Muskrat Falls Employers' Association Inc. Applicant And: Resource Development Trades Council of Newfoundland v. Labrador, 2021 NLSC 172

court crest IN THE SUPREME COURT OF NEWFOUNDLAND AND LABRADOR GENERAL DIVISION Citation : Muskrat Falls Employers' Association Inc. v. Resource Development Trades Council of Newfoundland and Labrador , 2021 NLSC 172 Date : December 16, 2021 Docket : 202101G0960 Between: Muskrat Falls Employers' Association Inc. Applicant And: Resource Development Trades Council of Newfoundland and Labrador Respondent Before: Justice Vikas Khaladkar On Judicial Review From: An Arbitration Decision of Wayne Thistle, Q.C., File # 1105 dated the 4th day of January, 2021. Place of Hearing: St. John’s, Newfoundland and Labrador Date of Hearing: November 19, 2021

Summary: The Arbitrator’s award followed a logical, reasoned chain of analysis. As such, there was no basis for setting aside his findings or his award. The Application was dismissed with costs to the Respondent.

Appearances: Stephanie M. Sheppard Appearing on behalf of the Applicant Michael S. Gillingham Appearing on behalf of the Respondent Authorities Cited: CASES CONSIDERED: Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65; Blouin Drywall Contractors Ltd.v. C.J.A. Local 2486 (1975), (ON CA), 57 D.L.R. (3d) 199, 8 O.R. (2d) 103 (C.A.); ExxonMobil Canada Properties v.Hebron Project Employers’ Assn. Inc., 2017 NLCA 28 STATUTES CONSIDERED: Labour Relations Act, R.S.N.L. 1990, c.

L-1 REASONS FOR JUDGMENT Khaladkar, J.: INTRODUCTION [1] The Applicant, Muskrat Falls Employers’ Association (the “Association”) is an employers’ organization within the meaning ofthe Labour Relations Act, R.S.N.L. 1990, c. L-1 (the “Act”).

It acts for and on behalf of all contractors and subcontractors engaged in theconstruction of hydroelectric generating installations and related facilities at the Muskrat Falls Hydroelectric Generation Project (the“Site”). [2] The Respondent, Resource Development Trades Council of Newfoundland and Labrador (the “Council”) is a council of tradeunions within the meaning of the Act.

It acts on behalf of all affiliated unions that represent employees employed by contractors andsubcontractors on the Site. [3] The construction work on the Site is subject to the Collective Agreement between the Association and the Council datedMarch 14, 2013. It applies to the construction of hydroelectric generating installations and related facilities at the Site, and is declared tobe a special project pursuant to

Section 70 of the Act. [4] This Application for a judicial review concerns a grievance filed by Brandon Hennessey (“Hennessey”) who had beenemployed as a service attendant by Labrador Catering Limited Partnership (“Labrador Catering”) to provide housekeeping, catering andjanitorial services in the accommodations complex on the Site. [5] Hennessey was hired in 2014 by Labrador Catering. At that time he was a resident of Labrador. A year later Hennesseypurchased a house in St. John’s and commenced to reside in that City. Labrador Catering was aware of his move and flew Hennessey toand from the Site and St.

John’s to fulfill his rotational shift duties. [6] About 18 months later Hennessey relocated to Happy Valley-Goose Bay. His work

schedule remained the same and LabradorCatering was aware of his move. [7] About a year later Hennessey again moved to St. John’s. His

schedule remained the same. Labrador Catering continued to payfor his travel to and from the Site. [8] In March, 2019 Hennessey’s fiancé took a job in Nova Scotia. The Arbitrator found that Hennessey spent about 75% of histime away from the Site in Nova Scotia and about 25% in St. John’s. Labrador Catering and a representative of Nalcor Energy(“Nalcor”) were advised by Hennessey of his need to rotate for his work

schedule from Halifax instead of St. John’s. None of theseparties objected to these changed circumstances on account of Hennessey’s change of residential status. He continued to work on Siteand rotated from Halifax until the COVID-19 Pandemic caused a shutdown of the operations of Labrador Catering in March, 2020. Atthat time Hennessey was issued a temporary layoff notice. He was recalled to work in July, 2020 – at which time he completed a two-week shift at the Site. [9] On August 3, 2020 Labrador Catering issued a Workforce Request Form for a service attendant.

Hennessey was referred onAugust 4, 2020 but, by that time, Nalcor had banned him from the Site on account of his being a resident of Nova Scotia. [10] The Collective Agreement between the Association and the Council stipulates that hiring is to be conducted in the following

manner: i. Qualified Labrador Innu; ii. Qualified Residents of Labrador who are members of the Council; iii. Qualified residents of Labrador; iv. Qualified residents of the island of Newfoundland who are resident members of the Council; and v. Qualified residents of the island of Newfoundland. [ 11 ] The Arbitrator ruled that there was no substantial evidence before him to allow the conclusion that Hennessey was a resident of Nova Scotia. APPLICANT ARGUES [ 12 ] The Association has raised three issues in its Application for judicial review: 1.

The Arbitrator erred in his application of the issue of estoppel because he found that the Association was estopped as a result of the conduct and/or representations of non-parties to the Collective Agreement; 2. The Applicant impugns the Arbitrator’s findings with respect to Hennessey’s residency and says that his reasons and findings are unreasonable; and 3. The Applicant says that the Arbitrator’s reasons are unreasonable and internally inconsistent with respect to Hennessey’s residence.

RESPONDENT ARGUES [ 13 ] Labrador Catering, as Hennessey’s employer, had the exclusive right to make decisions concerning hiring and firing under

Article 5.02 of the Collective Agreement. [ 14 ] Labrador Catering and Nalcor are both members of the Association. Both entities approved Hennessey’s relocation in 2019. The Arbitrator identified the facts and legal principles and applied the principles to the facts. The Arbitrator was justified in not accepting the Association’s assertion that Hennessey was a resident of Nova Scotia. [ 15 ] Site access is a labour relations issue. Nalcor is bound by the Arbitrator’s ruling. The dispute was properly resolved within the parameters of the grievance process.

ANALYSIS [ 16 ] As a result of the Supreme Court of Canada’s restating of the law relating to judicial reviews in Canada (Minister of Citizenship and Immigration) v. Vavilov , 2019 SCC 65 , there is a presumption that reasonableness is the appropriate standard in all cases.

Derogation from that standard is permissible where there is clear legislative intent through a prescribed alternative standard of review or where there is a statutory right of appeal to a Court from the decision of an administrative body (in which case appellate standards of review will apply). [ 17 ] Derogation from the reasonableness standard is also permissible where the subject matter concerns the rule of law, namely: constitutional questions, questions of law of central importance to the legal system as a whole, and questions relating to the jurisdictional boundaries between two or more administrative bodies.

In these cases the standard of correctness must be applied. [ 18 ] It was common ground between the parties, and I agree, that the standard of reasonableness is the appropriate standard to apply to the Arbitrator’s decision. [ 19 ] In conducting a judicial review of the Arbitrator’s decision I am constrained by the decision that he made, including his reasons for making it. I am not allowed to substitute my own decision based upon my assessment of the facts.

To do so would be an error. [ 20 ] Furthermore, as instructed by Vavilov at paragraphs 91-98 , the Arbitrator’s decision is not to be assessed against a standard of perfection. I am to read the reasons in light of the record and with sensitivity to the administrative setting in which the decision was made. [ 21 ] The burden is on the Applicant to show that the decision is unreasonable. It is incumbent upon the Applicant to show that there are sufficiently serious shortcomings in the decision sufficient to render it unjustifiable, unintelligible and opaque. Minor missteps are permissible.

Flaws must be so significant as to render the decision unreasonable. See Vavilov , paragraph 100 . [ 22 ] The Supreme Court of Canada instructed, in Vavilov , at paragraphs 102-103 , that a decision will be unreasonable where the conclusion reached cannot follow from the analysis undertaken or if the reasons, read in conjunction with the record, do not make it possible to understand the decision maker’s reasoning on a critical point.

THE ARBITRATOR’S DECISION [ 23 ] The Arbitrator defined the scope of his jurisdiction as follows at page 9 of his decision: I accept the line of arbitral and judicial authority which holds that grievances are not to be construed narrowly, but rather given a liberal

interpretation. The objective, in construing a grievance, is to identify the disagreement between the parties and to see the merits of that

disagreement addressed. [24] The Arbitrator cited Blouin Drywall Contractors Ltd. v. C.J.A. Local 2486 (1975), (ON CA), 57 D.L.R. (3d)199, 8 O.R. (2d) 103 (C.A.) as authority for the proposition concerning the liberal construction of grievances. [25] The Arbitrator found that Hennessey was prevented from attending work at the Site because he was banned from the Site byNalcor. He found that the revocation of Site access resulted in Hennessey’s loss of employment. [26] The Arbitrator noted that

Article 5.02 of the Collective Agreement entrusts Labrador Catering with the exclusive functions ofhiring, transferring, assigning work, monitoring and managing productivity, promoting, demoting, laying off, disciplining anddischarging employees for just cause or to increase and decrease the workforce as required. [27] The Arbitrator found that there was no just cause for dismissing Hennessey in this case.

He held that it was incumbent onLabrador Catering to show that there was support in the Collective Agreement for the loss of Hennessey’s employment. [28] The Arbitrator found that in February, 2019 Hennessey sought assurance from Labrador Catering that a proposed move toNova Scotia would not result in the loss of his employment. A representative of Nalcor, Leslie Noel, who dealt with point of hirechanges was also notified.

The Arbitrator found that no objection was made to Hennessey’s proposed move and, in fact, that he began torotate from Halifax in March, 2019 and continued to do so until the Site was shut down in March, 2020 on account of the COVID-19outbreak – when he, and a number of other workers, were issued “temporary” layoff notices. During this period Hennessey spent 75% ofhis turnarounds in Nova Scotia and 25% in Newfoundland. [29] The Arbitrator held that the principle of equitable estoppel applied in this case.

He explained the principle as being a situationwhere one party has, by his words, made to the other a promise or assurance which was intended to affect the legal relations betweenthem, and the second party has acted upon that promise or assurance, the party who made the promise or gave the assurance cannot,afterwards, be allowed to revert to the previous legal relations as if no such promise or assurance had been made. [30] The Arbitrator found that the evidence of the exchange between Hennessey, Labrador Catering and Nalcor’s representative wasundisputed.

Hennessey acted upon the promises made to him and began to use Halifax as his hub for turnarounds. He did so for an entireyear without objection from Labrador Catering or Nalcor. [31] Hennessey’s last day of work on account of the COVID-19 Pandemic was found to be March 17, 2020. Hennessey returned tothe Site in July, 2020 from Halifax. He completed a full rotation before returning to Halifax. [32] On August 4, 2020 Nalcor revoked Hennessey’s Site access.

As a result, he was unable to return to work. [33] The Arbitrator referred to the decision of Chief Justice Green (as he then was) in ExxonMobil Canada Properties v. HebronProject Employers’ Assn. Inc., 2017 NLCA 28. The Arbitrator acknowledged that the case stands for the proposition that the owner issubject to the rights flowing out of the labour relations regime mandated by the special projects order as declared by the Arbitrator.

Asstated by Chief Justice Green at paragraph 112: … Otherwise, ExxonMobil would have an override on all labour relations matters simply by arbitrarily exercising a purported unfetteredability, based on a naked assertion of property rights, to deny access to the site.

Such a conclusion is entirely at odds with the legislativeintent. [34] The Arbitrator held that the issue of Site access had a profound impact on a labour relations issue – whether or not Hennessey’semployment could be continued by the employer. [35] The Arbitrator ruled that if there was a successful challenge to his decision to reinstate Site access, then Hennessey should stillbe compensated for the loss of his employment – with the financial consequences to be sorted out between Nalcor and LabradorCatering. [36] The Arbitrator held that there was little evidence concerning whether or not Hennessey was a resident of the island ofNewfoundland or the Province of Nova Scotia.

At the time of his initial hiring, in 2014, he was a resident of Labrador. His residencechanged a number of times between 2014 and 2020. [37] The Arbitrator referred, in his decision, to

Article 3.01(

l) of the Collective Agreement – which defines “Provincial Resident”and outlines several factors to be examined when determining residency, including: property tax assessment, lease agreement, driver’slicense, vehicle registration, income tax returns, voter’s list registration and MCP number.

He indicated that no evidence was ledconcerning these factors and, therefore, he was unable to make a determination as to Hennessey’s residence. [38] The Arbitrator ruled that the purchase of a house in Nova Scotia was insufficient evidence of an alteration in Hennessey’sstatus as a resident of Newfoundland. [39] The Arbitrator found that Hennessey was recalled by Labrador Catering to return to work on July 11, 2020. At the time allparties understood that Hennessey was within the priority group of island resident.

He found that the recall was not in violation of theCollective Agreement because Hennessey’s status as a resident of Newfoundland had not changed. [40] The Arbitrator held that he had the jurisdiction to make an Order in respect of the labour relations issues presented in the case.He found that this extended to the issue of Site access in order to allow Hennessey to resume his employment with Labrador Catering.He ruled that the banning of Site access on the grounds indicated by Nalcor was not in compliance with the Collective Agreement. ISSUES

[ 41 ] Did the Arbitrator err in his application of the issue of estoppel because he found that the Association was estopped as a result of the conduct and/or representations of non-parties to the Collective Agreement? [ 42 ] Are the Arbitrator’s findings with respect to Hennessey’s residence reasonable? ESTOPPEL [ 43 ] There was uncontradicted evidence before the Arbitrator that Hennessey contacted Labrador Catering and an official of Nalcor with a view to discussing his wish to use Halifax as a hub for turnarounds.

There was uncontradicted evidence that Hennessey was told that it would not be a problem and, in fact, that for a year he used Halifax as his primary hub and that Labrador Catering paid for the associated costs of transportation. [ 44 ] Had Labrador Catering or Nalcor advised Hennessey that there would be a problem with him relocating his travel hub to Halifax, he might well have thought better of it and retained St.

John’s as his hub. [ 45 ] It is inappropriate to advise a person that a proposed course of events will have no consequences and, then, to use that same course of events as the reason for imposing consequences. To countenance such a course of conduct would be inequitable. [ 46 ] There is nothing unreasonable in the Arbitrator’s finding that the Association should not be allowed to assert that Hennessey’s residence could give rise to a denial of Site access. Hennessey took pains to ensure that Labrador Catering and Nalcor knew about his plans. Labrador Catering and Nalcor are members of the Association.

Labrador Catering’s knowledge was reasonably imputed by the Arbitrator to the Association. RESIDENCE [ 47 ] The Arbitrator relied upon the definition

section of the Collective Agreement (section 3.01(l)). The

section deals specifically with residency and how it is to be determined. The Arbitrator held that no evidence had been led with respect to the factors that are to be considered in determining residence. He found that the acquisition of property in another province was not tantamount, necessarily, to a finding that the property owner’s residence had changed. [ 48 ] The Arbitrator’s finding with respect to residence is logical. It is circumscribed by the agreement between the parties, as it should be.

I find that it is reasonable under the circumstances. [ 49 ] Vavilov instructs, at paragraph 83 : … the reviewing court must consider only whether the decision made by the administrative decision maker — including both the rationale for the decision and the outcome to which it led — was unreasonable. [ 50 ] And, at paragraph 85: … a reasonable decision is one that is based on an internally coherent and rational chain of analysis and that is justified in relation to the facts and law that constrain the decision maker.

The reasonableness standard requires that a reviewing court defer to such a decision. [ 51 ] The Collective Agreement makes specific reference to the factors to be taken into account in making a determination concerning residence. The Arbitrator found, as a fact, that no evidence had been led during the course of the hearing concerning the factors that were supposed to govern. I cannot find fault with the coherency of the Arbitrator’s reasoning or with his chain of analysis.

Therefore, I have no option but to defer to the decision made by the Arbitrator. [ 52 ] The Application is dismissed. [ 53 ] The Respondent shall have its costs under Column III of the

Schedule of Costs. _____________________________ Vikas Khaladkar Justice