IN THE MATTER OF AN INTEREST ARBITRATION UNIVERSAL WORKERS UNION, LOCAL 183. and METROPOLITAN TORONTO APARTMENT BUILDERS ASSOCIATION

Transcription

1 IN THE MATTER OF AN INTEREST ARBITRATION BETWEEN: UNIVERSAL WORKERS UNION, LOCAL 183 and METROPOLITAN TORONTO APARTMENT BUILDERS ASSOCIATION UNIVERSAL WORKERS UNION, LOCAL 183 and DURHAM RESIDENTIAL CONSTRUCTION LABOUR BUREAU UNIVERSAL WORKKERS UNION, LOCAL 183 and TORONTO RESIDENTIAL CONSTRUCTION LABOUR BUREAU Final Award BEFORE: Arbitrator Larry Steinberg APPEARANCES For the Union For the Employers Alan M. Minsky, Q.C. Carl W. Peterson J. Oliveira Richard Lyall J. Cortez Jason Ottey J. Alves Russell Groves John Evans Will Dunning Hearing held in Toronto Ontario on September 7, 2013

2 2 [1] This is an interest arbitration to settle the terms and conditions of the collective agreements between the parties. [2] This Award should be read together with an Interim Decision dated September 23, 2013 (2013 CanLII (ON LA)) which addressed a number of preliminary matters and a interim wage increase and a second Interim Decision dated December 5, 2013 regarding my jurisdiction to consider an Employer proposal to delete certain provisions of the collective agreements which are alleged to be illegal as being contrary to the provisions of the Competition Act. [3] By way of summary, I award wage increases as follows: MTABA $3.65 ($1.35, $1.20 and $1.10), TRCLB/DRCLB $3.50 ($1.30, $1.15 and $1.05) and DRCLB outside Whitby and Oshawa $3.25 ($1.25, $1.05 and $0.95). [4] I decline to award any of the non-wage items of any of the parties with the exception of the request of the MTABA to direct the inclusion in the agreement of the version of LOU 7 found by Arbitrator Herman to be the operative version. [5] My jurisdiction in this matter is to be found in Letter of Understanding 12 ( LOU 12 ) in each collective agreement. It reads as follows: LETTER OF UNDERSTANDING NO. 12 Re: No Strike No Lockout Agreement WHEREAS the Union and the Association have entered into a Collective Agreement which is effective on its face from May 1, 2010 to April 30, 2013; and WHEREAS the Union and the Association contemplate entering into successor collective agreements which will be effective on their face from May 1, 2013 to April 30, 2016 and thereafter from May 1, 2016 to April 30, 2019 (the successor collective agreements ); and WHEREAS the Union and the Association are desirous of ensuring that the high rise sector of the residential construction industry in the geographic area covered by the Collective

3 3 Agreement will not be subject to strikes and lockouts in future years; NOW THEREFORE the Union and the Association agree as follows with respect to the renewal of the two above-noted successor collective agreements: 1. If the Union and the Association are unable to agree upon the terms and conditions of both or either of the above-noted successor collective agreements, then on or about the thirtieth (30 th ) day of April in both or either 2013 or 2016, either party may refer the settlement of the new collective agreement to final and binding arbitration; 2. The Union and the Association agree that in view of the final and binding arbitration provisions set out herein there will not be, and they will not cause there to be, a strike or lockout following the expiry of the relevant collective agreements in either 2013 or 2016; 3. The Parties agree that, in order to meet the need for expedition in the construction industry, they will agree upon a mutually acceptable arbitrator by no later than April 30 th, of each bargaining year, although it is understood that simply agreeing to an arbitrator in no way means that the agreement(s) must be settled by arbitration; 4. Upon the issuing of a written notice of desire to proceed to final and binding arbitration to both the other party and the arbitrator, the arbitrator will commence a hearing with respect to the arbitration within fourteen (14) calendar days of the date of notice or thereafter if mutually agreed to by the Parties; 5. It is agreed that the arbitrator will hear, and will have the necessary jurisdiction to determine, all lawful proposal and positions which are put before him by either party, and there is no restriction upon the number of issues which may be put to the arbitrator. Further, the parties agree that the arbitration process will not be one of final selection; 6. With respect to the agreement set out in paragraph 5 above, the parties agree that they may mutually agree to modify the arbitration proceedings such that the number of issues proceeding to arbitration may be limited and/or that final offer selection may be utilized for all or part of the arbitration procedures in either or both of the bargaining years; 7. It is agreed that the arbitrator will issue his decision within seven (7) calendar days of the date of the hearing and that any aspects of the decision may be retroactive to May 1 st of the appropriate year if the arbitrator so determines;

4 4 8. It is agreed that any arbitrations which are required as between the Union and the Association will be the industry arbitration and accordingly pursuant to the terms and provisions of the Association s accreditation and the terms and provisions of the Collective Agreement, including but not limited to this Letter of Understanding, that such decisions will be final and binding upon any Employer bound to this or any similar independent collective agreement, for all purposes; 9. The Parties agree the agreements, duties, obligations and rights set out in this Letter of Understanding form part of the Collective Agreement which is binding upon them and in addition constitute a settlement of the proceeding under the Act which is enforceable under Section 96(7) of the Act and accordingly are enforceable both as a term and provision of the Collective Agreement and under the provisions of the Act with respect to the settlement of proceedings. The Parties [6] The Metropolitan Toronto Apartment Builders Association ( MTABA ) is an accredited Employer organization that represents all employers of employees engaged in apartment building construction for whom Universal Workers Union, LIUNA Local 183 ( the Union ) has bargaining rights in Board areas 8, 9, 10, 11, 18 and the part of 12 west of the Trent-Severn Waterway. These are the high-rise builders. [7] There are approximately 120 employers who are members of the MTABA who employ approximately 700-1,000 employees. [8] The Toronto Residential Construction Labour Bureau ( TRCLB ) is an accredited Employers organization that represents all employers of employees engaged in low-rise residential construction for whom the Union has bargaining rights in Board Area 8 and Simcoe County. There are 150 employers who are members of the TRCLB who employ approximately 800-1,000 employees. [9] The Durham Residential Construction Labour Bureau ( DRCLB ) represents employers of employees engaged in low-rise residential construction for whom the Union

5 5 has bargaining rights in Board Area 9. There are currently 50 employers who are members of the DRCLB and who employ approximately 100 employees. [10] The parties agreed on a number of matters in collective bargaining. The agreed items will be included in the renewal collective agreement. [11] There remain, however, a number of matters in dispute. These are listed below. MTABA Collective Agreement Wages [12] The Union is seeking an increase in wages of $4.00 over the three years of the agreement as follows: May 1, 2013 $1.45; May 1, 2014 $1.30; May 1, 2015 $1.25 [13] The MTABA has proposed an increase in wages of $3.21 over the same three years with increases of $1.07 in each year. Premium Pay [14] The Union is seeking an increase in premium pay for the Handy Man classification from $0.60 per hour to $2.00 per hour over the Labourers rate and from $1.25 per hour to $3.00 per hour over the Labourers rate for the Working Foreman classification. The Employer resists any increase. Travel Allowance [15] The Union is seeking an increase in Travel Allowance from 20 minutes to 30 minutes for employees travelling from Zone 1 to another Zone. The Employer resists any increase.

6 6 Deletion of LOU 7 [16] The Union is seeking the deletion of LOU 7 from the collective agreement, or alternatively, significant amendments to it. The Employer resists any changes to it and has proposed that the version of the letter found by Arbitrator Herman to be the applicable version in his award dated April 8, 2013 be inserted in the collective agreement. New Article [17] The MTABA has proposed that a new Article be included in the collective agreement which would require the Union to provide the MTABA with the hours remitted by each employer in the construction sector bound to the Union on a monthly basis. The Union resists this proposal TRCLB Collective Agreement Wages [18] The position of the Union is the same as its position above. The TRCLB has proposed an increase of $3.07 over the life of the agreement with increases of $1.03 in year one and $1.02 in years two and three. Premium Pay [19] The Union is seeking an increase in premium pay for the Handy Man classification from $1.00 per hour above the Labourers rate to $2.00 above that rate. The Employers oppose any increase in the rate.

7 7 Car Allowance [20] The Union is seeking an increase in car allowance provided for in LOU No. 10 for Servicemen/Handymen from $ per month to $ per month. The Employers oppose any increase. LOU No. 18 [21] The TRCLB is seeking an amendment to LOU No. 18 to provide either party the right to refer the settlement of a schedule for Simcoe County to arbitration if negotiations to do so are unsuccessful. The Union opposes this request. DRCLB Collective Agreement Wages [22] The position of the parties is identical to their proposals under the MTABA agreement with the exception that the DRCLB has proposed that the increase outside Whitby and Oshawa be $2.84 per hour with an increase of $0.95 in years one and two and $0.94 in the third year. Premium Pay [23] The Union has proposed an increase in premium pay for the Handyman classification from $0.90 per hour over the Labourers rate to $2.00 above that rate outside Whitby and Oshawa and from $1.00 per hour to $2.00 inside Oshawa. The Employer opposes any increase. Car Allowance [24] The Union has proposed the same increase as its proposal under the TRCLB collective agreement and the Employer opposes any increase.

8 8 Argument of the Parties on Wages [25] The position of the parties on the matter of wages can be summarized as follows. Union [26] The Union relied on the principle of replication and pointed to a number of settlements and arbitration awards in support of its position of a $4.00 increase over three years in all three collective agreements. [27] The Union relied on the principle of replication and pointed to a number of settlements and arbitration awards in support of its position of a $4.00 increase over three years in all three collective agreements. ICI [28] It was the Union s position that the IUOE settlement in February 2013 at $3.95 in the ICI sector has been broadly adopted as a benchmark for other settlements in that sector and other sectors, including the residential sector. [29] In the ICI sector the Union referred to the arbitration award for Carpenters (McKee) which awarded $3.95 to Local 27 for General Carpentry and for Acoustic and Drywall and Resilient Flooring. The Union also referred to the negotiated settlements in the ICI sector for Sheet Metal and Millwrights at the same rate. Somewhat higher increases were negotiated by the IBEW ($4.10), the UA ($4.20 and $4.15 for pipefitters and sprinkler fitters respectively), Boilermakers ($4.20) and Insulators ($4.00). [30] Settlements below the so-called benchmark included Cement Masons ($3.75) and Labourers in Board Area 8 ($3.45 to $3.75) and Plasterers ($3.25).

9 9 [31] The Union also referred to the arbitrated award (Jesin) in the Heavy Construction Sector at $3.95 as well as negotiated settlements at that level in the Sewer and Watermain and Roads sectors. Residential High Rise [32] In the high-rise residential sector, the Union referred to six agreements (Formwork Council (Setter/Layout Local 183), IUOE, Masonry, Residential Carpentry (LIUNA 183A), Trim Carpentry (Local 27) and Plumbers), specific to this sector (that is to say, these were not ICI agreements that also extended to the residential sector). Five of these agreements were settled at $3.95 (the exception was the Plumbers at $4.20). [33] With respect to six ICI agreements that apply in the residential sector (Electricians, Elevator, Roofers, Sheet Metal, Drywall and Rod Workers), three were at $3.95 and the other three were higher. Low-Rise [34] With respect to low-rise, and excluding those in which piece-rates are used, the Union referred to seven agreements. Those that did not involve Labourers (Electricians, Plumbers, Sheet Metal), all settled above the so-called benchmark at $4.10. With respect to those that did involve the Labourers, Low-Rise Forming ($4.00) was above the socalled benchmark, Masonry ($3.95) was at the benchmark, and the other two were below the benchmark at $3.70 (Concrete and Drain) and $3.25 (Landscape). [35] In addition to the above, the Union relied on a number of reports and published material dealing with matters such as units under construction, building permits and construction starts to support its view of the direction of the industry over the next few years. From this material, I was asked to conclude that, while there will be some reduction in condo construction from the peak in January 2013, the decline will not be precipitous. Similarly, for low-rise, the Union relied on a report from CMHC forecasting a decline from 2011 to 2014 of about 6.8%.

10 10 [36] The Union was critical of a report prepared for the Employer which forecasts a decline in high-rise construction of 70% from 2012 to 2015 and a decline in low-rise activity of more than 22% from 2011 to [37] The Union calculated that its wage proposal would amount to compound increases, depending on classification, from 7.9% to 9.1% in the MTABA agreement, from 8.8% to 9.8% in the TRCLB agreement and from 8.8% to 9.8% (Oshawa and Whitby) and 9.6% to 10.6% (Outside Oshawa and Whitby) in the DRCLB agreement. Employers [38] The Employers also relied on the replication principle as well as the well-known concept of demonstrated need. [39] The Employers had a very different view of the future of the industry over the life the renewal collective agreement. Relying on the report of Will Dunning Inc. and other materials, the Employer was of the view that the industry was about to experience a very sharp drop in high-rise condo construction and a significant decline in demand for low-rise housing. Focusing on sales, starts, unemployment rates and inflation, the Employer argued that the market has only one way to go down. [40] The Employers also focused on general economic conditions and asserted that the economy has not yet recovered from the 2008 economic collapse. [41] The Employers were very critical of the Union s characterization of $3.95 as a type of benchmark rate in which all trades moved in lock-step. In its view, there was ample evidence in the material to indicate quite a broad variation in the settlements. [42] Moreover, the Employers argued that these parties have a history of not following in lock-step the increases achieved by others and referred specifically to the 2010 round of bargaining where these parties settled for much less than some other parties.

11 11 [43] The Employers pointed out that the rates in these collective agreements are generally lower than some of the other agreements to which the Union is party as well as those on which it relied in its submission. As a result, increases of the magnitude requested here, based entirely on dollars per hour, would result in a percentage increase in wages well beyond normative increases whether measured by increases in the economy as a whole or in the construction sector. The Employers strongly urged that any increase must be reasonable when viewed from this perspective. [44] The Employers were of the view that the most comparable settlements were those in high-rise forming and Labourers ICI. The former settled at $3.80, $3.95 and $4.15 depending on classification amounting to an average increase of 7.4%. The latter settled at $3.45 to $3.75 amounting to 6.9%. The Employers also referred to the Concrete and Drain settlement in the low-rise at $3.70 amounting to an increase of 7.8% [45] Based on the foregoing, the Employers asserted that their offer of $3.21, amounting to an increase of 7.5% for the Labourers rate, was fair and reasonable in the circumstances. Decision [46] In making my decision, the following factors have been carefully considered. [47] First, both parties agree that all forecasts indicate that there will be a decline in the sector although the depth of that decline is hotly contested. That disagreement is not one that I can resolve. [48] Second, notwithstanding this uncertainty, I have the advantage that this is the last of the settlements in the industry. No doubt those who have settled before have factored into their settlements these very same forecasts, and for that reason, application of the replication principle will reflect the consensus of the industry.

12 12 [49] Third, the most relevant comparable settlements are those in the residential sector since the forecasts referred to above apply across that particular sector. I do not know what the forecasts and challenges are for other sectors. In high-rise, I was particularly interested in the settlements specific to the sector as opposed to those which import the ICI rate. [50] Fourth, settlements to which the Union was a party in the residential sector must be given weight. [51] Fifth, while one round of bargaining is not evidence of a consistent pattern, the 2010 settlement between these parties is a relevant factor that must be given some weight. [52] Sixth, regarding the percentage v.s. dollar per hour issue, in my view, both measures are relevant. No doubt the culture in the industry is to approach these matters on a dollar per hour basis. However, the replication principle, on which both parties rely, must also take into account the impact of any economic increase in wages as measured in percentage terms to ensure that such increase bears some normative relationship to others in the industry. And if the benchmark increase when applied to a collective agreement with lower rates produces an unreasonable percentage increase, it is a factor that must be taken into account. [53] The Employer s position is that based on comparable settlements, a normative increase should be in the range of 7% to 8%. [54] Applying the above factors, the settlements specific to the high-rise residential sector showed a clear trend to settle at $3.95 (five of six settlements) and the one exception was at a higher rate. Within this group, three were Labourers agreements and all settled at $3.95.

13 13 [55] In low-rise, the pattern for seven agreements is more scattered ranging from $3.25 to $4.10. The average for all settlements is $3.89 per hour. The Labourers have four agreements in the group ranging from $4.00 to $3.25 with an average of $3.73. If the $3.25 rate for landscape (which applies to both ICI and residential) is backed out, the average is $3.88. Although slightly lower than the so-called benchmark, the most comparable settlements in low-rise, cluster around that mark. [56] Therefore, application of the replication principle seems to indicate that a wage increase more in line with the Union s proposed increase than that of the Employers would be warranted. [57] However, replication also requires that the other factors mentioned above must be applied. [58] As I noted above, the factor of the forecasts of where the industry is headed in the next few years has likely already been factored into the comparable agreements and I do not think any further adjustment is required on that basis. It is however interesting to note that generally settlements in 2013 seem to be higher than those in [59] What about the Employer s argument that these parties have historically settled well below that of other trades? It is clear that in the 2010 round of bargaining, these parties departed significantly from other settlements, and of particular interest, those in high-rise forming and masonry. These parties settled for $3.05 for low-rise and $3.20 for high-rise. The Union settled its High-Rise Forming agreement at $3.40 to $3.50 and Masonry at $3.50. [60] This type of evidence is clearly relevant to any wage setting exercise when the request is of the me too variety. It does support the position of the Employers that the lock step approach is not universally applied and departure from the benchmark is not unusual. However, since one round of bargaining is not sufficient to establish a reliable pattern, the weight that I am prepared to give this factor must accordingly be tempered.

14 14 [61] Finally, the percentage increases must be considered. The comparisons are somewhat complicated since the parties chose to calculate this in different ways. The Union compounded the rates across all classifications whereas the Employers calculated the percentage increase on the base Labourers rate only which, because it is the lowest rated classification in the agreements, produced the largest percentage increase. [62] However calculated, the Employers seem to be correct that settlements and awards in 2013 are not in the range that would result from acceptance of the Union s proposed increases. [63] For no other reason than it is simpler, I will adopt the Employer s approach of not compounding but will run the calculations for each of the classifications in the particular agreement. [64] The Employer calculated that its offers of $3.21, $3.07 and $2.84 would amount to a 7.5% increase on the base Labourers rates in the agreements. However, applied to the other classifications in the MTABA agreement, the rate would amount to 7.3% and 6.5%, in the TRCLB/DRCLB the rates would be 7.2%, 6.7% and 7.1%, and DRCLB outside Oshawa and Whitby, 7.1%, 6.7% and 7.1%. Therefore, the rates proposed by the Employers appear to require some upward adjustment to meet even their target of 7.5 % for employees in the bargaining unit. [65] Of the comparables used by the Employer, the average increase of 7.4% in highrise forming and 7.8% in low-rise concrete and drain seem particularly relevant as both are in the residential sector, were negotiated with the Union and seem to support the view of the Employers regarding a moderation of the rate to be awarded. [66] Taking into account all of these factors, I am of the view that a reasonable increase in the MTABA collective agreement would be $3.65 as follows: May 1, 2013 $1.35; May 1, 2014 $1.20 and May 1, 2015 $1.10.

15 15 [67] With respect to the TRCLB/DRCLB agreements, I am of the view that an increase of $3.50 is fair and reasonable as follows: May 1, 2013 $1.30; May 1, 2014 $1.15 and May 1, 2015 $1.05. [68] With respect to the DRCLB agreement outside Oshawa and Whitby, I am of the opinion that a fair and reasonable increase is $3.25 as follows: May 1, 2013 $1.25, May 1, 2014 $1.05 and May 1, 2015 $0.95 [69] These increases will increase the MTABA rates by 8.5%/8.6%/7.4%, the TRCLB/DRCLB rates by 8.5%/8.3%/7.7%/8.2% and the rates outside Whitby and Oshawa by 8.5%/8.3%/7.7%/8.2%. [70] I believe that these increases are the result of a fair balancing of the factors noted above. Union Non-Wage Issues [71] I decline to award any of the Union s non-wage issues. [72] Insofar as an increase in premium pay is requested in all three agreements, the Union s demand is based on primarily on the fact that the existing premium has been in effect for a long time and the current differential does not reflect the difference in skill levels and responsibilities. [73] No evidence of demonstrated need was presented such as the difficulty in attracting employees to perform the work at the current differential. I was not made aware whether any other comparator agreements have a similar premium pay structure. If there are, then that would also have been useful evidence to have. [74] With respect to car allowance under the TRCLB and DRCLB agreements, the Union seeks a 25% increase after an increase of 20% in the last round of negotiations.

16 16 There is no demonstrated need why any increase at all is justified, much less one of this magnitude, nor were any provisions in any comparable collective agreements referred to. [75] With respect to the travel allowance demand across zones in the MTABA agreement, there is no doubt that commuting in the GTA has become more, and not less, challenging. Nevertheless, there were no comparables presented to me nor any evidence of demonstrated need. [76] The Union s rationale for the deletion, or alternatively, the amendment of LOU 7 in the MTABA collective agreement is based on many things; some substantive and some not. [77] LOU 7 is a provision dealing with the goal of the Union s organizing at least seventy-five percent (75%) of the builders in the apartment building construction industry. In the event that the Union s market share drops below 60%, the Union is to make a payment to the MTABA/Local 183 Industry Stability Fund (created under LOU 7) of $10, for each percentage point below 60%. [78] LOU 7 has been in the collective agreement since It was amended and renewed in the round of bargaining. The MTABA has filed a grievance which, as I understand it, is currently before Arbitrator Herman. He has issued an interim award settling a preliminary dispute about which version of LOU 7 was the operative one. The matter was to be re-listed for hearing on the request of either party. I do not know if that has been done, and if it has, I do not know the substance of the issues before him in connection with LOU 7. [79] The Union may be correct in its view of the substantive weakness in the provision. Or, it may be incorrect. I simply do not have any evidence of the experience of the parties in applying LOU 7 which would shed light on some of the issues identified by the Union.

17 17 [80] As a result, I do not feel it is appropriate to make any changes, at this time, to LOU 7. Employer Non-Wage Issues [81] With one exception, I decline to award any of the non-wage issues raised by the Employers. [82] The one exception is the request of the MTABA to have the language of LOU 7 reflect the finding of Arbitrator Herman regarding which version of it is the operative one. I agree with the MTABA that, in the absence of an application for judicial review, Arbitrator Herman s decision is now final and this request is in the nature of a housekeeping amendment. [83] Accordingly, I direct that the version of LOU 7 that Arbitrator Herman found to be the operative version be included in the collective agreement. [84] The MTABA request for a new Article in the MTABA agreement must be dismissed. The Union currently sends information to the MTABA regarding remittances required under the agreement by both members and non-members of the MTABA. There was no demonstrated need why this should be expanded in any way. [85] The request of the TRCLB for an amendment to LOU 18 is a difficult issue. [86] LOU 18, which has been in the collective agreement since 2007, obliges the parties to meet within three months of the signing of the collective agreement to negotiate a separate schedule for Simcoe County. The Employer is seeking an amendment that would permit either party to refer this issue to arbitration if the parties could not negotiate the schedule.

18 18 [87] From the submissions, I am not certain if meetings have taken place and were not productive, or whether they have simply not taken place at all. [88] The Union raised a number of objections to the request. The only substantive one was its view that I lack jurisdiction to do as requested. I disagree. My jurisdiction is to be found in LOU 12. Paragraph 5 of LOU 12 provides me all the jurisdiction necessary to resolve this issue as requested. [89] However, I decline to make the requested change on one other ground raised by the Union. The Union asserted that the Employer did not request a meeting within three months of signing the collective agreement in either 2007 or I agree with the Union that, if true, the Employer ought to be required to avail itself of the provisions as written before any changes should be made by an arbitrator. This is similar to the Union s request for the changes it seeks to LOU 7. [90] Accordingly, I decline to make the changes to LOU 18 as requested. Disposition [91] I direct the parties to enter into a renewal collective agreement which shall contain all the terms and conditions of the expired agreement except as modified by this Award and the matters agreed to by the parties (which I was advised at the hearing now also includes the Union s request for travel allowance under the TRCLB agreement). [92] The wage increases are effective on May 1, 2013, May 1, 2014 and May 1, 2015 and are retroactive where applicable. [93] I remain seized until a new collective agreement is signed by the parties.

19 19 Dated at Toronto Ontario this 5 th day of December Larry Steinberg