AH – 422




(the “Company”)



(the “Union”)




SOLE ARBITRATOR:                Michel G. Picher



There appeared on behalf of the Company:

Brian F. Weinert                         Director, Labour Relations

Jeff Barrett                               Linehaul Manager


And on behalf of the Union:

Jack Crabb                               Executive Vice-President

Michael Flynn                            Division Vice-President


A hearing in this matter was held in Toronto on November 22 & 23, 1992.



This is the arbitration of a grievance concerning the abolishment of a linehaul position at the Company’s Courtney terminal.

The facts are not in dispute. The Courtney terminal is located on Vancouver Island, between Nanaimo and Campbell River, where the Company also has terminals. The Company operated a number of linehaul positions out of Nanaimo, the southerly point, as well as Campbell River, the northerly point and Courtney. Linehaul driver Charlie Williams operated for a number of years from the Courtney terminal. In view of his impending retirement on July 31,1991 the Company decided to abolish his position at Courtney, and to effectively transfer it to the Nanaimo terminal. It appears that its decision was motivated by considerations of efficiency, having regard to morning ferry traffic at Nanaimo. The Company’s thinking is disclosed in a letter from Regional Linehaul Manager Jeff Barrett addressed to the Union’s Vice-General Chairman, Mr. Michael W. Flynn on June 21,1991. It reads as follows:

As previously advised, one of the subjects I had wanted to discuss with you was making a man power domicile change on Vancouver Island. For your information, Charlie Williams (Courtney employee) will be retiring on July 31st of this year. Charlie holds a linehaul spareboard position at Courtney. The demand for the men and power is at Nanaimo through the early a.m. (when boats are arriving). Since the demand for men and power is at Nanaimo, on July 31st I want to award an additional spareboard position in Nanaimo, and cancel the spareboard position in Courtney.

Please advise if you have any concerns, or require any additional information on this matter.

The Union alleges that the change implemented by the Company is an operational or organizational change which triggered the requirement of a notice under Article 5.1 of the Job Security Agreement which provides as follows:

5.1          The Company will not put into effect any technological, operational or organizational change of a permanent nature which will have adverse effects on employees without giving as much advance notice as possible to the General Chairman representing such employees or such other officer as may be named by the Union concerned to receive such notices. In any event, not less than three months’ notice shall be given, with a full description thereof and with appropriate details as to the consequent changes in working conditions and the expected number of employees who would be adversely affected.

The Company submits that Article 5.1 has no application in the facts at hand as there was no adverse impact on any employee in the bargaining unit. It submits that in the light of the retirement of linehaul driver Williams, the elimination of his position from Courtney resulted in no layoff or downgrading of any other employee. The Union representative submits, however, that it need not be shown that any employee had lost any actual earnings or had been displaced from his or her job, in order to establish that there has been an adverse impact. He submits, for example, that if it could be shown that a Courtney employee working on a lower-paid city driving assignment has lost the opportunity to bid into the higher paid linehaul job vacated by the retirement of Mr. Williams, an adverse impact would be disclosed.

For the reasons commented upon in the award concerning the abolishment of bulletins at Port Coquitlam [AH-424], issued contemporaneously with this award, the Arbitrator accepts that the concept of adverse impact for the purposes of the Job Security Agreement does not necessarily require a demonstration that employees have been laid off or downgraded. Many factors, such as physical dislocation, changes in hours and days of work, or the imposition of more onerous conditions of employment in a number of ways may serve to establish an adverse impact for the purposes of the Job Security Agreement.

In the case at hand, however, the Union goes one step further. It submits that the loss of an opportunity of advancement is, in and of itself, an adverse effect of the kind contemplated in Article 5.1 of the Job Security Agreement. With that submission the Arbitrator has greater difficulty. Needless to say, many decisions taken by the Company may have impacts upon employees. When a layoff is declared, the employees who leave the workforce face a direct negative impact. Others may face indirect impacts. For example, employees who are already on layoff may have the likelihood of their recall reduced by virtue of a subsequent layoff of more senior employees. It does not follow, however, that the employees who are indirectly affected in that way are entitled to the special protections of a Job Security Agreement.

The distinction between direct and indirect impacts was touched upon in CROA 2257. In that case the Union argued that employees laid off as a result of a strike at a mining company serviced by the employer railway should be given the protections of a material change provision of their collective agreement, similar to the Job Security Agreement in the case at hand. It was argued that by virtue of an earlier operational change, which reduced the number of jobs available, the employees facing layoff had fewer job opportunities to fall back upon in the exercise of their seniority. The Arbitrator found that that impact was too indirect and rejected the grievance. In doing so, he commented as follows:

The presumption underlying article 47 of the collective agreement is that the parties negotiate the minimising of adverse impacts resulting from material change at a time when the employees impacted can be identified and when adverse impacts upon them are reasonably known and quantifiable. The process so contemplated does not provide for the contingency of unforeseen, indirect impacts, such as those giving rise to the claim in this case. If it were otherwise the agreements negotiated under article 47 could never be finalised or cosseted by the parties with any certainty. In the Arbitrator’s view, that is plainly not the intention of the parties’ agreement in respect of material change.

The importance of certainty and the distinction between immediate and indirect impacts was touched upon by Arbitrator Weatherill in the award between Canadian Pacific Ltd. and United Transportation Union concerning the application of a special agreement pursuant to the Railway Passenger Services Adjustments Assistance Regulations, dated November 10, 1983. At pp. 10-11, in considering the scope of employees “adversely affected” within the contemplation of the Special Agreement he commented as follows:

... The class of persons contemplated as “adversely affected” in the Special Agreement as in the Regulations, consists of railway employees.

Even within that constituency, however, it is necessarily the case that the “effects” of a reduction of passenger services with the attendant abolition of positions may be substantial, diverse and difficult to identify. In the long run, there is less work to go around, less use of equipment, less maintenance, and so on. The “long run” will, however, also be affected by the continuing variations of ordinary business operations and, in the railway industry, by fluctuations of traffic. It may, thus, be impossible to determine whether or not some future reduction – or indeed any perceived insufficiency of earnings – is attributable or not to a particular change in operations. The cases of those whose positions were abolished and who were unable to hold other jobs are clear, as are the cases of those displaced by the exercise of seniority in such circumstances. It is, however, not clear that persons who did not hold regular positions should be said to be “adversely affected” within the meaning of the Special Agreement, where the effect on their work or earnings is only indirect. While, in a general way, such persons may appear to be “affected” by the change (as, in a general way, were many others), they do not, in my view, come within the class of those contemplated by the Special Agreement as entitled to benefits.

Clearly, there must be some rational ambit to the concept of adverse effects intended by the parties in Article 5.1 of the Job Security Agreement. As reflected in CROA 221, one means of understanding the concept of adverse effects is to examine the kinds of benefits and protections contemplated within the terms of the Job Security Agreement. In the case at hand, the Job Security Agreement provides such benefits as the maintenance of basic rates for employees who are compelled to move to lower rated positions. The Job Security Agreement also contains provision for relocation, training and weekly layoff benefits and severance payments. In the Arbitrator’s view the thrust of those provisions is clear: the adverse affects against which the agreement is intended to protect employees are direct negative impacts which give rise to the kinds of protections found within the Job Security Agreement, or similar protections which may be negotiated pursuant to the procedures contemplated under Article 5.

Against that background, can it be said that the evidence discloses any adverse impact for the purposes of the Job Security Agreement? I think not. This is not a case where any employee can claim a loss of work, or of any other vested right or advantage. To all appearances, all employees maintain the status quo, and continue to function in the assignments which they previously held. In the circumstances the Arbitrator cannot find that there has been an adverse effect on any employee at Courtney, or elsewhere, in the sense contemplated under Article 5.1 of the Job Security Agreement.

For the foregoing reasons the grievance must be dismissed.

DATED this 27th day of November, 1992.