THE OLRA BARGAINING FREEZE PERIOD , THE EMPLOYER CANNOT UNILATERALLY CHANGE WORKING
CONDITIONS THAT ARE TYPICALLY BARGAINED
In a very recently released decision, OPSEU v. Royal Ottawa Health Care Group
Institute, (MacDowell), July 23, 1999, the Ontario Labour Relations Board has
clarified that, during the statutory freeze of terms and conditions of employment that
applies during bargaining, the employer cannot unilaterally alter items that are typically
bargained. The employer has to go to the bargaining table and negotiate the changes. This
is a significant move away from the previous confusing test that permitted changes that
were viewed by the Board as "business as usual".
OPSEU represented a group of newly
certified employees at the hospital. Because they were in bargaining for a first
collective agreement, the statutory freeze under s.86(1) of the OLRA applied. There were
other unionized bargaining units at the hospital represented by other unions.
The hospital decided to save money by
reducing coverage and increasing employee costs under the Drug, Dental and LTD Plan
which is to say: by capping benefits, putting in deductibles, reducing the level or
categories of coverage and so on. These changes were made applicable to both non-union
employees and to the newly-unionized OPSEU group.
There were no benefit changes for other unionized
employees. The hospital was apparently of the view that the relevant collective agreements
prevented such changes. But since there was no collective agreement with OPSEU (yet), the
hospital decided that it was free to unilaterally reduce the benefits of this
newly-unionized OPSEU group.
OPSEU took the position that the
hospitals actions were unlawful, and undermined the process of collective
bargaining. OPSEU filed a freeze violation complaint.
Despite the outstanding complaint, the
parties continued to bargain, and eventually concluded a first collective agreement.
The parties did not resolve their
differences respecting the benefit package. They left that matter to be determined by the
The Board found the hospital was not
entitled to treat the OPSEU unit like a group of non-union employees. Section 86(1)
imposed the same limitation (albeit a temporary one) that the hospital recognized in
connection with the other bargaining units.
The following is a synopsis of the
OLRBs reasoning, using several quotes from the decision.
The Board stated: "The freeze captures
bona fide business behaviour that is not motivated by anti-union
considerations and may not be a breach of the duty to bargain in good faith. The mischief
to which section 86(1) is directed is an unexpected shift in the starting point or basis
for bargaining, during the initial stages of that bargaining. To put the matter
colloquially: it prevents a party from moving the goalposts in the middle of the
To paraphrase the wording of S.86(1), the
employer must preserve the employees terms and conditions of employment, rights,
duties and privileges until the statute permits a change (in the typical case, once the
parties have completed conciliation).
Traditionally the Board had looked at
whether any employer change was a departure from "business as usual" or violated
the "reasonable expectations" of the employees about the continuation of terms
and conditions. Those tests have been hard to apply and the outcome of Board cases in this
area has been unpredictable.
Now the Board has clarified that if there
is a planned change in a typically bargained item (i.e. the kind of item found in
collective agreements), then the employer cannot unilaterally make that change during
bargaining. The employer must seek union consent at the bargaining table.
To quote the Board: "If the change in
question is the kind of thing that affects employees as a collectivity, and it is
the kind of thing that the employer would be obliged to bargain about (per section 17),
and it is the kind of thing that, as a matter of labour relations practice, employers
typically do bargain about, then it is likely to be the kind of thing that the employer
cannot implement unilaterally during the currency of the statutory freeze. In other words,
it is the kind of change to employee "terms and conditions of employment, rights,
privileges or duties" that requires the consent of the bargaining agent."
The Board discusses how changes could be
introduced in a way that might make them acceptable. "Where the employer has not
acted unilaterally, has recognized the union, has accepted its obligation to bargain about
matters affecting the employees, has fairly raised a proposed change at the bargaining
table so that the union can bargain about it, and where, in addition, the employer really
is in a situation where business exigencies demand immediate action, the Board may well
take all of that into account when fashioning a remedy for any breach of the Act."
It should be noted that the OLRB believed
the hospital acted "bona fide". It accepted that the changes were
not motivated by anti-union feeling, but by a belief that these changes were necessary to
meet its budgetary constraints. But, the Board held: "s.86 delays such unilateral
exercise of business self-interest unless and until the parties have bargained about such
matters, and have either reached agreement, or proceeded to the prescribed method for
This is an important case brought forward
by OPSEU which clarifies that, during bargaining, there is a real freeze on the
employers unilateral right to change typically bargained items.
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