Union argued requirement contradicted collective agreement, disproportionately affected employees on maternity leave
An arbitrator has ruled that New Brunswick Power Corporation's requirement that employees returning from leave must have worked four months in the year being assessed, either before the leave or when they return, before becoming eligible for merit increases is unreasonable and must be reduced to three months maximum.
Arbitrator Michel Doucet, in a decision dated Jan. 3, 2026, found that while NB Power had the management right to impose a waiting period for performance reviews, the four-month threshold exceeded what was reasonable under the collective agreement with the International Brotherhood of Electrical Workers, Local 37.
The ruling came after the union filed a grievance in February 2025, challenging the policy's impact on employees returning from maternity leave.
The dispute involved step increases outlined in the Nuclear Operational Group collective agreement. Step increases fall due on an employee's anniversary date but may be withheld when, upon review by the employer, satisfactory performance and progress are not shown.
When policy met pushback
In January 2025, NB Power reviewed its process for administering step increases and introduced a new requirement: employees returning from any type of leave had to work a minimum of four months within the performance review period to be eligible for a merit award. The employer updated all relevant documentation, including employee guides, return-to-work checklists and leave letters, to reflect the change.
NB Power also added specific language to the Return to Service Agreement that employees must sign before taking maternity, parental, or adoption leave. It stated: "To be eligible for a merit, all employees (union and non-union) must have worked four (4) months in the year performance is being assessed, either before the leave or when they return."
The union argued the requirement contradicted the collective agreement and disproportionately affected employees on maternity leave. The employer defended the policy as necessary to ensure adequate performance evaluation, noting supervisors had expressed difficulty assessing employees who had been away from work for extended periods.
Performance-based, not automatic
Doucet determined that step increases under Article 8.03(a)2 of the collective agreement are performance-driven benefits, not automatic lock-step increases. “An employee will only receive this benefit on his/her anniversary date if the Employer determines that his/her work performance is ‘satisfactory,’” he wrote.
However, the arbitrator found the four-month requirement unreasonable when compared to other provisions in the same article.
"I find it perplexing that an employee returning from 'maternity leave' must undergo a four-month period before a 'performance review' is done, while an employee receiving an 'unsatisfactory review' only has to wait three months before their next evaluation."
An Ontario worker was recently awarded more than $43,000 in damages for discrimination and lost wages after her former employer denied her the right to return to her pre-maternity leave position and favoured the employee who replaced her during her leave.
No discrimination, but still unreasonable
The union also claimed the policy discriminated against employees on maternity leave. Doucet rejected this argument, concluding the appropriate comparator group was other employees on leave, not active workers. "There is no evidence to suggest that, for the purposes of Article 8.03 (a) 2, employees on maternity leave are treated differently from other employees on leave," he ruled.
Nevertheless, he ordered NB Power to reduce the waiting period to no more than three months, aligning it with other provisions in Article 8.03(a). The arbitrator concluded: "A 'three-month requirement' would align more with Article 8.03, where the a 'three-month requirement' seems to be the norm."
The employer must now revise all documentation to reflect the three-month standard. Doucet retained jurisdiction to resolve any implementation issues.
