IN THE MATTER OF AN INTEREST ARBITRATION CHARTWELL - PARK PLACE MANOR. - and - SEIU, LOCAL 1 CANADA

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1 IN THE MATTER OF AN INTEREST ARBITRATION B E T W E E N: CHARTWELL - PARK PLACE MANOR ( the Employer ) - and - SEIU, LOCAL 1 CANADA ( the Union ) BOARD OF ARBITRATION: Stanley M. Beck, Chair Ryan Wood, Employer Nominee Harold F. Caley, Union Nominee APPEARANCES: For the Employer: Nicole Desjardins For the Union: Mark Janson Andrew Hall A hearing in this matter was held in Toronto on October 7, 2010.

2 AWARD This interest arbitration is pursuant to the Hospital Labour Disputes Arbitration Act (HLDAA) to settle the outstanding issues for a first collective agreement between the Park Place Manor Retirement Home (Park Place or the Home) and the Service Employees International Union, Local 1 Canada (the Union). The Home is owned by Chartwell Seniors Housing REIT (Chartwell), which is the largest long-term care corporation in Canada. In 2008, Chartwell negotiated 19 separate collective agreements, 11 of which were for newly certified homes. The agreed wage increase was some 2.45% for the 2010 calendar year in the newly certified homes, and the total compensation package averaged 2.8%. This was a point the Home relied on repeatedly in the context of the replication principle. Chartwell also placed a good deal of emphasis on the fact that this was a first collective agreement, it was taking place at the end of an economic downturn and the replication principle should be adhered to. I will return to these themes in the judgment that follows. The Home has 93 suites and employs 7 full-time and 28 part-time members of the Union in the classifications of Guest Attendant, Dietary Aide, Activity Aide, Cook, Assistant Cook and Maintenance. The parties have agreed on a number of issues which are contained in the Union's Exhibit #4 and the Home's Exhibit #7, and these are to be taken as included in this Award as set out therein.

3 - 2 - TERM AND RETROACTIVITY Both parties agreed that the term should be two years as prescribed under HLDAA for a first contract. Accordingly, the term will be from October 1, 2009, to September 30, All adjustments shall be effective October 1, 2009 and shall be implemented within 30 days of the date of this Award. If HLDAA requires a different start and end period for a first contract, the term shall be adjusted accordingly. WAGES The primary dispute between the parties is as to wages. The Union's position is that effective immediately there should be parity with the Central Nursing Home wages and the institution of a grid with the steps being identical to those in the Central grid. Increases for retirement homes are rarely, if ever, based on Central rates. This is for the basic reason that retirement homes are funded solely on rent and fees paid by residents as opposed to government funding for nursing homes. Another important distinction, as arbitrators have pointed out, is the increased level of care required in nursing homes as opposed to what is necessary in retirement homes. Accordingly, the Central Nursing Home wage rates and grid are not adopted.

4 - 3 - It is clear, in terms of wage rates, that Chartwell is considerably behind when compared with other retirement homes. The Home makes the argument that Ontario is coming out of difficult economic conditions and that this is a first contract, both of which factors militate against any type of aggressive catch-up settlement. If one looks at the figures, however, Chartwell has been, and continues to be, a very profitable enterprise. In 2008, Chartwell's profit fell some 10%, but this was relative to an extremely large 91% increase in profit in Moreover, Chartwell bounced back very sharply in 2009 with a 32% increase in profit, and the first quarter of 2010 continues to show an increase, although considerably smaller than The economy remains strong in Southwestern Ontario and the demand for retirement home beds also remains strong. In all of the circumstances, Chartwell is well placed to begin to bring its Home employees up to standard with other retirement homes in Ontario. The fact that this is a first agreement does not militate against that fact. The Union's figures, which were not disputed in the Home's submissions, show that the Health Care Aide (Aide) is currently 6.30% behind the GTA average rate, and the Guest Attendant (Attendant) is some 8.81% behind the GTA average rate. (It is appreciated that the Home is in Aurora and not the GTA as such.) If the 2010 wage increases are factored in, the Attendant gap rises to 10.29% and the Aide gap is 5.03%. Chartwell proposes a wage freeze for the duration of the agreement. In justification, Chartwell cites recent settlements and the replication principle. For the reasons set out above, I do not believe a wage freeze for the term of the collective agreement would reflect the replication principle or anything close to it.

5 - 4 - While I am conscious of the replication principle and that catch-up is not normally a part of first agreements, I am satisfied that given the Home's agreement that the relative comparator is retirement homes rather than the Central Nursing Home agreement, the evidence of Chartwell's continuing profitability, and the gap between the Home's wage rates and those for other similarly placed retirement homes, there likely would have been some increase for the Home. In light of the above, I award an across the board increase of 2.5% on October 1, 2009, and an additional 2.5% as of September 30, These increases are well within the Company's ability to pay in the context of the current economic climate for the Home. I would also note the Union's submission that in the SEIU's 36 most recent retirement home settlements in arbitration awards, the average annualized wage increase is 2.92%. The Home's employees would need a raise of 6% to bring them to parity with the group of recent settlements cited. The recent settlements cited include a broad comparison of all Ontario settlements. I am constrained to note that for the most part, the Home's Brief contented itself with citing the replication principle and advocating the status quo. This was not helpful and a more fullsome Brief would have served its cause better.

6 - 5 - PAID HOLIDAYS The current collective agreement provides for nine paid holidays plus one float day. The Union proposes 11 paid holidays and one additional float day, for a total of 12. The Company proposes the status quo. We would award an additional float day holiday. The result would be nine paid holidays, plus two float days, for a total of 11 paid holidays. VACATION ENTITLEMENT The Employer proposes the status quo and the Union proposes an increase. The Union's submission seems to be directly in line with SEIU retirement home settlements, although that the great majority of them are renewal contracts rather than first contracts. In 18 recent first contract retirement home settlements involving the SEIU, there were no vacation improvements. Accordingly, the status quo is maintained here. SICK LEAVE The following terms shall be included in the collective agreement: Employees will accumulate sick leave credits at a rate of 7.5 hours of credit for every hours worked, to a maximum of 12 days per year. Employees would be able to carry over a maximum of 75 hours to the following year.

7 - 6 - This will replace the current Weekly Indemnity provision and is consonant with what is provided in many retirement homes. The Panel will remain seized of this particular term in the event that an employee is disadvantaged by the coming into effect and the replacement of the Weekly Indemnity. BEREAVEMENT LEAVE The following shall constitute the new bereavement leave provision. Employees who have completed the probation period shall be eligible for bereavement leave for regularly scheduled consecutive days lost from the date of death to the date of the funeral. In the event of the death of an employee's spouse, same sex partner or child, a leave of absence of up to five consecutive days may be granted without loss of pay for the purpose of arranging and/or attending the funeral. In the event of a death in the employee's immediate family, which shall include mother, mother-in-law, father, fatherin-law, brother, brother-in-law, sister, sister-in-law and grandparents, a leave of up to three consecutive days may be granted without loss of pay for the purposes of arranging and/or attending the funeral. The Employer may grant additional bereavement leave without pay at its discretion in special circumstances.

8 - 7 - PREGNANCY AND PATERNAL LEAVE The Union proposes a top-up of the current Employment Insurance Benefit up to 75% of employees' regular earnings. This is an important benefit and the total cost is very small. The data supplied by the Union indicates that a top-up of 75% of regular earnings for employees on pregnancy leave, for a period of 17 weeks, is becoming the norm for retirement homes, and that is what is ordered here. CHANGE OF CARRIERS The status quo is maintained. PENSIONS There is no pension plan in effect at Chartwell at this time. The Union proposes the adoption of the Nursing Homes and Related Industries Pension Plan (NHRIPP), with each eligible employee contributing 4% of applicable wages and the Home contributing an equal 4% of applicable wages. This would be a significant cost factor for Chartwell, but pension plans are becoming the norm and there is no sufficient reason why this Home should not have a NHRIPP. A NHRIPP should be implemented wherein each eligible employee covered by the collective agreement would contribute 1% of applicable wages to the Plan with a matching 1% contribution by the Home. The Plan should become

9 - 8 - effective on the date of this Award. Any RRSP is to be eliminated upon the adoption of a NHRIPP. HEALTH BENEFITS Given what has been granted to the employees in the sections above, particularly in wages and pension, a change in health benefits would not be appropriate at this time. Accordingly, the status quo is maintained. SENIORITY The Union proposal is adopted. Accordingly, the following language is to be included: Employees will be considered on probation for the first 450 hours and will have no seniority rights during that period of time. Following successful completion of the probationary period, employees shall receive credit for their hours worked for the purpose of assigning a seniority date or hours as the case may be. The dismissal, layoff or the failure to recall after layoff of a probationary employee shall not be subject to a grievance. LAYOFF AND RECALL PROCEDURES The language proposed by the Union is adopted as it is standard language and contains nothing that is binding. It simply requires a meeting to discuss and, if there's a failure to

10 - 9 - meet, the layoff is not delayed. Accordingly, the language set out at Tab 18 at page C-84 of the Union's brief under Article 28 is adopted. RECALL RIGHTS The Union proposal at page C-86 of its Brief is adopted. As the Union noted, it is fairly standard language and is found in a significant number of Chartwell Homes and provides a decent level of job security to employees. CONCLUSION The Panel will remain seized until a new collective agreement is signed. The Panel will also remain seized if there are any terms or any other matters that are not clear. DATED at TORONTO this 21st day of December, Stanley M. Beck, Chair "I dissent" - see attached Dissent Ryan Wood, Employer Nominee "I concur" - "Harold F. Caley" Harold F. Caley, Union Nominee

11 PARK PLACE MANOR AND SEIU EMPLOYER NOMINEE DISSENT - RYAN WOOD For the following reasons I must dissent from this award. 1) Park Place Manor is located in Aurora Ontario, not in the GTA as the award references. 2) The first agreement principles for replication are ignored by this award. 3) The Union did not submit a recruitment or retention claim as outlined under the HLDAA criteria. 4) As the HLDAA criteria establish, strong consideration should be given to the notion that experienced parties do factor in the weakened external economic environment when they are at the table. This award also fails to reflect the replication of the parties: A) Chartwell and SEIU have recently negotiated 10 first contract retirement home settlements. This award deviates from the total compensation increases of those settlements significantly. Park Place Manor is paid higher rates of pay than any of the Chartwell and SEIU first agreement settlements.(including 3 homes located in North York (Scarlett Heights, 4 Teddington and Constantia) which are properly described as GTA facilities). None of Chartwell voluntary settlements provide for the introduction of the NHRIPP pension plan. All of the settlements provided for wage increases, a float holiday and a modest sick leave improvement with no other changes to any other entitlement.

12 B) SEIU has also recently negotiated a first contract settlement for Clocktower Retirement (a former Chartwell facility, now sold to Allegro) only 8kms from Park Place Manor. The settlement is referenced numerous times through the Union s brief. The Clocktower agreement also provided for no introduction of a NHRIPP pension plan. This settlement should have been a strong guide for this Board. C) SEIU has recently settled a first agreement via consent arbitration award for a home in North York called Glynwood. The award was is referenced on page B35 of the Union s brief ( the award was issued on April 15, 2010 as a result of a rejected memorandum of settlement by Arbitrator Raymond) The settlement for this facility provided for the following increases. Term October 6 th, 2008 to December 31, 2011 January 1, % July 1, % January 1, % July 1, % Lump Sum payment for the period of October 7 th, 2008 to December 31, 2009 equal to 2.5% not to be rolled into the wage grid. The Glynwood agreement also provided for no introduction of a NHRIPP pension plan. We think this settlement should have been a strong guide for this Board.

13 In summary; 1) Chartwell and SEIU have a volume of first agreement replication which adheres to the generally accepted principle that in a first agreement the Union accepts less to get the collective agreement in place in a timely manner. This is illustrated by the 10 voluntary settlements between the parties. 2) The introduction of a pension plan for a first agreement is not the norm and is unheard of in a first agreement. 3) Recent SEIU first contract settlements at The Glynwood (North York and Clocktower (Newmarket 8kms from this facility) are strong examples of first agreement replication. Ryan Wood Employer Nominee

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