SHP - 55



Canadian Pacific Limited

(the "Company")



(the "Union")



SOLE ARBITRATOR: J. F. W. Weatherill




J.W. Asprey and others



M.N. Yorston and others



A hearing in this matter was held in Montreal on January 11, 1979.



The joint statements of fact and issue in this matter are as follows:


Mr. Medina was set up from the classification of Labourer to an Electrician's Helper on November 12, 1977. On February 21, 1978, some seventy-three (73) working days later, Mr. Medina was set back to a Labourer's position while two (2) Junior Electrician's Helpers were retained in that classification.


It is the position of the Union that the Company has sixty-five (65) working days to decide if an employee is undesirable in a classification. (Rule 23.1 of Wage Agreement No. 16). Mr. Medina had accumulated over sixty-five (65) working days as an Electrician's Helper and should not have been demoted.

It is the Company's position that there is no such restriction imposed by Rule 23.1 and that the Collective Agreement was not violated.

* * * * *

Rule 23.1 of Wage Agreement 16 is as follows:

A new employee shall not be regarded as permanently employed until he has completed 65 working days cumulative service. In the meantime, unless removed for cause, which in the opinion of the Company renders him undesirable for its service, the employee shall accumulate seniority from the date he entered the classification in the craft, and shall be regarded as coming within the terms of this Agreement.

Rule 23 deals generally with the matter of seniority. It is, as the Company points out, similar to the "probation" clauses found in many collective agreements. The effect of such clauses is, generally, that the employer may evaluate an employee during his probationary period and remove him if it wishes without, in most cases, the need to show cause. Under Rule 23.1, a "new employee" is, in effect, on probation for a period of 65 working days, after which he becomes "permanently employed". His seniority, nevertheless, accumulates during this "probationary" period, and he is covered by the collective agreement.

Mr. Medina, as is clear from the joint statement of facts, was not newly-hired by the Company. He had in fact been hired on January 27, 1977, as a Labourer. As such, he came within the scope of another collective agreement. It would appear that under the provisions of that collective agreement he became a permanent employee after 65 working days. The Company contends that he would no longer be subject to a "probationary period", and that Rule 23.1 has no application in the circumstances. The gist of the Company's case is that it removed the grievor from the classification of Electrician's Helper because he was incompetent. The Union's case is, in effect, that since he had spent more that 65 working days in the classification, the grievor had become a permanent employee in it.

Upon analysis of the matter, it appears to me that the parties have not really joined issue with respect to the true ground of the grievor's removal from his classification. There is a sense in which each of the parties is right, and a sense in which each of them is wrong, in my view.

First, it must be said that while Rule 23.1 does have the general effect of a "probation" clause, it does so in a special way which is unlike that found in most collective agreements. From Rule 23.1 itself, and from other provisions in Rule 23, it is clear that the seniority principle established under this collective agreement is one of seniority within a classification in a particular craft. (Indeed the exercise of seniority is more closely circumscribed than that, but the point is not material here). Rule 23.1 provides not merely for a "new employee" becoming permanently employed" after 65 working days, but it sets out this principle of classification seniority.

Second, and more importantly for this case, Rule 23.1 deals with "new employees" and provides that they are to be "regarded as coming within the terms of this Agreement". While he was employed as a Labourer, Mr. Median was not a member of this bargaining unit, and not covered by Wage Agreement No. 16. He was covered by a different collective agreement, and there do not appear to be any special inter-recognition provisions which would make the grievor anything other than a "new employee" within the meaning of Rule 23.1, when he became an Electrician's Helper, even if he was at that time already well-established in the employ of the Company.

Third, it seems clear that, in both parties' view, had Mr. Medina in fact been newly-hired by the Company on November 12, 1977, and had his history then have been the same, he would then certainly have become a "permanent employee". Rule 23.1 would undoubtedly have applied to him, and its effect would have been to give him some measure of job security. The rule is of general application, and it is difficult to see why a person who happens already to have been working for the Company in another bargaining unit should be in a worse position than one who is newly-hired into the Company.

Having regard to these considerations, it is my view that the Union is correct to this extent: that Rule 23.1 did apply to Mr. Medina, and that its effect was to make him a "permanent" employee in the classification of Electrician's Helper prior to February 20, 1978. As a permanent employee, he was no longer subject to "removal for cause which, in the opinion of the Company renders him undesirable for its service".

On the other hand, and in this respect the view of the Company is correct, the status of a "permanent" employee is not that of being irremovable from his job. In the case of the "new employee", removal may be effected where "in the opinion of the Company", the employee is "undesirable". Once an employee becomes "permanent", the Company may no longer exercise its opinion in so broad a way. The Company has not, however, been restricted by this rule, or by the fact of "permanent" status from exercising its right to determine whether or not an.employee is competent to do his job. That right may be exercised with respect to any employee, regardless of his seniority. This need not be, and has not been, a source of any very substantial insecurity for most employees however, because this right is not an absolute one, and is subject to review. When the Company removes an employee from his position on the ground of incompetence it must, if the matter is grieved, show, by reference to proper standards and by satisfactory evidence that the employee has become incompetent. The onus of proof is on the Company in such a case. The matter is very different from that of the Company's "being of the opinion", in the case of a "new employee", that he is "undesirable". Once the period in which the Company may exercise that opinion has gone by, it is then, if it removes an employee, faced with the necessity of justifying its action.

In the instant case, the joint statement of issue sets out the difference between the parties as to the application of Rule 23.1. On this issue, I have set out my conclusion that the Rule does apply. While this ruling involves the rejection of certain arguments advanced by the Company, what I have said in the course of it supports the right of the Company to remove employees on grounds of incompetence subject to the obligation to justify such action, if it is challenged. Much of the Company's argument in this case was directed to that end, that is to the justification of its determination that the grievor was not competent to perform the job. That issue, however, is not one raised in the joint statement, and was only incidentally dealt with by the Union.

On the issue before me, the grievance must succeed. It is my award that Mr. Medina be reinstated in his classification of Electrician's Helper forthwith, without loss of seniority in that classification, and that he be compensated for any loss of earnings flowing from his removal from that classification. In fairness, however, it must be noted that the Company is not thereafter precluded from explicitly removing the grievor on grounds of incompetence; another grievance, of course, might be brought on that issue.

(signed) J.F.W. Weatherill