Sysco Canada, Inc Applicant - v. -, 2021 ABQB 459

Court of Queen’s Bench of Alberta Citation: Sysco Canada, Inc v Miscellaneous Employees, 2021 ABQB 459 Date: 20210611 Docket: 1903 09854 Registry: Edmonton Between: Sysco Canada, Inc Applicant - and - Miscellaneous Employees, Teamsters Local Union No 987 of Alberta and Alberta Labour Relations Board Respondents _______________________________________________________ Reasons for Decision of the Honourable Madam Justice D. J. Kiss _______________________________________________________ Table of Contents I. Introduction . 2

II. Background . 2 III. Standard of Review .. 3 A. Reasonableness . 3 B. Procedural Fairness . 4 IV. Conducting a Reasonableness Review .. 5 V. Issues . 6 VI. Discussion . 6 1. Is the Board’s Decision procedurally unfair as the Board relied on case law that was not presented by the parties and upon which the parties were not given the opportunity to make submissions? 6 2. Is the Board’s Decision unreasonable because: 8 a. The Board failed to properly consider and apply relevant Code exemptions and provisions; 8 b.

The Board failed to properly apply the “dependent contractor” test to the facts of the case; and/or 8 c. The Board unreasonably misapprehended relevant evidence? . 8 VII. Overall Conclusion . 16 I. Introduction [ 1 ] This matter comes before the Court as an application for judicial review pursuant to s 19(2) of the Labour Relations Code , RSA 2000, c L-1 [ Code ].

The Applicant, Sysco Canada, Inc [Sysco] seeks judicial review of a decision of the Alberta Labour Relations Board [Board] dated April 12, 2019 (indexed at: 2019 CarswellAlta 706, [2019] Alta LRBR 186 ), which approved an application by the Respondent, Teamsters Local Union No. 987 of Alberta [the Union], for certification of a bargaining unit consisting of a number of truck drivers who provide services to Sysco. II.

Background [ 2 ] Sysco is part of a global company [Sysco Corporation] that sells, markets and distributes food products to restaurants, healthcare and education facilities, lodging establishments and other food service customers. This application relates to Sysco’s Edmonton division [Sysco Edmonton]. [ 3 ] In 2018, the Union filed two certification applications with respect to a bargaining unit of truck drivers at Sysco Edmonton. The two applications were heard together by the Board. [ 4 ] In the first certification application filed on October 19, 2018 (Board File No.

CR-05420), the Union applied for a bargaining unit comprised of “all drivers, including dependent contractors, working in and out of 25140 - 114 Avenue, Acheson, Alberta.” In the second certification application filed on November 7, 2018 (Board File No. CR-05431), the Union applied for a bargaining unit comprised of “all drivers, including dependent contractors, and driver helpers working in and out of 25140 - 114 Avenue, Acheson, Alberta” [emphasis added]. [ 5 ] A report dated October 31, 2018, was prepared by the Labour Relations Officer.

Both Sysco and the Union objected to certain findings made by the Officer and the matters therefore proceeded to a hearing before the Board. [ 6 ] The Board was required to determine whether these particular truck drivers were “employees” of Sysco pursuant to the provisions of the Code and were therefore able to unionize.

These certification applications affected both drivers who were providing services to Sysco under Independent Cartage Agent [ICA] contracts (ie. owner-operators or contractors) and drivers who were subcontracted to, or employed by, an ICA. [ 7 ] The Board dismissed the second application which sought to include “driver helpers” as part of the bargaining unit.

That decision is not the subject of this judicial review application. [ 8 ] With respect to the Union’s first application, the Board ruled that all drivers who perform driving work for Sysco, including drivers who are employed by or subcontracted to ICAs (whether or not the ICA is a dependent contractor), are “dependent contractors” of Sysco within the meaning of section 1(1)(h.01) of the Code and therefore included as “employees” in the bargaining unit.

The Board also determined that certain specific individuals and entities were excluded from the bargaining unit for various reasons: they did not provide driving services to Sysco; they operated as common carriers; they performed work outside Alberta; or they were otherwise not dependent contractors. Further, the Board concluded that the bargaining unit to be certified was properly described as “all drivers of Sysco Edmonton Division.” [ 9 ] This judicial review application relates to the Board’s decision on this first certification application only [the Decision].

Sysco seeks to have the Decision quashed on the grounds that the Decision is unreasonable and that the Board breached the rules ofprocedural fairness. [10] Sysco filed its originating application for judicial review of the Decision on May 10, 2019. Pursuant to a Consent Ordergranted April 17, 2020, the Board was added as a Respondent to the proceedings. All parties filed extensive written briefs. Only Syscoand the Union made oral submissions at the hearing.

In its written submissions, the Board did not seek to defend the reasonableness ofits Decision, or address whether the Decision raised an issue of procedural fairness. Rather, it restricted its submissions to addressing theapplicable standard of review, reviewing recent changes to the Code and providing an overview of the Certified Record of Proceedings. III. Standard of Review [11] The parties all submit that the standard of review applicable to this matter is reasonableness, except with respect to any issuesof procedural fairness. I agree. A.

Reasonableness [12] In Canada (Minister of Immigration) v Vavilov, 2019 SCC 64 [Vavilov], the Supreme Court of Canada provided a revisedframework for determining the standard of review with respect to administrative decisions. [13] Where a Court reviews the merits of an administrative decision (other than a review related to a breach of natural justiceand/or the duty procedural fairness), the presumptive standard of review is now reasonableness: Vavilov at para 2. [14] The presumption that reasonableness is the applicable standard of review is rebuttable in two types of circumstances.

Thefirst is when the legislature has clearly indicated that a different standard should apply. This occurs when the legislature either explicitlyprescribes the appropriate standard of review, or when the legislature has provided for a statutory appeal provision from anadministrative decision maker to a Court, in which case appellate standards will apply when the Court reviews the decision: Vavilov atparas 17, 33. [15] The second circumstance when the reasonableness standard will be rebutted is when the rule of law requires that the standardof correctness be applied.

This will be the case when the decision under review raises constitutional questions, general questions of lawof central importance to the legal system as a whole and questions related to the jurisdictional boundaries between two or moreadministrative bodies: Vavilov at paras 17, 53. [16] As noted previously, this application was brought by Sysco pursuant to section 19(2) of the Code, which states as follows: (2) a decision, order, directive, declaration, ruling or proceeding of the Board, except a decision made under section 145(3), may bequestioned or reviewed by way of an application for judicial review seeking an order in the nature of certiorari or mandamus if theapplication is filed with the Court and served on the Board no later than 30 days after the date of the decision, order, directive,declaration, ruling or proceeding, or reasons in respect of it, whichever is later. [17] Section 19(2) of the Code does not contain a legislated standard of review or an appeal provision that rebuts the presumptionof reasonableness.

Nor does the Decision engage any issues that would attract a correctness standard of review. As such, the presumptivereasonableness standard applies to my review of the merits of the Decision. B.

Procedural Fairness [18] Sysco also argues that the Board did not comply with the rules of natural justice and procedural fairness by relying on certaincase authorities which were not raised during the hearing, and to which Sysco therefore had no opportunity to respond. [19] The typical standard of review analysis does not apply to the determination by this Court of whether or not the Boardcomplied with its duty to be fair.

Questions of procedural fairness are not measured by whether they are “correct” or “reasonable,” butrather “whether the proceedings met the level of fairness required by law”: Cenovus TL ULC v Alberta (Energy), 2019 ABQB 301 atparas 18-19. [20] That this approach has remained unchanged since Vavilov was recently confirmed by the Alberta Court of Appeal in Borgel vPaintearth (Subdivision and Development Appeal Board), 2020 ABCA 192 at para 11 where the Court noted: Issues of fairness and natural justice are reviewed, having regard to the context, to determine whether the appropriate level of “dueprocess” or “fairness” required by the statute or the common law has been afforded: Vavilov at para. 77.

The question is not whether thetribunal’s decision was correct but whether the procedure chosen was fair given all the circumstances: Baker v Canada (Minister ofCitizenship and Immigration), (SCC), [1999] 2 SCR 817 at para 21. IV. Conducting a Reasonableness Review [21] In both the written briefs, and during oral submissions, considerable time was spent by counsel summarizing the properapproach this Court should take when conducting a reasonableness review.

I commend counsel on their thoroughness, and also theclarity with which they were able to articulate the many significant principles outlined by the Supreme Court of Canada in Vavilov. [22] Although it is unnecessary for me to review all of those principles here, it is certainly clear that, when reviewing the Board’s

Decision, I must approach the process keeping in mind the following: • The party seeking judicial review, in this case Sysco, bears the onus of establishing that the Board’s Decision wasunreasonable: Vavilov at para 100. • Any shortcomings or flaws in the Board’s Decision must be sufficiently central or significant to the merits, as opposed tosuperficial or peripheral, to render the Decision unreasonable: Vavilov at para 100 • The starting point for a reasonableness review is judicial restraint and respects the distinct role of administrative decision-makers, their specialized expertise and the institutional setting in which they operate: Vavilov at para 288; • This Court must focus on the decision the Board actually made, including the justification offered for it, and not on theconclusion this Court would have reached: Vavilov at para 15.

The role of this Court is to review the Board’s decision, not to ask whatdecision it would have made instead, to ascertain the range of possible outcomes open to the decision-maker, to conduct a de novoanalysis, or to determine the “correct” solution to the problem: Vavilov at para 83; • This Court must begin by examining the Board’s reasons with “respectful attention” to attempt to understand the reasoningprocess followed by the Board: Vavilov at para 84.

The Board’s Decision must be read “holistically and contextually,” rather thanapproaching the review process as a “line-by-line treasure hunt for error”: Vavilov at paras 102,103; • This Court must ask whether the Board’s Decision bears the “hallmarks of reasonableness,” namely: justification,transparency, and intelligibility.

A reasonable decision is one which is based on an internally coherent and rational chain of analysis.The Decision must also be justified in relation to the particular facts and law which constrain the Board: Vavilov at paras 85, 90, 100;Canada Post Corp v Canadian Union of Postal Workers, 2019 SCC 67 , [2019] SCJ No. 67 at para 2; • The Decision will be unreasonable and this Court must intervene if: (1) the Decision, read holistically, fails to reveal arational chain of analysis; (2) the Decision was based on an irrational chain of analysis; (3) the conclusion reached by the Board cannotfollow from the analysis undertaken; (4) the Decision, read in conjunction with the Record, does not make it possible to understand theBoard’s reasoning on a critical point; or (5) the Decision exhibits clear logical fallacies such as circular reasoning, false dilemmas,unfounded generalizations or an absurd premise: Vavilov at paras 103-104.

V. Issues [23] The issues that have been identified by Sysco, and which this Court must address in assessing whether the Board’s Decisionwas unreasonable and/or procedurally unfair, are as follows: 1. Is the Board’s Decision procedurally unfair as the Board relied on case law that was not presented by the parties and uponwhich the parties were not given the opportunity to make submissions? 2. Is the Board’s Decision unreasonable because: a. The Board failed to properly consider and apply relevant Code exemptions and provisions; b.

The Board failed to properly apply the “dependent contractor” test to the facts of the case; and/or c. The Board unreasonably misapprehended relevant evidence? VI. Discussion 1. Is the Board’s Decision procedurally unfair as the Board relied on case law that was not presented bythe parties and upon which the parties were not given the opportunity to make submissions? [24] The issue of procedural fairness should be analyzed prior to determining whether the Board’s Decision meets the governingreasonableness standard.

This is because the existing jurisprudence has clearly confirmed that if this Court finds that there has been asubstantive breach of the duty of procedural fairness to the Applicant – which is more than a defect in form or a technical irregularity – itdoes not need to proceed further in speculating on how the administrative decision-maker could have proceeded if there was no breach:Métis Nation of Alberta Association Fort McMurray Local, 2016 ABQB 712 at paras 106-108, citing Edmonton Police Assn vEdmonton (City), 2007 ABCA 184 at para 9. [25] A breach or denial of the right to fair hearing by an administrative decision-maker “must always render” an administrativedecision invalid, regardless of whether the reviewing court is of the view that the administrative decision-maker would have reached thesame conclusion without the breach: Cardinal v Kent Institution, (SCC), [1985] 2 SCR 643 at para 23. [26] Sysco argues that the Board breached its duty to comply with the rules of natural justice and procedural fairness by relying oncase authorities which were not presented at the hearing, those being: Fownes Construction Co Ltd, (Re), [1974] BCLRBD No 81, 1974CarswellBC 641 [Fownes #1]; Fownes Construction Co, (Re), [1974] BCLRBD No 115, 1974 CarswellBC 524 [Fownes #2]; FownesConstruction Co (Re), [1974] BCLRBD No 131, 1974 CarswellBC 556 [Fownes #3], and West Fraser Mills Ltd v USW, Local 1-425(2012), 209 CLRBR (2d) 146, 2012 CarswellBC 1132 (BC LRB) [West Fraser].

Sysco argues the Board breached the audi alterampartem principle by deciding the case on a basis not raised by the parties and by failing to give the parties a reasonable opportunity toaddress case law and a line of argument that was relied upon by the Board, but not raised during the hearing.

[27] The Union’s position is that these cases were before the Board. The Fownes #1 decision is referred to in the case of SaputoInc (Re), 2017 CarswellNfld 383, [2017] NLLRB No 4, which was relied upon by the Union.

Further, West Fraser is discussed inCanada Bread Co, 2017 CarswellOnt 14584 at paras 118, 121, [2017] OLRB Rep 629, which the Union notes was one of the authoritiesrelied upon by Sysco at the hearing. [28] In any event, regardless of whether these cases were specifically referenced at the hearing before the Board, our Court ofAppeal has clearly stated that it is not improper for a decision-maker to refer to case law not provided by the parties provided that doingso does not raise any new issues not addressed by the parties: Grenon v Canada Revenue Agency,

(2017) ABCA 96 at para 41[Grenon]. This issue was addressed again more recently by Renke, J in Edmonton (City) Police Service v Alberta (Information andPrivacy Commissioner), 2020 ABQB 10 at para 172 [Edmonton Police Service], wherein he stated: A tribunal is not bound by the authorities cited by parties. By raising an issue, a party opens the door to the existing jurisprudencegoverning that issue. Put another way, a tribunal is not constrained by the parties’ legal research.

Tribunal (and judicial) economyextends latitude to decide based on the law rather than on the specific authorities invoked by the parties: Grenon v Canada RevenueAgency, 2017 ABCA 96 at para 41. I agree with the IPC that an adjudicator is not obligated “to update or request submissions from theparties on every aspect of the Adjudicator’s reasoning process, including references to case law:” […]. [29] Sysco does not seem to be arguing that these cases raised a new issue, but rather that the cases were of limited application tothe circumstances of this case and were easily distinguishable.

In my view, this is exactly the situation contemplated in both Grenon andEdmonton Police Service and the Board did nothing improper by considering these additional authorities. [30] However, if I am incorrect in my

interpretation of Sysco’s submissions and Sysco is suggesting that these cases raise a newissue that was not argued at the hearing or previously raised by either party, then I do not accept that argument. [31] The concept of what constitutes a new issue was discussed in R v Mian, 2014 SCC 54 , [2014] 2 SCR 689 at para 30[Mian], where the Supreme Court of Canada stated: […] Genuinely new issues are legally and factually distinct from the grounds of appeal raised by the parties (see Quan v.

Cusson, 2009SCC 62, [2009] 3 S.C.R. 712, at para. 39) and cannot reasonably be said to stem from the issues as framed by the parties.

It follows fromthis definition that a new issue will require notifying the parties in advance so that they are able to address it adequately. [32] It is also clear that issues which are rooted in, or components of, an existing issue are also not “new issues”: Mian at para 33. [33] The West Fraser and Fownes #1, #2 and #3 decisions dealt with the issue of how to assess whether an owner-operator is a“dependent contractor.” The characterization of the ICA – employee driver relationship, and whether that relationship fell outside thescope of the definition of “employee” under the Code (if the ICAs were not dependent contractors), was clearly one of the central issuesraised at the hearing (Decision at para 9) that had to be addressed by the Board.

The Board’s reliance on these cases did not result in itembarking on an inquiry into a new issue that was legally and/or factually distinct from the issues raised by each of the parties. [34] I therefore reject Sysco’s argument and find that the Board made no error in relying upon these additional case authorities.The Board did not breach its duty to comply with the rules of natural justice and procedural fairness in doing so. 2. Is the Board’s Decision unreasonable because: a. The Board failed to properly consider and apply relevant Code exemptions and provisions; b.

The Board failed to properly apply the “dependent contractor” test to the facts of the case; and/or c. The Board unreasonably misapprehended relevant evidence? [35] Sysco argues that the Board’s Decision is unreasonable, both in its reasoning process (which it submits was incoherent andirrational) and in its outcome. Sysco submits that the Board failed to properly apply relevant statutory provisions and well-establishedlegal tests and committed factual errors.

As a result, Sysco suggests that the conclusion reached by the Board was unreasonable andunfair and must be quashed. [36] The statutory provisions relevant to this application for judicial review are found primarily in the definition

section of theCode. That

section defines the terms “employee” and “dependent contractor” as follows: 1(1) In this Act, (h.01) “dependent contractor” means a person, whether or not employed under a contract of employment, and whether or not furnishingtools, vehicles, equipment, machinery, material or any other thing owned by the dependent contractor, who performs work or services foranother person for compensation or reward on such terms and conditions that the dependent contractor is in a position of economicdependence on, and under an obligation to perform duties for, that person which more closely resembles the relationship of an employeethan that of an independent contractor; (l) “employee” means a person employed to do work who is in receipt of or entitled to wages and includes a dependent contractor, butdoes not include (

i) a person who in the opinion of the Board performs managerial functions or is employed in a confidential capacity in matters relatingto labour relations, (ii) a person who is a member of the medical, dental, architectural, engineering or legal profession qualified to practise under the laws of

Alberta and is employed in the person’s professional capacity, or (iii) repealed 2020 c28 s11(3) , (iv) a person employed on a farming or ranching operation as determined under subsection (2) whose employment is directly related to the farming or ranching operation; [ 37 ] Sections 12(2)(

a) and (

b) further provide that the Board has the authority to decide whether a person is an employer, or an employee, for the purposes of the Code . [ 38 ] Sysco has identified several areas where it believes the reasoning of the Board was not logical or sound, or where Sysco submits the Board failed to even engage in the appropriate legal analysis that was required in respect of the issues before it for determination. However, there is much overlap amongst these areas, in terms of the relevant sections of the Code , case law and the analysis conducted by the Board.

Therefore, although I will outline each of the areas of concern raised by Sysco separately, in the end, I am required to consider the Board’s Decision holistically and can only interfere if I determine that a significant error has been established by Sysco: Vavilov at paras 91-97 ; Newfoundland and Labrador Nurses' Union v. Newfoundland and Labrador (Treasury Board) , 2011 SCC 62 at paras 14-16 . a. Did the Board fail to properly consider and apply relevant Code exemptions and provisions? i. Managerial Functions Exemption [ 39 ]

Section 1 (l)(l)(

i) of the Code provides that an employee or dependent contractor who, in the opinion of the Board, “performs managerial functions or is employed in a confidential capacity in matters relating to labour relations” must be excluded from the bargaining unit. Sysco submits that the Board misinterpreted and failed to properly apply this “managerial functions” exemption. [ 40 ] Sysco argues that there were a number of drivers in the proposed bargaining unit that did perform “managerial functions” and should therefore be excluded from the definition of “employee” under the Code .

Sysco suggests that the Board addressed this key argument in just a single paragraph of its Decision.

Sysco therefore argues that there is no indication that the Board meaningfully grappled with this argument or with any of the facts put forward by Sysco to support its position, or that the Board actually considered any of the factors relevant to the determination of whether the ICAs performed managerial functions, such that the exemption would be triggered. [ 41 ] Further, while Sysco is prepared to concede that there is some overlap between the dependent contractor provisions in the Code and the managerial functions exemption, Sysco argues that the “managerial functions” exemption was not just a “fringe” argument and that the Board was required to address this issue separately, and meaningfully. [ 42 ] Finally, Sysco takes issue with the Board’s narrow

interpretation of the “managerial functions” exemption. Specifically, in paragraph 104 of its Decision, the Board states: In our view, the subsection must be read in the context of the bargaining unit under consideration. The question is do the ICAs perform managerial functions or are they engaged in a confidential capacity in matters related to labour relations in the proposed bargaining unit ?

If so, a conflict of interest arises between the role of the ICA and other members of the bargaining unit [emphasis added]. [ 43 ] Sysco suggests this conclusion by the Board is unreasonable and is inconsistent with well-established case law. Further, Sysco argues that this statement does not accurately reflect the actual impact of the Board’s Decision in practical terms, which results in a number of ICAs being in the same bargaining unit as their subcontracted drivers.

Sysco submits this is unreasonable from a labour relations perspective and cannot have been the legislature’s intent. [ 44 ] The Union argues that Sysco is asking this Court to engage in exactly the sort of “line-by-line treasure hunt for error” that the Supreme Court of Canada has cautioned against.

The Union submits that when the Decision is read as a whole, it is clear that the Board did grapple with this issue and that the Board’s reasoning process was transparent and demonstrates a logical, rational justification for the conclusion reached. [ 45 ] The issues for this Court to decide, stated simply, are whether the Board did address Sysco’s argument relating to the “managerial functions” exemption in its Decision, and if it did, whether the Board’s Decision was based on an internally coherent and rational chain of analysis and falls within the range of possible, acceptable outcomes defensible in respect of the facts and law: Vavilov at paras 85-86 . [ 46 ] I am of the view that, when the Decision is viewed holistically, the framework for the Board’s subsequent analysis of the issues is readily identified, and its reasoning process is transparent and logical.

I am mindful of the caution given by the Supreme Court of Canada ( Vavilov at para 91 ) that the Board’s written reasons must not be assessed against a standard of perfection and need not include reference to every argument, statutory provision, jurisprudence and other detail.

In trying to understand the Board’s reasoning process, I can also look to such things as the evidence that was before the Board, the submissions of the parties, publicly available policies or guidelines and past decisions of the Board ( Vavilov at para 94 ). [ 47 ] The complexity and length of this hearing was acknowledged by the Board in its Decision (para 11).

Although the parties were able to streamline the process by agreeing to the introduction of documents and exhibits entered during testimony, and also agreeing to provide the Board with evidence from a sample of drivers as agreed test cases, it was still a multiple day hearing with numerous issues. [ 48 ] At paragraph 9 of its Decision, the Board summarized Sysco’s seven objections to the report that had been prepared by the Labour Relations Officer. Two of those objections were noted by the Board to be the following:

• persons identified in the Officer’s Report as employees are not employees, but are independent contractors. The Union has the onus of proving the individuals are dependent contractors; • a number of persons identified as employees are employers of drivers and/or helpers and perform managerial functions, therefore excluding them from the definition of employee under section (1)(1)(l)(

i) of the Code . [ 49 ] At paragraph 83 of the Decision, the Board outlined the seven questions it intended to address. I agree with the Union that the questions as articulated by the Board “meaningfully account” for the central issues and concerns raised by both parties. The issues were also identified in a meaningful order, as the determination of the first few issues would necessarily impact the Board’s decision on the remaining issues. [ 50 ] Although none of the issues identified by the Board specifically reference Sysco’s concern relating to the application of the “managerial functions” exemption contained in section 1(1) (l)(

i) of the Code , it is also apparent from a holistic reading of the Decision that the Board chose instead to address this issue during its discussion of questions (2) and (4), which the Board phrased as follows:

(2) Can ICAs who employ or contract drivers or helpers be considered “employees” under the Code ?

(4) Are ICAs and other drivers “dependent contractors” under the Code ? [ 51 ] As noted by the Union, a significant portion of the Decision reviews the sometimes conflicting jurisprudence from other labour relations boards concerning the issue of the “managerial exclusion” in the context of dependent contractors.

The Board reviewed and relied on lengthy quotes from several cases decided by courts as well as those labour relations boards from various jurisdictions including: SFL v Saskatchewan , 2015 SCC 4 , [2015] 1 SCR 245 (Decision at para 90); Fownes #2 (Decision at para 92); Fownes #3 (Decision at para 93); Mount Nemo Truckers Assn v Canada Crushed Stone , [1977] OLRB Rep 806, 1977 CarswellOnt 964 (Ont LRB) (Decision at para 96 ) ; Brookville Transport Ltd v CBRT & GW (1991), 15 CLRBR (2d) 128, 1991 CarswellNat 1075 (Can LRB) [ Brookville ] (Decision at para 98), and Teamsters, Local Union 987 of Alberta v 331001 Alberta Ltd , [2011] Alta LRBR 76, 2011 CarswellAlta 169 (Alta LRB) [ Barrel Taxi ] (Decision at para 99). [ 52 ] The fact that the Board clearly considered the “managerial functions” exemption in arriving at its conclusion is particularly evident from its reference and reliance, in its Decision at para 92, on the following quote from Fownes #2 at para 11: The more difficult question is whether an individual, having been found to be a dependent contractor, should appropriately be included in the same bargaining unit as his employee.

On the surface, that would seem to produce the kind of conflict of interest which the Code tries to prevent by such provisions as the managerial exclusion from the definition of “employee” .

However, we are now inclined to the view that this is largely a hypothetical concern in the real world of the construction industry… [emphasis added]. [ 53 ] It is also clear from the Board’s extensive review of these various decisions that there was significant attention and consideration given to the legal issue of whether an owner-operator who is nominally an employer can still be considered a “dependent contractor” and included in the same bargaining unit as the driver he or she nominally employs.

The Board, after analyzing the conflicting jurisprudence, ultimately determined that each case would necessarily involve a factual investigation to determine whether the independent contractor was really an “employer” in substance, not just form.

This conclusion was stated by the Board, in its Decision at para 100, as follows: Overall, we conclude the question as to whether owner-operators who employ or sub-contract helpers and/or drivers can be included in the definition of “dependent contractors” depends on the context in which the helper and/or the driver are engaged by the owner-operator and the nature of their relationship with the purported employer. [ 54 ] I am of the view that the Board was clearly alive to the issue of the “managerial exemption” provision in the Code and the fact that the Board did not identify this as a discrete issue to be addressed is not fatal.

It was incumbent upon the Board, in its Decision, to address this argument in a meaningful and transparent way and I find that it did so. I am also of the view that the reasoning process adopted by the Board was very thorough, logical and transparent, and that the conclusions reached by the Board on these issues were certainly within the range of possible outcomes available to the Board and therefore, should not be interfered with by this Court. ii.

Sections 148 and 149 of the Code [ 55 ] Sysco submits that a proper consideration by the Board of sections 148 and 149 of the Code , which prohibit employer participation in, or interference with, the organizing of a bargaining unit for union certification, would have resulted in the Board reaching a different conclusion. Sysco argues that the Board did not adequately consider its argument concerning employer interference and undue influence if the ICAs and their employees are both permitted to be in the same bargaining unit. [ 56 ] Further, Sysco’s contention is that the narrow

interpretation of the “managerial functions” exemption adopted by the Board, which I have previously referenced, is not supported by these Code provisions and that the proper application of these Code provisions would have led the Board to reasonably conclude that the ICAs at issue in this case were “employers” and therefore should not be involved in the same bargaining unit as their employees. [ 57 ] Section 148(1) of the Code states: 148(1) no employer or employers’ organization and no person acting on behalf of an employer or employers’ organization shall (

a) participate in or interfere with (

i) the formation or administration of a trade union, or (ii) the representation of employees by a trade union, or

(

b) contribute financial or other support to a trade union. [ 58 ]

Section 149 of the Code also prohibits an employer from interfering with bargaining unit activities through a number of other means including, but not limited to: prohibiting employers from discriminating against a person for being a member in a bargaining unit (s 149(1)(a)); imposing any condition that restrains an employee from exercising their rights under the Code (s 149(1)(b)); or intimidating or threatening employees to prevent them from becoming a member, officer or representative of a trade union (s 149(1)(c)). [ 59 ] Sysco argues that one of the purposes of these provisions is to prevent employers from potentially influencing employees in a manner that impacts the union or the success of the bargaining unit.

Sysco suggests that allowing individuals who wear two hats (ie. who are “employees” for the purposes of collective bargaining but also “employers” of other individuals in the bargaining unit) inherently violates this protection. Sysco called no evidence of actual employer interference and undue influence at the hearing and so its argument was based solely on context. [ 60 ] There is considerable overlap between Sysco’s argument in relation to these particular sections of the Code and Sysco’s objections to the Board’s approach to the “managerial functions” exemption as previously discussed.

Sysco suggests that the restrictions in sections 148 and 149 of the Code make it clear that an “employer” should not be involved in the bargaining unit and that the restrictions in these sections reinforce the objective of the “managerial functions” exemption, which is to maintain this arm’s length relationship between the employer and bargaining unit [ 61 ] The Board dealt with this argument briefly, in its Decision at para 160, under the heading – “Is there evidence of support for the certification application?”: Sysco argued the support evidence is tainted by having been obtained, at least in part, as a result of improper employer influence, contrary to sections 148 and 149 of the Code .

The suggestion is drivers, other than ICAs, were improperly influenced by their ICAs. As we have found all the drivers, including ICAs, are dependent contractors, the interference argument cannot be sustained. [ 62 ] In other words, the Board concluded that this objection was not applicable as it had already determined that the ICAs were not “employers” in substance.

Rather, the Board was of the view that all of the drivers (including those who were employees or sub- contractors of ICAs) were in a position of economic dependence on Sysco, more closely resembling the relationship of an employee rather than an independent contractor. The ICAs and their employee drivers were properly characterized as “employees” of Sysco. Therefore, the protections of sections 148 and 149 were directed against interference or influence by Sysco, not the ICAs. [ 63 ] I see no basis upon which I should interfere with this conclusion by the Board.

The analysis and reasoning process undertaken by the Board in reaching this conclusion was thorough, intelligible and transparent. The Board’s Decision satisfactorily outlined the key documents and evidence that was before it, including the viva voce evidence of various witnesses. The Board properly identified the central issues it had to address; and the Board proceeded upon its analysis in a logical manner and clearly articulated the legal and factual basis for the conclusions it reached. I find that the Board’s determination that the drivers in question were not “employers” is justifiable.

Therefore, based on the Board’s determination that the drivers, including ICAs were “employees,” rather than “employers,” its subsequent conclusion that sections 148 and 149 of the Code were inapplicable in this circumstance, is also logical and supportable. b. Did the Board fail to properly apply the “dependent contractor” test? [ 64 ] Sysco argues that in determining that ICAs were dependent contractors, the Board failed to reasonably consider whether ICAs employing drivers are “entrepreneurial” and therefore qualify as independent contractors and are not subject to certification.

Sysco submits that the only logical reason for the ICAs to hire drivers and helpers would be to increase the ICAs revenue and efficiency, with a view to increasing profit. [ 65 ] Sysco contends that the Board erred by focusing on the fact that some of the ICAs did not take up the opportunity to advertise and promote their business or to seek driving opportunities with companies other than Sysco.

Sysco argues that it is the fact that the ICAs had the choice and opportunity to do so that ought to have driven the Board’s analysis. [ 66 ] However, it is apparent from the Decision that the Board, in its Decision at para 94, referenced the “dependent contractor” test as recognized and outlined in West Fraser , acknowledging, inter alia , that: […] the Board has collapsed those ten factors [of the test] under four general headings: 1) factors one to three establish the contextual framework in which to consider the application; 2) factors four, five and six pertain to the level of control exercised by the company over the putative dependent contractor; 3) factors seven and eight relate to the character of any economic dependence between the company and the putative dependent contractor; and 4) factors nine and ten are relevant to the level of entrepreneurial initiative …. [ 67 ] Further, I observe from my review of the Board’s Decision that the administrative decision-maker most certainly did consider evidence of the level of entrepreneurial initiative of the individuals who were ultimately included in the bargaining unit.

The Board’s comments and conclusions in relation to this issue include the following: • The Board found there was no evidence drivers advertise their businesses, have business cards, solicit clients, or undertake normal entrepreneurial activities to promote their business (para 114); • the Board concluded that the option for ICAs and their drivers to work for other customers was illusory given the long hours required by Sysco and the physical toll of this work (paras 22, 116); • the Board found that routes are established by Sysco; except for a few exceptions, drivers have no real ability to pick and choose their work, either in terms of their daily routes or when they will work; the weight of the products delivered per shift, along with mileage, are the main factors in determining income and therefore working more efficiently (i.e. getting the route completed sooner) does not necessarily translate into more income (paras 25-26, 120, 128);

• the Board noted that Sysco even maintains a degree of control over the type of vehicle that the driver had to purchase, when it had to be replaced (para 117) and requires that Sysco be allowed to install its company insignia on the vehicle (para 118). [ 68 ] I therefore do not accept that the Board failed to reasonably apply this “entrepreneurial” factor to its dependent contractor analysis as alleged by Sysco.

Instead, I agree with the Union that Sysco’s real complaint is that it disagrees with the weight applied by the Board to this particular factor in its overall analysis. [ 69 ] The factors relating to level of entrepreneurial initiative are only a part of the analysis required by the Board. There is nothing in the Code to suggest this factor is to be given undue weight. In any event, absent exceptional circumstances, a reviewing Court must not interfere with the factual findings of the administrative decision-maker: Vavilov at para 125 .

I find that no such exceptional circumstances exist in this case and therefore, I must refrain from “reweighing and reassessing” the evidence that was before the Board: Vavilov at para 125 . c. Did the Board make significant factual errors and/or inconsistent factual findings? [ 70 ] Sysco argues that the Decision contains “numerous” factual errors and inconsistencies which results in it being unreasonable. [ 71 ] First, Sysco takes issue with the conclusion reached by the Board in paragraph 120 of the Decision.

Sysco submits that the Board concluded that “more efficient work does not necessarily translate into more income for the ICAs.” Sysco suggests this conclusion is “illogical” as, if there was no increased efficiency or financial benefit to having additional drivers or helpers, ICAs would not bother to go through the trouble of hiring their own employees and subcontractors in the first place. [ 72 ] I do not agree either with Sysco’s characterization of the conclusion reached by the Board or with its suggestion that the Board’s conclusion was not logical. [ 73 ] Paragraph 120 of the Decision actually reads as follows: As expressed by various witnesses, the main way for drivers to earn more money is to work longer hours with a helper.

Weight of the products delivered per shift, along with mileage, are the main factors in determining income. As is typical in any work environment, some drivers work in a more efficient manner than others and are able to spend less time at work delivering similar volumes of goods. More efficient work, however, does not translate into more income unless additional runs are picked up by the driver [emphasis added]. [ 74 ] Paragraph 120 was included in the portion of the Decision where the Board was addressing the question of whether ICAs and other drivers were “dependent contractors” under the Code .

More specifically, this statement was made in the context of the Board’s analysis of the ability of the ICAs to demonstrate “entrepreneurial initiative” and exercise independent judgment.

The Board was simply restating its prior finding that, given the restrictions imposed on drivers by Sysco in relation to such things as the setting of routes and method of compensation, even if a driver finished his specific route more quickly, he would not earn more income. [ 75 ] As well, the Board did recognize and acknowledge (at para 122) that drivers with multiple trucks have some opportunity to earn income off the labour of others.

Even in its comments at paragraph 120, the Board noted that working more efficiently may not increase income “unless additional runs are picked up by the driver.” It is therefore apparent from the Decision that this was a factor taken into account by the Board; however, it appears to have been determined by the Board to be an insufficient basis upon which to conclude that the drivers were independent contractors.

This was certainly a finding that was open to the Board to make and I do not accept that it was illogical. [ 76 ] Second, Sysco submits that the Board was inconsistent in its application of the characteristics of “independence.” In support of this, Sysco points to the conclusion reached by the Board with respect to one of the ICAs in particular, Mr. Jack Hum.

The Board acknowledged that the Hum group operated four vehicles and had a full-time and part-time driver (para 141); took steps to control costs (para 21); had an opportunity to earn income off the labour of their drivers (para 122); and allowed drivers to arrange regular days off during the week (para 126). Sysco argues that the Board’s conclusion that Mr.

Hum and the Hum group were dependent contractors and should be included in the bargaining unit was unreasonable in light of this obvious evidence of independence. [ 77 ] It is clear that the Board was well aware of the basis for Sysco’s objection to the inclusion of the Hum group in the bargaining unit. The Board provided details regarding Mr. Hum’s specific circumstances in paragraphs 55 – 60 of its Decision.

It then responded to Sysco’s argument in paragraph 141 of the Decision, which states, in part: Sysco urged the Board to determine the Hum group operates a business and is not a dependent contractor as it operates four vehicles and engages a driver for one vehicle and a part-time driver for one day per week. We find, however, the drivers are all operating under the same basic conditions and are dependent on Sysco. The sub-contract drivers are paid based on a percentage of gross earnings from their tractors or trucks, and under the same control and direction of Sysco as the ICAs. [….].

We find the addition of one extra truck in this fleet operated by a sub-contracting driver and the use of a substitute driver on Wednesdays is not sufficient to establish the Hum group as an independent contractor. [ 78 ] The issue in this judicial review application is not whether I would have reached the same conclusion regarding Mr. Hum as the Board did. I must restrict my focus to the decision actually made by the Board and the justification provided for the decision.

Even if I were to find any flaw or error in the Board’s decision or reasoning, it must be “sufficiently central or significant to the merits” to render the Decision unreasonable: Vavilov at para 100 . [ 79 ] It is apparent from the Board’s Decision that Mr. Hum’s particular circumstances were fully canvassed and carefully considered. The considered factors that ultimately led to the Board concluding that Mr. Hum and the Hum group could be part of the bargaining unit were clearly identified. The Board’s reasoning process is transparent and involved a weighing of various facts.

Once again, there are no exceptional circumstances that would justify having this Court step in to reweigh or reassess the evidence that was considered by the Board.

[ 80 ] I therefore do not accept Sysco’s suggestion that the Board’s finding in relation to Mr. Hum demonstrated an inconsistency in its application of the characteristics of independence to its determination of whether certain drivers could properly be characterized as “dependent contractors.” VII. Overall Conclusion [ 81 ] This was a complex decision made by a Board familiar with this specialized area of law.

The Board was careful to outline the evidentiary basis that supported its findings of fact and the legal basis that provided the framework for its analysis of the issues in dispute. [ 82 ] Read holistically and contextually, the Board’s Decision demonstrates a rational chain of analysis. The conclusions reached are within the range of possible outcomes that were reasonably available to the Board. I find that Sysco has not met its onus of demonstrating that the Board’s Decision was unreasonable. [ 83 ] The application for judicial review is therefore dismissed. The Union is entitled to costs.

Heard on the 22 nd day of April, 2021. Dated at the City of Edmonton, Alberta this 11 th day of June, 2021. D.J. Kiss J.C.Q.B.A. Appearances: Frank Cesario and Amanda Cohen Hicks Morley Hamilton Stewart Storie LLP for the Applicant, Sysco Canada, Inc. Clayton H. Cook McGowen Cook for the Respondent, Teamsters Local Union No. 987 of Alberta Terri Susan Zurbrigg for the Respondent, Alberta Labour Relations Board