APPEARING FOR

A hearing in this matter was held in Montreal on January 31, 1996.

This grievance concerns the claim of two employees to an early departure incentive. The grievors are husband and wife, and count their seniority from September of 1980. From that time to the present, they have occupied work under collective agreement #1 in a number of positions, including Baggage Handler, General Operations Clerk and Ticket Agent. The instant grievance arises by reason of their treatment at the hands of the Corporation in the implementation of the terms of a Memorandum of Agreement dated August 24, 1995, following on the report of the Mediation-Arbitration Commission of the Honourable Mr. Justice Mackenzie as implemented effective September 21, 1995. The dispute and joint statement of issue filed at the hearing, read as follows:

It is common ground that in the proceedings before Mr. Justice Mackenzie the Corporation requested relief from the maintenance of earnings burden which it was carrying as a result of prior operational and organizational changes, and the previously-existing employment security and job security provisions by which it was bound. Judge Mackenzie's award, made pursuant to Section 53 of the Maintenance of Railway Operations Act, 1995 was handed down on June 13, 1995. Within the collective agreement language provided by that award, Article P provided enhanced retirement opportunities and early departure incentives (EDI). Article P reads, in part, as follows:

It is common ground that the effect of the foregoing provisions of the Mackenzie award was to permit the Corporation to abolish some 75 regular part-time assignments, being assignments of less than 40 hours per week but for which the employees were compensated, on a maintenance of earnings basis, to the rate of 40 hours weekly. The object of the exercise was to allow the Corporation to stop paying the maintenance of earnings burden in respect of employees who held year-round, part-time assignments paid at the 40 hours per week rate. In negotiations following the award the parties sought to identify those whose regular part-time assignments would be abolished, and who would therefore have the option of the early departure incentive. It is common ground that employees so entitled would be paid the departure incentive, and would thereafter revert to true part-time positions, with their seniority adjusted to the positions of persons newly-hired effective September 21, 1995. That is reflected in the foregoing provisions of the Memorandum of Agreement of August 24, 1995.

The material before the arbitrator establishes, beyond dispute, that in fashioning the list of employees appearing on Appendix A, a list which does not include the names of either Ms. or Mr. Pilidis, the parties intended to identify employees who held regular, part-time positions on a year-round basis, as a general rule, and who were in receipt of maintenance of earnings benefits.

It is not disputed that at the time of the Memorandum of Agreement the Corporation had consistently paid maintenance of earnings (MOE) benefits to the grievors. It submits, however, that it did so in error. According to the Corporation's representative, system-wide, employees who elected layoff and were thereafter returned to part-time assignments on a seasonal basis were not entitled to MOE protection. In fact, however, the grievors continued to receive MOE protection after they elected to take layoff in 1991, being recalled regularly to part-time assignments in accordance with seasonal availability. It does not appear disputed that only the grievors and three other employees in Winnipeg were maintained on MOE protection when they were recalled from layoff to part-time work. In the result, the Corporation submits that the grievors should not be seen as entitled to the EDI buy-out as they were not, in fact, properly in receipt of maintenance of earnings payments and, secondly, they did not hold year-round, regular part-time positions.

The arbitrator accepts the Corporation's characterization of the grievor's circumstances as accurate, and cannot take issue with the general principles underlying the entitlement of employees to the EDI payment, in accordance with the intention of Mr. Justice Mackenzie and the negotiated terms of the Memorandum of Agreement. However, there is a further dimension to be examined in the instant case. A review of the employment history of the grievors reflects that in October of 1992 the grievors were faced with a layoff in Edmonton. It is common ground that they could then have held year-round, regular part-time positions by bumping to Jasper. In fact, the Corporation's officers then advised the grievors that if they should not opt to move to work in Jasper, their Maintenance of Earnings protection would nevertheless be maintained. In other words, when they returned to work on recall, they would have the advantage of being paid on a 40-hour basis, even though they might hold part-time assignments. In those circumstances, and annually thereafter, Mr. and Ms. Pilidis opted to take layoff rather than protect year-round, regular work at Jasper. It is clear that the grievors had the seniority to hold year-round, regular part-time assignments, as such assignments were, in fact, held by persons junior to themselves. In reliance on the information given to them by the Corporation, however, they chose not to use their seniority to hold such positions. Now, as noted above, the Corporation stresses that its information and advice to them was in error, and they cannot claim an EDI because they did not hold year round positions in regular part-time assignments.

What, then, does the unfolding of these events disclose? It appears clear to the arbitrator, as argued by the Union's representative that, in fact, but for the advice given to the grievors by the Corporation's officers, they could and would have followed a course of action which would have maintained their status as persons holding year-round, regular, part-time positions.

In these circumstances, the arbitrator has some difficulty with the argument of the Corporation to the effect that to grant the EDI payments to the grievors would be to afford them an unintended pyramiding of benefits. As is clear from the material before me, it was the intention of Mr. Justice Mackenzie and, indeed, of the parties, to relieve the Corporation of the obligation of the burden of maintenance of earnings payments. In exchange for that relief, the minimizing effect of the early departure incentive was to be made available to employees impacted by that change. In the result, effective September 21, 1995, Mr. and Ms. Pilidis lost their MOE incumbency. They did not, however, have access to the EDI payment, notwithstanding that employees junior to themselves were given that opportunity. The arbitrator would not disagree, for the purposes of this grievance, with the Corporation's position to the effect that the Pilidises were not entitled to MOE payments. However, the fact is that MOE payments were consistently provided to them from 1991 onwards. Most importantly, the knowledge that they would continue to receive MOE payments even though they declined to protect year-round, regular part-time work, and opted for layoff, induced the Pilidises into a course of action which led to the very disqualification which the Corporation now asserts. In other words, but for the Corporation's own error, there is little doubt, on the balance of probabilities, Ms. and Mr. Pilidis would have maintained themselves in a protected position, using their seniority to hold year-round, regular part-time positions. Very simply, but for the Corporation's own erroneous actions, the grievors would have been among those employees identified for protection, and listed on Appendix 'A'.

In these circumstances, by reference to principles of estoppel, if necessary, the arbitrator is satisfied that the grievance must succeed. It is inequitable, in my view, for the Corporation, which held out consistently and over a period of years to the grievors that they were employees entitled to MOE protection, as a result of which they opted not to protect year-round, regular part-time positions, to now assert that they are outside the spirit and letter of the protections intended by the Memorandum of Agreement of August 24, 1995. Nor can the result be said to be unfair to the Corporation, insofar as its expectation emerging from the Mackenzie award. It is common ground that, in fact, a substantially smaller number of the 75 positions identified by Mr. Justice Mackenzie were ultimately identified for compensation, largely by reason of the employment contingencies experienced by certain of the employees identified on the Appendix 'A' list. This is not, therefore, a circumstance in which the Corporation can say that the result of the grievance succeeding would bring it outside its general cost expectations based on the Mackenzie award.

In the result, therefore, the grievance is allowed. The arbitrator directs that the grievors be afforded the opportunity to receive the EDI payment extended to employees listed on Appendix 'A' of the Memorandum of Agreement of August 24, 1995. I retain jurisdiction in the event of any dispute between the parties with respect to the interpretation or implementation of this award.

DATED at Toronto this 7th day of February, 1996.

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Michel G. Picher - Arbitrator