IN THE MATTER OF INTEREST ARBITRATION PURSUANT TO THE FIRE PROTECTION AND PREVENTION ACT, 1997 FOR A NEW COLLECTIVE AGREEMENT

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1 B E T W E E N: IN THE MATTER OF INTEREST ARBITRATION PURSUANT TO THE FIRE PROTECTION AND PREVENTION ACT, 1997 FOR A NEW COLLECTIVE AGREEMENT THE CORPORATION OF THE CITY OF KITCHENER - and - (the Corporation or the City ) THE KITCHENER PROFESSIONAL FIRE FIGHTERS ASSOCIATION Hearing Panel: Heard: May 27, 2013 and February 18, 2014 Decision: December 8, 2014 (the Association ) Edward T. McDermott Michael Riddell Jeffrey Sack Chair Employer Nominee Union Nominee Appearances: For the City For the Association John W. Saunders Counsel Stephanie N. Jeronimo Counsel Tim Beckett Fire Chief Steve Usher Deputy Fire Chief Gary Mann Deputy Fire Chief Brendan Soye Manager, Employee Relations Dimetra Resendes Human Resources Associate Ita Magid Supervisor, Benefit Development Henry Watson Advocate Steve Jones Chair of Negotiations Committee Daryl Greb Negotiating Committee Jim Metzger Negotiating Committee Jeff Noble Negotiating Sub-Committee Brian Forbes Negotiating Sub-Committee Patrick O Halloran Negotiating Sub-Committee Mike Pauze District Vice President OPFFA AWARD

2 INTRODUCTION 1. This arbitration relates to the renewal of the Collective Agreement that expired on December 31, 2011 between the City of Kitchener and the Kitchener Professional Fire Fighters Association. 2. From the information provided to us by the parties, we are aware that the population of the City of Kitchener is 232,200 and that the City is adjacent to the two smaller cities of Cambridge to the south and Waterloo to the north. The three cities are often known as the tricities. 3. The City employs some 2,276 employees (including 202 fire fighters and 18 civilian employees) of which 217 are represented by the Association including 186 suppression fire fighters operating on a 24-hour shift rotation. Of the total number of employees only the Chief and two Deputy Chiefs are excluded from the bargaining unit although there are a number of employees in the CUPE bargaining unit who provide administrative assistance to the department. 4. In an attempt to renegotiate the provisions of the prior Collective Agreement the parties exchanged proposals for the renewal of that agreement on December 13, 2011 and subsequently met on a number of occasions during The parties further met in a mediation with this Board of Arbitration on April 15, 2013 however none of the outstanding matters were resolved between the parties at that time. 5. Subsequently, the parties exchanged their briefs on the various positions to be placed before this Board of Arbitration relative to the matters at issue and attended before this Board for full days of hearing on May 27, 2013 and again on February 18, The scheduling of these hearing dates was arranged by agreement of the parties in order to ensure that all parties could be in attendance. 6. Following the conclusion of the hearing on February 18, 2014 this Board of Arbitration met in several executive sessions in order to discuss and reflect upon the matters at issue between the parties and their relative positions in respect thereto. Unfortunately, an unexpected injury to the Chair resulted in some delay in finalizing and issuing this award.

3 7. Having given full consideration to all of the submissions (including in particular the various comparators placed before this Board) the following sets forth the decision of this Board of Arbitration on all matters in dispute. 8. While the following award is formulated in determinative terms, that does not mean that this Board has not spent a considerable amount of time with respect to each and every issue and position advanced by the parties during the course of this proceeding. It is also of particular importance for the parties to be aware that we have taken into account all of the criteria mandated under the provisions of s of the Fire Protection and Prevention Act, 1997 ( FPPA ), which obligates us to take into account the following: (i) (ii) (iii) (iv) (v) The employer s ability to pay in light of its fiscal situation; The extent to which services may have to be reduced, in light of the decision, if current funding and taxation levels are not increased; The economic situation in Ontario and in the municipality; A comparison, as between the fire fighters and other comparable employees in the public and private sectors, of the terms and conditions of employment and the nature of the work performed; The employer s ability to attract and retain qualified fire fighters. 9. These criteria should not however be viewed in isolation as Arbitrator Burkett stated in his 2013 award for the City of Toronto: Before considering the application of these criteria to the issues before us, it is important to observe that their application, as with the criteria found in other interest arbitration statutes, is not intended to cause a predetermined result. While requiring a board to put its mind to various factors that might be relevant to its ultimate determination, they do not abridge the broad discretion of an interest board of arbitration to consider and weigh all the relevant factors in any given case in coming to a freely determined result that is fair and reasonable in all the circumstances. The discretion given to an interest board of arbitration in this regard is fundamental to the functioning of an interest arbitration process that serves as an alternative to free collective bargaining under which the parties are able to resort to economic sanctions in the form of strike or lockout in support of their respective positions. Where the legislature, in its wisdom, decides that in the interest of the greater public good the right to free collective bargaining must be restricted to the extent that economic sanctions are not permitted, i.e. police, fire and health services, the alternative must be fair, impartial and transparent. This is

4 why statutory criteria, as found in the various interest arbitration statutes, including the Fire Protection and Prevention Act, do not remove the ultimate discretion of a board of interest arbitration to make a fair and impartial award that takes into account all relevant considerations. 10. In fashioning this award, this Board has accordingly also taken into account the general principles applicable to interest arbitration including in particular, with respect to non-monetary issues, the principles of demonstrated need and replication and, with respect to monetary issues, we have given consideration to the principles of total compensation and replication of the agreement that we believe the parties would have achieved had they been subject to the potential impact of a strike or lockout. 11. Accordingly after considering all of these criteria and principles of arbitration as well as the full and complete submissions of all parties, we have arrived at the following determinations with respect to the matters at issue between the parties. Any proposals advanced by either of the parties which are not referred to in the following award have been denied by this Board and are deemed to have been dismissed. We would also direct that unless otherwise indicated in the terms of this award, the effective date of any provision of this award shall be the effective date of the award itself. The Board shall remain seized of this matter until advised that the parties have entered into a renewal agreement encompassing the terms of this award whereupon we will be deemed to be functus. 12. Accordingly, we have made the following determinations and awards which will form part of the renewal agreement which has been placed before us. The agreement will contain all of the provisions of the previous collective agreement as amended by the terms of this award. The agreement will also include all matters agreed to by the parties. CITY S PROPOSALS 1. Term. The term of the collective agreement shall be from January 1, 2012 to December 31, 2014 (agreed by parties). 2. Employees Covered. The City seeks to add a provision allowing it to appoint an employee to act in a position outside the bargaining unit for a period of up to one year during which time the employee will not be actively involved in the administration of discipline to

5 bargaining unit members. The City also seeks to amend the provisions of Article 1.01 to allow such employee to retain and accumulate seniority and have the right to return to his/her position in the bargaining unit following the completion of the temporary assignment. We are persuaded by the reasons advanced by the City that there is a demonstrated need to import such a proposal into the bargaining unit in order to permit employees who choose to accept such an assignment (which is beneficial to both the employee and the City) to do so without fear of losing their seniority and position in the bargaining unit. We accordingly award the following amendments to Article 1.01 of the Collective Agreement: 1.01 The provisions of this Agreement excluding Schedule B shall apply to all Full time fire Fighters of the Kitchener Fire department with the exception of the Fire Chief, and the Deputy Chief. The Corporation may appoint an employee to act in a position outside the bargaining unit for a period of up to one year. If an employee accepts a transfer to a temporary position outside of the bargaining unit, the employee shall retain the right to return to his/her position in the bargaining unit following the completion of the temporary assignment. If the employee returns to the bargaining unit, he/shall shall retain the seniority accumulated up to the date of leaving the bargaining unit, and will be credited with seniority for the period of time accumulated in the temporary assignment. During the time outside the bargaining unit, the employee shall not be actively involved in the administration of discipline to bargaining unit members. 3. Article 22 No Contracting Out. The current provisions of Article 22 preclude the City from assigning the work customarily performed by a Full Time Fire Fighter to another employee or to a person who is not an employee of the corporation. The City indicates that it has been in discussions concerning the potentiality of amalgamating dispatch services for all emergency services across the region. While there does not at the moment exist any concrete proposal to amalgamate such dispatch services, the City is concerned that if such an opportunity arises, it should not be precluded by the terms of the Collective

6 Agreement from entering into such an arrangement provided appropriate protections are built into the Collective Agreement for the members of the bargaining unit. The City also notes that the Association has publicly spoken out in favour of such an amalgamation. While the City has asked for a blanket provision permitting contracting out, its real concern appears to be directed towards the potentiality of an amalgamated dispatch operation for emergency services. No specific provision has however been tabled to address this specific aspect of the operation except for a reference to a provision awarded in Clarington by Arbitrator Burkett which may be unsuitable or even unworkable for the Kitchener dispatch operation. In these circumstances and bearing in mind there is no current concrete plan to move towards amalgamation of the dispatch services, we are not prepared to award any amendment to the current Article as sought by the City. We do note that the existing provision contemplates that the parties can agree to modify the impact of Article during the life of the collective agreement. In the material presented to us, there is some indication that the parties might both see benefits to amalgamating the emergency dispatch services and it is our view that discussions between them on this issue at this time might well be relevant and productive. We accordingly refer this issue back to the parties for further discussion. The Board shall not however remain seized of this matter should the parties be unable to reach agreement on the various issues which might touch upon the potentiality of an amalgamation of dispatch operations for emergency services. 4. Article 7 Accidents and Sickness. The City seeks to update and make accurate the description of the benefit plans referred to in Article 7.01 of the Collective Agreement as they have become outdated. The City assures the Association and the Board that it is not proposing these changes as a means of undermining or reducing employee benefits as negotiated or awarded into the Collective Agreement. The Board awards the following amendments (in bold) to Article 7.01(e) and (g) of the previous collective agreement:

7 7.01 The Employer will pay one hundred percent (100%) of the cost of the following benefits (e) Extended Health Care Plan, as negotiated, which includes: (g) Dental Plan, as negotiated, based upon the current Ontario Dental Association Fee Schedule, plus Dentures, Orthodontics $2,500 lifetime max., and crowns & Caps $2,500/year max., with a 50/50 co-insurance. Check-ups for adults (those 19 years of age and older) each nine (9) months. (Life insurance coverage is not extended to include dependents). The Employer may substitute a carrier for any Plan under this Article 7.01 provided that the level of benefits conferred thereby is not decreased. The Employer will advise the Association of any change in carrier at least sixty (60) days prior to implementing a change in carriers. The foregoing is also awarded in the corresponding provisions in the civilian bargaining unit collective agreement (Schedule B to the Collective Agreement) Article 7.01(d) and (f). 5. Article 9.03 Seniority. The City seeks to add the word or as it was omitted as a result of a previous drafting error. The Association does not object to this housekeeping amendment. The City also seeks to amend Article 9.03 by making it clear that for the purposes of this article seniority is determined at the time that the absence commences which, says the City, was the intention of the parties and is the City s existing practice. The Association disagrees it is the current practice and asserts it is an attempt by the City to start the clock ticking earlier. The Board awards the following amendment (in bold) to Article 9.03 of the previous collective agreement:

8 9.03 A Full Time Fire Fighter shall have their name removed from the seniority list in the event of continuous non-employment, including lay-off, any authorized leave of absence, sickness or accident, or after their sick leave credits have expired, for a period of time equal to half the length of a Full Time Fire Fighter s seniority, or for a period of twenty-four (24) months, whichever is the lesser. 6. Article 25 Duration. The parties are agreed that the last date of the agreement shall be December 31, Article shall accordingly be amended to provide as follows: This agreement shall be and remain in force and effect until the 31 st day of December 2014 and thereafter it shall be automatically renewed from year to year unless in any year either Party gives notice to the other Party in writing of its desire to revise or amend this Agreement, such notice to be given no earlier than one hundred and twenty (120) days and not later than thirty (30) days prior to the termination date. 7. Article 7 Accidents & Sickness. The City is seeking to add a provision to Article 7.05(b) to make it clear that it can recoup funds advanced to employees if their claim is not approved by the Workplace Safety and Insurance Board. The Association does not object to such a provision provided it is clear that the City cannot recover such monies until any rights of appeal have been exhausted by the employee. The Board agrees that a clarification of this proposal is necessary and appropriate and accordingly awards the following amendment to the last paragraph of Article 7.05(b) as follows: Where a Full Time Fire Fighter is compensated under the terms of this Clause, there shall be no deduction from the Full Time Fire Fighter s sick leave benefit unless the claim is not approved by the Workplace Safety and Insurance Board. In such cases any payment made by the Employer shall be deducted from the Full Time Fire Fighter s sick leave benefit provided that such deductions shall be reimbursed to the sick leave benefit in the event that the decision denying the claim is reversed on appeal. 8. Article 24 Wellness. The Employer seeks an amendment to make it clear that the reference to years in Article means calendar years.

9 The Association does not contend that the Employer s version of the article is incorrect but rather takes the position that it has not experienced any problems with the language as of yet and that the Employer has not provided any methodology for implementation of the language. The City has provided such a methodology in its Reply Brief. We award the language proposed by the Employer to be added to the end of Article as follows: For the purposes of this clause years will mean calendar years. 9. Article 25 Duration. The Employer has brought forward a previous typographical error in Article with which the Union agrees. Article shall accordingly be amended (in bold) as follows: If at any time during negotiations, as provided in clauses and 25.02, either Party comes to the conclusion that an agreement cannot be reached, then the provisions of the Fire Protection and Prevention Act shall apply. ASSOCIATION S PROPOSALS 1. Duration of Agreement. As previously indicated, the parties are in agreement that a renewal agreement should cover the period from January 1, 2012 through December 31, Article 7 Accidents and Sickness. The Association seeks monetary improvements in all of the benefits provided for under the current Extended Health Care Plan, the Long Term Disability Plan and the Dental Plan. The Association also seeks the addition of new benefits for: (a) Clinical psychologist coverage to a combined maximum of $2,000 per calendar year per covered individual; (b) Orthotics to a maximum of $400 for one pair or $800 for two pairs per calendar year;

10 (c) Acupuncture, naturopath or homeopath coverage to a combined Plan maximum of $500 per covered individual per calendar year; (d) Payment for any costs associated with extended health care benefits including medical notes or forms ordered by the corporation or the benefit carrier; (e) Payment for the full cost of specialized diagnostic tests required by the employee s physician (PSA; CA-125; HRT). The Board has reviewed the submissions of both of the parties in connection with each of these benefits and has determined after reviewing the cost of such benefits in light of the principles of total compensation and replication as well as the level of such benefits currently being provided by comparable bargaining units particularly in the tri-city area and Guelph. Having taken into account all of these considerations as well as the criteria set forth in s of the FPPA, we have determined to award the following amendments to the provisions of Article 7 of the Collective Agreement. Once again, to the extent that a particular benefit has not been referred to herein, the request of the Association for an improvement in such benefit has been denied. The Board accordingly awards the following amendments to Article 7.01(e) of the Collective Agreement as follows: (e)(ii) Hearing Aid Coverage - $1,000 per family member for every 36 months (e)(iii) Physiotherapy Coverage to a maximum of $900/year for each covered bargaining unit member and $600/year for other family members (e)(vi) Effective 30 days after the date of this award, Dispensing Fee reimbursement cap at $10 per prescription (e)(vii) Orthotics Coverage to a maximum of $400 for one pair or $800 for two pairs per calendar year.

11 While the orthotics coverage is new language for this Collective Agreement, it is not a new benefit inasmuch as the current insurance provider determines the ordinary and customary cost of orthotics (currently at $375 per pair and $750 for two pairs per calendar year). It can accordingly not be regarded as a new benefit. The amount requested and awarded is still below the amounts provided for in the Waterloo and Cambridge agreements. It is, in our view, appropriate that the provision be included in the terms of the Collective Agreement and raised to the level herein awarded (e)(viii) Add the following provision: Any actual and reasonable costs associated with providing medical notes or forms for extended health care benefits ordered by the Corporation or benefit carrier will be paid for by the Corporation. Once again this is not a new benefit inasmuch as the City is already reimbursing employees for the reasonable cost of sick notes or forms that it requests. We see no objection to recording this in the agreement in the above noted terms. 6. Amend Article 7.01(f) as follows: 7.01(f) Long Term Disability Plan (LTD) as per the policy with the present Insurance carrier; A Full Time Fire Fighter who qualifies for LTD benefits will be covered for LTD benefits at 70% of their monthly salary to a maximum of $7, Article 5.02 Vacations. Amend the last paragraph as follows: 5.02 Effective 30 days after the date of this award, on completion of twenty-four (24) years of continuous service shall be granted six (6) weeks vacation in each calendar year. 8. Promotions Article In accordance with the agreement of the parties, this matter is referred back to the parties for further discussion. The Board shall not remain seized of this issue should the parties be unable to reach an agreement.

12 SALARIES It is important to note that in making a determination as to the appropriate salary level to be awarded to the members of the Association we have given full consideration to the criteria set forth in section 50.5 of the FPPA including in particular the Employer s position that the City lacks the ability to pay the increases sought by the Association. We have reflected on all of the information and data submitted by the Employer in support of this argument as well the countervailing arguments of the Association. In configuring our determination relative to the appropriate salary levels to be awarded to members of the Association we agree with the summation of the Employer that Kitchener is to be viewed as being a municipality which is generally in the mid-range economically of all of the municipalities in the province. We also agree with the submissions on behalf of the Employer that the City must be fiscally responsible relative to the allocation and utilization of its resources. The Board has given careful consideration to the economic consequences of the monetary impact of the various proposals advanced on behalf of the Association and has taken into account the principles of total compensation in responding to the submissions of the Association and the City in this respect. We also have had due regard to the results of the application of both freely bargained and awarded collective agreements affecting the closest comparators of the City over the same time period covered by this collective agreement, almost all of which were known by the time of issuance of this award. We have in particular noted that as at the end of 2011, the starting salary of a first class fire fighter in Kitchener ($83,061) was somewhat below many of its direct comparators including Waterloo, Cambridge and Guelph as well as the Waterloo Regional Police ($83,156) because, we are told, Kitchener settled before the rates for these comparators were determined for 2010 and In subsequent determinations Guelph reached a freely negotiated settlement for salaries for the year 2012 providing for an end rate of $85,582, and such increases were also awarded to Cambridge fire fighters by Arbitrator Burkett for that year.

13 Subsequently the City of Guelph entered into a freely negotiated agreement for the years 2013 and 2014 and in the City of Waterloo, a Board of Arbitration chaired by Arbitrator Steinberg issued an award encompassing the same increases agreed to in Guelph for the years Accordingly, at the time of issuance of this award the salary levels for two of the City s closest comparators had already been set for the three-year period under consideration and the rates in Cambridge had been established for In arriving at our salary determination, we have had regard to the wage scales of the Waterloo Regional Police which had also been determined for the three-year period under consideration in this proceeding. While there is not necessarily any symmetry between the rates of the Regional Police and those of the fire fighters and somewhat different considerations and comparators are at play in fashioning the rates for the police units, we do note that the application of the above referenced wage schedule results in virtual equality between the Waterloo Regional Police and the fire fighters in Guelph and Waterloo as at the end of 2014 which was also the case at the end of 2011 for these municipalities and Cambridge. We have also given careful consideration to the monetary (and non monetary) provisions of the various agreements between the City and its other unionized employees some of which involve freely negotiated agreements extending into 2015 and we have taken into account, from the information available, the average wage increases obtained in the public and private sectors in the Province of Ontario generally, and in specific examples provided to us on behalf of the City. We have also considered that the City is, on the information presented to us, able to successfully retain and attract qualified employees for available positions in the bargaining unit on the basis of the current terms and conditions of employment. In summary we have given full consideration to all of the economic information and submissions thereon placed before us as well as the statutory criteria and principles applicable to interest arbitration in an attempt to come to a determination as to what the fair-minded objective observer would consider to be a fair and reasonable wage increase in all of these circumstances. In our view, the following wage schedule (which is the same as is now in place for the Waterloo and Guelph fire fighters and has the same end rate as Cambridge for 2012) achieves that objective and places all of the information we have received into a proper perspective.

14 In all of these circumstances, we award (for a first class fire fighter) the following salary increases effective on the undernoted dates as follows: January 1, 2012 $84,819 July 1, 2012 $85,582 January 1, 2013 $86,438 July 1, 2013 $87,302 December 1, 2013 $87,957 January 1, 2014 $89,276 July 1, 2014 $90,169 December 1, 2014 $90,349 All other rates for the fire fighters and Civilian members covered by the collective agreement are to be adjusted accordingly in proportion to the percentage of the increases set forth above which apply to the first class fire fighters. PROVISION FOR RETROACTIVITY BASED ON ALL PAID HOURS Retroactivity when occurring under the terms of this award, is to be paid on all paid hours within 90 days of the date hereof for all present employees. Any employee who has left the employ of the City is to be notified in writing at the address on file with the City within 30 days of the effective date of this award and payment is to be made within 60 days of receipt of acknowledgement of notice. Except as otherwise specified, all amendments made under this award are effective from the date of this award. Dated this 8 th day of December, 2014 Edward T McDermott Edward T McDermott Chair Jeffrey Sack Partially dissenting Jeffrey Sack Q.C. Association Nominee Michael Riddell Partially dissenting - attached Michael Riddell City Nominee

15 Partial Dissent Of The City s Nominee I have reviewed the Award of the Chair, and I partially dissent to the Award. I contend that the Chair should have awarded the City s proposed contracting out language in Article This would have allowed the City to contract out dispatch work. Awarding the proposed language, along with providing some alternate employment opportunities for affected employees, could have resulted in a reduction in expenditures for the City. While the total awarded monetary package is similar to comparator Fire Departments, the overall increase in the monetary package is far in excess of other public and private sector settlements and Arbitration Awards. On the positive side, I was pleased that the Chair refused to award the Association s proposed Health Spending Account or retiree benefits for life as well as a number of new or enhanced benefit proposals. Dated at Toronto, Ontario this 6 th day of December, 2014 Michael Riddell City Nominee