City of Surrey v. Surrey Fire Fighters’ Association

IN THE MATTER OF AN ARBITRATION

BETWEEN:

AND:

CITY OF SURREY

(the “Employer”)

SURREY FIRE FIGHTERS’ ASSOCIATION,

LOCAL 1271 OF THE INTERNATIONAL

ASSOCIATION OF FIRE FIGHTERS

(the “Union”)

ARBITRATOR:

COUNSEL:

John Kinzie

Michael Wagner and Carrie Koperski,

for the Employer

Stephanie Mayor and Elisabeth Finney,

for the Union

AWARD

I

This proceeding is concerned with a policy grievance dated June 1, 2017 filed by

the Union claiming that the Employer was denying employees absent from work and on

Workers’ Compensation Board leave (hereinafter “WCB leave”) the right to have the

unused portions of their annual vacation and statutory holiday entitlements paid out to

them.

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The Union maintains that even though these employees are absent from work on

WCB leave and therefore not working, they continue to accrue annual vacation and

statutory holiday entitlements because those benefits are status-based, i.e., they continue

to accrue based on the fact the employee remains in the service of, or employed by, the

Employer. It is not necessary, the Union says, for those employees to be actually

performing work for the Employer in order for these entitlements to be refreshed for the

upcoming year. The Union further contends that employees absent from work on WCB

leave cannot use up their entitlements because they are not actively at work. The Union

submits that trading the elements of work for rest and relaxation is a critical component

of an annual vacation and that such a trade is not possible in these circumstances as the

employee is not actively at work. Instead, they are off work because of an occupational

injury or illness and it is for this reason that these employees are not able to make use of

those entitlements.

The Union contends that the Employer’s refusal to pay out these employees who

are unable to use their prior year’s annual vacation and statutory holiday entitlements is

contrary to the provisions of the 2012-2019 collective agreement.

The Employer disagrees. First of all, it submits that the annual vacation and

statutory holiday entitlements are “earned benefits”, i.e., an employee must be at work to

“earn” them. These benefits are “work-based”; they do not arise simply by virtue of the

employee being in the employ of the Employer. Secondly, during his WCB leave, the

employee is paid his “normal net salary”. Thus, the Employer contends that over the

course of 52 weeks, the employee receives not only the wages he would have been paid

for his work, but also the pay he would have been paid for the other benefits. Thus, the

Employer says the employee could not have suffered any loss as he would already have

been paid for his annual vacation and his statutory holidays for that year.

Interpretive issues arise in respect of various provisions of the 2012-2019

collective agreement. Generally speaking, the Employer asserts that the words the parties

used in the collective agreement to express their intentions are clear in their intent.

However, the Union says that a bona fide doubt, insofar as the issues that arise in this

case, exists and it relies on collective bargaining evidence and past practice to resolve

that doubt in its favour.

In the event I am persuaded by the Employer that its interpretation of the relevant

provisions of the collective agreement is correct and that it was entitled to deny these

employees’ claims to be paid out for unused annual vacation and statutory holiday

entitlements, the Union then contends that those denials of these benefits amount to a

violation of Section 13 of the Human Rights Code. That claim would involve the

assertion that the Employer’s denial of these entitlements in respect of employees on

WCB leave constituted discrimination against these employees on the grounds of their

“physical or mental disability”.

As a final alternative argument, should all of its earlier submissions fail to

convince me of its position, the Union argues that based on its longstanding past practice

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of paying out such claims made by employees absent from work on WCB leave in

respect of unused annual vacation and statutory holiday entitlements, the Employer is

estopped from changing its position in that regard prior to giving the Union notice of its

intention to revert to its strict legal rights and an opportunity to bargain the issues with

the Employer and to seek to change the Employer’s mind.

For its part, the Employer denies that it has discriminated against employees

absent from work on WCB leave in terms of their entitlements to annual vacation and

statutory holidays. It says that these employees are in fact paid their annual vacation and

statutory holiday pay as part of their “normal net salary” for the 52 week period of their

absence. If they were paid a second time on the theory they had not used their

entitlements, they would be receiving a second payment in respect of those entitlements

contrary to the requirement that the payment of that “normal net salary” not result in a

“net gain . . . to the employee on an annual reconciliation basis”. See Article 6.8 of the

2012-2019 collective agreement. With respect to the Union’s estoppel argument, the

Employer says that the facts of this case do not support the application of that doctrine.

No formal hearing, either in person or virtual, was conducted in this proceeding.

Instead, by the agreement of the parties, I was provided with a Partial Agreed Statement

of Facts comprising 85 paragraphs and supported by 26 documents, three Statutory

Declarations from employees or former employees of the Employer, and a Union Book of

Documents encompassing 37 separate tabs. Counsel followed those materials up with

detailed written argument supported by extensive case authorities.

II

The background facts to this proceeding are as follows.

The Surrey Fire Service is one of the departments within the Employer’s

operations and the Union is certified to represent a bargaining unit of employees working

in that department excluding the Fire Chief, Deputy Fire Chiefs, Assistant Fire Chiefs,

and certain office personnel.

At the time the grievance giving rise to this proceeding was filed, the parties were

governed by a collective agreement whose term ran from 2012 to 2019. Article 5.1 of

that agreement addresses paid annual vacations for employees covered by the agreement.

First of all, Article 5.1 identifies a number of different branches or divisions within the

Surrey Fire Service and through a chart for each branch or division lays out the annual

vacation benefit for employees in that branch or division based on their “years of

service”with the Employer. The annual vacation benefit is expressed in terms of a

“number of shifts” or a “percentage of the employee’s total earnings for the year”. For

example, an employee in the Suppression Branch with between two through five years of

service is entitled to eight shifts annual vacation or 4.4% of the employee’s total earnings

for that year, whichever is the greatest. In the case of an employee in that branch with

between 10 to 13 years of service, she would be entitled to 16 shifts annual vacation or

8.8% of her total earnings for that year, whichever is greater.

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In addition to employees in the Suppression Branch, there are also employees

working in the Training Branch, the Prevention Branch, the Communications Division,

the Maintenance Division and the Support Services Division. In the case of the

Suppression and Training Branches and the Communication and Support Services

Divisions, there is one chart covering all employees in the branch or division. In the case

of the Prevention Branch and the Maintenance Division there are two charts, one for

employees in that branch or division working a five day work week and another for

employees working a four day work week.

Secondly, Article 5.1 lays down a number of rules or terms and conditions that

govern the annual vacation benefit and they read as follows:

“Paid annual vacation for employees covered by this Agreement

shall be granted as follows:

(a) Annual vacations shall be taken at such times as mutually

agreed upon by the employee and the Fire Chief, so that

efficiency and operation of the Department shall not be

impaired.

(b) Employees leaving the service either before completing one

year’s service or before qualifying for their next annual

vacation shall be paid vacation allowance as provided by the

‘Employment Standards Act’ for the period worked.

(c) Employees with less than one year’s service shall receive 4%

vacation pay based on total earnings and no vacation time off.

(d) Suppression branch member’s (sic) holidays are to start on

their first day shift and the City agrees that employees will not

suffer any time loss as a result of transfer to another shift.

(e) Calendar year for the purpose of this Agreement shall mean

the twelve (12) month period January first (1^st) to December

thirty-first (31^st) inclusive.

(f) Vacations not used within the year will be carried over to the

following year as prior year’s vacation. Prior year’s vacation

will be used by March 1^stthe following year.

(g) Vacation adjustment pay for the previous year will be

processed before May 1^st. Unused prior year vacation will be

paid out as part of the vacation adjustment pay.

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(h) Vacation adjustment pay shall be based on total base earnings.

Base earnings shall include pay received for acting in a higher

rank but shall not include any other pay such as overtime,

gratuity pay, statutory differential pay or early retirement

payments.

(i) All employees on continuous non-occupational medical

absence due to illness or injury for greater than 60 calendar

days will have their annual vacation entitlement pro-rated

during the duration of their absence up to the date they return

to regular or alternate duty. Should any entitlement deficits

occur as reconciled for the year, the parties will reconcile the

balance owing from the next entitlement year or in the case of

retirement, recover any deficit from final payments.”

Article 5.2 addresses the subject of statutory holidays including the holidays

recognized under the agreement and how employees will be paid for those days including

in circumstances where they have to work on one of those days. Article 5.2 in the 2012-

2019 collective agreement reads:

“5.2 Statutory Holidays

(a) All persons covered by this Agreement shall be entitled

to the following Statutory Holidays: New Year’s Day,

Family Day, Good Friday, Easter Monday, Victoria

Day, Canada Day, British Columbia Day, Labour Day,

Thanksgiving Day, Remembrance Day, Christmas Day,

Boxing Day and any or all days that may be declared a

statutory holiday by Federal, Provincial or City

Governments. Such days may be accumulated and

taken as time off; at such times as the Fire Chief

considers that the employee can best be spared.

(b) In addition to the first paragraph of this section, any

Fire Department employee covered by this Agreement

who is required to work on any of the statutory holidays

shall be paid at time and one-half ( 1½) the employee’s

regular rate of pay for each of the hours that the

employee is on duty for such statutory holiday.

(c) Where Statutory Holidays fall on a scheduled

Prevention Branch, Training Branch, Maintenance or

Support Services work day, staff working shall be given

that day off. Should a Statutory Holiday fall on a

members (sic) scheduled day off, a member working a

5 day per week schedule shall receive the next

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scheduled work day off. A member working a 4 day

per week schedule will be entitled to another day off in

lieu.

(d) All new full time employees are entitled to statutory

holidays that occur after the applicable hire date without

a waiting period.

(e) All Employees on continuous non-occupational medical

absence due to illness or injury for greater than 60

calendar days will have their annual statutory holidays

pro-rated during the duration of their absence up to the

date they return to regular or alternate duty. Should any

entitlement deficits occur as reconciled for the year, the

parties will reconcile the balance owing from the next

entitlement year or in the case of retirement, recover

any deficit from final payments.”

In the Partial Agreed Statement of Facts, the parties expand somewhat on the

rules set out in Article 5.1 regarding employees’ paid annual vacation benefit. The

benefit is based on employees’ years of “service”. There they state that:

“7. . . . Although ‘service’ is not defined in the Collective

Agreement, the term ‘service’ is used in Article 5.1 to

mean ‘employment’.”

Employees are expected to use their annual vacation entitlement in the calendar

year in which it accrues. If an employee is not able to do so, the parties state in the

Partial Agreed Statement of Facts that:

“9. If an employee cannot use their allotted vacation

entitlement within that calendar year, due to an injury, illness,

training or cancellation by the fire chief, they are permitted to

carry-over that vacation entitlement until March 1^stof the

subsequent year. However, on the rare occasion that the

employee still cannot use that vacation entitlement by March

1^st, he or she will be paid out an amount equivalent to the

unused vacation shifts.

10. When payouts are required, they are done for all employees

at the same time in or around May 1^stas part of the vacation

adjustment pay. The Employer codifies such payouts, which

typically only occur for the very long absences, as ‘prior

vacation paid out.’

11. For example, Firefighter A is notified they have 20 vacation

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shifts in October 2017, which they then schedule for use

during 2018. However, in 2018, they cannot use some or all

of their allotted vacation shifts. The Collective Agreement

permits Firefighter A to carry-over those unused vacation

shifts to March 1, 2019. If Firefighter A still cannot use all or

some of those 2018 vacation shifts by March 1, 2019, the

Collective Agreement mandates a payout as part of the

vacation adjustment equivalent to those unused shifts. The

payout would be added to that employee’s pay cheque in or

around May 2019 and codified as ‘prior vacation paid out.’

12. The very few employees who are paid out end up receiving

more in that payout year than if they had used their vacation

shifts in the previous year.”

With respect to statutory holidays, the Partial Agreed Statement of Facts provides

that “similar to paid annual vacation, statutory holidays are granted as a single benefit”

[at para. 17] and they schedule both at the same time in October for the following year.

See paragraph 19. Again, as with their annual vacation entitlement, employees are

expected to use their statutory holiday entitlement in the calendar year for which it was

allocated. However, if an employee is unable to do so in a particular year, he may carry

unused days over into subsequent years, but under the 2012-2019 collective agreement he

was not entitled as of right to a payout for those unused days. See paragraphs 21 and 23

of the Partial Agreed Statement of Facts.

The Union’s policy grievance which is before me in this proceeding concerns

employees who are away from work due to a compensable on-the-job accident. In other

words, they are absent from work as a result of the injuries they have suffered and are

entitled to continue receiving their “normal net salary” from the Employer during the

period of their absence. The wage-loss benefits that would ordinarily be paid by Work

Safe BC to the employee are instead paid to the Employer.. With respect to such

employees, Article 6.8 of the 2012-2019 collective agreement under the heading “On The

Job Accident Compensation (W.C.B.)” provides that:

“Employees absent from duty due to injuries received in the

performance of their employment shall receive normal net salary

during such absence but time loss compensation payments

received from the Workers’ Compensation Board shall be

remitted to the City and provided further that when an employee

is unable to return to work through a compensable illness or

injury and has been granted a pension by the Workers’

Compensation Board, the City shall from the date of granting

such pension make no further payments to the employee under

this clause. It is understood that normal net salary includes

amounts that would be received for acting in a position of higher

rank, when appropriate.

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Normal net salary is defined as no net gain or no net loss to the

employee on an annual reconciliation basis. Statutory deductions

such as Income tax, CPP and EI etc. will be considered when

determining the annual net pay as no net gain or no net loss for

the employee.

Employees absent from duty due to an occupational injury or

illness received in the performance of their employment with a

different employer, whether currently employed by that employer

or as a result of an injury or illness sustained while previously

employed, must inform the City as soon as they are able and shall

have all money received from WorkSafe BC remitted to the City.

If the amount received from WorkSafe BC does not completely

cover the employee’s absence the employee will be placed on sick

leave for the difference. The union health fund will not be

responsible for absences of this nature and there will be no loss of

gratuity days.”

With respect to WCB leave, the parties have agreed in their Partial Agreed

Statement of Facts that:

“30. Generally, when an employee goes on WCB leave, the

Employer continues to issue biweekly pay advices and the

amounts received for time loss payments from the WCB are

sent directly from the WCB to the Employer. The Employer

tops-up the difference by continuing to pay an employee as

if they are still working.

. . .

31. WCB covers 90% of an employee’s net earnings up to a

maximum annual wage limit. Those earnings are based on

the 12 months immediately prior to the injury. WCB states

this includes ‘wages and salaries,’ which it lists as including

wages, salaries, commissions, vacation and holiday pay,

bonuses, allowances and piecework. As of 2016, the

maximum annual wage rate that WCB compensated for was

$81,900 gross.

. . .

32. Employees on WCB leave for under a calendar year may be

able to use their unused vacation and statutory holiday

entitlement within that year. In that case, an employee on

WCB leave would receive the same total annual payment

9

that they would have received had they been working that

full calendar year and taken their vacation and statutory

holidays. Employees on WCB leave for a complete calendar

year who are paid out their vacation and statutory holiday

entitlement in the following year will receive more total

annual payment in that year than an employee who had

taken their vacation and statutory holiday entitlement within

the year.”

Finally, Article 6.9 (j) addresses “Entitlements During Unpaid Leave of Absence”

and provides that:

“Except where specifically provided otherwise in this Agreement,

an employee on an unpaid leave of absence, including maternity

and parental leave, shall be subject to the following during the

period of leave:

• shall maintain but shall not accrue seniority

• shall not accrue sick leave

• shall receive vacation pay and any other accumulated benefits

on a pro-rated basis, based on actual earnings for the calendar

year(s) of the leave

• shall be eligible for any sick leave gratuity on a pro-rated basis,

with the period of unpaid leave of absence excluded

• shall not receive pay for any statutory holidays which occur

during the period of leave

• may elect to maintain benefits coverage, except pension,

during the period of leave by paying the total cost of the

premiums in advance

• in the case of maternity leave, parental leave, and

compassionate care leave, pension contributions shall cease

during the period of leave unless the employee makes

arrangements prior to commencing leave to pay their

contributions pursuant to the provisions of the Municipal

Pension Plan.

• in the case of other unpaid leaves of absence, upon return to

work and completion of the time required pursuant to the

provisions of the Pension (Municipal) Act, the employee may

make arrangements to purchase pension service relevant to the

period of leave in a single lump sum purchase of service by

paying both the employee and employer contributions.”

I now turn to the evidence concerning bargaining between the parties relating to

the afore-mentioned provisions of their collective agreement.

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First of all, in the 1993-95 collective agreement, what is now Article 6.8 of the

2012-2019 collective agreement only consisted of the first paragraph of that provision

and it provided that employees on WCB leave would receive “full salary” during that

leave not “normal net salary”. Further, the 1993-95 language did not contain the last

sentence that is found in the first paragraph of the current version. The problem with that

language from the Employer’s perspective is that it paid the employee her “full salary”

including remitting amounts represented by Income Tax, Canada Pension Plan

contributions, and Employment Insurance contributions to Revenue Canada, while it only

received back from WorkSafe BC an amount equivalent to the employee’s net salary

exclusive of those deductions. The employee then recovered those deductions at tax time

on the basis that WCB wage loss benefits were not taxable. In the Employer’s view, this

scenario created a tax windfall for the employee in an amount equivalent to those

deductions. To correct the situation, the Employer proposed that its obligation to pay the

employee be changed to an amount reflecting the employee’s “normal net salary” which

would exclude those deductions which in turn would remove the “tax windfall”.

The Union understood the Employer’s position in this regard, but it was

concerned itself that by agreeing to the Employer’s proposal to replace “full salary” with

“normal net salary” it did not want to negatively impact its members’ pensions and any

other benefits such as holidays and vacations. See the Statutory Declaration of Lorne

West #1 dated December 1, 2020, paragraphs 19 and 20. At the time, Mr. West was

President of the Union and also the lead negotiator for the Union in the 1997 round of

negotiations where these matters were raised and discussed. He went on to declare that

the Union bargaining committee was

“. . . adamant that normal net pay meant no loss to our members’

normal pay cheque and we, in particular, emphasized that

pensions and all other benefits could not take a hit as a result of

of agreeing to [this] provision.”

(at para. 20)

Mr. West also declared that the Union committee

“. . . also specifically discussed with the Employer that normal net

pay would not affect vacation adjustment pay.”

(at para. 22)

With respect to both of these concerns of the Union’s committee, Mr. West swore

that the Employer assured the committee that there would be no negative effect or

consequence on any other form of earnings other than the “tax windfall”. See paragraphs

21 and 22 of his Statutory Declaration #1.

At the time of these negotiations in 1997, Larry Thomas was a fire fighter in the

Union’s bargaining unit and a member of its bargaining committee. However, effective

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November 26, 2011, he became a Deputy Fire Chief and as a result, ceased being a

member of the bargaining unit. On July 1, 2019, he took the position of Fire Chief,

Emergency Planning Coordinator for the Surrey Fire Service. Mr. Thomas also swore a

statutory declaration on March 9, 2021 for the purposes of this proceeding and in it he

declared that:

“I disagree with Mr. West’s recollections from this round of

negotiations as set out in paragraph 20 of the West Statutory

Declaration. More specifically, while I agree that the Union’s

position on WCB ‘net salary’ change in language was contingent

on there being no negative impact on member’s benefits or their

pension contributions, I do not recall any specific mention by the

Union during these discussions regarding holidays or vacations.”

(at para. 15)

In the Memorandum of Agreement dated January 19, 1999 reflecting the

settlement of this round of collective bargaining, the changes to Article 6.8 concerning

WCB leave compensation were described this way:

“Amend ‘full salary’ to ‘normal net salary’. It is understood that

normal net salary includes amounts that would be received for

acting in a position of higher rank, when appropriate.’

The City assures the Union that any errors in calculation related

to normal net salary with the City will be corrected. The City is

not responsible for tax implications that arise solely from an

employee’s interests or dealings separate from his/her

employment with the City.”

During the 2003 round of collective bargaining which led to the 2003-2006

collective agreement, the Employer proposed to limit the accrual of annual vacation and

annual vacation pay, on the following terms:

“Employees, in the year of retirement, or who have been absent

on sick leave or WCB for a period exceeding six (6) months, will

cease to accrue vacation and vacation pay, and will receive a

prorated entitlement for their active time at work.”

This provision would have become Article 5.1 (g) of the collective agreement.

The same provision was also proposed to limit the accrual of statutory holidays

under a new Article 5.2 (e). Finally, the same provision was proposed to limit the accrual

of sick leave under Article 6.1 (a).

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However, the Employer was not successful in persuading the Union to agree to

these measures and they did not appear in the 2003-2006 collective agreement.

In the 2007 round of collective bargaining, the Union proposed deleting Article

5.2 (c) of the collective agreement. That provision read as follows:

“With at least fourteen (14) calendar days’ notice, employees in

the Suppression and Communications Divisions may request

payout for statutory holidays.”

At the time of these negotiations, Michael McNamara held the position of Union

Registrar. In that position, Mr. McNamara attended negotiations as a representative of

the Union. In that capacity, he swore a Statutory Declaration dated November 27, 2020

in support of the Union’s position in this proceeding. With respect to Article 5.2 (c), he

swore that:

“The Union proposed the elimination of Article 5.2(c) because it

wanted to encourage members to take the time off work to rest

and recuperate, rather than take a pay out for their statutory

holiday entitlement.

The Union was also concerned that if employees regularly got

paid out for their statutory holidays the Employer might argue in

subsequent rounds of collective bargaining that employees did not

need as much time off as the collective agreement provided.

Removing Article 5.2(c) helped the Union reduce the likelihood

this might happen.

At no point did the Union understand the elimination of Article

5.2(c) to indicate agreement that unused statutory holidays could

never be paid out. If an employee was unable to schedule their

statutory holidays, the Union did not intend the elimination of

Article 5.2(c) to mean that employees would be giving up earned

statutory holiday pay.

The Union understood that the elimination of Article 5.2 (c) was

meant to simply remove an employee’s ability to get their

statutory holidays paid out during the year in which those

statutory holidays were earned.”

(at paras. 9-12; emphasis in original)

In the Memorandum of Agreement dated March 11, 2008, the parties agreed to

remove Article 5.2 (c) from their collective agreement.

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Matters pertaining to employees absent from work on WCB leave arose again in

collective bargaining in 2010. By this time, Mr. West had moved on to the position of 6^th

District Vice-President of the International Association of Fire Fighters. In that capacity,

Mr. West was not present at the 2010 negotiations involving the Employer and the Union.

Mr. Thomas had replaced him as the Union’s President and as its lead negotiator in that

round of collective bargaining. By this time, Mr. McNamara had become the Union

Secretary and in that capacity he was also a member of the Union’s bargaining committee

in the 2010 negotiations. Both Mr. Thomas and Mr. McNamara declared that the Union

continued to have concerns over the interpretation to be given to the phrase “normal net

salary” in Article 6.8. Mr. Thomas explained it this way in his statutory declaration:

“After the ‘normal net salary’ language was implemented in

Article 6.8, the Union became aware that the timing of CPP, EI,

and income tax deductions for an employee on a short-term WCB

leave of less than a calendar year had a negative consequence on

their annual net salary, such that those employees on WCB

benefits would receive less net salary on an annual basis than

employees that worked the full calendar year.

Accordingly, during the 2010-2011 round of bargaining, the

Union sought to find a solution where employees on WCB

received the same net annual salary as if they had worked a full

year.

Ultimately, the parties agreed to a new payroll process and new

language was introduced to Article 6.8, which ensured that

‘normal net pay’ meant there would be no net gain or no net loss

to the employee on an annual reconciliation basis.

I specifically recall that the determination of whether there was no

net gain or no net loss on an annual basis to an employee’s

normal net pay was calculated based on comparing an employee

who had a short-term WCB absence to an employee who worked

the entire year and taken vacation and holidays as paid time off.

In other words, normal net pay for the latter included vacation and

holiday pay.

At the time the WCB normal net salary ‘fix’ was implemented

and the revised Article 6.8 language was agreed to in 2010, there

was no practice or experience with employees being off work on

WCB leave for an entire calendar year.”

(at paras. 17-21)

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The agreed upon response to these concerns raised during the 2010 negotiations is

the language of the second paragraph in Article 6.8 of the 2012-2019 collective

agreement quoted above.

The second concern with respect to Article 6.8 related to situations where an

employee was absent from work as a result of an occupational injury or illness that

occurred in secondary employment held by the employee. The parties clarified how that

situation would be dealt with in the third paragraph of what is now Article 6.8 in the

2012-2019 collective agreement quoted above in this Award.

Finally, in collective bargaining that led to the 2012-2019 collective agreement,

the parties agreed to include Articles 5.1 (i) and 5.2 (e) in that new collective agreement.

Those provisions called for employees’ annual vacation entitlement and annual statutory

holidays entitlement to be pro-rated where they were continuously absent for more than

60 calendar days due to non-occupational illness or injury. Mr. McNamara declared that

the parties “explicitly discussed” that these provisions “would only apply to non-

occupational leaves” and that “the Union explicitly rejected the notion that accrual of

statutory holidays and vacation would cease if a member was on WCB.” (at para. 16). In

this regard, the Employer’s original proposal in that round of bargaining sought to

include WCB leaves. See its proposed Article 5.1 (e) which read:

“An employee who is absent as result of sick leave for 30 or

more consecutive calendars (sic) days within the calendar year

shall have their remaining annual vacation and statutory holiday

entitlement prorated for that year on the basis of the total time

absent due to sick (sic) (including WorkSafeBC) during the single

occurrence; providing an employee shall not be put into a deficit

position should eligible vacation be less than already taken

vacation.”

Language similar to Articles 5.1 (i) and 5.2 (e) in respect of WCB absences was not

included in Article 6.8 or anywhere else in the 2012-2019 collective agreement.

With respect to employees receiving long term disability benefits, Mr. McNamara

declared that:

“. . . the Union understood that those employees were off payroll

and so were not entitled to paid annual vacation and statutory

holidays while they were on LTD. However, the Union

understood that employees on LTD would continue to be paid out

for any paid annual vacation or statutory holidays they were

entitled to prior to going on to LTD.”

(at para. 18)

15

Next, I refer to the evidence regarding earlier examples of employees on WCB

leave being paid out in respect of unused annual vacation and statutory holiday

entitlements. In the Partial Agreed Statement of Facts, the parties stipulate that:

“42 The Employer has long paid out vacation and statutory

holidays for employees on WCB leave, or allowed them to

carry those benefits forward into the next year, at least when

that leave is under a year.

43. For example, Mr. Dan Paine was hired in 1983. His

entitlements for 2010, 2011 and 2012 would have been 25

vacation days and 11 statutory days for a total of 36 days or

nine sets of four shifts each set per year. Mr. Paine was

injured at work on May 10, 2010. He worked alternate

duties from September 25, 2010 until April 29, 2011 and

went back onto WCB from the period beginning on April 29,

2011 until February 2, 2012.

44. Prior to his injury, Mr. Paine had taken 12 days of vacation.

During his alternate duties in 2010, he took an additional

four vacation days and 11 statutory holiday days totaling 16

vacation days and 11 statutory holidays for the year. He had

nine days of vacation and zero statutory holiday days left

over at the end of 2010.

45. The eight vacation days rolled over into 2011 and he was

able to take those days while working alternate duties. For

2011, Mr. Paine was entitled to 25 vacation days and 11

statutory holiday days. Prior to going back on WCB in or

around April 29, 2011, Mr. Paine was able to take four

vacation days and eight statutory holiday days from his 2011

entitlement. This left him with 21 unused vacation days and

three unused statutory holiday days from his 2011

entitlement.

46. Those 21 vacation days and three statutory holiday days

rolled over to 2012. When Mr. Paine returned to work on

alternate duties on February 2, 2012, he was asked to use his

unused days from 2011. He managed to use 15 of those days

prior to the March 1, 2012 deadline, which were coded as

prior year vacation time of ‘PVT.’ This left Mr. Paine with

five vacation days and three statutory holiday days that he

was paid out in or around May 2012.

47. Mr. Paine then used the entirety of his pro-rated 2012

16

entitlement to vacation and statutory holiday days prior to his

retirement on August 31, 2012.

48. Accordingly, despite being off for nearly a year on WCB,

there was no dispute that he was entitled to his full vacation

and statutory holiday entitlements, which were rolled over or

paid out when he could not use them within a calendar year.”

49. Another example is Davinder Deol. Mr. Deol was hired on

May 17, 1982. He was a Lieutenant and went on WCB leave

on March 25, 2001 after suffering a cardiac arrest. Despite

the Union fighting to have his claim accepted by WCB,

WCB ultimately did not accept that his claim was work-

related and he was coded as on sick leave from June 11, 2001

to September 25, 2001. Despite his lengthy WCB and sick

leave absence, he was entitled to roll-over his entire vacation

entitlement until he returned to work (he used 11 of his 20

vacation days in 2001, and the remaining 9 days between

January 18, 2002 and February 3, 2002) and was paid out all

statutory holiday entitlement in or around 2001.”

In response to this evidence however, the Employer draws a distinction between

employees on WCB leave for a period under a year and employees on WCB leave for

over a year. It acknowledges that it has paid out unused annual vacation credits for

employees on WCB leaves lasting under a year. However, it says that it has never paid

out such benefits for employees on WCB leaves for over a year since the 2010

negotiations and the substitution of the phrase “normal net salary” in Article 6.8 for the

phrase “full salary”.

With respect to “employees on WCB leave for over a year”, the Partial Agreed

Statement of Facts goes on to provide that:

“53. The Union and the Employer are only aware of two

recorded instances where employees have been on WCB

leave for a full calendar year: Paul Mahil, and Rick

Henderson. Although Dave Bachand was on WCB leave for

most of 2013, he did work for 3 hours on January 3, 2013.

The Parties are also aware of George Embree but dispute

whether the facts of his leave and payment can be relied

upon.

Paul Mahil

54. Mr. Mahil started working for the Employer on June 19, 1995

17

and was a Fire Prevention Captain prior to his retirement in

April 2020. He normally worked four days a week for 8 ¾

hours.

55. In 2014, Mr. Mahil was in his 20^thyear of service and

entitled to 24 vacation shifts and 12 statutory holidays.

56. Between January and June 2014, Mr. Mahil took eight

statutory holiday days. However, he was injured while at

work and went off on WCB leave in or around June 19,

2014. He thus had a balance of 24 unused vacation shifts

and 4 unused statutory holiday days by the end of 2014.

57. Mr. Mahil remained on WCB leave for the remainder of

2014 and the entirety of 2015 and 2016. In 2015 and 2016,

Mr. Mahil would have been entitled to an additional 28

vacation shifts and 12 statutory holiday days per year.

58. On May 1, 2015, Mr. Mahil was paid out his unused

vacation and statutory holiday days from 2014, amounting to

an additional pay equal to 210 hours of vacation and 35

hours of statutory holiday pay.

. . . .

59. On May 27, 2016, Mr. Mahil was paid out his unused

vacation entitlement from 2015, amounting to 245 hours for

vacation. He was not paid out his unused statutory holiday

days from 2015, which would have amounted to 105 hours.

. . . .

60. On May 12, 2017, Mr. Mahil was not paid out any amount

for vacation or statutory holiday days from 2016, although he

would have earned 245 hours and 105 hours respectively for

2016. This occurred after the Union raised an issue about the

Employer’s failure to pay out unused holiday pay for Mr.

Mahil. . . . .

David Bachand

61. Mr. Bachand started working for the Employer on May 17,

1982. Prior to his retirement, Mr. Bachand was a Captain

and he worked a 42-hour work week. In 2013 and 2014, Mr.

Bachand would have been entitled to use 24 vacation days

and 12 statutory holiday days in each year.

62. In or around January 3, 2013, M. Bachand went on WCB

18

leave. He returned to work on a graduated return to work

(‘GRTW’) program in or around January 27, 2014.

. . .

63. Upon his GRTW, Mr. Bachand worked January 27-30, 2014.

Mr. Bachand then received four vacation days that were

carried over from his 2013 entitlement in February 2014 and

of which were coded ‘PVT’ in his pay advice.

. . .

Mr. Bachand also used 12 of his 2014 statutory holiday

entitlements as well as 15 of his 2014 vacation entitlements

before the end of June 2014.

. . .

64. Given that Mr. Bachand’s return to work was unsuccessful,

he returned to WCB leave in or around the end of June 2014

at which time WCB converted him to direct pay. The

Employer did not payout the balance of his unused 2013

statutory or vacation days or his unused 2014 vacation days.

Rick Henderson

65. Mr. Henderson started working for the Employer on May 4,

1987. Prior to his retirement, he was a Captain and he

worked 2 days, 2 nights, followed by 4 days off. He worked

an average 42 hours a week.

66. In 2015, he was entitled to 28 vacation days and 12 statutory

holiday days. Before June 24, 2015, he used 14 vacation

days and seven statutory holiday days from his 2015

entitlement.

67. Mr. Henderson went on WCB leave from June 24, 2015 until

April 10, 2017. Mr. Henderson would have been entitled to

28 vacation days and an additional 12 statutory holiday days

for 2016.

68. On May 27, 2016, Mr. Henderson was paid out 168 hours

for his vacation entitlement, which is equivalent to 14 unused

vacation days from 2015. He was not provided any payout

for his unused statutory holiday days, but he was permitted to

carry forward 216 statutory holiday hours, which equalled 18

unused statutory holiday days from his entitlement in 2015

and 2016.

. . . .

19

69. Mr. Henderson was informed by the Assistant Chief of

Operations, Chris Keon, that he was entitled to five sets

(where sets equal 4 days) of vacation and statutory days (i.e.,

20 holiday days total) for 2017. This amounted to half of

Mr. Henderson’s entitlement (i.e., 40 holiday days, including

vacation and statutory days).

70. In or around April 2017, Mr. Henderson returned to work

with the original intention of retiring in or around July 2017.

However, he learned from Deputy Chief, Larry Thomas, that

he was not, in fact, entitled to five sets of vacation and

statutory shifts and so he instead retired in the end of June

2017.

71. On July 7, 2017, Mr. Henderson was paid out his unused

vacation entitlement for 2016 of 336 hours, which equalled

28 vacation shifts, which was his full entitlement for 2016.

Although he was not paid out his unused statutory holiday

pay at that point, this occurred after the Union had filed a

grievance on the issue and received a denial at Step 2 . . . .”

The parties also agreed that employees on WCB leave regardless of whether

under or over a year receive all other benefits provided for under the collective agreement

including sick leave, gratuity credits, health and dental coverage, clothing and cleaning

allowances, supplementary pension and pensions. See paragraph 72 of the Partial Agreed

Statement of Facts. Employees on all other paid leaves of absence, for example, sick

leave and vacation, continue to receive all negotiated benefits unless explicitly agreed

otherwise in the collective agreement. See paragraph 73.

Based on the circumstances of Mr. Mahil and Mr. Henderson, the Union filed a

policy grievance on June 1, 2017. With respect to the nature of the grievance, it states

that:

“The [Employer] has arbitrarily discontinued the long standing

practice of paying employees for unused statutory holidays and

vacation while these employees have been suffering from long

term occupational injury and unable to work.”

In response, the Union states in the policy grievance that

“[e]employees off work due to an occupational injury are entitled

to their full pay and benefits.”

In the policy grievance, the Union goes on to contend that:

20

“. . . the fact that an employee has been injured and unable to

work cannot preclude them from being entitled to vacation [and to

all of the Statutory Holidays], or compensation in the manner

described in the Collective Agreement. This has been the practice

for many years and the Union has never been advised of a change

in this practice by the City, nor was notice served at any time that

the City intended to change this practice.

With this in mind and in consideration of the statement that

compensation should ensure ‘no net gain or no net loss to the

employee,’ the arbitrary discontinuation of prior year vacation

and stat payout to an injured worker must be considered as a net

loss to that employee.”

With respect to the payments made to Mr. Mahil reflected in paragraphs 58 and

59 and to Mr. Henderson reflected in paragraph 71 of the Partial Agreed Statement of

Facts, Mr. Thomas declared in his Statutory Declaration dated March 9, 2021 that:

“After Mr. Henderson’s retirement in June 2017, the City’s

Payroll inadvertently processed some holiday payout for Mr.

Henderson for the calendar year in which he was not at work the

entire year. During that year of WCB absence, Mr. Henderson

had received his salary with no net gain or no net loss on an

annualized basis.

Because Fire Management does not see the individual amounts

paid to employees, we were unaware that either Mr. Mahil or Mr.

Henderson received payouts for unused vacation and/or statutory

entitlement for years that they remained off on WCB leave for the

entire year until the Union filed a grievance.

It at all times remained by (sic) understanding that employees on

WCB leaves over a calendar year did not continue to accrue

vacation and/or statutory holiday pay, and therefore the payouts to

Mr. Mahil and Mr. Henderson were made in error.”

(at paras. 35-37)

Finally, with respect to the George Embree matter, it appears that he suffered an

occupational injury sometime in the 1990s. It also appears that the Workers’

Compensation Board did not regard the injury as all that serious, as it awarded Mr.

Embree a small pension and closed its file expecting that Mr. Embree would be able to

return to work. However, Mr. Embree was not able to do so on a continuing basis. As a

result, he went on short term sick leave before transitioning to long term disability. He

also appealed the decision of the Workers’ Compensation Board to deny his claim and

close his file. In 2000, Mr. Embree’s appeal was successful and he was awarded a 100%

21

pension and his wage loss claim was successful. Now as an employee off work on WCB

leave, the Union argued that Mr. Embree should have received top-up of his salary for the

period he was off work because of his occupational injury along with a payout of his

unused annual vacation and statutory holiday benefits

It does appear that the parties were able to resolve Mr. Embree’s claims although

there also appears to be some dispute regarding some of the terms of that resolution. In

that regard, on October 6, 2000, Brian Merryweather, the Employer’s Manager, Labour

Relations, wrote to Mr. Thomas who was then the Union’s Treasurer in the following

terms:

“As a result of your meeting with John Dominato, Heather

McKinnon and Jeff Marwick on September 19, 2000, I am

writing to confirm the agreement reached with regard to Normal

Net Salary. First, on a Without Prejudice basis, George Embree

will be paid Sick Gratuity, Statutory Holidays and Vacation for

the period of his absence on WCB. Effective immediately, Sick

Gratuity, Statutory Holidays and Vacation will cease to be paid

for any absence, including WCB. Effective immediately, Sick

Gratuity, Statutory Holidays and Vacation will cease to be paid

for any absence, including WCB, in excess of 6 months.

Also, effective today, pay period 20, Superannuation

contributions will be calculated on full superannuable salary for

all Fire Fighters who are in receipt of Normal Net Salary while on

WCB benefits.

I trust that this letter correctly outlines the agreement reached on

September 19^th. We would appreciate meeting with you to

present the calculations for Mr. Embree’s payment in addition to

signing the Memorandum.”

With respect to a Union response to the October 6, 2000 letter, Mr. Thomas swore

in his March 9, 2021 Statutory Declaration that:

“While I was unable to locate a copy of the final correspondence

sent by the Union in response to the Employer’s October 6, 2000

letter, I did locate a draft communication that I wrote to Brian

Merryweather, Manager, Labour Relations for the Employer on

behalf of the Union in response, which stated:

Re: Embree Calculations and WCB Net Pay Calculation

In regards to the George Embree file, we have agreed in

principle to the calculations presented. The City will calculate

the portion of interest paid by the WCB, to which George is

22

entitled. This will be added to the net amount owing to

George and a cheque will be ready before October 27, 2000.

The City will inform the Embree’s (sic) when they can pick up

the cheque.

The WCB normal net pay calculation was implemented before

we had a mutual agreement in place. The City agrees to

recalculate the payroll of any employees affected by the

recently implemented calculations, once an agreement is in

place. Further, the City agrees to apply an employees (sic)

marginal tax rate, to any taxable earnings that are affected by

the WCB net pay calculation within a given pay period.

Further, Superannuation contributions will be calculated on

full superannuable salary for all employees who are in receipt

of normal net pay while on WCB benefits. Finally, the City

will draft a letter assuring the Union, that corrections will be

made, if the WCB net pay calculation has a negative

consequence on an employee’s pay. This is the Unions (sic)

understanding of our discussions today.

Subsequent to our meeting, the Union received your

correspondence dated October 6, 2000. As previously stated,

the Union accepts the Cities (sic) position regarding

Superannuation contributions while on WCB benefits.

The Union strongly disagrees with the Cities (sic) position to

cease pay for Sick Gratuity, Statutory Holidays and Vacation

for any absence, including WCB, in excess of 6 months. If the

City implements this position, the Union will be left with no

option but to file grievance.

I specifically recall that this correspondence was finalized and

signed by me, and sent by me, (on behalf of the Union) to the

Employer on or about October 16, 2000.”

(at paras. 30-31)

III

I now turn to address the issues that arise for determination in this proceeding.

In the first instance, this is an interpretation case. What did the parties to the

2012-2019 collective agreement mutually intend when they said in Article 6.8 of that

agreement that “[e]mployees absent from duty due to injuries received in the performance

of their employment shall receive normal net salary during such absence . . . .” More

specifically, does the use of the phrase “normal net salary” evidence an intention that

23

employees on WCB leave are entitled to receive a payout in respect of their annual

vacation and statutory holiday entitlements that they were not able to use because of their

injuries?

The Union submits that the latter question must be answered in the affirmative.

In their written argument on behalf of the Union, counsel submit that:

“The Union asserts that its position is straight-forward:

employees are entitled to the payout of annual vacation and

statutory holiday benefits if they cannot use them unless explicitly

prohibited by the Collective Agreement. The Collective

Agreement only ceases such entitlements for employees on

unpaid leaves and those on non-occupational sick leaves for

certain durations. Accordingly, employees on WCB leave,

considered by the Parties to be paid leave, are entitled to these

benefits, regardless of the length of the employee’s WCB leave.

There is no language in the Collective Agreement that limits these

entitlements for employees on occupational leave.

We will first demonstrate that the Collective Agreement provides

entitlements to vacation and statutory holiday pay based on an

individual’s employment status. Accordingly, so long as an

individual on WCB leave remains an employee, they are entitled

to receive that entitlement unless there is clear Collective

Agreement language that removes such rights. We say there is no

such removal of rights in the Collective Agreement. Any clear

limitations on vacation and statutory holiday benefits that exist

under the Collective Agreement undisputedly do not apply to

employees on WCB leave.

The Collective Agreement and past practice confirm that if an

employee is unable to use their annual paid vacation and statutory

holiday time within a calendar year, they are entitled to roll over

that entitlement into the next calendar year. If they are still

unable to use the benefit, the employee is entitled to a pay out of

the monetary value of the unused days. That is, in a given year,

an employee’s annual salary is inclusive of any vacation or

statutory holiday days taken as time-off during the year, but

exclusive of a pay out of unused time.

We rely on extensive extrinsic evidence that supports the Union’s

interpretation of the Collective Agreement. The Union asserts

that longstanding past practice and the bargaining history of the

relevant Collective Agreement provisions reflect a mutual

understanding that entitlement to vacation and statutory holiday

24

benefits depend only on an employee’s status and continue while

employees are on any length of WCB leave.

We will then address anticipated Employer arguments against the

Union’s interpretation of the Collective Agreement and show that

none of these concerns meaningfully challenge the Union’s

interpretation of the Collective Agreement language.

We finally turn to an analysis of Article 6.8 and show that it does

not deny employees on WCB leave vacation and statutory holiday

entitlements, either on an interpretation of the language alone or

with the aid of bargaining history and past practice.”

(at paras. 122-127)

The Employer, on the other hand, submits that the question must be answered in

the negative. In their Written Submission, counsel contend that:

“. . . the present issue can be determined on the plain language in

Article 6.8 alone, and does not require a convoluted analysis

resolved by reference to arbitral dogma, such as that put forth by

the Union.

Through this lens, the Employer highlights that a proper

interpretation of the Collective Agreement in accordance with the

longstanding principles of collective agreement interpretation

clearly demonstrates that employees on a WCB leave for greater

than one calendar year are not entitled to payouts of vacation or

statutory holiday pay. Any interpretation to the contrary would,

in the Employer’s submission, result in an unfair advantage

whereby employees on lengthy WCB leaves would receive more

net pay (and thus a financial windfall) as compared to those that

worked the entire year. Such situations would be entirely

contrary to the express intention set out in Article 6.8 that

employees on a WCB leave shall be kept whole by receiving their

normal net salary but ought not be enriched with respect to same.

However, even if there is a bona fide doubt as to the mutual

intention of the Parties with respect to the payout of vacation and

holiday pay for employees on WCB leaves of over one calendar

year, the extrinsic evidence presented in this case (bargaining

proposals and evidence of past practice) is not reliable or helpful

in reconciling same as it neither evinces a mutual intent between

25

the Parties with respect to the interpretation and application of

Article 6.8, nor a consistent past practice to inform same.”

(at paras. 108-110)

In searching for the parties’ mutual intentions in these circumstances, arbitrators

have looked first to the words they have used to express those intentions. Parties are

presumed to have intended what they have said. However, the words the parties have

used in the provision in dispute are not intended to be interpreted in isolation. Instead,

they are to be read in the context of the collective agreement as a whole, giving those

words their normal and ordinary meaning unless to do so would lead to an absurdity or

inconsistency with the rest of the agreement. See Brown and Beatty, Canadian Labour

Arbitration (4^thed.) paras. 4:2100 and 2110.

If there is a bona fide doubt as to what the parties intended from a consideration

of the words they have used, arbitrators have had regard to various forms of extrinsic

evidence to assist them in resolving that doubt. One source of such evidence is the

exchanges the parties may have had across the bargaining table when they were

negotiating the provision in dispute. They may have discussed the very issue in dispute

and the evidence regarding their exchanges across the table may disclose that they had

reached a consensus on that issue. A second source of such evidence is the practice of

the parties in applying the provision in dispute. The employer may have interpreted the

provision in a particular way and the union, with knowledge of how the employer was

interpreting and applying it, may not have grieved or objected. In both cases, such

evidence would provide the arbitrator with evidence of what the parties mutually

intended by the words they used in their collective agreement.

However, caution should be exercised in the use of various forms of extrinsic

evidence to assist in the interpretation of a collective agreement. This point was made by

the Labour Relations Board of B.C. in Board of School Trustees, School District No. 57,

Prince George, BCLRB No. 41/75, 1975 Carswell BC 1369, where the Board stated that:

“The significance and weight accorded to parole evidence should

be directly related to the degree of ambiguity in the collective

agreement. In most instances the text of the agreement (and by

the text I mean not only the language of the provision itself but

the entire collective agreement) and common sense rules of

construction will favour one interpretation. That is not to deny

that an ambiguity or another interpretation is possible. In such

circumstances only very persuasive and unequivocal parole

evidence would justify the less obvious interpretation.

Conversely, in an agreement whose two different interpretations

are equally attractive, the significance of extrinsic evidence is far

greater. But the point to emphasize is that an arbitration board’s

recognition of an ambiguity does not compel it to decide the

meaning of the agreement according to the parole evidence it

26

hears. It is the agreement and not the extrinsic evidence which

must be interpreted. The evidence will assume greater or lesser

significance according to the degree of ambiguity in the text. If

the parole evidence itself is equivocal the Board is merely

deprived of one tool in its interpretative function. In all instances

it must settle the difference with regard to the wording of the

agreement.

Secondly, there is extrinsic evidence of various types and value.

At one end of the spectrum is objective evidence such as

negotiating minutes signed by both parties or the past practice of

parties. Such evidence must be given considerable weight

because in both examples it reflects a mutuality of intent

measurable by objective standards. At the other end of the

spectrum is subjective evidence of a party’s intentions or

impressions of what in fact was achieved at a bargaining session.

Unless such impressions are supported by evidence validating

those impressions, they are of no value. The intent of one party is

only significant when the extrinsic evidence allows an arbitration

board to attribute it to the other party.”

(at paras. 30-31)

Prior arbitration awards dealing with the same words, phrases or concepts can

provide context when it comes to interpreting a disputed provision and thereby assist in

determining what the intention of the parties were in agreeing to that provision. See

Brown and Beatty, Canadian Labour Arbitration, supra, at para. 4:2220.

Before I turn to consider the words the parties used in Articles 5.1, 5.2 and 6.8 to

express their mutual intentions regarding the issues that arise for determination in this

proceeding, I propose to review the decisions of various arbitrators that address the

general principles that apply in cases such as this.

The first case I wish to refer to is Regional Municipality of Peel, [2014] O.L.A.A.

No. 361, 251 L.A.C. (4^th) 87 (Albertyn). That case concerned a number of employees

who were off work on short term disability (“STD”) receiving STD benefits who claimed

they were also entitled to holiday pay for a public holiday that occurred during that same

period.

The majority of the board noted that the arbitral jurisprudence fell into two

different categories or approaches to the issue depending on the language of the

collective agreement. It stated that:

“The first question is whether employees are entitled under the

language of the collective agreement to claim holiday pay and

STD benefits for the same hours. The question is answered by

27

looking at the language of the collective agreement to find the

parties’ intention. The case law falls into two categories, based

on the language of the relevant collective agreement. The first

category has cases that decide holiday pay and STD payments are

intended as an indemnity against lost wages, so the payment of

one obviates the need for payment of the other (as in Unimin

Canada and other cases cited by the Region), unless pyramiding

is expressly contemplated. The second category covers those

situations in which the collective agreement makes holiday pay

and STD benefits (or their equivalent) wholly separate types of

compensation, independent of each other, dedicated to different

purposes, in which event both payments are contemplated (as in

Atlantic Packaging, TTC and Complex Services).”

(at para. 23)

After considering the language the parties used in their collective agreement, the

majority concluded that their case fit within the first category. They denied the grievance

and in so doing stated that:

“This latter approach fits with the language in the parties’

collective agreement. A distinction is made in the sick leave

provisions of the collective agreement, in Article 27, between an

‘incidental absence’ in Article 27.02 (an illness or non-

occupational injury absence) of up to 3 days and sickness

absences beyond 3 days, from the 4^thday onwards, that are

covered by the STD plan. Pay for the days of incidental absence

is expressly an indemnity for the loss of regular pay. Article

27.02 makes this clear: ‘the employee will receive his/her regular

pay for the duration of such incidental absence’. Although not

expressly so, we find the STD payment made from the 4^thday of

sickness absence onwards, is also an indemnity against the loss of

regular pay. The STD payment is an earned benefit, the result of

work for the employer, like other aspects of the employee’s

compensation package. This is apparent from the calculation of

the benefit. Those with longer service receive a greater amount, a

higher proportion at full salary, and those with less service

receive a reduced benefit at 2/3^rdsalary. Article 27.04 provides

that ‘benefits are based on an employees regular earnings’. The

amount of the STD, based on regular wages, is an earned

indemnity for loss of wages, no less than for incidental absence.

The parties did not intend that an employee on STD benefits

would be paid more (likely double) what a healthy employee

would be paid for a holiday. Holiday pay is a form of wages.

The STD benefit is paid so that an incapacitated employee does

28

not lose income while sick; a form of insurance payment designed

to provide compensation for an inability to earn regular wages.

As Arbitrator Burkett said in Unimin Canada, at p. 352, ‘The

implied precondition to payment of such a benefit, therefore, is a

loss of earnings.’ So, when holiday pay is paid, there is no loss,

and so no use of the STD entitlement.

We find, therefore, under the collective agreement, that

employees are not entitled to be paid both holiday pay and STD

benefits for the same days.”

(at paras. 31-33)

Atlantic Packaging Products Ltd. 2001 Carswell Ont. 5925, 96 L.A.C. (4^th) 64

(Goodfellow) dealt with the same issue, i.e., whether employees off work and in receipt

of weekly indemnity benefits were entitled to holiday pay for public holidays that

occurred during that period. As the majority in Regional Municipality of Peel, supra,

indicated, Atlantic Packaging represents an example of the second category of case. In

Atlantic Packaging, Mr Goodfellow, after a fairly lengthy review of the arbitral

jurisprudence that existed at that point in time, observed that:

“In my view, the foregoing adequately addresses the Company’s

first argument. Quite simply holiday pay and the various forms

of sickness and accident benefits are widely recognized as

constituting independent and unrelated forms of entitlement that

are directed at different purposes. Holiday pay is an ‘earned

benefit’, that forms ‘part of the overall wage package’, the

entitlement to which accrues over a period of the employee’s pre-

illness or pre-injury employment. Sickness and accident benefits

by contrast are seen as a form of insurance payments that are

designed to provide a measure of compensation for an inability to

earn regular wages. However, they are not themselves wages.

Hence their dual application is neither inconsistent nor inequitable

and it does not require specific language to achieve. The

presumption is now in favour of the payment of holiday pay to

employees receiving sickness benefits – whatever their origin –

and that presumption can only be displaced by specific language.”

(at para. 16)

With respect to the concern about “double recovery”, Mr. Goodfellow commented

that “the notion that holiday pay and sickness benefits are both intended to ‘cover the

same contingency’ is entirely at odds with the prevailing view as to the nature of the two

forms of benefit.” (at para. 22).

In upholding the grievance, Mr. Goodfellow concluded that:

29

“On the basis of the foregoing and with the greatest of respect to

the learned arbitrator in Unimin, I am unable to follow that award.

The overwhelming weight of the case law on the question of the

simultaneous payment of sickness benefits and holiday pay

favours the Union’s position. I can see nothing (nor apparently

could any of the parties or arbitrators who dealt with the payment

of ‘weekly indemnity benefits’ in Truck Engineering Ltd., supra,

or Miracle Food Mart, supra) that would distinguish between

‘weekly indemnity’ and other forms of sick benefits for that

purpose. All are funded more or less directly by the employer

and all are triggered by the same events. While it is true that

these and other cases dealing with similar benefits (eg. York

Farms Division of Canada Packers Ltd., supra – sick pay and

welfare plan Dominion Stores Ltd., supra – sick leave and

insurance benefits) dealt with the withholding of the holiday pay

rather than the sickness benefit that was not true of the decision in

American of Canada Ltd., supra. Further in many of the cases as

in this case the real issue was whether employees were entitled to

the full amount of both forms of benefit.

Accordingly in the absence of language in the collective

agreement that would expressly suggest that weekly indemnity

benefits are subordinate to the payment of holiday pay or that

they are only available to employees who are not also entitled to

some other benefit (such as holiday pay) for the days in question,

I must reject the Company’s alternative argument as well.

(at paras. 28-29)

These two cases concerned statutory holidays occurring while employees were off

work due to sickness and in receipt of STD or weekly indemnity benefits. The next two

cases concern employees off work on WCB leave or because of sickness or illness and

their entitlement to vacation pay while they were off work on that basis.

Spruce Falls Inc., 2002 Carswell Ont 5217, 112 L.A.C. (4^th) 88 (Saltman), dealt

with a policy grievance against the employer’s decision to offset weekly indemnity

payments to employees by the amount of their vacation entitlement that year. In this

regard, paragraph 4 (i) of the collective agreement provided that:

“An amount of disability benefit will not be payable for those

days for which the employee receives holiday pay, vacation pay,

or more than one-half day’s regular pay, from the Company.”

Despite this provision, Mr. Saltman recorded that the Union claimed that:

30

“. . . the Company cannot require an employee to take vacation.

(As the Company conceded the point, it is not necessary to review

the Union’s argument on this matter.) Nevertheless, the Union

agreed that if the employee elects not to take vacation, vacation

time off (also known as vacation leave) is lost, as the collective

agreement does not permit the carryover of either vacation or

vacation pay; both are forfeited, if not taken prior to the end of the

vacation year. However, the Union claimed that the Company

cannot compel an employee to accept vacation pay in lieu of

weekly indemnity benefits, because, in order to do so, the

Company must be able to allocate vacation pay to particular days,

which it cannot do as, by its own admission, it is not permitted to

put an employee on vacation. Accordingly, it was submitted that

the employee continues to receive weekly indemnity benefits

under the collective agreement and is entitled at the end of the

year to the vacation pay earned in the previous year. What is lost,

however, is the right to carry over vacation leave into the

following year.”

(at para. 6)

Based on the concession of the employer, Mr. Saltman concluded “. . . I find that [the

employer] cannot suspend weekly indemnity benefits and require that the employee

accept vacation pay in respect of this period.” (at para. 12).

That being the case, the employer advanced its “double recovery” argument.

With respect to this argument, Mr. Saltman stated that:

“Nevertheless, the Company suggested that the provision of

vacation pay for the same period an employee receives weekly

indemnity benefits is a form of ‘pyramiding’ (‘double dipping’, as

it was also referred to). Properly understood, however,

pyramiding refers to the duplication, or double payment, of

benefits for the same purpose and does not encompass the

payment of benefits designed for different purposes. In this case,

weekly indemnity benefits are provided to indemnify an

employee who is absent due to illness or injury against loss of

income, whereas vacation pay is an earned benefit, which arises

out of an employee’s continuous service and is based on a

percentage of previous year’s earnings (subject to a minimum

calculation). Consequently, although an employee may be

granted vacation pay to coincide with the employee’s vacation

leave, it is not referable to a particular day or even to earnings

within the current calendar year. Accordingly, in my view,

providing an employee on weekly indemnity benefits with

vacation pay does not result in double payment to the employee,

31

as these payments are for different purposes. Moreover, as

weekly indemnity benefits are intended to provide income

replacement for an employee who is legitimately absent due to

illness or injury, it is no more double payment to provide vacation

pay to an employee in receipt of weekly indemnity benefits than it

is to provide vacation pay to an employee in receipt of wages who

decides not to utilise his/her vacation leave during the calendar

year.

In the result, I find that Article 4(i) of Appendix ‘B’ has

application where an employee is actually on vacation. Although

there may be other circumstances in which this provision might

apply, as the Union suggested, the most common application

might be one in which an employee suffers an illness or injury

while on vacation. In these circumstances, Article 4(i) would

prevent the employee from claiming weekly indemnity benefits in

respect of those vacation days for which the employee received

vacation pay.”

(at paras. 13-14)

In the result, the grievance was allowed.

The final case I wish to refer to at this point is City of Toronto, [2004] C.L.A.D.

No. 51 (Goodfellow). This case concerned a grievor who had been off work since 1994

and was in receipt of WCB benefits plus an employer top-up to bring him to an amount

equal to his “full net pay” he received from the employer. The grievance claimed that he

was also entitled to vacation pay for the year 2002.

In support of the grievance, the union advanced an argument along the lines of the

one that was successful in Spruce Falls Inc., supra, and Atlantic Packaging Products

Ltd., supra. Workers’ compensation benefits and vacation and vacation pay are separate

and distinct benefits and are directed at different purposes. An employee who can satisfy

the requirements for both is entitled to receive them both unless that right is taken away

by specific language. In Atlantic Packaging Products Ltd., supra, Mr. Goodfellow

commented that:

“The presumption is now in favour of the payment of holiday pay

to employees receiving sickness benefits – whatever their origin –

and that presumption can only be displaced by specific language.”

(at para. 16)

In City of Toronto, supra, the union maintained before Mr. Goodfellow that:

32

“. . . these rights [to vacation and vacation pay] are independent

of any other rights that may exist under the collective agreement

and can only be taken away by specific language.”

(at para. 3)

The employer’s response to the grievance was to the effect that the grievor was

being paid his “full net pay” equal to 52 weeks and that pay included his vacation pay

entitlement. To allow him to claim vacation pay as well would result in the employee

receiving more than 100% of his pay if he was working. That could not be right it said.

It maintained that:

“. . . as an employee who has received a full net pay benefit

equivalent to 52 weeks pay, the grievor has received all of the

pay, and vacation pay, to which he is entitled.”

(at para. 12)

Mr. Goodfellow went on to state that:

“Vacation pay is part of an employee’s gross earnings. It is part

of the employee’s overall stream of income from the employer

and is meant to compensate the employee for the statutorily or

contractually prescribed period of time off work as rest.”

(at para. 28)

He subsequently concluded that the grievance should be dismissed stating that:

“Once again, I cannot see in this provision any intention to confer

upon an employee who has received the full net pay benefit for 52

weeks in a year an entitlement to receive an additional amount on

account of unused vacation. That amount was, in effect, paid out

on an ongoing basis. The fact that the employee was unable to

actually take the vacation, for the same reason that he or she was

unable to work (ie. because of the compensable illness or injury),

is of no moment. Pursuant to Article 30, the employee is placed,

so far as possible, in the same position that he or she would have

been in had he or she been working; that is, receiving a full year’s

salary, inclusive of vacation.

In the result, I am unable to find anywhere in the agreement the

kind of clear and specific language which, in my view, would be

required to generate the outcome that the Union is seeking here.

As I interpret the agreement and understand the facts, Mr.

33

Malcolm has already received the full amount of his vacation

entitlement in the year 2002.”

(at paras. 32-33)

To summarize, I am of the view that for the purpose of this proceeding, the

arbitral jurisprudence distinguishes between two types of clauses making provision for

compensation for employees absent from work due to a variety of different reasons

including absence due to occupational illness or injury. One type of clause draws a

distinction amongst the various elements that make up an employee’s compensation and

if each element serves a different purpose, the employee is entitled to receive both or all

of them as part of his entitlement. Thus, receiving pay for annual vacation and statutory

holidays during an employee’s absence from work does not duplicate any compensation

the employee receives from an insurance or an indemnity plan by way of sick benefits. It

is to be noted that these insurance and indemnity plans do not generally compensate an

employee for all of his lost earnings as a result of his absence. Instead, their coverage is

more often in the neighourhood of 66 2/3 to 75% of those lost earnings. In these types of

cases, the absent employee will generally be able to recover all of these separate and

independent forms of lost earnings or income. A duplication argument cannot be

effectively made because the indemnity or insurance plan is not sufficiently inclusive

financially to cover everything.

However, where the general insurance plan is seen as “ compensation for an

inability to earn regular wages”, it has been construed as having the same or similar

purpose as holiday pay. In these circumstances, an employee would not be entitled to be

paid holiday pay and his regular pay for the same day. See Regional Municipality of

Peel, supra.

The critical factor in respect of this type of clause is the presumption against the

pyramiding of benefits. For the purposes of this discussion, the terms “benefits” and

“premiums” can be used interchangeably. The authors in Palmer and Snyder, Collective

Agreement Arbitration in Canada (6^thedition) para. 19.112, refer to the description of the

presumption or rule in Headwaters Health Care Centre, [2004] O.L.A.A. No. 332

(Surdykowski) where Mr. Surdykowski stated that:

“That said, it is clear that in its modern form, the ‘rule’ against

pyramiding exists as a rebuttable presumption that is itself subject

to the terms of the particular collective agreement. The

presumption is that the parties did not intend to (sic) that

employees would receive more than one premium in addition to

their regular wage rate for the same hours of work. To that end,

arbitrators have distinguished between premiums that serve the

same purpose, and premiums that serve different purposes. The

former attract the operation of the presumption or ‘rule’, and the

latter do not. Where two or more interpretations of the collective

agreement are possible in a particular case arbitrators have tended

34

to apply the rule against pyramiding by selecting an interpretation

that does not result in the pyramiding of benefits, if available.

That is, unless the particular collective agreement requires

otherwise, an employee is entitled to only one of two or more

premiums that have the same purpose for the same hours worked.

To put it another way, an employee is generally not entitled to

more than one premium for the same hours unless the purpose of

the premiums is different, or the collective agreement specifies

otherwise. Conversely, where the underlying purpose of two

applicable premiums is different, the presumption or ‘rule’ does

not apply and both premiums are payable unless the collective

agreement specifies otherwise.”

(at para. 11)

The authors also refer at para. 19.111 to the following comments from Aramark

Canada Ltd., [2007] O.L.A.A. No. 672 (Starkman) where Mr. Starkman stated that:

“The general understanding of duplication is receiving two

premiums that serve the same purpose. The Canadian Oxford

Dictionary defines duplicate as ‘copied or exactly like something

already existing’. At a facile level, the premiums in this matter

are not duplicated because the amount of money payable for each

is different. More significantly however, the Board is satisfied

that the purpose of the shift and weekend premiums are for

different purposes. The shift premium being to compensate

employees for lack of sleep and the weekend premium intended

as additional compensation for working at less socially attractive

times.”

(at para. 17)

A second type of clause the parties to a collective agreement will sometimes

adopt will provide that in the case of absence due to occupational or non-occupational

illness or injury, an employee will be entitled to be paid his regular salary as if he was

still actively working for the employer. See City of Toronto, supra. In those

circumstances, the payment to the absent employee is intended to be inclusive and all-

encompassing regarding all the different types of earnings or income that go into making

his pay what it is. By making the payment called for under such a clause, the employer

would be compensating the employee for the loss of all the different forms of earnings

and income that go into his salary including his annual vacation pay and his statutory

holiday pay. To then have to compensate the employee a second time for his annual

vacation pay and his statutory holiday pay under a different provision in these

circumstances would constitute a duplication.

35

With these general principles gleaned from the arbitral jurisprudence in mind, I

now turn to consider the language of the parties’ collective agreement. One of the

important rules of interpretation is that in searching for the mutual intentions of the

parties, the words used by them to express those intentions are not to be interpreted in

isolation. Instead, they are to be construed in the context of the collective agreement as a

whole and against the background of the current arbitral jurisprudence. In this regard, I

wish to record the fact that I was not provided with a copy of the full 2012-2019

collective agreement. I was only provided with certain excerpts, i.e., the ones that

contained the provisions that the parties felt were germane to the issues in dispute in this

proceeding. Of course, I am not in a position to consider the impact of a provision in the

agreement of which I was not made aware.

Based on an interpretation of the words the parties have used to express their

intentions in the context of the arbitral jurisprudence and the collective agreement as a

whole, I have reached the following conclusions regarding their intent.

First of all, I am of the view that Article 6.8 is an example of the second type of

clause referred to above. Once an employee absents herself from duty “due to injuries

received in the performance of [her] employment”, the Employer is obliged to continue

to pay her her “normal net salary” as if she was continuing to actively work for the

Employer. Despite not being able to perform any work, the employee maintains her

income in terms of wages and benefits, subject only to statutory and collective agreement

deductions. These benefits and deductions are set out in the Pay Advices that accompany

the biweekly or monthly salary payments. With that payment, net of statutory and

collective agreement deductions, the employee is paid all of the wages and benefits

during that pay period that he is entitled to receive from the Employer. Thus, such a

payment would be all-encompassing and inclusive of all forms of income and earnings of

the employee on WCB leave.

Second, in light of its all-encompassing and inclusive nature, payment of the

employee’s “normal net salary” biweekly or monthly over a 52 week period will result in

the employee’s annual vacation and statutory holiday entitlements being fully paid. That

is because all of the employee’s earnings and income as well as deductions are included

in the calculations for his “normal net salary”. This fact can be confirmed by reference to

employee Pay Advices. Article 6.8 requires that all this income and these benefits be

reconciled annually.

Third, as one set of annual vacation and statutory holiday entitlements is paid off,

a new set of entitlements is generated by the collective agreement. The Employer

disputes this interpretation. It maintains that annual vacation and statutory holiday

entitlements must be earned by employees performing work for the Employer. In City of

Burnaby [2015] B.C.C.A.A.A. No. 136 (Hall), Mr. Hall refers to the award of Donald R.

Munroe, Q.C., in Vancouver School Board (1998), 72 L.A.C. (4^th) 192 where, in the

course of his award, Mr. Munroe commented that:

36

“There are certain basic assumptions underlying the employer-

employee relationship. The core assumption is that the employee

will render service in exchange for which the employer will pay

wages and benefits. This core assumption is of course capable of

modification both by contract and by statute; as employers and

unions struggle with the competing interests arising from the

human condition, and as legislatures may intervene in the public

interest. But I think the normal understanding is that where

something happens to an employee which altogether prevents her

from working, certain of the incidents of the employment

relationship become inapplicable – without that reality alone

giving rise to a claim that the employee has been ‘discriminated

against’. One of the incidents of the employment relationship

which normally becomes inapplicable – which is suspended, in

effect – is the employer’s obligation to pay wages and such other

employment benefits as are commonly accepted or negotiated to

be service driven.”

(at 225-226)

Based on that core assumption, one would expect an employer’s obligation to pay

wages and benefits would cease when an employee has to absent himself from work.

However, in this case, the exact opposite happens. Pursuant to Article 6.8 of the

collective agreement, in the case of an employee who has to absent himself from work

due to an occupational injury or illness, the Employer is obligated to maintain his

“normal net salary” for however long he is absent from work on WCB leave. Clearly in

my view, the Employer’s obligation to make those payments is not work-based. All that

is required is that the individual be an employee and that he be absent from work on

WCB leave.

Further, annual vacation credits are based on “years of service” or employment

with the Employer. See the charts laid out in Article 5.1 for the various branches

demonstrating that the length of vacations increase based on an employee’s “years of

service”. With respect to statutory holidays, Article 5.2 (a) provides that “all persons

covered by this Agreement shall be entitled to the following Statutory Holidays” and 5.2

(d) states that “all new full time employees are entitled to statutory holidays that occur

after the applicable hire date without a waiting period.”

Finally, in my view, if the mutual intention of the parties had been that the

entitlement of employees to annual vacation and statutory holiday benefits was work-

based, there would not have been the need to include Articles 5.1 (i) and 5.2 (e) in the

collective agreement specifying that employees on continuous non-occupational medical

absences due to illness or injury for more than 60 calendar days would have their

entitlements to these two benefits “pro-rated during the duration of their absence up to the

date they return to regular or alternate duty.” Instead, employees would have been cut-

off from those benefits the moment they were absent from work and on WCB leave.

37

Having considered all of the circumstances, I am satisfied that an employee’s

entitlement to receive her “normal net salary” including her annual vacation and statutory

holiday entitlements during her absence from work on WCB leave is status-based, not

work-based. Accordingly, an absent employee on WCB leave will continue to accrue

those benefits so long as she retains her status as an absent employee on WCB leave.

Fourth, there is no express limitation such as we see in Articles 5.1 (i) and 5.2 (e),

concerning “employees absent from duty due to injuries received in the performance of

their employment.” The Employer sought such a limitation in respect of occupational

injuries during bargaining in 2003 and in bargaining leading to the 2012-2019 collective

agreement, but was not successful in achieving it. See Article 6.8. Accordingly,

pursuant to Article 6.8, an employee on WCB leave is prima facie entitled to accrue

annual vacation and vacation pay as well as statutory holiday and statutory holiday pay

throughout his absence from work due to occupational illness or injury on the job.

Prior to the 1997 round of bargaining, Article 6.8 of the collective agreement

provided that employees absent from work on WCB leave due to injuries suffered at

work were entitled to receive their “full salary” from the Employer. What this meant was

that they received their gross salary including having statutory deductions such as income

tax and Canada Pension Plan and Employment Insurance contributions remitted to

Revenue Canada on their behalf. However, because WCB payments were not taxable,

the Employer did not receive reimbursement for these payments from Work Safe B.C.

Then at tax time, the employee claimed and received a tax refund in the amount of these

statutory deductions again because the WCB payments were not taxable. The result was

the employee on WCB leave received a “tax windfall” equal to the amount of the

employee’s statutory deductions in respect of income tax and Canada Pension Plan and

Employment Insurance contributions. What the Employer sought to achieve in the 1997

round of bargaining with the deletion of the requirement to pay the employee his “full

salary” and the substitution of an obligation to pay his “normal net salary” was the

elimination of this “tax windfall” to the employee while he was on WCB leave.

For its part, the Union understood the Employer’s concern insofar as this “tax

windfall” was concerned and was prepared to correct it by agreeing to the substitution of

an entitlement to “normal net salary”. However, at the same time, it wanted to make

clear that this change would not negatively impact an employee’s entitlement under

Article 6.8 in any other way. Again, as Mr. West swore in his Statutory Declaration:

“. . . the Union explicitly raised with the Employer concerns that

the language not negatively impact members’ pensions or any

benefits, including holidays and vacations. We were adamant that

normal net pay meant no loss to our members’ normal pay cheque

and we, in particular, emphasized that pensions and all other

38

benefits could not take a hit as a result of agreeing to the

provision.”

(at para. 20)

The Union submits that the phrase “normal net salary” just captures the “salary”

of the injured employee on WCB leave. In this regard, the Union refers to Articles 9 and

Schedule “A” to the 2012-2019 collective agreement. The preamble to Article 9 states

that:

“The schedules of classifications and salaries for all employees

covered by this Agreement shall be as listed on Schedule ‘A’,

Salaries and Wage Benefits.”

Schedule “A” then lists the salaries for bargaining unit employees in the various branches

of the Employer based on a monthly payment, a bi-weekly payment, a bi-weekly/shift

payment or an hourly payment.

The Union then maintains that employee benefits such as annual vacations,

vacation pay, statutory holidays and statutory holiday pay are separate and distinct from

an employee’s salary and are payable to an employee absent from work on WCB leave

under the arbitral jurisprudence reflected in decisions such as Spruce Falls Inc., supra,

and Atlantic Packaging Products Ltd., supra. That these benefit payments were to be

maintained is reinforced, the Union says, by the inclusion of the words “no net gain or no

net loss to the employee” in Article 6.8.

The Union summed up its position as follows:

“Given that the reference to ‘salary’ does not include other

benefits and given that there is no other reference to an impact on

benefits, Article 6.8 on its face cannot be read to limit the payout

of vacation and statutory holidays for those on WCB leave in any

way.”

(at para. 233)

The Employer does not agree with the Union’s interpretation. It submits that:

“The absurdity of the interpretation that the Union implores this

Arbitration Board to accept is best demonstrated by comparing

the earnings of two employees with identical years of service and

vacation entitlement, one too (sic) whom works the entire year

and one who is off on a lengthy WCB leave:

(a) For example, Employee A and Employee B each have 3 years

of service. Under Schedule A, they each earn $88,956.24 per

39

year. Under Article 5.1, they are each entitled to eight shifts

of vacation annually.

(b) Employee A works the entire year. She takes her allotted

eight shifts of vacation and will receive a total of $88,956.24

in salary for the year. This amount is inclusive of vacation

pay.

(c) In contrast, Employee B is off on WCB leave and does not

work at all for the entire year. Under Article 6.8, she will

receive her entire annual salary of $88,956.24, which, as

demonstrated above for Employee A, includes vacation pay.

(d) However, should the Union’s interpretation of Article 6.8 be

accepted, Employee B would also receive a vacation payout

for their eight shifts of vacation, for total gross earnings of

$92,866.40, or $3,910.16 greater than Employee A (despite

Employee A working the entire year).

Quite simply, the above situation is precisely the one which the,

“no net gain or no net loss” language agreed to by the Parties was

intended to avoid. The Employer submits that the Grievance

ought to be dismissed on this basis alone.”

(at paras. 126-127)

I do not agree with the Union’s argument in this regard. While the employee’s

Pay Advice will contain a listing of the items that go into making up the employee’s

gross pay or earnings and the deductions that are to be taken off those gross earnings, it is

the “net pay” that is paid to the employees as if they are still working. See paragraph 30

of the Partial Agreed Statement of Facts. Thus, salary for the purposes of Article 6.8 of

the collective agreement includes factoring in all salary and benefits as well as required

statutory and collective agreement deductions. The “net pay” column reflects the

employee’s normal net pay for the time period covered by the Pay Advice.

Thus, the Employer’s system encompasses elements of both types of clauses

reflected in the arbitral jurisprudence. Through the vehicle of the Pay Advice, the absent

employee on WCB leave receives notification of the separate and distinct elements of

compensation he is entitled to receive, the categories for which deductions will have to be

made from his gross salary, and then these items will be added and subtracted which will

in turn produce the “normal net salary” aka “net pay” under the Pay Advice. That nicely

fits within the requirements for Article 6.8.

However, in the end, the Employer’s process produces an all-encompassing,

inclusive “normal net salary” which includes the employee’s annual vacation pay and

40

statutory holiday pay for that 52 week period or year. In this regard, see paragraph 8 of

the Partial Agreed Statement of Facts which provides that:

“When employees take vacation days, the amount of pay on their

pay advice is no different than if they were at work. However,

the pay advice lists pay as ‘Vacation’ and then lists the hours and

rate . . . . On a regular (non-vacation) pay advice, in contrast, pay

is listed as ‘Regular’ with the applicable hours and rate.”

Further, a shift of work, a shift of annual vacation and a shift of statutory holiday will all

be paid at the same rate. See paragraphs 8 and 18 of the Partial Agreed Statement of

Facts. Paragraph 18 also provides that the pay advice will list statutory holiday pay as

“Stat”.

In my view, it makes no difference in substance which approach is followed; the

result will be the same. Treating “salary” as just wages and then adding to it all the other

separate and distinct headings of earnings or income provided for under the collective

agreement, one would come up with the employee’s same gross pay over a defined

period of a week, biweekly, or monthly. One would then deduct from this gross pay all

the required statutory and collective agreement deductions resulting in the net pay for that

employee for that period of time. Or one could take the approach reflected in the

employee Pay Advice taking the “net pay” figure and multiplying it by the number of

those periods in 52. The important point though is that in either case, annual vacation

pay and statutory holiday pay would be factored into the calculation, expressly in the case

of the separate and distinct method and implicitly in the “net pay” method and the

employee would have been paid for those benefits..

“Normal net salary” is to be calculated on an “annual reconciliation basis”. See

Article 6.8. Thus, the time period for measuring the “normal net salary” is 52 weeks. In

my view, the items that go into measuring that amount are periods of work, periods

where the employee is taking annual vacation, and periods of statutory holidays. The pay

for a shift of work is the same as the pay for a shift on annual vacation and a shift on

statutory holiday. Further, in light of the requirement for an “annual reconciliation”, I am

of the view that the “normal” expectation is that an employee would use up her annual

vacation and statutory holiday entitlements in the year they became vested and available

to access. Put another way, it would not be normal, in my view, for an employee to work

52 weeks of the year and not take any rest breaks by way of annual vacation and/or

statutory holidays. The “net” salary would then be calculated by deducting income tax,

Canada Pension Plan contributions and Employment Insurance contributions from the

gross salary.

On this basis, an employee absent from work on WCB leave who has been paid

his “normal net salary” over a 52 week period would have been compensated for his

annual vacation pay and statutory holiday pay entitlement for that year. See City of

Toronto, supra. In my view, this is the critical finding of fact in this case. To then say

he has not received that benefit or that he has not used it and therefore is still entitled to

41

be compensated for it would result in him being paid for it a second time. In effect, he

would experience a “net gain” over the “normal net salary” he would have received if he

had worked through that period. I am satisfied that the parties did not mutually intend

that result.

To make its claim in this regard, the Union points to Article 5.1 (f) and (g) of the

collective agreement. It says that the annual vacation and statutory holiday entitlements

that accrue each year while an employee is absent from work on WCB leave remain

unused because an employee on leave is not in a position to opt to take a rest break via

annual vacation or by using some statutory holidays. On the theory that these

entitlements remain unused, the Union then says they are candidates for being paid out

pursuant to Article 5.1 (g) as “unused prior year vacation”.

Having considered the matter, I am of the view that Article 5.1 (f) and (g) do not

apply to a case such as this involving an employee absent from work on WCB leave for a

considerable period of time, i.e., at least one year. Such an employee would not likely be

returning to work any time soon with the result, in my view, that it does not make sense

to speak of him “using” his annual vacation or his statutory holiday time to obtain some

rest and relaxation. What such an employee would be interested in is whether he is going

to be paid for that time. The fact is that he is paid for that time through receiving his

“normal net salary” over a 52 week period. From a substantive standpoint, an absent

employee on WCB leave is paid for his accrued annual vacation and statutory holidays

that year by his receiving his “normal net salary” over a 52 week period of his absence. I

agree with Mr. Goodfellow’s statement in City of Toronto, supra, that “the fact that the

employee was unable to actually take the vacation . . . is of no moment.” (at para. 32).

The issue there was the pay for the “unused” vacation, not the vacation itself as is the

case here. This is not a case of an “unused” vacation. Employees “used” the vacation

and statutory holidays through their being paid in full for those benefits.

In addition, in my view, Article 5.1 does not apply procedurally to a case such as

this. This case, in my view, is primarily governed by Article 6.8. That provision requires

that the payment of the employee’s “normal net salary”, as if he were still an active

employee, be reconciled on an annual basis. The reconciliation process under Article 5.1

can last up to 14 months in respect of the carry over of annual vacation entitlement and

16 months before an entitlement to be paid out may arise. In my view, the annual

reconciliation process under Article 6.8 does not contemplate a carry-over process from

one year to the next.

I am of the view that these conclusions are in accord with the reasoning in

Regional Municipality of Peel, supra, and City of Toronto, supra. They are also

consistent with the reasoning in Toronto District School Board, [2004] O.L.A.A. No. 677

(Knopf). In that case, the issue was

“. . . what happens when someone is unable to schedule or use

their annual vacation because they are otherwise absent due to a

42

workplace illness or injury[?]”

(at para. 1)

In dismissing the grievance, Ms. Knopf addressed the issue as follows:

“What then happens to this vacation entitlement if scheduled

vacation cannot be utilized by an employee already off work due

to a workplace injury or illness? Is the vacation ‘entitlement’ lost

or stripped away as the Union suggests if the Employer succeeds

in this case? When the question is asked in that ‘loaded’ way it

would seem unfair for an employee to ‘lose’ such an entitlement.

However, the question cannot be posed in that way. The question

that the parties jointly put before this Arbitrator is simply ‘what

happens to vacation entitlement if someone is off due to WSIB

and because of that cannot schedule or use the vacation

entitlement?’ Article U.1 provides that employees are ‘eligible’

for paid vacation. One must note the use of the word ‘eligible’, as

opposed to ‘entitled.’ Article U.2 then sets out the formula by

which vacation eligibility is calculated each year. Article U.5.1

provides for what happens when vacations cannot be used

because of operational requirements or unusual circumstances.

Only under Article U.5 is the Employer given the discretion to

allow an employee to ‘bank,’ more than one week of unused

vacation in unusual circumstances. Failing that, the collective

agreement does not provide for the accrual of vacation or the

creation of a vacation bank. Therefore, the amount of paid

vacation that the employee is ‘eligible’ to schedule and use must

pass with the passage of the calendar year. This finding does not

mean that an employee off on WSIB has ‘lost’ the benefit of the

paid vacation. His or her WSIB benefits are calculated on the

basis of the collective agreement’s schedule of wages which are

set out on an hourly basis. In the fact scenario posed for

determination, the underlying assumption is that the WSIB

benefits will be calculated on the basis of 52 weeks of annual

earnings, only 49 of which would have been on the job and three

weeks would have been paid vacation. Therefore, the right to the

paid vacation remains alive and recognized by virtue of the fact

that the WSIB benefits are calculated on the basis of 52 weeks of

earning power. Similarly, the amount of earned vacation would

be recognized on a prorated basis, recognizing the full amount of

the employee’s work and earned vacation. If the Union’s

argument were correct, the employee would receive 52 weeks of

WSIB payments plus three weeks of vacation pay. Because this

collective agreement does not allow for accrual of vacation and

has no vacation bank, it cannot be concluded that it confers an

43

employee who receives WSIB for 52 weeks’ entitlement to an

additional amount of money because of the unused vacation.

Therefore, it must be concluded that an employee off on WSIB

who cannot use or schedule his or her vacation by the end of the

calendar year because of absence, will continue to receive WSIB

benefits calculated on the basis of 52 weeks of earning capacity,

which includes his or her full vacation entitlement. Therefore,

that employee will not also be entitled to receive payment for the

time of unused vacation.”

(at paras. 14-15)

In summary, the issue of duplicate payments and double recovery arose in some

of the early cases. See for example Spruce Falls Inc., supra. However, arbitrators in

those cases tended not to focus on that issue, but instead found that weekly indemnity

benefits and workers’ compensation benefits were separate and distinct in terms of their

purpose from entitlements to paid annual vacations and paid statutory holidays and their

purposes. Because these benefits served different purposes, arbitrators concluded that

employees absent from work due to injury or illness could recover both. In my view,

one of the reasons why arbitrators tended not to focus on this duplication or double

recovery issue was that the nature of the indemnity or insurance benefit did not really

allow for it. Those benefits tended to be only a percentage of what an employee would

normally earn over a period where he was actively working, for example, 66 2/3% in the

case of a weekly indemnity and 75% in the case of workers’ compensation. In these

circumstances, it could not be said with sufficient certainty that this portion of the weekly

indemnity benefit represented the employee’s annual vacation pay or that this portion of

the workers’ compensation benefit represented statutory holiday pay.

However, collective agreement obligations began to change and particularly in the

case of absences from work caused by occupational injuries or illness, employers became

responsible for maintaining an employee’s regular salary or pay as if she was still

actively working. See Regional Municipality of Peel, supra, where the obligation was to

maintain the employee’s “regular pay”; City of Toronto, supra, where the obligation was

to maintain the employee’s “full net pay”, and in the case before me where the obligation

is to maintain the employee’s “normal net salary”. Arbitrators dealing with cases under

provisions such as these tended to look at the calculation issues based on a 52 week or

annual basis. Based on the grievor’s length of service, his annual vacation entitlement

was determined and then the number of statutory holidays was calculated. Those

calculations were then reflected on the 52 week calendar with the remaining weeks

representing weeks of actual work. The expectation was that employees would take full

advantage of their annual vacation and statutory holiday entitlements to rest and I am of

the view that that expectation was a reasonable one. Following through on this analysis,

an arbitrator could see how the injured and absent employee had already been

compensated for his annual vacation pay entitlement and his statutory holiday pay

entitlement over the course of the year. She could then further see that to permit the

44

employee to separately recover for her annual vacation on the theory that it had not been

used would result in duplication and double recovery. In my view, this is what the

arbitrators in City of Toronto and Toronto District School Board, supra, concluded, and

accordingly, they dismissed the grievances before them.

In response, the Union maintains these conclusions in respect of the ability of

employees on WCB leave to recover for unused days of annual vacation and statutory

holidays are inconsistent with the evidence of collective bargaining between the parties as

well as the Employer’s efforts to limit employee rights to be paid for those unused days.

While acknowledging that the Employer was successful in respect of limiting the right of

employees absent from work due to non-occupational illness or injury to accrue annual

vacation and statutory holiday entitlements after 60 calendar days of absence, it was not

successful in imposing a similar limitation on employees who were absent from work due

to occupational illness or injury, i.e., WCB leave. The Employer initially sought a

limitation on all absent employees’ right to continue to accrue those entitlements during

absences from work in 2003. That effort failed altogether. It renewed its efforts in

bargaining leading to the 2012-2019 collective agreement. This second effort succeeded

in part. It succeeded in respect of employees absent from work as a result of non-

occupational illness or injury. See Articles 5.1 (i) and 5.2 (e). However, no such

limitation made it into the collective agreement in respect of employees’ absences from

work on WCB leave.

In light of these facts, the Union’s argument continues:

“In the 2012-2019 round, an explicit limitation was put on the

accrual of paid annual vacation for employees on non-

occupational sick leave, but those on WCB were specifically

excluded. (see paras 195-201, below) Such employees therefore

remain entitled to the accrual of paid annual vacation while on

WCB leave.

In this arbitration, the Employer now raises the exact same

argument they did in the 2003 round of bargaining: that

employees on WCB should not be getting paid out for earned and

accrued paid annual vacation and statutory holidays because this

would result in ‘extra pay’ or ‘enrichment’ of such employees.

This issue was explicitly considered in the 2003 round of

bargaining and explicitly rejected. The Union submits that the

Employer is now trying to accomplish through arbitration what it

could not in bargaining by attempting to read in a limitation on

the payout of earned and accrued vacation and statutory holidays

where none exists.”

(at paras. 172-173)

45

I do not agree that the Employer’s proposals to amend the collective agreement in

2003 and subsequently in 2012 reflect “the exact same argument” as it makes before me

in this proceeding based on the City of Toronto, supra, the Regional Municipality of Peel,

supra, and Toronto District School Board, supra. The 2003 and 2012 proposed

amendments were focussed on restricting or limiting employees’ ability to continue to

accrue annual vacation and statutory holiday benefits and pay after an employee had been

absent from work for a specified period of time. This portion of the Employer’s

argument before me based on the arbitral jurisprudence reflected in the above awards

does not rely on any limitation placed on an employee’s ability to accrue either benefit.

Instead, it proceeds on the assumption that the employee absent from work due to

occupational illness or injury continues to accrue annual vacation pay and benefits as

well as statutory holiday pay and benefits. Thus, these benefits have to be paid out to the

employees each year of their absence. In these circumstances, where the collective

agreement requires that the absent employee be paid his “regular pay” or his “full net

pay” or his “normal net salary” as if he was still working, those payments over the course

of 52 weeks would effectively pay off those obligations to the employee. Thus, the

argument before me is that the employee has already been paid his annual vacation and

statutory holiday entitlements. To then say that that those benefits have not been used

and should then be paid out again pursuant to Article 5.1 and 5.2 is to call for a duplicate

payment and double recovery.

I now turn to the evidence concerning the payment of unused prior annual

vacation benefits and unused statutory holiday benefits in the past to employees absent

from work on WCB leave. These employees include Messrs. Paine, Deol, Mahil,

Bachand and Henderson.

First of all, there is no dispute between the parties that the Employer

“. . . has long paid out vacation and statutory holidays for

employees on WCB leave, or allowed them to carry those benefits

forward into the next year, at least when that leave is under a

year.”

See Union’s Written Submission, para. 265 and Employer’s Written Submission, para.

44. In this regard, reference is made to the cases of Messrs. Paine and Deol as detailed in

the Partial Agreed Statement of Facts.

I agree, in circumstances where the WCB leave is for less than a year. In those

circumstances, it is possible that the employee on WCB leave might also return to work

during that year and take advantage of that opportunity to take some annual vacation

and/or statutory holidays and enjoy the rest and relaxation. Thus, the potential for the

carry over of annual vacation and statutory holiday entitlements serves a purpose and

makes sense. The provision for a payout of the unused entitlements also makes sense in

case all of the rest and relaxation breaks cannot be used. But the limit must be

recognized; the application of Articles 5.1, 5.2 and 6.8 together cannot result in an

employee being paid any more than once for her annual vacation entitlement and her

46

yearly statutory holiday entitlement. The two reconciliation processes, one contained in

Article 5.1 and the other in Article 6.8, must be applied together in such cases so as to

guarantee that the employee does not suffer any financial loss, but also does not secure

any financial gain.

Second, the Union maintains that it is

“. . . the Employer’s practice with respect to employees on paid

leaves other than WCB has been to provide all other negotiated

benefits, unless otherwise explicitly agreed to in the Collective

Agreement. It follows that employees on WCB should also be

provided with these benefits. For example, the Employer

provided employees on lengthy sick leaves lasting over a year

with paid annual vacation and statutory holidays until 2014, when

Articles 5.1 (i) and 5.2 (e) were added to the Collective

Agreement, explicitly removing that benefit.”

See Union’s Written Submissions at para. 267. The Employer does not dispute this

submission either. See its Written Submissions at paras. 74 and 75.

Third, with respect to the evidence of past practice regarding how the system was

administered, the Union

“. . . asserts that this evidence demonstrates a pattern of rolling

over and, ultimately, paying out (if the employee cannot return to

active work) any unused vacation and statutory holidays for

employees who are on WCB leaves for any length of time. While

the Employer may argue there are too few examples to make a

practice, there are only a few examples known to exist of

employees on such lengthy WCB leaves. That is, the small

number of examples is a function of how rare it is for employees

to be on lengthy WCB leaves, not a function of an inconsistent

practice. Indeed, the above examples are an exhaustive list of all

the employees who have been on long-term WCB leaves that are

known to the Parties. Each one of them received a rollover and/or

payout of earned and accrued paid annual vacation and statutory

holiday benefits.

Further, just because such a situation does not arise very often

does not mean that a consistent past practice does not exist. A

past practice can be established on the basis of a few number of

incidents.”

(at paras. 272-273)

47

Having considered all of the evidence and argument, I am of the view, first of all,

that the extrinsic evidence regarding collective bargaining does not provide much

assistance in deciding whether there has been a duplicate payment in this case or not.

Collective bargaining had much to do with the accrual of annual vacation and statutory

holiday benefits and whether that accrual should be permitted to continue beyond a

certain period of time such as 60 days. The parties agree that it should not be permitted

to continue beyond 60 days in the case of non-occupational sickness and injury, but did

not agree to impose the same restriction in circumstances where the absence was based

on an occupational sickness or injury. In these circumstances, the parties decided to

leave the situation as it was, basically unrestricted, with employees absent on WCB leave

free to continue to accrue annual vacation and statutory entitlements as long as the

absence continued. However, in my view, collective bargaining did not touch on the

Employer’s contention that an employee was not entitled to a double recovery of his

annual vacation and statutory holiday benefits.

With respect to the past practice evidence, the evidence did disclose that the

Employer had paid out some employees on the theory that they had some unused annual

vacation and statutory holiday days. This was particularly the case in respect of

employees who were absent on leave for under a year. With respect to employees who

were absent on WCB leave for over a year, it appears that the Employer initially paid out

claims made by Messrs Mahil and Henderson in respect of annual vacation benefits, but

not statutory holiday benefits. In making these payments, the Employer must have

believed at the time that Article 5.1, in particular Article 5.1 (f) and (g), required it to do

so. Then, after a year or two, similar claims made by these employees were denied with

the assertion that to do so would result in an employee receiving a duplicate payment for

his annual vacation credits and his statutory holiday benefit.

I am of the view that the mutual intentions of these parties are that employees

absent from work on WCB leave are to receive their “normal net salary” during their

absences as if they were continuing to actively work for the Employer. I am of the

further view that consistent with the Pay Advices issued to employees by the Employer

that over a period of 52 weeks of receiving her “normal net salary” an employee absent

from work on WCB leave would have received the annual vacation and statutory holiday

pay she was entitled to receive for that calendar year. To then permit her to claim her full

annual vacation pay and her statutory holiday pay again, pursuant to Article 5.1 (f) and

(g), on the theory that she had not been able to use them because she was absent from

work on WCB leave, would result in a duplicate payment and a case of double recovery.

Such a result would, in my view, be inequitable and unfair and, accordingly, could not

have been what these parties had mutually intended. The few occasions on which these

double payments appear to have been made are not sufficiently persuasive and

unequivocal to cause me to conclude that they reflect the mutual intentions of the parties.

Instead, in my view, they are based on a misapprehension that Article 5.1 (f) and (g)

applied to the situation of employees absent from work on WCB leave for in excess of a

year receiving their “normal net salary” pursuant to Article 6.8.

48

In summary, having considered the words the parties have used to express their

intentions in the context of the collective agreement as a whole and the arbitral

jurisprudence and now in light of the extrinsic evidence of collective bargaining between

the parties and the past practice pertaining to the application of Articles 5.1, 5.2 and 6.8, I

am of the view that the Employer’s interpretation of Article 6.8 still best reflects the

mutual intentions of the parties. An employee absent from work on WCB leave is

entitled to receive from the Employer his “normal net salary” as if he was actively

working for the Employer, as long as the absence continues. There are not to be any

deductions from that amount, other than statutory or contractually approved amounts.

Accordingly, the “normal net salary” received by the employee on WCB leave will

therefore entail “no net gain or no net loss to the employee on an annual reconciliation

basis.” In my view, the Union’s contention in this case that an employee absent from

work on WCB leave is entitled to receive a payout of his unused prior year’s vacation

pursuant to Article 5.1 (g) would result in a net gain to the employee over and above his

annual “normal net salary” because the employee had already received payment for his

annual vacation and statutory holiday entitlements as part of his “normal net salary” over

a 52 week year.

In my view, the Union’s interpretation of the relevant provisions of the collective

agreement in this case is in error in two important respects. First of all, Article 5.1 and its

provisions for the carry over of unused annual vacation and for the subsequent payout of

those unused annual vacation shifts, in my view, do not apply in respect of employees

absent from work on WCB leave for a year or more for the reasons discussed above.

Secondly, an employee absent from work on WCB leave and in receipt of his “normal net

salary” for a period of 52 weeks will have been paid his annual vacation and statutory

holiday entitlements consistent with the “annual reconciliation” process required under

Article 6.8.

Neither the collective bargaining evidence nor the past practice evidence

addresses these flaws in the Union’s interpretation. The collective bargaining evidence

explained the significance of the word “net” in the phrase “normal net salary” and the

Employer’s efforts to restrict or limit an employee’s ability to accrue annual vacation and

statutory holiday entitlements, but it did not address the concerns raised by these two

errors in the Union’s interpretation. The past practice evidence was to some degree

consistent with the Union’s interpretation, but that evidence did not provide an answer to

those two errors. In the end, I am satisfied that the evidence arising from collective

bargaining and the past practice of the parties under Article 6.8 is not sufficiently

persuasive so as to cause me to reject the more convincing interpretation advanced by the

Employer.

Next, the Union submits that denying employees on WCB leave a payout of their

unused annual vacation and statutory holiday entitlements is discriminatory and in

violation of the Human Rights Code.

Section 13 (1) (b) of the Human Rights Code provides in part that

49

“A person must not

(b) discriminate against a person regarding employment or

any term or condition of employment

because of the Indigenous identity, race, colour, ancestry, place of

origin, political belief, religion, marital status, family status,

physical or mental disability, sex, sexual orientation, gender

identity or expression, or age of that person or because that person

has been convicted of a criminal or summary conviction offence

that is unrelated to the employment or to the intended

employment of that person.”

In the Township of Langley [2018] B.C.C.A.A.A. No 15, 290 L.A.C. (4^th) 273

(Nichols), the arbitrator reviewed the criteria that must be met in order to show a prima

facie case of discrimination:

“1. Does the individual have a characteristic that is

protected under the Human Rights Code;

2.

3.

Has the individual experienced an adverse impact with

respect to their employment; and

Was the protected characteristic a factor in the adverse

treatment?”

(at para. 52)

Applying that three-part test to the facts of this case, I am satisfied that the

employees absent from work on WCB leave due to an occupational illness or injury have

a characteristic that is protected under the Human Rights Code. They are temporarily

disabled from performing their assigned duties because of an occupational illness or

injury. Disability is the protected characteristic.

The critical question though is whether these employees on WCB leave have

experienced any “adverse impact” as a result of their occupational illness or injury which

has resulted in them having to go on WCB leave. In my view, they have not. First of all,

they continue to accrue annual vacation and statutory holiday benefits and pay.

Secondly, they continue to receive their annual vacation pay and statutory holiday pay

even though they are absent from work. They receive this pay through the vehicle of

being paid their “normal net salary” during their WCB leave as if they were still actively

working for the Employer. Over a 52 week period, they are paid for their full annual

vacation entitlement and their full statutory holiday entitlement as if they were still

actively working for the Employer. On this basis, their disabilities do not have an

“adverse impact” on their annual vacation or their statutory holiday entitlements. There

being no “adverse impact”, there is no violation of the Human Rights Code.

50

Finally, the Union argues that the Employer is estopped from denying payout for

accrued annual vacation and statutory holidays for employees on any length of WCB

leave. It asserts that the Employer has made representations to this effect, first of all, by

its longstanding past practice of having done that very thing for employees on WCB

leave. Secondly, during bargaining, it has sought to limit those entitlements for various

groups of employees who are absent from work including those on WCB leave. With

respect to employees on WCB leave, it has not been successful in achieving any of those

proposed limitations. Finally, the Employer assured the Union that none of the changes it

was proposing to Article 6.8 of the collective agreement during 2012 bargaining would

negatively impact any benefits already being received by those employees who were

absent from work on WCB leave.

In Insurance Corporation of British Columbia (2002), 106 L.A.C. (4^th) 97 (Hall),

the arbitrator considered the equitable doctrine of estoppel and its application to labour

disputes. In the course of his consideration, Mr. Hall commented that:

“The purpose of the modern doctrine is to avoid inequitable

detriment. An estoppel may arise where: (a) intentionally or not,

one party has unequivocally represented that it will not rely on its

legal rights; (b) the second party has relied on the representation;

and (c) the second party would suffer real harm or detriment if the

first party were allowed to change its position. The requirement

of unequivocal representation or conduct is a question of fact, and

may arise from silence where the circumstances create an

obligation to speak out. The notion of reliance must be assessed

from the perspective of the party raising the estoppel. In the

labour relations context, the element of detriment may be satisfied

by a lost opportunity to negotiate: Versatile Pacific Shipyards,

supra, at pp. 270-71. See more generally Re Abitibi Consolidated

Inc. and I.W.A. Canada, Loc. 1-424 (2000), 91 L.A.C. (4^th) 21

(Blasina) at p. 35.”

(at 108)

Having considered the matter, I am of the view that the doctrine of estoppel has

no application to the circumstances of this case. I acknowledge that the Employer did

pay out Mr. Mahil’s unused annual vacation entitlement for 2014 and 2015 and Mr.

Henderson’s unused annual vacation entitlement for 2015 and 2016. Thereafter, the

Employer changed its position to one of stating that by being paid their “normal net

salary” for 52 weeks as if they were working, employees such as Messrs. Mahil and

Henderson had already been compensated for those benefits. If they are compensated

again for those same benefits on the theory that those benefits remain unused, the

employee would in effect be paid these benefits for a second time, i.e., a “net gain” over

what the employee would make if she was in fact working. In my view, the payouts to

Messrs. Mahil and Henderson do not constitute a longstanding past practice. I am of the

51

further view that it is not appropriate for the Union to rely on the practice in respect of

employees who are absent from work on WCB leave for periods of time less than a year

in length as different considerations arise in their circumstances as discussed above. For

these reasons, I am not persuaded that the Employer’s conduct amounts to an unequivocal

representation that employees absent from work on WCB leave for in excess of a year are

entitled to a payout of their unused annual vacation and unused statutory holiday

entitlements pursuant to Article 5.1 (g) of the 2012-2019 collective agreement.

Nor has any detriment been incurred. Employees absent from work on WCB

leave for in excess of a year receive their full annual vacation and statutory holiday

entitlements as a result of being paid their normal net salaries during that period pursuant

to Article 6.8 of the collective agreement. These are precisely the benefits the collective

agreement specifies.

Having considered the matter, I am of the view that the Employer’s action in

stopping the second payment is one of correcting a mistake that was resulting in an

overpayment to employees absent from work on WCB leave for in excess of a year. Put

another way, this is a case where the Employer’s action entailed it in correcting an

inequity, i.e., the employees absent from work on WCB leave being paid twice for annual

vacation and statutory holiday benefits over the course of a 52 week period, rather than a

case of the Employer creating an inequity by its action. In my view, it would be unfair

and inequitable to require the Employer to continue to pay employees absent from work

on WCB leave twice for their annual vacation and statutory holiday benefits over a 52

week period.

In conclusion, having considered all of the evidence and argument adduced in this

proceeding, I am of the view that:

1.

the Employer is not denying employees absent from work on WCB leave the

right to have their annual vacation and statutory holiday entitlements paid out

to them;

2.

in fact, employees absent from work on WCB leave for a year or more have

already received their annual vacation and statutory holiday pay as part of

their “normal net salary” being paid pursuant to Article 6.8 over a 52 week

period;

3.

4.

to pay these amounts to them again pursuant to Article 5.1 (g) would result in

duplication and double recovery for these employees absent from work on

WCB leave;

this interpretation and application of the parties’ collective agreement does

not discriminate against employees absent from work on WCB leave within

the meaning of Section 13 of the Human Rights Code of British Columbia;

and

52

5.

the Employer is not estopped from relying on its strict legal rights under the

parties’ collective agreement in resisting the Union’s claim that it is

improperly denying to employees absent from work on WCB leave the right

to be paid out in respect of their unused annual vacation and statutory holiday

entitlements.

Accordingly, the Union’s policy grievance must be dismissed.

It is so awarded.

Dated this

19^th

day of July, 2022.

‘John Kinzie

JOHN KINZIE

ARBITRATOR