SHP - 382




(the "Corporation")



(the "Association")






Abe Rosner – Counsel

Lukas Biniaris – Systems General Chairperson

Claude Bergeron – President LL2762

Jim Young – Sheet Metal Worker LL2762 M.M.C.


Ken Taylor – Counsel

Josee Ouellet – Sr. Officer Labour Relations


A hearing of this matter was held at Montreal on June 3, 1993.



Four grievances have been presented to the Arbitrator for adjudication. The first of these has been filed as an individual grievance on behalf of the named Grievor, R. Aubin, and claims for this Grievor eight hours of pay at the overtime rate for each of the days of February 4, February 5 and February 12, 1991. The second grievance filed as an individual grievance on behalf of the Grievor, M. Sarrazin, is identical in nature. The final two grievances have been filed on behalf of the named Grievor, J.W. Young, who claims firstly by grievance dated February 8, 1991, four hours of pay at the overtime rate for work performed on February 4, 1991, and secondly by grievance dated February 12, 1991, a further eight hours of overtime for each of the days of February 4, February 5 and February 12, 1991. All of the work in each case was contracted out to a third party contractor.

The joint statement of issue and facts which the parties have filed in the form of a joint submission, reads as follows:


Alleged violation of Rules 21 and 24 of Collective Agreement No. 5, when the Corporation contracted-out the fabrication and installation of an exhaust system for the welding booth in the Montreal Maintenance Centre (M.M.C.)in Pt. St. Charles.


In February 1991, following recommendations of the Health and Safety Committee, the Corporation employed a contractor to relocate the welding booth to accommodate a new exhaust system.

Sheet Metal Workers J.W. Young, R. Aubin and M. Sarrazin filed claims of twenty-eight (28), twenty-four (24) and twenty-four (24) hours, at punitive rates of pay, for the work performed by the contractor.

The Association processed the claims through the respective steps of the grievance procedure, which the Corporation denied. Both parties agree the matter is now proper before the Arbitrator, in accordance with Rule 5 of Collective Agreement No. 5.


(signed) C. ROBERT (signed) C. C. MUGGERIDGE

for: System General Chairman Department Director, Labour Relations

Date: April 05, 1993 Date: 15 March 1993

The Collective Agreement, at Section 24.1, contains a general provision against the contracting out of work "presently and normally performed by employees" subject to certain exceptions. The provision reads thusly:

RULE 24 Contracting Out of Work

24.1 Work presently and normally performed by employees represented by the International Association of Machinists & Aerospace Workers signatory to this Agreement shall not be contracted out except:

(1) when technical or managerial skills are not available from within the Corporation; or

(2) where sufficient employees, qualified to perform the work, are not available from the active or laid-off employees; or

(3) when essential equipment or facilities are not available and cannot be made available from the Corporation’s property at the time and place required; or

(4) where the nature or volume of work is such that it does not justify the capital or operating expenditure involved; or

(5) the required time of completion of the work cannot be met with the skills, personnel or equipment available on the property; or

(6) where the nature or volume of the work is such that undesirable fluctuations in employment would automatically result.

The conditions set forth above will not apply in emergencies, to items normally obtained from manufacturers or suppliers nor to the performance of warranty work, nor to work performed by Canadian National Railway Company or Canadian Pacific Limited on behalf of VIA Rail Canada Inc.

The assignment in this case consisted of the fabrication and installation of an exhaust system for the Welding Booth in the Montreal Maintenance Centre located in Pointe St-Charles.

The Company’s position, insofar as concerns its invoked justification for contracting out the work in question, is contained in two letters forwarded to the Union on April 15, 1991 and July 8, 1991, respectively, the relevant portions of which. are to the following effect:

April 15, 1991

When it becomes time to modify a building the size of the Montreal Maintenance Centre, it necessitates the implication of specialized personnel, which is not available within our managerial or ununionized personnel.

Since the necessity of such a ventilation system had not been foreseen when the shop was built, its installation involved a study of the building structure by experts, the expertise of professionals in ventilation systems and shop drawings.

For the above mentioned reasons, since we did not have the expertise required within our staff and also the machinery to fabricate the components, the whole project was given to an outside contractor for its quick realization in accordance with construction’s regulations.

The work in question, is not work normally performed by employees represented by the I.A.M. signatory to agreement no. 7, our personnel’s function is to maintain the existing installation and on occasion, perform minor modifications which does not involve highly technical expertise.

We therefore, believe that the Corporation did not commit any violation of art. 24 of agreement #7 in contracting the work in question.

July 8, 1991

This letter is in response to our Step 3 appeal dated May 8, 1991, and our joint conference on June 13, 1991, regarding the welding booth/contracting-out grievances. The circumstances of this case follow:

The Health and Safety Committee recommended improvements to the welding facility which would provide improved air quality in respect to the noxious fumes produced by welding work.

The project entailed a redesign of the welding facility, wherein the location of the welding shop was moved to accommodate a new exhaust system.

The skills to design an exhaust system are not within the Corporation, and likewise, there is no expertise to test and verify that the system performs within the appropriate specifications.

To ensure that specifications would be met, the exhaust system was tendered as a total project. Firms experienced in this type of construction were invited to tender.

In February 1991, an independent firm installed the exhaust system in the welding shop. This project included the design of an exhaust system to meet safety specifications, the fabrication and installation of hoods and ductwork, installation of fans/motors and electrical service, and some building modification for exhaust vents.

The Corporation’s decisionto contract the design and construct of the entire exhaust system to specifications, falls within the exceptions of Rule 24.1 (1), (3) of Collective Agreement No. 7. The Corporation acted for valid business purposes to ensure an exhaust system was constructed to meet the safety needs of employees and building standards. The grievances must, therefore, be respectfully declined.

The Association raised the issue of notice for upcoming contract work. In this instance, the Corporation did not properly inform the Association in accordance with Article 24.2, for which we apologize. To ensure this situation will not repeat itself, the Association’s representatives, along with the other Shopcraft Unions’ representatives, have been invited to a meeting on July 31, 1991, to discuss contracting-out issues.

The Union, on the other hand, insists that the work functions comprised within the assignment, by their nature quite properly fall within "work presently and normally performed by employees …" who are members of the bargaining unit and that these employees possess the skill and ability to perform the work and have performed it on occasion in the past. It emphasizes that expertise, skills and qualifications for performance of the work to which the Company alluded formed part of the training of sheet metal workers during their apprenticeship and was well within their competence. Union counsel added that in the event that the Arbitrator should find that the work in question involved a technical dimension which went beyond such competence that such dimension was at the level of concept, design and testing and formed a relatively minor part of the assignment, so that the physical work involved could have and should have been directed to members of the bargaining unit.

Upon the basis of the evidence presented and representations made, the Arbitrator is satisfied that while a significant portion of the work involved in the assignment was within the competence of the Grievors and members of the bargaining unit generally, the assignment, as a whole, was broad in scope and involved a dimension which went beyond the technical capability of members of the bargaining unit. The assignment included the conception, design, installation and testing of an exhaust system designed to improve air quality by venting the noxious fumes produced by welding work. The particular initiative had been recommended by the Health and Safety Committee and included a technical and testing dimension. Involved were considerations of safety and security with due regard to particular safety specifications.

The Arbitrator has serious reservations as to whether all elements of the assignment could properly be said to constitute "work presently and normally performed by employees …" and is moreover inclined to question whether the skills and technical expertise were available from amongst members of the bargaining unit within the meaning of the exceptions enumerated in Section 24.1. Work functions of a sheet metal worker do not normally include testing of exhaust systems in relation to safety standards which comprised an important part of the assignment, or for that matter, developing technical designs where safety standards represent the principal consideration.

Other considerations are that the entire project absorbed only seventy-six person hours of work and no employees were on layoff at the time nor deprived of their regular hours of work by reason of the contracting out. Given these considerations, the Arbitrator does not believe that it was unreasonable to direct the assignment, in its entirety, to a single contractor with proven technical skills and capacities to meet all requirements of the assignment and specifications.

Thus the Arbitrator is prepared to conclude that the assig|nment, in its entirety (and in this regard the Arbitrator believes that the assignment must be seen from that perspective), is not "work presently and normally performed by employees …" and even if it were, that the exceptions are sufficiently broad to encompass the type of situation which the particular assignment presented. As far as the Arbitrator is concerned, it is one thing to install exhaust systems and perform the physical work involved in their construction, and quite another to design exhaust systems to meet specific safety standards and then to verify whether these exhaust systems, once constructed, meet such safety standards. Thus, given the relatively circumscribed and confined nature of the work with due regard to its duration, the Arbitrator is most reluctant to find that the various functions comprised within it should not have been directed as an entire, all encompassing, project.

Insofar as the Arbitrator believes that the contracting out in this case was justified in terms of Section 24.1 of the Collective Agreement, it need not consider other issues to which the grievances may have given rise, particularly as regards a matter of whether the Grievors would have been entitled to claim the assignments, which they do, as overtime.

For the foregoing reasons, the grievances are dismissed.

MONTREAL, June 15, 1993