Employees were working voluntary, unpaid overtime. The company and the union were both aware of it, but the company made no effective moves to stop it. The arbitrator upheld the grievance, agreeing that the language was clear and the company was gaining a benefit from allowing the practice to continue.
The union for workers at a provincially owned insurance company filed a policy grievance claiming that the employer was knowingly failing to pay workers for time worked beyond the negotiated hours of work.
Hours of work for the 5,200 workers employed by the provincial Crown Corporation were established by the collective agreement.
The collective agreement also specified that all time worked in excess of regularly scheduled hours was to be paid at the appropriate overtime rates.
The employer’s unwritten policy held that requests for overtime had to be pre-approved by a manager.
Workload issues
In 2009, the union began to look into workload issues. The union also began to express concerns that the employer was requesting, permitting and/or turning a blind eye to widespread, unpaid overtime.
Internal management communications indicated that the employer was aware of the union’s concerns.
The union grieved.
The employer argued that overtime assignments were the exclusive prerogative of management. Employees had been informed that pre-approval was required for overtime work. If workers were working overtime without the requisite approvals, they were doing so unilaterally and in spite of management directions not to do so.
The union said that in the circumstances, the onus was on the employer to make reasonable efforts to ensure that workers were not working beyond their regularly scheduled hours. In addition, the employer could not rely on policy to impose a pre-authorization obligation that had not been bargained.
The Arbitrator agreed.
There was no ambiguity in the language of the collective agreement and that language took precedence over policy.
“The fact that there has developed a practice of requiring overtime to be authorized cannot create a ‘right’ to one party inconsistent with the language of the Collective Agreement,” the Arbitrator said.
That the employer had relied on its pre-authorization policy for some time did not diminish the effect of the language of the collective agreement and the policy did not satisfy the KVP requirements that would allow the unilateral imposition of a workplace rule.
Unjust enrichment
“I conclude that the Employer’s defence that all overtime must be pre-authorized must be rejected. There is no such requirement in Article 14.04 of the Collective Agreement which provides compensation for all hours worked beyond regularly scheduled hours,” the Arbitrator said.
The union also charged that the employer had benefited from unjust enrichment.
The Arbitrator agreed.
“In the present case, whether authorized or not, the Employer has benefited from the work performed by employees beyond their regular shifts but the employees have suffered a loss, i.e. no compensation for the work performed.
“I find that the Union has made out a case for unjust enrichment. The Employer failed to have a system in place to ensure that employees did not perform work beyond their regularly scheduled hours even though the Employer knew that certain employees continued to work beyond their scheduled hours even after being told not to do so.
“If employees had not performed the unpaid work, it would have to be performed during regular hours or by other employees. It is no defence to say the work was unauthorized. The employer knowingly allowed the work to be done and received a benefit. The employees are entitled to claim the corresponding benefit, i.e. compensation for the work performed on the basis of quantum meruit,” the Arbitrator said.
The grievance was allowed.
The Arbitrator ruled that the employer had knowingly and actively violated the collective agreement.
The employer was ordered to cease permitting or condoning the practice of allowing employees to perform unpaid work after their regularly scheduled shifts.
The employer was ordered to take steps to ensure that employees were not working beyond their regularly scheduled shifts and to pay overtime according to the collective agreement when they did.
The employer was also ordered to compensate workers who had performed unpaid overtime in the year 2010.
