that she had travelled to Squamish to visit with him on the weekend, is a fact to be weighed in assessing the appropriateness of the demotion. In particular, the grievor’s act of insubordination was isolated and was responsive to the unique facts. I will return to the significance of those findings later.

The grievor remained out of service until he posted into a vacancy as a bench carpenter with a start date of November 16, 1987. The decision to impose the demotion was made by senior officials on the recommendation of Mr. Griffin. Mr. Griffin said that he thought he had recommended a one-year suspension, although it may have been a six-month recommendation. However, the decision made was to impose a permanent suspension. The demotion and the reasons for it were expressed in a letter to the grievor dated November 12, 1987 which reads as follows:

After conducting a thorough investigation with regards to your actions of October 31st and November 1st, 1987, it has been determined that you failed to carry out the instructions of your Supervisor, and when questioned about this by your Supervisor your conduct constituted insubordination. Your attitude and actions in dealing with people has previously been brought to your attention by a Supervisor which resulted in demotion. It is obvious to me that your conduct has not changed and your attitude has led to the aforementioned incident.

Insubordination as well as an inability to follow instructions cannot and will not be tolerated by the Railway. A Foreman’s position requires an employee to possess sound judgement and leadership qualities to properly supervise employees under his Supervision. Your attitude has shown an inability for you to perform the duties of a Foreman. Therefore effective immediately, you are demoted from holding the position of B&B Foreman.

(emphasis added)

That letter was not prepared by Mr. Griffin, although it was signed by him. It was conceded in evidence that the grievor had not refused to follow instructions. He had not sought instructions. He was seen as having failed to follow standard practice. Further, the grievor had not been demoted previously. It transpired in the evidence that the allegation of a failure to carry out or follow instructions arose from the fact that Mr. Griffin was of the view that the grievor should have known that the crew should not have been sent home. No failure to follow instructions in any overt sense was alleged and the Railway did not succeed in establishing that the grievor knew he should not send the crew home. He acted within his discretion, although it was clear that he persuaded himself against his better instincts that the crew would not be needed. It is not an important distinction in an assessment of the grievor’s work performance, but it is important in assessing the allegation of insubordination. In particular, the evidence does not support a finding that the grievor failed to carry out or follow orders.

The same can be said about the allegation of a prior demotion. The Railway sought to support the allegation of a prior demotion by leading evidence of an incident that occurred on October 28, 1985. There was an allegation made that the grievor had been abusive to employees on his crew. However, on November 6, 1985 that allegation was withdrawn unconditionally. In particular, F.E. Kimball, the assistant chief engineer for the Railway, wrote the following letter to the grievor on November 6, 1985:

Regarding the investigation conducted by your supervisor Mr. Harold Kleywegt on October 28, 1985 concerning allegations that you were verbally and physically abusing your men on the job at mile 458. This is to advise you that there will be no discipline assessed for the alleged incident as there is insufficient proof of the accusation.

On December 2, 1985 the grievor was advised by his supervisor that he was being “disqualified from the position of foreman”, being the language used by the Railway to record a demotion. But that initiative was withdrawn. The circumstances of the withdrawal were not made clear. However, whatever the reason, the grievor was not demoted. He took a leave of absence for one month on the insistence of his supervisor. Coincidentally, he had access to the Railway’s employee assistance program on the suggestion of his supervisor and returned to his position as foreman on January 20, 1986. The Railway elected not to impose any discipline on the grievor in the circumstances and there was no basis established for treating the incident as a prior incident of discipline which would support the demotion. The grievor said in his evidence that he challenged his foreman’s move to disqualify him at the time and determined that he would return to work as a foreman. He was returned in that capacity approximately one month later. He said that the incident creating the issue arose because he had difficulty with three members of his crew. He denied that he had any problem. He said that he did not know why he was referred to the employee assistance program, including a psychiatric evaluation. In any event, he said the referral was quickly concluded and resulted in the determination that there was nothing wrong with him and that he was perfectly fit to perform his duties as a foreman.

His evidence was not contradicted in the hearing and is supported in its general thrust in a report from the employee relations officer of the Railway to the grievor’s supervisor on January 15, 1986. There was no evidence of any prior or subsequent difficulties until the incident giving rise to his demotion. There were suggestions that he was perceived by some as being hard on his crew members, but that perception was not developed in any evidentiary sense. Mr. Tischler, who worked for him in his crew and as his assistant and relief foreman, said he was sometimes hard on the crew, but that he was a good foreman. He said the grievor’s production level was the best in the department and that he had never heard higher management criticize the grievor’s performance.

All of the evidence was to the effect that the grievor was an excellent foreman. Mr. Griffin was asked in cross-examination who was the best qualified foreman in the department and he said without hesitation, “[the grievor] is – no doubt – I miss him out on the bridges right to this day”. As stated, he said that he did not make the decision to permanently demote the grievor. He said he was “shocked” when he saw that the penalty was disqualification, (being permanent demotion) . He said that in retrospect he was glad he recommended a temporary demotion rather than disqualification. He then said that within three months of the demotion he perceived a distinct change in the demeanour and conduct of the grievor. He said that as of the time of the hearing: “[the grievor] is now a good foreman. He knows what he is doing and he treats people as individuals. His crew respect him. Before that, they were afraid of him”.

The evaluation of Mr. Griffin reflected the actions of the Railway. In particular, the grievor was reinstated to the position of foreman unilaterally on October 11, 1988. The letter of reinstatement was written by Mr. Griffin and it reads as follows:

I have been reviewing your work performance since you were demoted on November 12, 1987. I was pleased to find that your work performance has been excellent and that your ability to communicate and work with your supervisors as well as other employees has showed great improvement. Your effort to change your attitude, when dealing with others, has resulted in enhancing your employment relationship with BC Rail. As a result, I am reinstating your qualification as a B&B Foreman immediately. You will be free to bid on any Foreman’s positions that may occur in the future. I look forward to a long and enjoyable working relationship with you in the future.

On those facts I conclude that the actions of the grievor on the day in question constituted an isolated incident and not part of a pattern of conduct. In particular, there was no basis for concluding that the grievor’s attitude towards his crew or towards supervisory employees had impaired his ability in the past to perform his duties in a manner satisfactory to the Railway. In fact, as was stated quite frankly by Mr. Griffin, the grievor was considered to be the best qualified foreman in his department. There is no doubt that the Railway officials, in retrospect, were concerned about the grievor’s conduct on the day in question. But the issue is whether the facts supported a finding that there was just cause to impose a permanent demotion upon him.


Both parties acknowledged that the circumstances in this dispute are governed by the principles set out by the former Labour Relations Board in Wm. Scott & Company Limited and Canadian Food and Allied Workers Union, Local P-162 (1977) 1 C.L.R.B.R. 1 (Weiler). On p. 5 the Board wrote:

[A]rbitrators should pose three distinct questions in the typical discharge grievance. First, has the employee given just and reasonable cause for some form of discipline by the employer? If so, was the employer’s decision to dismiss the employee an excessive response in all of the circumstances of the case? Finally, if the arbitrator does consider discharge excessive, what alternative measure should be substituted as just and equitable?

The submission of the Union is that there was conduct deserving of discipline proven by the Railway, but that the penalty selected was excessive. Its submission was that an appropriate penalty would have been a written warning or a suspension. In that regard the Union pointed out that the Railway had unilaterally introduced a new discipline guide in January of 1987 which adopted the progressive discipline pattern contemplated by the Board in Wm. Scott & Company. The Union also relied on the prior decision between these parties in British Columbia Railway and Canadian Union of Transportation Employees, Local 6 (1983), 8 L.A.C. (3d) 233 @ pp. 234-38, to support the proposition that the Railway is required to establish just cause for the imposition of disciplinary penalties. The progressive discipline approach adopted by the Railway in 1987 is contained a document entitled “Guidelines Respecting Discipline of Unionized Employees”. I will return to the guide later.

In Wm. Scott & Company, the Board was considering the standard to be applied in the arbitral review of a dismissal under the provisions of the Labour Code. An important factor to note in that decision is that the jurisdiction of an arbitrator in a review of the discipline or dismissal of an employee emanates from the legislation. In particular, what is required of an arbitrator is an independent review of the circumstances to determine whether proof of just cause for a particular disciplinary initiative has been made out.

It is a general principle of the law of the collective agreement that it is not sufficient for an employer to prove just cause to impose discipline, the employer must go on and prove that it had just cause to impose the specific penalty selected. In K.V.P. Co. Ltd. vs. Lumber and Sawmill Workers Union (1965), 16 L.A.C. 73 (Robinson), the arbitrator addressed that issue as follows on p. 96:

There has been a difference of opinion upon this matter but the prevailing rule now appears to be established that where the question arises whether or not the penalty was for just cause, the company must establish just cause not only for the imposition of a penalty but for the imposition of the particular penalty imposed.

There is recognition in the arbitral authorities of a right in an employer to impose a disciplinary demotion. However, there is some measure of controversy as to whether and when it is appropriate to impose a permanent demotion as a matter of discipline. The subject of disciplinary and non-disciplinary demotions was discussed extensively in Re Crane Canada Inc. and United Association of Plumbing & Pipefitting Industry, Local 170, (1990), 14 L.A.C. (4th) 253 (Hickling) @pp. 269-83. The consensus would appear to be that where an employer imposes a demotion, whether disciplinary or non-disciplinary, it will be put to the proof on a balance of probabilities that it had just cause to take that extreme action. The facts in that regard must disclose an inability or unwillingness on the part of the employee to meet or maintain an acceptable standard of work performance. Further, it is generally accepted that a permanent demotion is inappropriate as a disciplinary measure. See Brockville Chemical Industries Ltd. vs. International Chemical Workers, Local 721 (1971), 23 L.A.C. 336 (Shime). Professor Shime wrote as follows on p. 341:

In our view that case indicates that there is to be a limit imposed on disciplinary demotion and an employee is not indefinitely to be precluded from assessing his seniority rights under a collective agreement.

However, a permanent demotion imposed for disciplinary reasons, being a demotion for an indefinite period, is acceptable if it is responsive to a deficiency in job performance and if it leaves to the grievor his rights under the provisions of the collective agreement to bid on other vacant positions following the demotion, including vacant positions in the classification from which the employer was demoted, and to be considered for those vacancies in an application of any criteria set forth in the collective agreement. See Re District of Kitimat and Canadian Union of Public Employees, Local 707 (1980), 26 L.A.C. (2d) 316 (MacIntyre) @ pp. 319-20. Here it would appear that the grievor was permanently denied his right to exercise his seniority in the bridge and building foreman’s classification. That restriction was later lifted unilaterally by the Railway.

Thematic in the authorities with respect to disciplinary demotions is a requirement in the employer to show that the conduct giving rise to the demotion implies an inability on the part of the employee to meet or maintain an acceptable standard. That fundamental principle was addressed in the context of a supervisory employee who had an altercation with one of the employees she was supervising in Re Riverdale Hospital and Canadian Union of Public Employees, Local 79 (1973), 2 L.A.C. (2d) 178 (Rayner). That decision stands for the proposition that a disciplinary demotion can only be justified if it is based upon facts which support the conclusion that the employee was unable to perform her/his job. The arbitrator wrote as follows on p. 181:

If the action is classed as disciplinary, then the board must consider the generally accepted arbitrable rule that demotion is not a proper form of discipline partly because it abridges seniority rights and partly because it is for an indefinite period of time. See Re Int’l Ass I n of Machinists and Gabriel of Canada Ltd. (1968), 19 L.A.C. 22 (Christie); and Re U.A.W., Local 27, and Tecumseh Products of Canada Ltd. (1968), 19 L.A.C. 180 (Weatherill). However, even if the board classifies the demotion as disciplinary, the board recognizes that in some cases the demotion may be appropriate as a discipline. See, for example, Re International Chemical Workers, Local 721, and Brockville Chemical Industries Ltd. (1971), 23 L.A.C. 336, where a board of arbitration chaired by Mr. 0. Shime, came to the conclusion that if the conduct which gave rise to discipline indicated an inability to do the job, demotion may be appropriate. In considering the latter case, the board feels that the real issue in cases of this nature is the question of determining when the decision taken by management is a purely disciplinary decision as opposed to the decision that the employee no longer is suited to the job that he had. The line between these two questions, in many instances, quite fine.

(emphasis added)

The arbitrator went on the consider the circumstances in which a disciplinary demotion would be justified and, conversely, when such an action would be considered unjustified. As stated, the determining factor in such cases is the extent to which the employer is able to prove that the employee was not able to perform the work. The point is, an employer is not free to use a demotion as a form of pure discipline. The arbitrator summarized his views in that regard on p. 183 as follows:

In actual fact, the board is of the opinion that what the Hospital really attempted to do here was impose demotion as a form of discipline. The actions of the Hospital in the matter indicate that they treated this incident as a culminating incident in the grievor’s work performance. Although a minor incident may justify disciplinary actions under the doctrine of “culminating incident”, this doctrine in the board’s opinion is applicable more to disciplinary matters than to matters of demotion. If a culminating incident is to be relied upon for demotion, clearly the onus is on the employer to show such behaviour as to make the grievor unsuitable to carry on in the present position.

(emphasis added)

That reasoning applies to the facts proven in this dispute. The demotion letter, while it speaks of an “inability to perform the duties of a foreman”, when read in conjunction with the evidence, invites the conclusion that the demotion was imposed as an act of discipline rather than in response to any assessment that the grievor could not perform his job. Further, the demotion letter indicates that consideration was given to a prior incident for which no discipline was imposed and which does not support a conclusion that it reflected an inability on the part of the grievor to function as a foreman. He had functioned in that capacity to the apparent satisfaction of the Railway for many years and received what could easily be described as lavish praise for his ability in that position.

No evidence was led by the Railway to show that even if the grievor did have some difficulties in relating to his crew, those difficulties had an impact on the efficiency of operations. More particularly, there was no evidence to indicate that the grievor had difficulty responding to supervision. That is not to say that the conduct of the grievor was not deserving of discipline. In fact, the circumstances disclose a serious act of insubordination which justified a significant disciplinary response. Insubordination is a serious employment offence on the part of an employee at any time and in any circumstances. It is infinitely more serious for a supervisory employee to act insubordinately in the presence of employees under his supervision. In those circumstances the Railway was justified in imposing discipline which would bring home to the grievor his obligation to accept supervision positively and to demonstrate to other employees that insubordination on the part of an employee constitutes a serious disciplinary infraction.

On p. 10 of the discipline guide the Railway has indicated to employees that it perceives insubordination as a serious offence and considers that acts of “gross insubordination” will justify dismissal. It also records for the instruction of employees that suspensions without pay will be imposed in response to serious disciplinary infractions and, while the imposition of suspensions will normally be imposed progressively through a two-day, five-day and ten-day progression, suspensions in excess of ten days will be imposed in response to special circumstances.

In my view an appropriate substitute penalty for a demotion on the facts in this case would be a ten-day suspension. That is a serious penalty to impose, but not out of keeping with the nature of the offence. However, because this issue comes on after the fact, to require the grievor to actually serve a 10-day suspension would mean that he would suffer a demotion for a period of approximately one year and then a ten-day suspension without pay. A further consideration is that a reinstatement of the grievor to his position as foreman would trigger a potential claim for wage compensation between the rate he received during his demotion and the rate he would have received as foreman.

An appropriate resolution of those competing facts is to treat the suspension as having been served and to deny compensation for any wage loss the grievor may have suffered. In the result, the grievor is entitled to have his discipline record amended to show that he received a ten-day suspension for his insubordination rather than a demotion and to amend his seniority date to reflect the fact that he continued in the classification of foreman during the period of his demotion. I will retain jurisdiction to assist the parties in implementing that decision if that becomes necessary.

DATED at the City of Vancouver, in the Province of British Columbia, this,25th day of November, 1991.

(signed) H. ALLAN HOPE, Q.C.