INDUSTRIAL RELATIONS IN CANADA Fiona A. E. McQuarrie Prepared by: Tom Barrett

Changes to the Union or the Employer C h a p t e r 12

Opening Vignette: Airline Unions in Bitter Clash Over Seniority Unionized workers at Canadian Airlines Corp. are consulting lawyers and threatening to involve an arbitrator in a bitter clash over seniority with their counterparts at Air Canada Union sources say Canadian Airlines employees are angry over a united stand by Air Canada unions, who are insisting Canadian staff be pushed to the bottom of Air Canada’s seniority lists when the workforces of the two carriers are integrated Calgary-based Canadian, with 16,000 employees, was bought by Montreal-based Air Canada, which has 24,000 employees

Chapter 12 Objectives At the end of this chapter you should be able to: –Define successorship and understand what criteria are used to assess whether successorship has occurred or not –Describe the process of decertification –Understand what happens to certifications and collective agreements when unions or companies merge –Explain some of the ways that technological change and restructuring affect union-employer relationships

Changes to the Union or the Employer What happens if a change occurs after a certification begins or a collective agreement goes into effect? What if the workplace conditions change or there is a change in the status of the parties named in the certification or collective agreement?

Successorship The term successorship, as used in labour legislation, relates to the status of a certification order after some material change in a business or employer occurs, given that the certification order was already in place before the change If a labour relations board determines that past and present forms of the business are sufficiently similar, then successorship is declared to exist The employer is then bound by the terms of any certification or collective agreements—or other formal relationships with a union—that existed in the earlier form of the business

Successorship The question of successorship can arise in a number of different situations: –Change in the location of the business –The business itself is sold or transferred to a new owner or the purpose of the business changes or broadens –The employer transfers work to other locations or to other workers or organizations through subcontracting

Successorship Whether or not the certification or collective agreement is still valid after a change in the workplace, has major implications for how the workplace functions If a change occurs, a party will apply to the labour relations board to determine whether a declaration of successorship should be issued A declaration of successorship has the effect of applying the existing certification or collective agreement to the new form of the business The new employer is automatically bound by the certification or agreement covering the previous employer unless there are exceptional circumstances

Successorship A declaration of successorship can also apply where the employer is involved in some union- related process that has not yet been completed, e.g., a certification campaign According to Canadian labour codes, if an employer sells or changes business during any such process, the altered employer is still considered the employer and is bound by the obligations required by these processes unless a labour relations board declares otherwise

Successorship Determining whether successorship exists can be complicated Labour relations boards look for evidence that the employer’s actions are not motivated by anti-union animus There are no hard and fast rules that determine when successorship has occurred Anti-union employers can be quite creative; labour relations boards are often called upon to judge new situations As a result, many criteria used to determine successorship have developed through case law

Successorship Continuity or control between previous and present form of business: –“Continuity” – any form of connection between two forms of the business –Some evidence of continuity, no matter how small, is expected to form the basis of an argument that successorship exists –The question of control is usually considered if it appears that the employer has established a new entity in order to avoid the obligations of certification

Successorship “Control” refers to how much direction the management or owners of the previous business give to the new business It is not necessary to prove both continuity and control Continuity is more important in the sale, lease, or transfer of a business Control is more important when a new business is established or part of the operations have been assigned elsewhere

Successorship Other criteria the labour relations boards consider when determining successorship: Direct contact Transfer of assets Identification Transfer of customer Lists Transfer of accounts receivable, existing contracts, or inventory

Criteria for Successorship Pledges by the successor to maintain the good name of the predecessor or pledges by the predecessor not to compete The same employees perform the same work A hiatus in business Whether the customers of the predecessor are now serviced by the successor

Successorship Another criterion is key person doctrine—i.e., successorship may exist if the successor business includes essential individuals from the previous business The onus is on the employer to prove legitimate business reasons

Successorship A declaration of successorship is issued if the board decides that there is sufficient evidence that: –There was continuity or control within the two forms of business, or –The changes in the business were motivated by the intent to avoid certification obligations If a unionized business is expanding to non- unionized locations or if a completely separate business entity owned by the employer is created, the board may issue a common employer declaration with the declaration of successorship

Successorship A common employer declaration states that all the employer’s businesses are considered to be a single business for the purposes of certification and the collective agreement A labour relations board usually issues this declaration where it has been shown that the employer attempted to avoid obligations by moving some or all of the unionized parts of the business to a non-unionized business or part of the business If the application for a declaration of successorship is denied, the original certification order continues to exist without any changes

Successorship However, if the business changed substantially, failure to declare successorship may substantially impair the union’s ability to represent workers This is especially true if the union represents workers in what is now a small part of an expanded business or if business has effectively ceased to function Union members may apply for decertification Or, if change involves expansion or new entities, workers at the new non-unionized business or new parts of unionized business may apply for separate certification as a new bargaining unit

Decertification During the term of the collective agreement, union members may no longer want a certified union They may be dissatisfied with their union or may no longer wish to have a union To change a designated bargaining agent, the existing certification must be nullified The process used to cancel certification is called decertification Decertification provides a way for members to hold unions accountable

Decertification Timelines: –Give newly certified unions a chance to establish selves as credible worker representatives –Minimize the possibility that decertification applications will be made when feelings about the union are particularly heated, such as during collective bargaining Several jurisdictions ban decertification applications during strikes or lockouts

Decertification Some jurisdictions allow employers, as well as employees or unions, to apply for decertification To some degree, allowing employers to apply for decertification gives them another way to resist unionization Most jurisdictions permit the labour relations board to declare decertification if there is evidence of fraud during the certification process Most labour codes permit employers to apply for decertification, or a board to issue decertification, if there is an abandonment of bargaining rights by the union

Decertification If the union has not issued a notice to bargain to the employer or has not commenced bargaining, it may be considered to have abandoned bargaining rights It is fairly unusual for decertification to be granted on the basis of abandonment of bargaining rights The decertification process is similar in structure to certification Application must be made to the labour relations board, showing sufficient level of support for decertification among bargaining unit members

Decertification In most jurisdictions, the level of support required is identical to what is required for a certification application Many jurisdictions require a bargaining unit members’ vote after a decertification application is received A secret-ballot vote is conducted in the workplace by the board The vote is successful if the majority indicate they do not want to be represented by union

Decertification Following a successful decertification vote, the board will issue an order of decertification and the union ceases to legally represent employees Any current collective agreement is no longer in force Most boards will scrutinize an employer’s decertification application to see if anti-union animus exists When there is a raiding attempt, a decertification application may be filed for the current union before, or at the same time as, the raiding union applies for certification If the raiding union is successful, a new certification order is issued

Union Mergers The merger of existing unions is a relatively recent trend in Canada, that for the following reasons, has become more common: –A merger can ensure continued viability of unions, particularly smaller ones –Larger unions with shrinking membership may feel a merger offers a way to maintain their existence –A union can increase its size without recruiting unorganized workers –It is a reflection of the general trend in business toward larger organizations –Union mergers may be forced by company mergers, which may raise complicated issues, e.g., seniority criteria

Union Mergers Legislation that regulates changes in certified unions is quite similar to successorship legislation Both are intended to ensure continuity in representation Union mergers have different effects on an existing certification, depending on the reasons for the merger If one union merges with another or if locals merge within a single union, the affected locals usually apply to the board for a change in the existing certification order Such changes do not usually require a vote among the affected employees

Union Mergers If a business merger results in two unions representing employees of a single company, employees are usually asked to select one in a vote The vote determines which collective agreement will be in effect The vote is a secret ballot vote similar to the representation vote The certification of the unsuccessful union is cancelled, along with its collective agreement

Technological Change Changes during the collective agreement may occur because of changes in the workplace itself Work restructuring occurs when technological change alters the content of jobs or how work is conducted Technological change encompasses any change in tools that leads to a change in the way the job itself is done—e.g., many jobs in banking have been affected by automatic teller machines

Technological Change Technological change may create new situations that are not adequately addressed by the existing collective agreement Effects of technological change may be addressed through collective bargaining However, if the collective agreement will be in place for some time, there may be a need for an alternative way to address the effects of technological change

Technological Change There are two ways to address technological change: –Some jurisdictions have legislation dealing specifically with handling technological change –Some legislation permits collective agreements to contain a reopener clause which allows the union and employer to renegotiate an agreement while it is still in effect

Technological Change Five Canadian jurisdictions (federal, B.C., Manitoba, New Brunswick, and Saskatchewan) require employers to give notice of intended technological changes After the notice is issued, the parties either reopen collective bargaining or negotiate a plan for implementation of the proposed change

Technological Change The parties can include specific conditions within the collective agreement itself that recognize and address the possibility of technological change during the term of the agreement The second method of dealing with technological change — the reopener clause — allows parties to immediately negotiate new collective agreement terms in order to address change

Workplace Restructuring Changing economic conditions have led to another type of change during the life of a collective agreement—workplace restructuring This includes: –Downsizing in the workforce –Work being partially or completely shifted to other locations, companies, or countries –Increased industry competitiveness leading to changes in working conditions or redesigned work

Workplace Restructuring Most collective agreements have language in place to deal with layoffs or termination The union’s role in restructuring has not been widely addressed by labour relations boards The doctrine of management rights (residual rights) holds that management has unchallenged right to decide workplace changes — unless the collective agreement specifically states that the union must be consulted On one hand, most collective agreements give management the ultimate right to manage the workplace On the other hand, collective agreements also implicitly contain a conflicting principle, i.e., the doctrine of implied obligations

Workplace Restructuring Implied obligations suggest that the union and employer share the responsibility for the regulation and administration of the workplace The few labour board cases that do exist, suggest there are some concerns that need to be addressed during workplace restructuring It is not clear whether the employer is legally compelled to include the union in planning or carrying out restructuring Still, the employer must be careful that restructuring does not undermine or bypass the union’s legal role as representative of bargaining-unit members

Workplace Restructuring A study of the steelmaking industry suggests that establishing a strong internal and external relationship with management prior to restructuring, may strengthen the union’s ability to represent its membership more effectively in restructuring A study of the Ontario supermarket industry suggests that unions should attempt to ensure the interests of all members are equally represented and defended The union’s duty of fair representation would suggest that the union should be motivated to ensure restructuring does not unduly harm one group of members while protecting or benefiting another group

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