AH – 324




(the "Company")



(the "Union")






There appeared on behalf of the Company:

D. T. Cooke – Labour Relations Officer, Montreal

M. Senecal-Tremblay – Counsel, Montreal

S. J. Samosinski – Manager, Labour Relations, Montreal

R. A. demontignac – Manager, Benefits, Montreal

D. L. Johnson – Benefits Plan Officer, Montreal


And on behalf of the Union:

D. W. Brown – Counsel, Ottawa

P. Davidson – Counsel, Ottawa

G. D. Housch – Vice-President, Ottawa

K. Deptuk – Vice-President, Ottawa

D. McCracken – System Federation General Chairman, Ottawa

R. Della Serra – General Chairman, Montreal



A hearing in this matter was held in Montreal on Tuesday, 20 July 1993.


This arbitration concerns the interpretation of the Job Security Agreement. The Dispute and Statement of Issue contained in the ex parte document provided by the Union outlines the back-ground to the grievance, and reads as follows:


The application of Articles 7.3 and 7.8 of the job security Agreement ("JSA")


On August 16, 1993, the Company will implement, on the Pacific Region, A Technological, Operational and Organizational change, notice of which was duly served upon the Brotherhood pursuant to Article 8.1 of the JSA on April 2, 1992. The said Article 8 change will operate to abolish all positions in the Company’s Track Department, after which a reduced number of positions will be bulletined and filled by Brotherhood members in conformity with the JSA, Agreements 41 and 42 and Supplementals thereto, and the Special Agreement entered into between the parties on June 2, 1993.

During negotiations regarding the implementation of the said Article 8 change, the Brotherhood learned that the Company’s policy with respect to Article 7.87 of the JSA will be to award positions to employees with Article 7.8 protection at their home location in the following manner: (1) Track Maintenance Foreman, seniority permitting; (2) Leading Track Maintainer, seniority permitting; and (3) Track Maintainer, regardless of whether or not the employee in question possesses the seniority necessary to hold that position.

Further, it will also be the Company’s policy that an employee with Article 7.8 protection who, for whatever reason, is unable to hold work at his home location, will be awarded a position at the headquarters on another section nearest his residence in the following order: (1) a Track Maintenance Foreman position, seniority permitting; (2) a Leading Track Maintainer position seniority permitting; and (3) a Track Maintainer position regardless of whether or not the employee is question possesses the required seniority to hold that position.

The Brotherhood contends that: 1.) Employees with Article 7.8 protection are prohibited by the provisions of both the Collective Agreement and the JSA from acquiring a position in their home location if their seniority does not so permit; 2.) Employees with Article 7.8 protection are not required to relocate; 3.) The Company’s policy, if implemented, could in some circumstances, create in an employee with Article 7.8 protection an entitlement to relocation benefits which would, in itself, constitute a violation of Article 7.8; 4.) The Company’s policy, if implemented, would create a form of super-seniority that has no textual or other basis in any agreement entered into between the Company and the Brotherhood; and 5.) The Company’s policy in this regard, is in direct violation of Articles 6, 7.2, 7.3 and 7.8 of the JSA, and Articles 13, 14 and 15 of Agreement No. 41.

The Brotherhood requests that: 1.) It be declared that the Company’s policy in this matter is in violation of both the Collective Agreement and the JSA; and 2.) It be ordered that the Company implement the said Article 8 change in the manner intended by the parties to the Collective Agreement and the JSA.

The Company denies the Brotherhood’s contentions and declines its request.

It is not disputed that on April 2, 1993, the Company served a timely notice upon the Brotherhood in conformance with article 8.1 of the Job Security Agreement. The Company’s initiative involves a substantial reorganization of its Track Department system wide, which will result in loss of some six hundred bargaining unit positions across Canada. This grievance arises in relation to the first stage of implementation, which is on the Pacific Region, encompassing British Columbia and Alberta. The changes will be implemented in that Region effective August 16, 1993. Given the scope of the reorganization, it was deemed appropriate to abolish all track department positions across the system. To minimize displacement, it was further agreed that the new positions would be bulletined and filled by bargaining unit members through a pre-bid process.

The dispute arises in respect of treatment of employees who have protection under article 7.8 of the Job Security Agreement. Article 7 of the Job Security Agreement establishes employment security for employees who have completed eight years of cumulative compensated service with the Company. Article 7.2 provides that an employee with such standing is protected against layoff or continuing layoff as a result of a technological, operational or organizational change under article 8.1 of the Job Security Agreement. To protect their employment security employees are compelled to exercise their maximum seniority rights in accordance with article 7.3. Those rights are applied in an ever expanding area from the location, through the area and region, and if necessary into another seniority group, another bargaining unit, the barraging unit of another union, or into a non-unionized position. In the normal application of the requirements of article 7 an employee may be compelled to relocate, meaning that he or she must change the location or his or her principal residence (see CROA 1977).

Article 7.8 makes an exception to the requirement to relocate. It provides, in part, as follows:

7.8 Notwithstanding any provision in this article to the contrary, no employee shall be required to relocate who:

(i) has 20 years of continuous service with the Company and is within 5 years of qualifying for early retirement benefits under the terms of the applicable pension plan;


(ii) has within the preceding 5 years been required to relocate under the provisions of the Employment Security plan or has voluntarily elected to transfer with his work.

The instant dispute concerns the treatment of fourteen employees on the Pacific Region who, it is agreed, are protected by the terms of article 7.8(ii), by reason of the fact that they were required to relocate as the result of a technological, operational or organizational change within the last five years. The nature of the dispute is perhaps best illustrated by an example. Employee W. Seiben resides at Rimbey, the former headquarters location for his section. Under the pre-bid, he would be assigned to a job at Lacombe, which would involve a drive of some thirty-five miles. The Company asserts that that is a reasonable commuting distance, and that a change of headquarters from Rimbey to Lacombe, subject to the payment of a travel allowance for the period of the employee’s article 7.8 protection, does not constitute an obligation to relocate, and is in conformity with the requirements of the Job Security Agreement. The Company submits that in the circumstances, in the bidding process, Mr. Seiben cannot be out-bid or displaced by a senior employee if the result of such a displacement would be to compel him to relocate his principal residence.

The Brotherhood maintains that all bidding must be by seniority, in accordance with the provisions of the collective agreement and of the Job Security Agreement for the protection of employment security. It submits that should Mr. Seiben, for example, be unable to protect employment other than in a location which would require the moving of his principal residence, he is not required to move, and his salary is protected, even if no work should be available to him at his location, by virtue of his employment security. In other words, in the Brotherhood’s view, if another employee can assert a prior right, by reason of seniority, to the position which Mr. Seiben would have held at Lacombe, the position must be awarded to the senior employee, and Mr. Seiben would assume no active position, although his salary remains protected by the employment security provisions of the job security agreement. The Brotherhood submits that the Company’s application of the obligation to protect employment security and article 7.8(ii) is in derogation of the principle of seniority which underlies the terms of the Job Security Agreement. Specifically, it submits that the system underlying the Company’s policy results in employees being assigned to the position of Track Maintainer regardless of whether they have sufficient seniority to hold such a position.

The Company justifies its position, in part, on the reasoning of CROA 2082. That case concerned an employee of the Company at Sudbury whose position was abolished as a result of a technological, operational or organizational change. The employee in question elected to displace a junior employee at Sault Ste. Marie who had previously relocated to the position which she held in the preceding five years, also by reason of a technological, operational or organizational change. The Arbitrator there held that the junior employee at Sault Ste. Marie could not be displaced by the senior employee from Sudbury, applying what was then the terms of article 7.7(ii) of the Job Security Agreement in the case at hand, which are identical in all material respects to article 7.8 (ii) . In that case the Arbitrator commented, in part, as follows:

In the instant case it is not disputed that the grievor can displace junior employees other than the employee in Sault Ste. Marie who has the protections of Article 7.7(ii) of the Job Security Agreement. While it may be her preference to relocate elsewhere, the provisions of article 7 reflect a balancing of interests which must be respected: the junior employee who has already relocated and had the protections of article 7.7(ii) is entitled to continue to work and cannot be forced to relocate while, on the other hand, the grievor is compelled to exercise her seniority rights as against other junior employees who are not so protected. In that way senior employees continue to hold active positions and the overall incident of relocations is minimized. Significantly, the Company avoids the consequence of having a junior employee in the position of the incumbent at Sault Ste. Marie placed on inactive status while retaining full wages and benefits pursuant to the Job Security Agreement. In the Arbitrator’s view it should not be found that the parties intended that result, in the absence of clear and unequivocal language.

The Company’s wish to apply the rationale of CROA 2082 is the case at hand is, to some degree, understandable. The prospect of junior employees receiving full wages and benefits while inactive 7 is an outcome which is arguably unusual in a system predicated on access to wages and benefits through the exercise of seniority. By the same token, however, the position of the Union is equally understandable. As a reading of the Job Security Agreement reveals, the parties have fashioned the obligations under article 7 so that employees are first given the opportunity, indeed the obligation, to apply their seniority rights first at their location, before being required to do so elsewhere in the area and region. In other words, the structure of article 7, and in particular article 7.3, reflects the understanding of the parties that employees with employment security should be able, insofar as possible, to use their seniority rights to remain in their location, and to avoid the personal disruption that is inevitable if they are required to relocate. If the interpretation applied by the Company in the case at hand should prevail, senior employees who otherwise would not be required to relocate would be forced to do so.

In the Arbitrator’s view there is a substantial distinction between the facts of the case at hand and those disclosed in CROA 2082. That case concerned a single employee who would have been bumped and physically displaced to another location by the exercise of an employee’s seniority rights. In other words, what was there under consideration was a circumstance of clear displacement. In the case at hand, for the purposes of the pre-bid process, it is common ground that all positions are vacant. There are, by contrast to CROA 2082, no employees holding positions who can be said to be subject to being displaced. The narrow issue in the case at hand is the system by which employees will have access to positions, all of which are vacant, across the Pacific Region. The interpretation of the Company would have the effect of preassigning job vacancies to employees who have protection under article 7.8(ii). This it would seek to do by analogy from the principles reflected in CROA 2082.

In the Arbitrator’s view the situation at hand is substantially different. The instant case concerns the wholesale reorganization of an entire work force, on a scale similar in many respects to the special bid upon the reorganization of VIA Rail in December of 1989 (see CROA 2074.) In that context it is vital that a board of arbitration carefully consider the interests and tradeoffs which underlie the general terms of a job security agreement. CROA 2082 must not be taken for more than the narrow principle which it reflects, which is that in a bumping circumstance a junior employee retains certain protections under article 7.8(ii) of the Job Security Agreement. That case did not consider and should not be taken to speak to the very different circumstance of a system-wide reorganization where all jobs are declared vacant, to be filled by bidding in conformity with the terms of the collective agreement.

There is nothing in the collective agreement, nor in the terms of the Job Security Agreement, which would derogate from the principle that where vacancies exist, job bidding is to be on the basis of seniority. Indeed, no contrary suggestion was argued before me. It may be that some employees with article 7.8(ii) protection will, notwithstanding that they are junior, be unable to obtain active positions, and while inactive will have the wage and benefits protections of employment security. However, that result is not contrary to the general scheme and intention of the Job Security Agreement. As noted above, the Job Security Agreement, and in particular the provisions with respect to employment security, are predicated upon an understanding that employees are to be entitled to exercise their seniority in such a way as to minimize the requirement to relocate. Whatever may have been the intention of Arbitrator Dalton Larson in authoring its language, it is difficult to see in the provisions of article 7.8(ii) a wholesale rejection of that principle in the context of a system-wide job bid. In that context it is, I think, more in keeping with the purposes of article 7.8(ii) to conclude, as the Union argues, that employees protected by article 7.8(ii) may indeed invoke the protections of employment security, notwithstanding that they are unable to hold work without relocating. Nor is it apparent to the Arbitrator that there is, in the end, necessarily a significantly greater cost to be incurred by the employer. However, the practical difference in dislocation implicit in the Company’s interpretation might well be significant, particularly as it would impact senior employees who would otherwise not be forced to relocate.

For the foregoing reasons the grievance must be allowed. The Arbitrator finds and declares that the Company’s position with respect to the assignment of positions to employees with relocation protection under 7.8(ii) of the Job Security Agreement is in violation of the intention of the Job Security Agreement and the collective agreement. The Union is correct in its interpretation that employees with relocation protection may hold positions only to the extent that their seniority would so permit, consistent with the application of the Job Security Agreement and the collective agreement.

The above conclusions do not, however, entirely dispose of the grievance. A substantial issue still to be resolved is the determination of what does or does not constitute relocation. The evidence before the Arbitrator discloses that certain of the fourteen employees who are the subject of this grievance suffered no dislocation whatever with respect to the location of their headquarters. In other words, the commuting distance between their principal residence and their headquarters has remained the same. Others, however, have had a substantial change in that regard. Six of the employees have had additional distances, varying from eleven miles to forty-five miles of travel, placed upon them as a requirement to protect the positions available to them under the pre-bid process. Obviously, there must be some line beyond which an employee cannot be expected to commute, without being placed in a position of deemed relocation. It is plainly no answer to an employee who protests a forced relocation to say to the employee that he or she is not forced to relocate, but is merely required to commute an additional hundred miles per day.

How, then, is the line to be drawn? In the Arbitrator’s view little significant guidance can be drawn from article 6 of the Job Security Agreement. That article deals with relocation expenses, and, most significantly, the bulk of its terms were negotiated prior to the introduction of article 7.8 into the Job Security Agreement, which resulted from the award of Arbitrator Larson, handed down on April 11, 1988. It is obviously difficult for an arbitrator to make a determination of what may arguably be an arbitrary figure with respect to mileage which would constitute a deemed obligation to relocate. Such factors as geography, road conditions, urban and rural settings and the willingness of individuals to travel can vary dramatically from one circumstance to another. All of these factors might have a bearing on a determination of what is reasonable on a case by case basis. As the parties have been unable to come to such a determination, however, the Arbitrator is left with no alternative. In the result I am satisfied that an employee who is compelled to commute in excess of thirty-five miles from his or her normal place of residence, by reason of a change of work location implemented on or after August 16, 1993 is, for the purposes of the protections of article 7.8 of the Job Security Agreement, deemed to be forced into a position of relocation. It is, I think, not unreasonable to expect an employee to commute to work over a distance of thirty-five miles, and to return home that same distance at the end of the working day. While the time expended in such travel might vary in different regions or locations, the distance in question remains, I think, a reasonable rule of thumb by which the parties may be guided in the application of the terms of the Job Security Agreement.

In the result, any employee who has the protection of article 7.8(ii) and who would be compelled to travel to work daily in excess of thirty-five miles, such as S. Clarke of Killam, must be taken to have suffered a deemed relocation. To that extent a violation of the collective agreement and the Job Security Agreement would be disclosed. An employee in the position of Mr. Clarke would, by the operation of the Company’s policy, be effectively required to relocate in a manner contrary to the purpose and intention of article 7.8(ii) of the Job Security Agreement. The Arbitrator retains jurisdiction in the event of any dispute between the parties with respect to the interpretation or implementation of this award.

Dated at Toronto, July 21st, 1993