SHP – 535




(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. 2212 filed by the union alleging that the employer had incorrectly contracted out work related to Bus #931, 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.

There is little dispute about the facts giving rise to the grievance. In late February 2000 Bus #931 was scheduled for routine emissions testing in Sudbury at Harper Diesel. Ontario Northland does not have the equipment or expertise to perform emissions testing. The bus therefore went in for testing after it had completed a trip to Sudbury. As it failed the emissions test Harper Diesel began to check for what may be causing the problem. It determined that dirt had entered the internal parts of the engine rendering it unserviceable.

Harper Diesel called Ontario Northland for instructions, and was told to replace the engine on a unit exchange basis. Following this work being done, the emissions test was conducted again and Bus #931 passed the test.

Mr. Peter Straus has been a mechanic in the employer’s 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, including at the Harper training facility. In the course of his employment Mr. Straus has performed the type of work involved in removing the engine from a bus, rebuilding it, and replacing it. He indicated that the bus mechanics overhaul all of the buses. Ontario Northland concedes that bus mechanics normally remove and reinstall bus engines.

It is noteworthy that at the behest of the employer Mr. Straus successfully completed a five-day training program in 92 series engine overhauls, and received a Certificate of Merit for that course. Bus #931 had the very same engine type, and it was that engine that was replaced by Harper Diesel.

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 the removal, rebuilding and reinstallation of the engine. It contends that there was no urgency to having the emissions test done on that specific date and there is no dispute that the bus was running without problems. Therefore, the union argues that Ontario Northland could have brought the bus back to the bus garage in North Bay where the work performed by Harper Diesel could have been performed by bargaining unit members who normally and regularly do this type of work. It is also argued that the machinists in the bus garage have the exclusive right to perform engine replacements. In the union’s view the work could have been performed in North Bay and an emissions test could then have been done in North Bay.

The employer argues that it has not violated the terms of the collective agreement in this instance. It believes that the situation with respect to Bus #931 falls within Appendix VIII, the Letter of Understanding on Contracting Out of Work. Thus, it claims that the work in question falls within Items 1 or 3 of that Letter, or was in the nature of an emergency. The basis for the employer’s argument is that Ontario Northland does not possess either the equipment or the necessary technical skills to perform emissions testing at the North Bay bus garage. Thus, this work must be contracted out.

With respect to the engine work, the employer argues that it would have been required to separate work elements, which would have involved undue cost and duplication to have had to tow the bus back to North Bay for the engine work. It therefore contracted out the entire task. Furthermore, Ontario Northland argues that rebuilt engines are normally obtained from suppliers, so it simply asked Harper Diesel for an engine on a unit exchange basis.

The employer claims that it would have had to tow the bus from Sudbury to North Bay to have the engine installed in its bus garage, and then would have had to send the bus back to Sudbury for the emissions test. It therefore, for valid business reasons and in good faith contracted out the work to Harper Diesel.


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.

Having reviewed the evidence in this case I cannot find that there was an emergency in this instance. While Ontario Northland is obliged by law to have its vehicles emissions tested annually, there is no requirement as to when the testing must be done. In this instance the employer had determined to have Bus #931 tested when it reached Sudbury in late February 2000. The bus was running fine at the time. When Harper Diesel indicated the bus had failed the emissions test due to some dirt in the engine, the bus was still capable of running safely, albeit without a clean emissions result. There was therefore no emergency at that juncture.

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.

I cannot accept the employer’s contention that the bus mechanics are not covered by this trade description. It is clear from the face of the collective agreement that it covers bus mechanics. The parties negotiated this collective agreement to cover a variety of types of employees of Ontario Northland. Section 5 of the agreement addresses work jurisdictions for various trades and for support services. The work jurisdictions in the support services section refers to cleaners, engine attendants, assistant engine attendants, stationary engineers, material handlers, forklift operators, and engine watchmen. A perusal of the work jurisdictions for the 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.

A review of Rule 27, as it was in an earlier collective agreement No. 12 (effective April 12, 1992), bolsters my view. In that agreement the cover page indicates it was meant to cover the Locomotive and Car Departments. Machinists’ Special Rules, Rule 27, made no reference to buses, motor coaches or motor cars, or to diesel powered engines. Clearly, by the time the parties negotiated the present collective agreement there had been an addition of the bus and maintenance of way mechanics.

Further, as a review of the present Rule 27 indicates, there have been significant additions to the Machinist Trade Description to include the work that bus mechanics do. The parties appear to have included bus mechanics trade description in with that of the machinists who had heretofore worked in the locomotive and car departments. To find otherwise is to say that there is no reference to the bus mechanics in a collective agreement that on its face purports to cover this group of workers. That would be a contrary finding in the face of the various references to bus mechanics, buses, and motor coaches in the agreement.

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 Exceptions 1 and 3, and has claimed there was an emergency. I have already found that there was no emergency in this instance for the reasons outlined with respect to Rule 21.

With respect to Exception 1, there is no dispute that the North Bay bus garage is not equipped to conduct the required provincial emissions testing on Ontario Northland buses. There is therefore no question that the employer has the right to contract out the work of having its buses emissions tested. The issue is whether, when in the course of the emissions test conducted by Harper Diesel the employer heard that there was a problem with the engine in Bus #931, it was justified in ordering that company to do an engine exchange or whether it should have returned the bus to its own garage for the work to be done by members of the bargaining unit.

The evidence is that bus mechanics at the bus garage have been dismantling and installing bus engines for a long time. Rule 27 appears to capture the work as part of the trade description, and specifically makes reference to buses and motor coaches. Mr. Straus had successfully completed the very course needed to work on the particular engine in Bus #931. Further, he had performed the type of work in question on many previous occasions. It therefore appears that the technical skills to remove the engine, overhaul it, and replace it were all available within Ontario Northland’s North Bay bus garage. I therefore cannot find that the first exception was applicable in this instance.

Pursuant to Exception 3, when essential equipment or facilities are not available and cannot be made available from employer-owned property at the time and place required, the employer may contract out the work. As has already been noted, there is no question that Ontario Northland did not have the equipment to do emissions testing, and that it was therefore justified in contracting out that work. However, for the same reasons outlined above with respect to Exception 1, I cannot accept that the employer did not have the essential equipment or facilities to perform the work regarding the engine for Bus #931.

This case is somewhat driven by its particular facts. In this instance the bus in question was not far from the North Bay bus garage, and was roadworthy. It could therefore have been brought back to North Bay and the work could have been performed without significant inconvenience to the employer. That may not always be the case. If a bus was not working properly and was a long way from the bus garage, it may be that such a situation would call for a different employer response and it may justify the contracting out of work that could normally be performed by the bargaining unit.

Ontario Northland did not inform the union in writing that it intended to contract out the work involved with the engine for Bus #931, contrary to the language of Appendix VIII.

It is important to comment on the interplay of Rule 21.1 and Rule 27.1. The parties have clearly agreed in Rule 21.1 that, except in cases of emergency, persons outside the bargaining unit will not perform bargaining unit work. They have then gone on in Section 5 of the agreement to describe in some detail the particular work that is seen as falling within the trades of machinists, boilermakers, blacksmiths, sheet metal workers, electrical workers, and so on.

Of particular interest to this proceeding is Rule 27.1 which describes the work of the machinist trade. The description includes dismantling, rebuilding, and installing of diesel engines in buses and motor coaches. Clearly the work in question in this grievance is work that falls squarely within the parameters of the trade description in the collective agreement. This Rule also states that those who perform the work defined can “completely and independently” plan how the work falling within their trade jurisdiction is carried out.

It is therefor difficult to find that the employer was justified in contracting out the work in dispute. For all of the above reasons the grievance is allowed.

I declare that the employer violated Rule 27.1 and the Letter of Understanding regarding the contracting out of work by contracting out the engine work that could have been performed by bus mechanics at the North Bay bus garage and by failing to inform the union of its intention to do so. I decline to make any order of compensation in the circumstances of this case as there is no evidence that any bargaining unit employee lost work or was in any way financially prejudiced by this particular employer decision.

DATED AT WATERLOO, October 7, 2000,