IN THE MATTER OF AN INTEREST ARBITRATION PURSUANT TO THE HOSPITAL DISPUTES ARBITRATION ACT, R.S BETWEEN: SCHLEGEL VILLAGES.

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1 IN THE MATTER OF AN INTEREST ARBITRATION PURSUANT TO THE HOSPITAL DISPUTES ARBITRATION ACT, R.S BETWEEN: SCHLEGEL VILLAGES AND (The "Employer") SERVICE EMPLOYEES INTERNATIONAL UNION, LOCAL 1 CANADA JANICE JOHNSTON - CHAIR ( The "Union") IRV KLEINER- EMPLOYER NOMINEE HAROLD CALEY- UNION NOMINEE APPEARANCES: For the Employer: Michael Allen Mike Putt Matt Drown Melissa Metzger Counsel Labour Relations Director Vice-President, Human Resources Labour Relations Manager For the Union: Jesse Stanson Ricardo McKenzie Pearl T otimeh Lee-Ann Carlyle Sharon Hutchinson Jennifer Grant Ritchie Weinstein Tutu Abebe Union Spokesperson Union Representative Negotiating Committee Negotiating Committee Negotiating Committee Negotiating Committee Negotiating Committee Negotiating Committee A hearing in this matter was held in Mississauga, Ontario, on March 27, Executive sessions were held on May 31, June 8 and July 4, 2012.

2 AWARD This is an interest arbitration under the Hospital Labour Disputes Arbitration Act ("HLDAA" or "the Act"). The hearing in this matter took place on March 27, 2012, and executive sessions were held on May 31, June 8 and July 4, In coming to the conclusions set out in this award, we have given careful consideration to the submissions made by the parties, both written and oral. This arbitration pertains to the second renewal collective agreement between SEIU and Schlegel Villages. We are dealing with a multi-site bargaining unit comprising six nursing homes and two retirement homes. The two retirement homes are adjacent to the two nursing homes of the same name. The following homes are the ones we are dealing with in this award: Erin Meadows Nursing Home (Mississauga) Humber Heights Nursing Home; Humber Heights Retirement Home (Etobicoke) Riverside Glen Nursing Home (Guelph) Sandalwood Parkway Nursing Home (Brampton) Tansley Woods Nursing Home; Tansley Woods Retirement Home (Burlington) Taunton Mills Nursing Home (Whitby) In total, there are approximately 1,275 employees. Of this total, approximately 1,047 work in the nursing homes and 227 work in the retirement homes. There are full-time and part-time employees. Employees are employed in a broad group of classifications including Registered Nurse (RN), Registered Practical Nurse (RPN), Personal Support Worker or Health Care Aide (PSW or HCA), Guest Attendant, Activity/Dietary/Housekeeping/Laundry Aide and Cook. These groups have 2 wage grids. One is for the retirement home workers and the other is for the nursing home workers. The largest group of employees are classified as Personal Support Workers. Section 9 of HLDAA provides that:

3 2 9. (1) The board of arbitration shall examine into and decide on matters that are in dispute and any other matters that appear to the board necessary to be decided in order to conclude a collective agreement between the parties,... (1.1) In making a decision or award, the board of arbitration shall take into consideration all factors it considers relevant, including the following criteria: 1. The employer's ability to pay in light of its fiscal situation. 2. The extent to which services may have to be reduced, in light of the decision or award, if current funding and taxation levels are not increased. 3. The economic situation in Ontario and in the municipality where the hospital is located. 4. A comparison, as between the employees and other comparable employees in the public and private sectors, of the terms and conditions of employment and the nature of the work performed. 5. The employer's ability to attract and retain qualified employees. The criteria listed above are those that we are statutorily mandated to consider. The Act does not give precedence to any one of the factors, nor is it stipulated that these are the only criteria we should consider in making an award. In fact, the Act is quite clear that we can and should take into account all criteria that we consider to be relevant. It is a well-accepted proposition that the purpose of interest arbitration is to replicate free collective bargaining. One of the goals of interest arbitration is to attempt to establish the terms and conditions of employment that the parties might have come to had they had the ability to engage in a strike or lockout. Another important and guiding principle is that of comparability. The most recent collective agreement between the parties expired on March 31, Therefore, in coming to some of the conclusions we have reached, we have been able to review and take into account other arbitrated awards and settlements in the industry that have

4 already occurred and address approximately the same time period we must deal with. The award that we considered to be the most relevant was the Central Agreement Award of Arbitrator Weatherall in Re: Participating Nursing Homes and Service Employees International Union, Local 1 Canada, dated September 8, Term of the Agreement As the parties were unable to agree on the term for this collective agreement, pursuant to Section 10(11) of HLDDA, we award a two-year term running from April1, 2011, to March 31, Contents of the Agreement The renewal agreement shall consist of all of: the unchanged terms and conditions of the collective agreement that expired on March 31, 2011; the items agreed to by the parties prior to the date of this award and set out in the employer's brief at tab 28; any items agreed to at the hearing; and the items we describe and award in this decision. Issues In Dispute There are twelve monetary and language issues in dispute in this case. Any proposal not expressly dealt with is denied and not awarded. Article Job Posting CURRENT PROVISION All applications received will be considered within seven (7) days of the end of a posting procedure. In the event one (1) or more employees apply, the Employer shall consider the qualifications, experience, ability and seniority of the applicants. Where

5 4 these factors are equal, the applicant with the greatest seniority shall fill the vacancy. EMPLOYER PROPOSAL Amend by adding the following text, For the purpose of comparing full time seniority with part time seniority, one/ (1) year full-time seniority = 1800 hours part-time seniority. UNION PROPOSAL Status Quo The bargaining unit is made up of full-time and part-time employees. For full-time employees, seniority is based on date of hire. For part-time employees, it is based on hours. In determining relative seniority should a part-time employee and a full-time employee apply for the same position, there is a need for conversion of the part-time employee's hours to allow for this determination. The language proposed codifies the existing practice and mirrors language found in the layoff and recall provision of the collective agreement. We agree that this proposal is practical and appropriate and the collective agreement shall be changed to reflect the language proposed. Article Union Security- Article 5.02 (a) and (b) CURRENT PROVISION 5.02 (a) All employees who are in the employ of the Employer at the signing date of this Agreement and all new employees who enter the employ of the Employer after the Agreement has been signed, shall be subject to regular monthly Union dues to be deducted from their wages and remitted to the Union.

6 5 (b) The Employer shall, when remitting such dues, provide the names of all employees from whose pay deductions have been made, total hours worked in the period and total dues remitted per employee for the period. The Employer shall send to the Union office each month a list of names and each quarter a list of names, addresses, telephone numbers and classifications of all employees. In the event the Employer is capable of providing the Union with information in an electronic format, the parties shall meet to discuss the format in which the information is remitted. The parties shall meet to discuss this issue in an expeditious manner to ensure that the implementation is not impeded. UNION PROPOSAL Delete 5.02 (a) and (b) and replace with: 5.02 (a) All employees who are in the employ of the Employer at the signing date of this Agreement and all new employees who enter the employ of the Employer after the Agreement has been signed, shall be subject to regular monthly Union dues to be deducted for their wages and remitted to the Union. The Employer agrees to deduct an initiation fee from all new hires and submit to the Union office with the dues. (b) The Employer agrees to forward a list of dues deductions in an electronic format designated by the Union showing names, current addresses, phone numbers, Social Insurance Numbers, highlighting new hires, resignations, terminations, new unpaid leaves of absence and return from leaves of absence, hourly rate, hours worked, and the amount of dues remitted on behalf of each of the employees of whom deductions have been made. EMPLOYER PROPOSAL

7 6 Status quo. The proposal with regard to Article 5.02 (a) merely adds that the employer shall deduct and remit an initiation fee for new hires. This is rationally connected to the existing language and is a reasonable request. The current language shall be amended to reflect this additional language. The current Article 5.02 (b) indicates that if the employer is capable of providing information in an electronic format, the parties shall meet to discuss the format to be utilized. That has not yet occurred. It is our understanding that the cost of moving to an electronic format is minimal and is becoming the norm in the industry. Accordingly, the parties are directed to meet and agree on the appropriate software for implementing an electronic format for the information requested in the union's proposed Article 5.02 (b). Once agreement is reached, the language proposed by the union regarding Article 5.02 (b), minus the reference to "designated by the Union" in the second line, shall replace the current language in Article 5.02 (b). In the event that the parties are unable to reach agreement, we shall remain seized of this issue. Article 22- Health and Insurance Benefits Both parties have proposed changes to the language pertaining to benefits. The only change we are prepared to make is with regard to the provision dealing with vision care. It currently reads, "Vision care in the amount of $ every twenty-four months will be provided". The union seeks to increase the amount to $ We are prepared to move it up to $ Therefore, the reference to $160 is deleted and $180 is substituted. This provision shall come into effect the first full month after the date of this award. There is no demonstrated need for any of the other amendments proposed by the parties and they are accordingly rejected.

8 7 Schedule A - Wages UNION PROPOSAL Effective Apri11, Adjust nursing home wage grid to reflect parity with the SEIU Central Nursing wage grid. Increase retirement home wage grid by 3% Effective April1, Increase nursing home wage grid by 2% across the board. Increase retirement home wage grid 3% across the board. EMPLOYER PROPOSAL Effective April1, % Effective April 1, % Our award addresses the period of time from April 1, 2011, to March 31, For the period April 1, 2011, to March 31, 2012, the union is seeking a higher percentage increase for the retirement home employees and has requested that the nursing home wage grid be adjusted to parity with the SEIU central nursing wage grid prior to any general wage increase. The employer has offered 2% for both groups for this time period. The wage rates at this group of homes is not so far behind the central rate that an adjustment to the nursing home wage grid such as the union is seeking is warranted at this time. There is no demonstrated need for such an increase and it is denied. A review of the decisions and voluntary settlements of the relevant comparators for the year 2011 indicates wage rate increases of 2% were normative. There is no demonstrated need to award an extra percentage to the retirement home employees and this request is also denied. We therefore award a wage increase of 2% to all

9 8 employees, effective April 1, The employer argues that an increase of 1.5% is appropriate in the second year of this agreement. Although there are fewer settlements and decisions available for the time period addressed by the second year of the collective agreement before us, a careful assessment of them establishes a clear pattern or trend that an increase of 2% is normative. In reaching this conclusion, we in particular considered Re ldlewyld Manor and Service Employees International Union, Local1 Canada (Herman) andre Copernicus Lodge and Service Employees International Union, Local1 Canada (Stout). In the ldlewyld case, the Board commented that it was appropriate to give considerable weight to SEIU collective agreements with other long-term-care facilities covering approximately the same time period, as the negotiated and arbitrated collective agreements involving SEIU provide particularly helpful guidance as to the terms the parties would likely themselves have settled upon had they been able to bargain a renewal agreement. We agree with this comment and it is especially relevant when it comes to the determination of the appropriate wage increase. Accordingly, we see no reason to deviate from the established pattern and hereby award an increase of 2% to all employees, effective April1, Once again, no demonstrated need has been established to justify awarding the retirement home employees an additional 1% and the request is denied. Wage increases are to be applied for all job classifications in the bargaining unit at all wage steps effective and retroactive to the dates stated above for all hours paid by the employer to all bargaining unit employees. We will remain seized with regard to the implementation or interpretation of this award.

10 Dated in Toronto this 31st day of July, "lrv Kleiner" Partial Dissent Attached lrv Kleiner Employer Nominee "Harold Caley" Partial Dissent Harold Caley Union Nominee

11 PARTIAL DISSENT OF UNION NOMINEE - HAROLD CALEY I dissent in part from this Award primarily on the basis that all employees should be entitled to the pension benefit at the rate of a four percent contribution from the employer and a matching contribution from the employee. The contribution rate currently stands at three percent. I agree with the Chair that 2% increases for both 2011 and 2012 is the current pattern. In my view these increases are low for the employees performing the required services in the nursing homes and the retirement homes. Retirement homes do not receive government funding and wage increases are in many cases above 2% for the two years; nursing homes, where the current pattern is at 2% for the two years, receive government funding, however the credibility of the government asserting restraint has been tested on a number of fronts. The most recent test involves the cancelling of two gas-fired power plants. During the last election the government cancelled the construction of a plant, where construction j had already started, in order to secure the election of the candidates in the area. The cost to date of this cancellation is 180 million dollars. How can a government cry austerity; waste 180 million dollars; and 'ask' a group of employees, predominately female, making twenty dollars per hour, performing a needed service to the community, to 'agree' to wage increases that are below the increase in the cost of living? Dated this day of July, 2012 "Harold Caley" Union Nominee

12 DISSENT OF EMPLOYER NOMINEE - IRV KLEINER I must take issue with the Chairperson's award in respect of the second year of the term of the Agreement. The Chair has indicated that there is a "clear pattern or trend of 2% for this period. In reaching that conclusion, she appears to have relied to a great extent on arbitration awards in ldlewyld Manor, and Copernicus Lodge both of which I would maintain are anomalous outcomes and which do not represent a "pattern" for the period in question. Moreover, the Chair has noted that in the ldlewyld case, the Board commented that it was appropriate to give considerable weight to SEIU collective agreements with other long term care facilities covering approximately the same period "as the negotiated and arbitrated collective agreements involving SEIU provide particularly helpful guidance as to the terms the parties would likely themselves have settled upon had they been able to bargain a renewal agreement". While the Chair has agreed with this comment, I think that the Board's comments in ldlewyld and this Chairpsons concurrence with those comments are incorrect. The ldlewyld Award is for the period January 1, 2011 to December 31, That term is very similar to that of the SEIU Master which expires on September 15, At paragraph 3, the ldlewyld Board embraced the concept of replication. At paragraph 4 the Board acknowledged the two SEIU Master Awards of Arbitrators Jesin and Weatherill. At paragraph 6, on page 3, Arbitrator Herman chose to ignore Jesin's Award on the basis that more of the term of the ldlewyld renewal -January 2011 to December fell within the term of the Weatherill Award which covered the 12 month period ending September This is a critical departure from logic. The Weatherill decision that was issued following the Jesin Award is for the same parties. It is true that Arbitrator Weatherill awarded 2% for 12 months beginning with September 15, But Arbitrator Herman

13 ignored Arbitrator Jesin's Award, which provided for compensation at the annualized rate of 1.45%, for the first 9.5 months in This is the first 9.5 months of the ldelwyld renewal. At paragraph 6, page 4, Arbitrator Herman reviewed the Awards of Arbitrator Luborksy in Huntsville District Nursing Home and Arbitrator Chauvin in Erin Mills Nursing Home and stated as follows: The pattern of bargaining or arbitrated awards for the years in question in the sector therefore clearly demonstrates that 2.0% annually is not only the average or normative increase in wages, but that this is the overwhelming trend since the time of the Jesin Award. In the face of this predominant pattern of increases of (at least) 2.0 % in each of 2011 and 2012 without proration and as of the anniversary dates of a collective agreement, the fact that other boards of arbitration have prorated percentage increases in other contexts where other bargaining agents represent employees is not persuasive (see, for examples of prorated increases, Huntsville District Nursing Home and Health, Office & Professional Employees, a Division of UFCW, Local 175 (2011) Canlll (Lubarsky), Devonshire Erin Mills Inc. c.o.b. as Erin Mills Nursing Home (2011) Canlll (Chauvin)). As these Awards were not dealing with SEIU Homes, it is not apparent those boards of arbitration were presented with the predominant pattern of annual increases of at least 2.0% that have been received by SEIU Homes. [emphasis added] This conclusion is incorrect. The awards since Weatherill, including the two awards which were specifically ignored by Herman, have been based on the outcomes of the SEIU Master. It was the SEIU pattern, which was established by the combination of the Jesin and Weatherill Awards that compelled other unions such as UFCW, CAW, and CLAC, to resolve their current bargaining for service workers with average annual wage outcomes of 1.7%. The history in the sector for many years, has been to fashion bargaining outcomes based on the rate of compensation increase that results from the SEIU Master Awards. This current round of bargaining in the sector should be no

14 different. The total number of homes which resolved their current bargaining after the Weatherill Award totals 285, including ONA represented RNs bargaining units. These post-weatherill outcomes were fully informed on the nature of the Jesin and Weatherill Awards. If CAW, CUPE, USWA, and CLAC bargaining results in awards and settlements which are based on SEIU precedents and the result is an average annual rate increase of 1.75%/year, then Arbitrator Herman's Award makes no sense and ought to have been given no weight by this Chairperson. How could Arbitrator Herman have based his Award of 2% per year based on the same SEIU precedents? I would pause to point out that indeed many of the agreements that were relied upon by the Union in this case were agreements and awards that affected other unions. I would maintain that SEIU indeed takes guidance in its bargaining from bargaining outcomes in the sector involving other unions. SEIU referred to 68 settlements out of which only 26 were in respect of SEIU bargaining units with the balance being in respect of other trade unions in the sector. Once again, there have been renewals of collective agreements (either through arbitration or negotiated settlements) covering 285 homes since the release of the Weatherill SEIU master arbitration award in September, These have largely been at or below 1. 7% per annum in wage increases. Of these, 164 have been ONA awards for RNs, a classification where the relationship between the supply and demand for labour favours a Union argument for higher than average wage increases. The ONA outcomes have resulted in wage rates increasing at less than 1% per year. There are 121 service bargaining units covered by post-weatherill awards and settlements which when combined with the 98 Homes in the SEIU Master, represent 58% of the service units in the entire nursing home sector.

15 Immediately following the Weatherill Award, there were some single-home outcomes which followed the combined precedents of the Jesin and Weatherill Awards for the SEIU Master. These included a number of UFCW homes. Also included were several CAW multi-home decisions: Arbitrator Barrett's Award covering 14 CAW homes; Arbitrator Kaplan's Award covering 20 CAW homes and Arbitrator Rayner's Award covering 10 CAW homes. All of these were based on a combination of the Jesin and Weatherill Awards. CUPE challenged the validity of these precedents in a case involving 10 Extendicare Homes. They were able to persuade Arbitrator Kaplan only to defer the implementation of the 1.7% trend until the 2nd year of that renewal, In all of the circumstances, this Board ought to have awarded the Employer's proposal of a 1.5% increase for the second year of the term in conjunction with the 2% wage increase for the first year, as that would have produced an outcome over the two year term, that was better than the combined effect of the Jesin and Weatherill arbitration awards. Dated this 31st day of July, 2012 "lrv Kleiner" Employer Nominee