SHP 330

IN THE MATTER OF AN ARBITRATION

BETWEEN

Ontario Northland Railway

AND

National Automobile Aerospace and Agricultural Implement Workers Union of Canada

AND

International Association of Machinists and Aerospace Workers

GRIEVANCE RE ARTICLE 8 NOTICE OF DISCONTINUANCE OF PASSENGER SERVICE

 

SOLE ARBITRATOR: M. G. Picher

 

There appeared on behalf of the UnionS:

Brian Stevens President, Local 103, National Automobile Aerospace and Agricultural Implement Workers Union of Canada

Michael Pilon Vice-President, Local 103, National Automobile Aerospace and Agricultural Implement Workers Union of Canada

R.S. Barker Regional Chairman, Lodge 413, International Association of Machinists and Aerospace Workers

 

There appeared on behalf of the Company:

M. J. Restoule Labour Relations Assistant

 

A hearing in this matter was held in North Bay, Ontario on November 5, 1990.

 

AWARD

The Dispute and Statement of Fact and Issue filed by the Company at the hearing is as follows:

Dispute:

The serving of a notice under Article 8.1 of the Employment Security and Income Maintenance Plan resulting from cancellation of certain rail passenger services.

Company Statement of Fact and Issue:

VIA Rail announced on Wednesday, October 4, 1989 that it was slashing 50% of its rail passenger service as of January 15, 1990. Train No. 128129 operating between Toronto and Kapuskasing and the weekend Northlander service, Train No. 123124 operating between Toronto and North Bay, were terminated by VIA Rail.

The Company advised the Brotherhood Railway Carmen of Canada and the International Association of Machinists and Aerospace Workers that as a result of the cuts, a number of carmen and machinist positions would be abolished on Ontario Northland Railway.

The Unions requested formal notice under Article 8.1 of the ESIMP. The Company responded stating that the reductions were the result of a decision by VIA Rail over which the Company had no control and that it was viewed as a fluctuation of traffic as contemplated by Article 8.7 of the ESIMP. Therefore, no notice would be served.

The Unions maintained throughout the grievance procedure that notice was required. The Company does not agree and has declined to issue the notice.

***

The provisions of the Employment Security and Income Maintenance Plan pertinent to the grievance are the following:

Article 8 Technological, Operational and Organizational Changes

8.1 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.

...

8.7 The terms operational and organizational change shall not include normal reassignment of duties arising out of the nature of the work in which the employees are engaged nor to changes brought about by fluctuation of traffic or normal seasonal staff adjustments.

The material facts are not in dispute. VIA Rail Canada Inc. operated an overnight passenger train between Toronto and Kapuskasing (Train 128129). It was operated by VIA Rail between Toronto and North Bay, as well as between Cochrane and Kapuskasing. Between North Bay and Cochrane it was operated by the Ontario Northland Railway pursuant to a contractual arrangement with VIA. The night train was known as the Northland. A second train, known as the Northlander, (#123-124) was operated by VIA Rail between North Bay and Toronto, with Ontario Northland maintaining and supplying the passenger equipment.

In October of 1989 the Government of Canada announced the elimination of both trains, effective January 15, 1990. The Union maintains that the cancellation of the trains constitutes an operational or organizational change within the contemplation of article 8.1, while the Company asserts that what has transpired is a fluctuation of traffic which fails within the exception defined within article 8.7 of the ESIMP.

The position of the Company is based largely on its submission that it had no control over the elimination of the two trains. Its representative submits that insofar as the change was outside its control, and concerned the cessation of operations on the two routes by VIA Rail, to whom it provided a service, the cancellation of the trains may be characterized as brought about by a fluctuation of traffic, as contemplated in article 8.7.

The Arbitrator has substantial difficulty with that submission. The recent VIA Rail cutbacks have been the subject of a number of arbitral awards. In VIA Rail Canada Inc and the International Association of Machinists and Aerospace Workers (Award dated December 8, 1989) the instant arbitrator was called upon to determine whether the Shopcraft employees of VIA Rail were entitled, in the same circumstances as give rise to this grievance, to notice under article 8.1 of the ESIMP which applied to them. In rejecting the position of VIA Rail that notice was properly owing under article J of the Special Agreement concerning the transfer of passenger services from CN and CP to VIA, at pp 14- 15 the following comments were made:

In the Arbitrator's view in light of the history of both the Regulation and the Special Agreement, it cannot be concluded that the unilateral abolishment of Shopcraft positions within VIA Rail, entirely unrelated to the transfer of employees as between other railways and VIA, falls within the definition of "changes" as contemplated within the Regulation, or within the terms of the Special Agreement or "Green Book". What has transpired is an internal decision, obviously driven by external budget constraints imposed by the Government of Canada, to make substantial operational and organizational change of a permanent nature. That is precisely what is contemplated by the terms of Article 8.1 of the Employment Security Income Maintenance Plan negotiated between the Corporation and the Union. The fact that the change results from political and budgetary decisions made in Ottawa does not alter the character of the change or its impact on employees for the purposes of the Plan or of the collective agreement. Most importantly, it does not bring it within the provisions of the Special Agreement which, for the reasons canvassed above, relates exclusively to the of transfers of passenger related work from other railways to the Corporation pursuant to government initiatives. The factor of government influence, or even government direction, does not of itself bring a decision of the Corporation within the Special Agreement. If it were otherwise, given that the employer is a Crown corporation which is obliged to take direction from the Government of Canada, the important protections of Article 8.1 of the Employment Security and Income Maintenance Agreement would be reduced close to the vanishing point. In considering whether the Special Agreement applies, the question is not whether the change in question has been caused by some governmental action, it is whether it relates causally to the transfer of passenger related work from other railways to VIA Rail Canada Inc. as originally contemplated in P.C. 1977-2987.

In the foregoing case the precipitating events were arguably beyond VIA Rail's control. Passenger train routes in Canada, including the routes that are the subject of this grievance, are controlled by the Government of Canada through the Minister of Transport. Although the decision was taken by Ottawa to cancel the train routes, it was found that the elimination of trains was, for the purposes of the ESIMP, an operational or organizational change as it related to the employees adversely impacted.

In the Arbitrator's view what the instant case discloses is that the Company and VIA Rail were involved in a joint venture in the operation of both the Northland and the Northlander. The cancellation of these two trains cannot, it seems to me, be said to impact VIA Rail directly, and the Ontario Northland Railway only indirectly insofar as VIA is a customer which it services. In my view that is an artificial and inappropriate characterization of what has transpired. The Northland and Northlander were operated jointly by VIA Rail and Ontario Northland Railway on an integrated basis according to an arrangement between business partners. Both companies were impacted by a government directive, and not by a fluctuation of traffic as contemplated under article 8.7 of the ESIMP. In the result, the Company discontinued a part of its operations, insofar as the two trains were removed from service. In the Arbitrator's view, for these reasons and the reasons canvassed in the VIA Rail Canada Inc. award, what the facts disclose is an operational change within the meaning of article 8.1 of the ESIMP. As it is common ground that the change resulted in a reduction of a number of positions in the Unions' bargaining unit, I must find and declare that the Corporation violated the terms of the ESIMP by failing to give notice to the Unions under the terms of article 8.1 of the Plan. As it appears that in the result there were no practical adverse consequences to any employees, because of collateral events, the remedy in the instant case is restricted to the foregoing declaration. I remain seized in the event of any dispute respecting the interpretation or application of this award.

DATED at Toronto this 9th day of November, 1990.

(sgd) M. G. Picher

Arbitrator