Manitoba municipal workers protest employer claw-back of holiday benefits

LOA only intended for beneficial provisions: Arbitrator

When a new town in Manitoba was created, two separate collective agreements had to be merged into one.
On Jan. 1, 2015, the communities of Strathclair and Shoal Lake were amalgamated to create the Rural Municipality of Yellowhead. The municipal employees of both former communities were unionized workers, represented by the International Union of Operating Engineers (IUOE), Local 987.
A new collective agreement was signed on Sept. 20, 2017, but it went into effect as of Jan. 1, 2016. Because the former contracts differed in terms of various sick leave and vacation benefits, a letter of agreement (LOA) was attached that was titled: “Regarding retro pay.”
It included a phrase that established which employees would receive the retroactive benefits from the old collective agreements: “To qualify for retroactive monetary benefits of any sort (including without limitation wages, vacation accrual, pension contributions, sick-time accrual), an employee must be employed as of the date the parties signed this agreement.”
But in November 2017, the union discovered some retroactive adjustments that negatively affected certain employees. 
In some cases, employees lost sick leave, vacation entitlements, and it discovered Easter Monday as a holiday would be clawed back for the former Strathclair workers.
On Dec. 8, the town sent a list of employees who would lose some formerly earned benefits to the union: Five employees would each lose two accrued holidays due to Easter Monday no longer being a day off for the Yellowhead employees.
A few others had sick time and other holiday time removed from their sick and vacation banks.
The IUOE argued that the LOA should be interpreted as only providing new benefits and it didn’t allow for the employer to retroactively remove employee benefits that were already earned.
The municipality countered and said the term benefits should not be construed to mean only positive items for workers, but in terms of fairness to the taxpayers, the new agreement must also be interpreted to standardize all benefits levels, including days off, for all employees.
The arbitrator, A. Blair Graham, disagreed and found the employer breached the collective agreement.
“Notwithstanding the very able arguments of counsel for the employer, there is nothing in the wording of the LOA which contemplates a downward adjustment of sick time or vacation time or general holidays to account for any lessening of monetary benefits under the collective agreement, relative to the benefits provided by the Strathclair and Shoal Lake collective agreements,” said Graham.
The union’s argument about the plain wording of the LOA were more persuasive than the employer’s, said Graham.
“The subject line or heading of the LOA is ‘Regarding retro pay.’ The inclusion of the word ‘pay’ in the subject line suggests that the subject of the LOA is the entitlement of employees to receive pay retroactively. This is consistent with the union’s arguments that the LOA deals with items which are beneficial to employees such as pay and monetary benefits,” said Graham.
“The concept of qualifying for a benefit (by remaining employed until a certain date) is entirely consistent with the proposition that the LOA was only intended to address the retroactivity of provisions which were beneficial or advantageous to employees, relative to the collective agreements being replaced, not the retroactivity of provisions which were disadvantageous to employees.”
And because there was nothing written into the LOA that specified any loss of benefits, “in order to deprive those employees of any portion of those benefits, which they had earned and had already received by the summer of 2017, clear language expressing such an agreement would be required,” said Graham.
“Those employees had therefore earned and had become entitled to the monetary benefits provided for under those collective agreements, while those agreements remained in effect, namely until the summer of 2017,” said Graham. Reference: Rural Municipality of Yellowhead and International Union of Operating Engineers (IUOE), Local 987. A. Blair Graham — arbitrator. Jeff Palamar for the employer. William Sumerlus for the employee. Oct. 30, 2018. 2018 CarswellMan 547


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