SHP – 534




(the “Employer”)



(the “Union”)




SOLE ARBITRATOR:                          Frank Reilly



There appeared on behalf of the Employer:

Mike Restoule                        – Manager, Labour Relations, North Bay

Ken Duquette                        Area Supervisor

And on behalf of the Union:

Brian E. Stevens                        Local President

Brian Kelly                        Chief Steward

Dan Ciesla                        Committeeperson

Peter Straus                        Grievor


A hearing in this matter was held on September 14, 2000.



This arbitration deals with Grievance No. 2242 filed by the union alleging that the employer had incorrectly contracted out work related to Bus #954, work that is normally performed by bus mechanics. By way of remedy the union seeks to have the employer cease contracting out the work in question, and that the union be awarded damages for work lost as a consequence of the contracting out. It further requests an order that in the future the employer should consult with the union prior to contracting out work.

The parties are bound by Collective Agreement No. 12, which governs rates of pay and rules of service for locomotive and car departments, bus and maintenance of way mechanics. The agreement is effective from January 1, 1998 to June 30, 2001.

Bus #954 was on a regular intercity run in January 2000 when it failed in Latchford, Ontario. Two bus mechanics were sent, along with a replacement bus, to attempt to repair Bus #954. As they were unable to do so, the bus had to be towed back to the North Bay bus garage. The bus was repaired and sent on a trip to Toronto. However, the bus again failed, this time in Huntsville.

A bus mechanic was sent to Huntsville to repair Bus #954. The passengers were moved to another Ontario Northland bus. The mechanic was successful in getting the bus running again, and it was brought back to the North Bay bus garage.

On the following Saturday Bus #954 was scheduled to do a charter run to Casino Rama in Orillia. However, before it left the yard the bus failed. Ontario Northland decided to have the bus towed to Harper Diesel in Sudbury as that company has more sophisticated equipment to analyze engine problems than does the North Bay bus garage. Furthermore, Bus #954 was still under the manufacturer’s warranty, and Harper Diesel is an authorized warranty depot.

Harper Diesel determined that the problem originated in the on-board computer in the bus. It corrected the problem under warranty and at no cost to Ontario Northland.

On May 7, 2000 Bus #954 came to the North Bay bus garage with a “check engine” warning light on and a report that on occasion the engine was not revving up. The bus mechanics at the garage made attempts to diagnose the problem in between Bus #954’s regular runs. In particular, Mr. Peter Straus, a bus mechanic, began the prescribed diagnosis procedure in order to narrow down where the malfunction was. He left instructions regarding his findings for the next shift of employees. When he returned from his next two days off he heard that Bus #954 had been sent to Harper Diesel in Sudbury.

Mr. Straus has been a mechanic in the bus garage for 18 years and has been working at the trade since 1972. Over the years he has received extensive training through the employer and courses that the employer has sent him to. In March 1997 Mr. Straus completed training at Centennial College that he claims prepared him for the type of work involved with Bus #954, and Series 60 engines. He has been trained in troubleshooting when there is an engine problem. He was also trained in electronics, electronic controls, fault code accessing and clearing. He concedes that data programming was not part of the training. Mr. Straus testified that he could have, and does, the type of work involved in assessing the problem with Bus #954.

On May 12, 2000 Bus #954 again failed, this time in Parry Sound. On this occasion the employer ordered that it be towed directly to Harper Diesel in Sudbury, which subsequently repaired the on-board computer again. The work was conducted under warranty and at no cost to Ontario Northland.

The union alleges that the employer has violated the collective agreement by contracting out bus mechanic’s work, which in this instance would have involved bringing Bus #954 back to North Bay from Parry Sound in May 2000 for inspection and analysis before sending it anywhere else. Essentially the union is alleging that the bus mechanics at the garage should have had the opportunity to assess the problem and attempt to fix it before the work was contracted out to Harper Diesel.

It is the union’s contention that the bus mechanics have the exclusive right to perform repairs, adjustments, diagnoses and tests on bus engines, pursuant to Rules 21 and 27 of the collective agreement. It argues that the work in question has historically been performed by the bus mechanics, and that they have the skills to do it.

Further, the union argues that pursuant to Appendix VIII of the collective agreement, the work in question should not have been contracted out because it did not fall within any of the exceptions outlined in that Letter of Understanding regarding contracting out.

The employer argues that having Bus #954 repaired by Harper Diesel in Sudbury was not work contracted out in violation of the collective agreement, including the Letter of Understanding regarding contracting out. It is the employer’s position that the work falls within the exceptions to the prohibition against contracting out.

Ontario Northland also argues that the work that was contracted out was not work that was presently and normally performed by bargaining unit employees. Repair attempts had been made in the bus garage on this particular vehicle, but it ultimately appeared that the garage did not have the capability to perform the repairs originating with the on-board computer. Furthermore, Bus #954 was still under the manufacturer’s warranty and warranty work is exempt from the restrictions against contracting out.


In reaching a decision in this case I begin with a review of the relevant terms of the collective agreement. Rule 21 states:


21.1 Employees not covered by the collective agreement shall not perform work of the bargaining unit, except in the case of an emergency; wherein an explanation will be provided to the union.

Rule 27 outlines the Machinist Trade Description and states the following as part of the description of the trade:

27.1 Completely and independently plans, lays out, repairs, dismantles, rebuilds, maintains, installs, adjusts, diagnoses, tests, locomotives and shop machinery and all diesel or gas powered engines including internal oil pumps, transmission systems, hydraulic and pneumatic equipment including braking systems, air compressors, auxiliary power units, rail or rubber tired vehicles including buses, bulldozers, cranes, payloaders, motor cars, motor coaches, locomotives and track equipment.

As I have found in the decision in respect of Grievance No. 2212 (October 2000), the bus mechanics are covered by this trade description. It is clear from the face of the collective agreement that it covers bus mechanics. Section 5 of the agreement addresses work jurisdictions for various trades and for support services. A perusal of all of the work jurisdictions for all of the trades (machinists, boilermakers, blacksmiths, sheet metal workers, electrical workers, carmen) and support services indicates that the work of the bus mechanics is clearly covered in the machinist trade description.

Appendix VIII to the collective agreement contains a letter of understanding between the parties executed on January 8, 1986. It addresses the matter of contracting out of work and states in part as follows:

… it is agreed that work presently and normally performed by employees represented by organizations signatory to the Memorandum of Settlement dated today, will not be contracted out except:

when technical or managerial skills are not available from within the railway; or

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

when essential equipment or facilities are not available and cannot be made available from railway-owned property at the time and place required; or

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

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

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.

In addition, the company will advise the union representatives involved in writing, as far in advance as is practicable, of its intention to contract out work which would have a material and adverse effect on employees. Except in case of emergency, such notice will be no less than 30 days.

The onus of proving that it had justification for contracting out the work performed on Bus #931 lies with Ontario Northland (see SHP 381, Frumkin, June 1993).

The employer has relied upon Exception 1 and the exception regarding warranty work.

Having reviewed the evidence it is apparent that between January and May 2000 a number of efforts were made by bargaining unit bus mechanics to resolve the problems that Bus #954 was having. On three occasions it failed and bus mechanics worked on the problems to get the bus back on the road. After the third breakdown Ontario Northland sent the bus to Harper Diesel for more sophisticated analysis. It determined that the problem was with the on-board computer, which was still under the manufacturer’s warranty. Since Harper Diesel is an authorized warranty depot, it made the necessary repair and returned the bus to service at no cost to Ontario Northland. The union has not complained about this aspect of the work sent to Harper Diesel.

When Bus #954 was again having problems on May 7, 2000 it was the bus garage that had first carriage of the bus for analysis. Mr. Straus himself worked on the bus but had to leave it before he had completed the analysis. It appears that the bus was put back into service before it failed in Parry Sound on May 12, 2000 and was towed to Harper Diesel in Sudbury.

In my view this is not a case about Rules 21 and 27 of the collective agreement. The bus mechanics have the work jurisdiction outlined in Rule 27, the Machinist Trade Description and the parties have agreed that with some exceptions, work of the bargaining unit will not be contracted out. The bus mechanics had had many opportunities to work on Bus #954 up until May 12, 2000 when it was sent to Harper Diesel. Ontario Northland did not send the bus to an outside contractor immediately after it began to have problems. Rather, all of the early diagnostic work was performed in the bus garage or on the road by bargaining unit bus mechanics.

None of the employees of the bargaining unit were laid off or deprived of their regular hours of work as a result of the work in question being performed under warranty at Harper Diesel.

Considering the five-month history of mechanical problems with Bus #954 by May 12th, it is hardly surprising that the employer decided to simply have the bus towed to Harper Diesel in Sudbury for further warranty repairs.

From a review of Appendix VIII, the letter of understanding regarding the contracting out of work, it is clear that the parties had agreed that the six conditions outlined as exceptions would not apply to the performance of warranty work. However, even if they did, I am satisfied that in this instance the North Bay bus garage did not have sufficiently sophisticated equipment or technical skills to establish that the problem with Bus #954 was the on-board computer.

That conclusion is reached by a review of the various efforts made by bus mechanics between January and May 2000 to try to find out why the bus kept failing. The problem could not be isolated in the bus garage, and it was not until the bus went to Harper Diesel in Sudbury the first time that it became obvious that the on-board computer was the problem. The diagnostic work had apparently been beyond the technical capability of members of the bargaining unit. As a result of that experience, the employer knew that Bus #954 was failing as a result of the computer, and further, that the problem was one that could be fixed under warranty.

I am satisfied that it was not necessary for Ontario Northland to go through another cycle of attempts at the bus garage on May 12, 2000 before it sent the bus back to Harper Diesel. Warranty work had been performed earlier by Harper Diesel, and a short time later a similar problem manifest itself again. In those circumstances the employer was entitled to send the bus back to the authorized warranty depot. It is noteworthy that the repair was again done under warranty and at no cost to the employer.

While the machinist trade description in Rule 27 includes diagnosis and tests on buses and motor coaches, in this case bus mechanics had had ample opportunity to do that work without success. The problem with Bus #954 was isolated by Harper Diesel and was warranty work. When the same bus had a similar problem to what it had been experiencing previously, and since Ontario Northland knew that Harper Diesel had been able to identify and rectify the problem earlier, it was reasonable for the employer to send Bus #954 back to Harper Diesel. As Harper Diesel performed warranty work, I cannot find that the employer has breached the terms of the collective agreement in the particular circumstances of this case.

For all of the above reasons the grievance is denied.

DATED AT WATERLOO, October 7, 2000,