IN THE MATTER OF AN ARBITRATION
BETWEEN: VIA RAIL CANADA INC.
AND NATIONAL AUTOMOBILE, AEROSPACE, TRANSPORTATION AND GENERAL WORKERS OF CANADA (CAW - CANADA)
AND IN THE MATTER OF A GRIEVANCE RELATING TO THE CONTRACTING-OUT OF WASTE REMOVAL AT WINDSOR
SOLE ARBITRATOR: J.F.W. Weatherill
A hearing in this matter was held at Montreal on October 17, 2003.
D. Olshewski, for the union.
E. Houlihan, for the company.
The dispute in this matter is as follows:
Concerning the alleged contracting-out of waste removal at Windsor, Ontario.
The parties filed separate ex-parte statements of issue. Although the differences between them are for the most part insubstantial, each should be set out.
Union ex-Parte Statement if Issue:
In late 2001 the Corporation contracted with Miller Sanitation to perform the work of removing waste from the sewage holding tanks on passenger cars at Windsor, Ontario. It is the Union’s position that any work being performed on passenger cars is core work and belongs to the bargaining unit. The Union cites a violation of Rule 26 of the Collective Agreement. The Union requests that the work be returned to the bargaining unit , and that Heavy Duty Mechanic, J. Leblanc of Windsor be recalled from Employment Security to perform the work in question.
It is the Corporation’s position that the waste removal at Windsor, meets with the exceptions
of items 3 and 4 of Rule 26 in that the Corporation lacks the equipment to perform the work and the volume of work does not justify the capital expenditure involved.
The company’s statement is as follows:
It is the Union’s position that any work being performed on the passenger cars is core work [and] belongs to the bargaining unit. The Union requests that the work be returned to the bargaining unit, and that Heavy Duty Mechanic, J. Leblanc of Windsor be recalled from Employment Security to perform the work in question.
The Corporation maintains that the work was not presently and normally being performed by the employees. In addition, essential equipment and facilities are not available. Also, the nature and volume of the work does not justify capital or operating expenses involved.
The material portions of Rule 26 are as follows:
26.1 Work presently and normally performed by employees represented by the Union signatory hereto will not be contracted out except:
- - -
(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
- - - .
In my view, the union has satisfied the initial requirement of Rule 26, that the work in question be “presently and normally” performed by employees in the bargaining unit. It is true that this particular task was not performed by employees at Windsor, or, apparently, at other line points, although it was, and is, performed by employees at Toronto and perhaps elsewhere. Waste removal was, however, performed by employees at Windsor and the “technological change”, such as it is, is not a drastic or sophisticated one. It is not suggested that carmen lacked the skills to perform such work; it is patently clear that they are as capable of performing it at Windsor as they are at Toronto. The work relates to the removal of waste from equipment which was, in the first place, installed by carmen, although not at Windsor.
As was stated by arbitrator Picher in Shopcraft Case No. 409, “The introduction of new equipment, methods, tools or technology does not change the fundamental nature of the work”. In the circumstances of the present case, I conclude that the general nature of the work in question here is that of work “presently and normally performed by employees represented by the Union”. It may be noted that there is no restriction to particular work locations.
It follows that such work may not be contracted out unless it comes within one or another of the exceptions listed in Rule 26.1. In the instant case, the company relies on two of these. The first is that “essential equipment or facilities are not available and cannot be made available from the
Corporation’s property at the time and place required”. In considering the applicability of this exception, then, reference is to be made to the particular work location. In Windsor, the company does not possess the necessary vacuum truck, although it does have one, and is acquiring a second, at Toronto. At Toronto, the company possesses as well what it describes as an “older pump unit” which it considers “no longer suitable for regular use”. Since the requirement of such equipment at Windsor is considerably less than at Toronto, I consider that it has not been shown that the older pump unit could not be used for the necessary work at Windsor. In that case, however, there might be a further problem with the ultimate disposal of the waste. That problem would not arise were the company to purchase a new vacuum truck for Windsor, at a cost, it is said of from $90.000. - $100,000, although the union has indicated its doubt that the equipment used by the subcontractor had a value approaching that amount.
While the necessary equipment might not be immediately available at Windsor, it has not been shown that it could not be made available. The real question is whether or not it could be made available at a reasonable cost. That is really what is put in issue under exception (4) to Rule 26.1 - does the volume of work justify the capital or operating expenditure involved? On the material before me, I conclude that the volume of work fluctuates from one to two hours per day, and perhaps slightly more at peak periods. There is no evidence as to whether or not there is other “carmens’ work” at Windsor to which the work in question might be added, even on an overtime basis. Nor does the material before me permit a detailed comparison of the relative costs of the contracting-out of the work in question with its performance in-house. The estimated cost of the contract to the company, over a three-year period, was $180,000. There is some evidence, although it is not conclusive, that the actual cost will be greater than that. It would appear - although again the evidence is not conclusive - that the purchase of equipment and the performance of the work in-house would be, on the same basis of estimation, somewhat greater, although it has not been shown that it would be substantially so.
The question, therefore, is whether or not the nature or volume of work is such that it does not “justify” the capital or operating expenditure involved. That criterion, set out in Rule 26, should not be read as permitting the company to contract-out bargaining unit work simply where it can save money - even a small amount - by doing so. It may be that there are other line points at which work of this nature is required to be done, and where to have it performed by bargaining unit employees, even although it is, in a general way, “their” work, would be clearly impractical and unjustifiably expensive, on any reasonable interpretation of that term. In the instant case, however, the savings - if, in the long run, there really are any - which the company might make (whether in capital or operating expenditure) have not been shown to be of such an order as to bring the case within the exception to the general rule against contracting-out established in Rule 26. This is not a case of some “new or occasional venture” (See CROA No. 713), but of work which may be expected to continue indefinitely, and in respect of which an appropriate capital expense is to be expected.
For all of the foregoing reasons, the grievance is allowed. The union notes that the contract with the subcontractor contains a thirty-day escape clause, and is satisfied that the company be directed to repatriate the work at the expiry of that period, and that the employee on layoff be recalled at that time. It is so awarded. The company is directed to give such notice forthwith. I retain jurisdiction to determine any issues that may arise with respect to the application of these directions, and to complete the award.
DATED AT OTTAWA, this 4th day of November, 2003.
Original signed by: J.F.W. Weatherill ,