AD HOC

AWARD

This arbitration concerns a claim by Engine Attendant Dennis Matt for a relocation allowance under the Job Security / Employment Security Agreement between the Company and the Union. The nature of the dispute is outlined in a joint statement of fact and issue filed at the hearing. It reads as follows:

DISPUTE:

The complete application of article 7A.6 of the Job Security/Employment Security Agreement between CPR and CAW Local 101.

STATEMENT OF FACT:

In this matter there is no dispute that Mr. Matt was entitled to an amount of payment under article 7A.6 of the Job Security/Employment Security Agreement between CPR and CAW Local 101 in relation to an article 8.1 notice served with respect to reductions at London, Ontario.

As Mr. Matt could not exercise his seniority at the time he did not relocate immediately. Mr. Matt relocated to Windsor in November of 1996. He received the $14,000.00 portion of the moneys available under article 7A.6 or 7B.3 of the Job Security/Employment Security Agreement between CPR and CAW Local 101.

Mr. Matt finally bought a home in Windsor in August or September of 1998. He applied for the remaining $11,000.00 of the moneys available under article 7A.6 or 7B.3 in March 2000. The Company refused his request.

The Company outlined its position in their reply to Local 101 Regional Vice-President R. Laughlin dated May 10, 2000 as follows:

We have examined this matter. Based on information provided to date we cannot provide any further relocation Allowance other than the $14,000.00 already provided to Mr. Matt under the Job Security Agreement. Our decision was based on the fact that Mr. Matt did not sell his house at London or purchase another residence at Windsor within the timeframes clearly stipulated in the Job Security Agreement.

STATEMENT OF ISSUE:

It is the position of the Union that in accordance with the Job Security Agreement between CPR and CAW Local 101, Mr. Matt is entitled to receive the additional $11,000.00 in question.

Therefore it is the position of the Union that Mr. Matt should be paid $11,000.00 claimed in this matter.

The Company denies the Union’s contentions and claims.

As can be seen from the above, the facts are not in substantial dispute. On August 3, 1995 Mr. Matt was advised that he would be laid off at London, Ontario, effective August 11, 1995. He remained laid off until such time as he was eligible to displace to Windsor, Ontario, which he did in November of 1996. He was then paid the $14,000 lump sum relocation benefit outlined in article 7A.6 or 7B.3 of the Job Security Agreement. He then continued to retain the ownership of his home in London, and lived in rented accommodation in Windsor. In or about August or September of 1998 the grievor purchased a home in Windsor, his place of permanent relocation. At that time he applied for the additional relocation allowance payable to a home owner. As the allowance for a home owner is $25,000, he sought the payment of the difference of $11,000.

Article 7A.6 and 7B.3 read as follows:

7A.6 Employees required to relocate pursuant to Article 7A and who actually relocate, will be entitled to the relocation benefits pursuant to Article 6 or, in lieu, if having met the requirements of Article 6, may choose a lump sum relocation benefits as follows:

– within the Region … $25,000 Homeowner

… $14,000 Renter/Mobile Home Owner

Note: Where more than one relocation is involved within the Region, the second and subsequent relocations within the Region shall be provided in accordance with Article 6 of this Agreement.

– beyond the Region … $50,000 Homeowner

… $29,000 Renter/Mobile Home Owner

Employees will be required to pay back one-half of the lump sum relocation benefit if they voluntarily cease their employment relationship with the Company within two years of receiving the lump sum relocation benefit.

7B.3 Employees required to relocate pursuant to Article 7B.1(c) and who actually relocate, will be entitled to the relocation benefits provided pursuant to the provisions of Article 6, or, in lieu, if having met the requirements of article 6, may choose a lump sum relocation benefits as follows:

– $25,000 Homeowner

– $14,000 Renter/Mobile Home Owner

Note (a): Where more than one relocation is involved, the second and subsequent relocations shall be provided in accordance with article 6 of this Agreement.

Note (b): Employees will be required to pay back one-half of the lump sum relocation benefit if they voluntarily cease their employment relationship with the Company within two years of receiving the lump sum relocation benefit.

Article 6 of the Job Security Agreement deals with relocation benefits. It treats, in part, the issue of an employee who loses money as a result of the sale of his or her private home by reason of relocation. In that regard article 6.8 provides in part:

6.8 (a) Except as otherwise provided in article 6.8(c) reimbursement of up to $14,000 for loss sustained on the sale of a relocating employee’s private home which he occupied as a year-round residence. Loss sustained is determined as the difference between the value determined at the outset plus any real estate agent fees, legal fees, including those legal fees on purchase of a home at the new location, and any mortgage closure penalties, and the amount established as the selling price in the deed of sale.

…

6.8 (d) An Eligible Employee who desires to sell his house and receive any benefits to which he may be entitled under article 6.8 must advise the Company’s officer concerned accordingly and also sell his home within twelve months of the date the initial change takes place. No employee shall be entitled to any claim under article 6.8 if the house is not listed within sixty days of the date of the final determination of value and thereafter the house continues to be listed for sale. Any claim for reimbursement under article 6.8 must be made within twelve months of the final determination of value.

Note: Notwithstanding other provisions of article 6.8, special cases of loss on sale of homes may be submitted to the Committee for adjudication, but such special cases shall not be subject to arbitration.

The Company submits that to be eligible for the lump sum amounts provided in article 7A.6 of the Job Security Agreement Mr. Matt must meet the requirements of article 6 of the Job Security Agreement. The Company submits that the scheme of the Job Security Agreement clearly contemplates a twelve month period as the time frame for an employee moving his or her household. In that regard it notes, in addition to the provisions of article 6.8 (d), the language of article 6.10 (a) and (b) of the Job Security Agreement which provide a monthly allowance of $190.00 in lieu of moving expenses for an individual who does not wish to move his household to his or her new location. The Company’s representative notes that those provisions are limited to payments for a maximum of twelve months from the date of transfer to the individual’s new location.

Further reference is made to Appendix I of the Job Security Agreement which is in the form of a letter addressed to the Union’s National Representative from Mr. D. Cooke, Director of Labour Relations, dated June 13, 1996. That letter reads, in part, as follows:

Dear Mr. Rosner,

Further to our discussion and your S2-MR message dated March 11, 1996, concerning the details surrounding the eligibility for a relocation lump sum benefit as stipulated in Article 7 of the Job Security Agreement. As per our discussion, the Company and the Union agreed that in order to be eligible to receive the relocation lump sum benefit for home owners, employees must abide by the following requirements:

1. The employee must elect to receive the relocation lump sum benefit in lieu of the enumerated benefits of Article 6 of the JSA, and;

2. The employee must relocate by changing their “principal place of residence” as per CROA 1977, and;

3. If the employee sells their home at the old location and/or buys a home at the new location, they may : receive the relocation lump sum benefit for home owners as per article 7 of the JSA, or;

4. If the employee is unable to sell their home before or immediately upon relocating to the new location then they must make every reasonable effort to sell their home in the 12 month period following their relocation. Every reasonable effort is defined as follows:

i) A fair market value must be established as per Article 6 of the JSA

ii) Immediately upon relocating the employee receives the “renter” relocation lump sum benefits as per Article 7 of the JSA.

iii) At the time the employee sells and/or buys a home, they will receive the difference remaining between the rental relocation lump sum benefits and the homeowner relocation lump sum benefit.

iv) The remainder of the relocation lump sum benefit shall be paid in 4 quarterly instalments provided the employee’s home remains listed and the employee shows every reasonable effort to sell the home.

The Union submits that there are no time limits stipulated within articles 7A.6 and 7B.3 governing the period within which an individual must purchase a home at their new location. Its representative submits that the purchase of a home in Windsor by the grievor, some twenty months after the grievor’s relocation, does not offend any time limit provided within articles 7A.6 and 7B.3 of the Job Security Agreement, and Mr. Matt must therefore be viewed as eligible for the $25,000 home owners’ lump sum payment in lieu of benefits under the provisions of article 6.

Upon careful consideration of these provisions the Arbitrator is left in substantial difficulty with the position argued by the Company. Prior arbitral jurisprudence has established that an employee in similar circumstances can be entitled to the $25,000 lump sum payment even though he or she may not have relocated their household and family to the location of a new work assignment, albeit that determination was made in relation to comparable language in the JSA of the Union with another company (See SHP 547). In the case at hand there is very simply no language within the provisions of articles 7A.6 or 7B.3 of the Job Security Agreement which places any time limit on the purchase of a home in the circumstance of a relocation.

The thrust of the Company’s argument is that the conditions provided within article 6 of the JSA must be met as a requirement of eligibility for the benefits provided under articles 7A.6 and 7B.3. The Arbitrator agrees, given the wording of those articles, that reference must be had to article 6. That is clearly so in light of the words “… having met the requirements of article 6” which appear in each of those provisions. When regard to had to the language of article 6, however, it appears evident that the reference is to the eligibility requirements of articles 6.1 and 6.2. Those provisions stipulate, for example, that an individual must have two years’ CCS, must be a householder and chooses to relocate as a result of a layoff, a displacement or an article 8.1 notice, to name a few requirements. Article 6.8 (d) does not, in my view, describe an essential condition to the payment of lump sum in lieu of relocation benefits. Rather, it deals with those individuals who choose to sell their house and wish to receive the benefits of article 6.8 of the Job Security Agreement, benefits which involve compensation for losses sustained on the sale of their private home. While it is true that a one year qualification period is established for that purpose, there is nothing within the language of article 6, or of the scheme of the provisions in question, to suggest that the one year limitation period is intended to have any other application beyond the compensating purposes of article 6.8 itself.

The Arbitrator agrees with the Company that there must be some connection with the process of relocation for an employee to be eligible for the payment of the lump sum benefits established under articles 7A.6 and 7B.3 of the Job Security Agreement. It may well be, for example, that an employee who relocates and chooses to purchase a house only some seven or eight years following relocation would not be eligible for the lump sum payment in question. That home purchase would be more in relation a personal lifestyle decision than an obligation or adjustment brought on by the relocation itself. There must, in other words, be some reasonable connection between relocation and entitlement to the benefit provided. While there is, as the Union asserts, no time limit stipulated with respect to the purchase of a home, it is implicit that the purchase must be within a reasonable time.

Can it be said that that a causal connection and a reasonable delay are demonstrated in the instant case? I am satisfied that it can. The decision to purchase a home at a new work location is one which may understandably involve a period of time and exploration, as an individual becomes familiar with the new location, the advantages or disadvantages of renting, and the homeowners market in the various neighbourhoods of the new location. In addition, a relatively junior employee might have concerns about the longevity of his or her new assignment. It is not implausible, therefore, to conclude that the parties would have allowed for a reasonable period of time for an individual to make the decision as to the purchase of a home within a new location. As noted above, that period cannot be indefinite or unreasonably long. In the case at hand, however, I am satisfied that the period of some twenty months from the initial relocation is not excessive, and can be said to be within such reasonable period of time.

For all of the foregoing reasons the Arbitrator is satisfied that the purchase of a home in Windsor by the grievor did entitle him to the full homeowners’ lump sum allowance of $25,000, in lieu of relocation benefits. The grievance is therefore allowed and the Arbitrator directs the payment of the difference to Mr. Matt forthwith.

I retain jurisdiction in the event of any dispute between the parties concerning the interpretation or implementation of this award.

Dated at Toronto, this 16th day of February 2004

(signed) MICHEL G. PICHER

ARBITRATOR

SHP 584