2023 FC, 2023 FC 1143

Date: 20230824 Docket: T-1938-19 Citation: 2023 FC 1143 Ottawa, Ontario, August 24, 2023 PRESENT: The Honourable Mr. Justice Gleeson BETWEEN: GRAIN WORKERS’ UNION LOCAL 333 ILWU Applicant and VITERRA CANADA INC. Respondent ORDER AND REASONS I. Overview [ 1 ] The Respondent has been found in contempt of an arbitration award [Award] ordering that it cease and desist violating the maximum weekly work hour provisions in the Canada Labour Code , RSC 1985, c L-2 [ Code ] ( Grain Workers' Union Local 333 ILWU v Viterra Inc , 2022 FC 796 ).

A fine in the amount of $400,000 has been imposed (the Court’s May 31, 2023 Order [Penalty Order]). [ 2 ] The Penalty Order provides that the $400,000 fine shall be reduced to $275,000 should the Respondent demonstrate that it has purged its contempt and that it continues to comply with the Award. [ 3 ] The Respondent filed submissions and evidence on June 30, 2023 seeking to demonstrate that the contempt had been purged. The Applicant filed responding submissions and the Respondent also filed a reply.

The Applicant seeks to file a sur-reply to which the Respondent objects. [ 4 ] The issues raised have been considered and addressed based on the Parties’ written representations. I am in agreement with the Respondent; the Applicant’s sur-reply is not necessary to properly determine whether the Respondent has purged its contempt. I also conclude that the Respondent has failed to demonstrate that the contempt has been purged. My reasons follow. II. Preliminary Matters A. Sur-reply not considered [ 5 ] In seeking to submit a sur-reply, the Applicant argues that the Respondent has adopted a new position in its reply.

The Applicant submits that, in its original submissions, the Respondent advanced the position that any case of employee work hours exceeding the 48- hour per week maximum was permissible and in compliance with the Award because the Respondent had been validly averaging the hours worked by its employees. The Applicant submits that, in its reply, the Respondent revised its position to further argue that employees working a Monday to Friday

schedule are excluded from the application of any averaging agreement.

The Applicant argues that a sur-reply to address this issue is warranted. [ 6 ] The circumstances in which leave is to be given to file a sur-reply argument include those where considerations of procedural fairness arise and where submissions on sur-reply are needed to properly determine the issues before the Court ( Dzawada’enuxw First Nation v Canada , 2021 FC 939 at para 23 , George v Heiltsuk First Nation , 2022 FC 1786 at paras 30 and 31 ). [ 7 ] In this instance, I am not persuaded that a sur-reply argument is required to properly address the issue before me. [ 8 ] In submitting that its contempt has been purged, the Respondent relies on its view that it is operating under a valid hours averaging agreement.

It submits that under this agreement it is compliant with the Award even if employee work hours exceed 48 hours in any given week as long as the weekly hours averaged over a 26-week averaging period do not exceed 48 hours for any particular employee. [ 9 ] The Respondent relies on the Affidavits of Mr. Peter Idema affirmed on October 27, 2022 [Affidavit #1] and June 30, 2023 [Affidavit #2] in advancing its argument that the contempt has been purged. Mr.

Idema is the Respondent’s Director of West Coast Terminal Operations and his duties include conduct of collective bargaining and labour relations at the Terminals. [ 10 ] Affidavit #2 identifies specific employees at the Respondent’s Cascadia and Pacific terminals as being on a " “Monday - Friday

Schedule (Not Eligible For Averaging)” " (Affidavit #2, Exhibits “B” and “C”). The Evidence also sets out the hours paid and worked by employees at the Cascadia Terminal and Pacific Terminals during the period of January 1, 2023 - June 3 2023 (Affidavit #2, Cascadia at Exhibits “I” and “L”, Pacific at Exhibits “J” and “K”). [ 11 ] As an aside, I note that paragraph 52 of Affidavit # 2 states that Exhibit “K” contains time cards for employees from the Cascadia Terminal and Exhibit “L” contains time cards for employees from the Pacific Terminal. This is incorrect. Exhibit “K” contains the Pacific Terminal time card reports and Exhibit “L” contains the Cascadia Terminal time card reports.

[12] The time cards in Exhibits “K” and “L” reflect the details of the hours paid and worked that are reported in the Weekly Reportsreferenced at paragraphs 41 - 42 and found in Exhibits “I” and “J” of Affidavit #2. The contents of the Weekly Reports were alsouploaded to the Court file in electronic form (Affidavit #2, para 41). [13] The evidence before the Court is detailed and it reflects that certain employees are not subject to the averaging plan that theRespondent argues it has validly established.

The fact that certain employees are exempt from any averaging plan is evident upon areview of the evidence. [14] In addressing the issue currently before the Court – i.e., whether the Respondent has demonstrated compliance with the Awardthereby purging the contempt – the Court is well positioned to review and interpret the evidence to assess the Respondent’s position thata legitimate averaging agreement is in place and that the weekly hours of employees "“Not Being Eligible For Averaging”" comply withthe Award.

Any sur-reply on the part of the Applicant at best underlines the Court’s responsibility to assess and consider the evidence. [15] No issue of fairness arises and the sur-reply is not needed to properly determine the issue. The sur-reply has not been considered. B.

Adequacy of the Evidence [16] The Applicant submits that paragraphs 30, 40-42 and 46-48 as well as Exhibit “I” and “J” of Affidavit #2 are hearsay and notadmissible under any recognized exception. [17] The Respondent submits, and I agree, that the question of whether contempt has been purged is an extension of the penalty phase ofthe contempt proceeding. Hearsay evidence, subject to weight, is properly admissible at this stage of the proceeding. III. The Respondent has not demonstrated that its contempt hasbeen purged [18] The Respondent relies on the Affidavit evidence of Mr.

Idema to establish that it has developed an averaging plan, that it hassubmitted the plan to Employment and Social Development Canada [ESDC], and that it has properly implemented that plan (Affidavit#1, paras 6 - 25). The Respondent submits that, on the basis of its plan, it has been validly averaging hours worked by its employees atPacific Terminal and Cascadia Terminal under subsection 169(2) of the Code and

section 6 of the Canada Labour Standard Regulations,CRC, c 986 [Regulations] since July 4, 2021. It submits that, in implementing the averaging plan, it has complied with its obligationsunder the Code and Regulations and that the ability to average employee hours is essential to its operations. [19] The Respondent further argues that the Applicant cannot dispute the validity of the averaging plan in this proceeding.

TheRespondent relies on Weber v Ontario Hydro, (SCC), [1995] 2 SCR 929 and Northern Regional Health Authority vHorrocks, 2021 SCC 42, to argue that this Court has no jurisdiction to consider a dispute arising directly or inferentially from a collectiveagreement, the matter being within the exclusive jurisdiction of a labour arbitrator.

The Applicant has not initiated any grievance relatingto the implementation of the averaging plan and has declined the Respondent’s invitation to address the matter by way of arbitration.Finally, the Respondent argues that, in any event, the evidence discloses few instances of employees working in excess of 48 hours in aweek. It describes those instances as being negligible as they only account for three percent of the employee workweeks betweenJanuary 1, 2023 and June 3, 2023. [20] The Respondent has the burden of establishing that it has purged its contempt.

It has failed to do so. [21] The Respondent’s assertions that the Code and Regulations allow for the unilateral adoption and implementation of an averagingplan rely on Mr. Idema’s evidence that subsection 169(2) of the Code and

section 6 of the Regulations permit an employer to unilaterallyadopt an averaging plan. Mr. Idema’s evidence is that he came to this conclusion when the President of Prince Rupert Grain Ltd. advisedhim that averaging could be implemented and told him that Prince Rupert Grain Ltd. began to do so in January 2021 (Affidavit #2, paras6 - 7). No further evidence that might support the Respondent’s view in this regard is provided nor is any legal argument advanced insupport of the Respondent’s

interpretation of the Code. Instead, the Respondent seeks to rely on operational circumstances as well as Mr.Idema’s statement indicating that those circumstances led him to conclude that "“an averaging plan would be appropriate”" to justify theinterpretation of the Code (Affidavit #2 at para 9).

A perceived need is, of course, not sufficient to demonstrate compliance with theAward or the purging of the Respondent’s contempt. [22] The Award (which is described in some detail in paragraphs 9 - 13 in Grain Workers’ Union Local 333 v Viterra Inc, 2022 FC 796[Contempt Order]) is instructive with regard to the Respondent’s ability to unilaterally adopt and impose an averaging plan under theCode.

In expressly addressing the possibility of an averaging agreement as a means for the Respondent to comply with the Code, theArbitrator states the following: … I leave it to the parties to meet and determine what form of averaging arrangement can be agreed upon in the context ofa 6-on/3-off continuous operation

schedule that does not operate on a week-to-week basis [emphasis added]”. [23] The expert arbitrator does not indicate either explicitly or implicitly that a unilaterally imposed averaging agreement is available tothe Respondent "“in the context of a 6-on/3-off continuous operation

schedule that does not operate on a week-to-week basis.”" [24] In addition, ESDC, which describes itself as responsible for the administration and enforcement of the Code and Regulations, hasexpressed the opinion that the Respondent’s averaging plan does not meet the criteria set out in the Regulations (Affidavit #1, paras 20 -21 and Exhibits “N” and “O”). [25] The Respondent argues that, because ESDC has acknowledged that disputes in this regard are to be resolved in accordance with the

collective agreement and/or with the assistance of an arbitrator, ESDC’s opinion is of little value. I disagree. As noted above, the Respondent has the burden to establish that the contempt has been purged. ESDC’s opinion is due some weight in assessing whether the burden has been met and it is to be weighed against evidence, if any, to the contrary. [ 26 ] In this matter, there is no contrary evidence, merely assertions and beliefs.

The assertions and statements of belief are insufficient to establish that there is any merit to the Respondent’s position that it is operating under a valid averaging plan and is therefore in compliance with the Award. [ 27 ] Based on the contents of Affidavit #1, I have previously found that there is no basis to conclude that the Respondent is in a position to unilaterally impose an averaging approach to work hours (Penalty Order at para 65) .

Nothing in the additional evidence that the Respondent has filed changes my view in this regard. [ 28 ] Nor am I convinced that, when assessing whether the contempt has been purged, the Court is without jurisdiction to assess the strength of the Respondent’s view that the Code and Regulations allow it to unilaterally develop and implement an averaging plan. To accept the Respondent’s submissions in this regard would require the Court to yield its role and responsibility to maintain public confidence in the administration of justice by fostering party compliance with court orders.

In this case, this would involve yielding that role to the very party the Court has found in contempt ( Bell Media Inc v Macciacchera (Smoothstreams.tv) , 2023 FC 801 at para 25 , also see Canada (Human Rights Commission) v Warman , 2011 FCA 297 at para 88 ).

In cases of contempt, a court must have the authority to assess and determine the strength of the Respondent’s arguments asserting that the contempt has been purged. [ 29 ] In this instance, there is an absence of substantive evidence and legal arguments to support the position that the Respondent asserts with respect to the availability of an averaging plan. Faced with what is essentially a bald assertion, the Court’s analysis in this regard need not involve more than a weighing of the evidence in light of the burden that the respondent must satisfy.

The Respondent has not demonstrated on balance that the Code and Regulations contemplate the unilateral development and implementation of an averaging plan in the circumstances of this case. In fact, the little evidence that is before the Court indicates the opposite – averaging pursuant to the Code in the Respondent’s workplace is to be achieved by way of agreement.

That the Applicant has not initiated a grievance or accepted to proceed to arbitration is of little assistance to the Respondent as it is not material to the question of compliance with the Award. [ 30 ] In the absence of an averaging plan, the undisputed evidence is that there has been ongoing non-compliance with the Award. The Respondent concedes that its time card evidence discloses that, between January 1 and June 3, 2023, there were 132 instances where employees worked in excess of 48 hours in a workweek. [ 31 ] I have reviewed the evidence as set out in Exhibits “I”, “J”, “K” and “L” of Affidavit #2.

When it was included, I have also specifically examined the time card data related to each instance where the Weekly Reports (Exhibit “I” and “J”) indicate that an employee worked in excess of 48 hours in a week. In doing so, I have recognized that the reported hours do not necessarily reflect the hours worked.

I have therefore relied on the employee punch-in and punch-out time data included on the time cards (Exhibits “K” and “L”) to calculate actual hours worked. [ 32 ] Having adopted this approach to calculate hours worked and having recognized that not all time cards have been provided due to an oversight (Affidavit #2 at para 52), I have identified 91 instances where employees have exceeded 48 hours of work in a week in the January 1 to June 3, 2023 period.

I expect my conservative approach to calculating work hours explains the discrepancy between the number of instances I have identified and those identified by the Respondent. [ 33 ] In the 91 cases that I have identified, workweeks have ranged from 49 hours to, in one case, 68 hours. There are many instances where employees worked 52 to 56 hours in a week and a number of weeks where employees worked 60 hours or more. [ 34 ] I am unable to agree with the Respondent’s view that the number of instances of non-compliance in the first five months of 2023 are negligible.

Ninety-one instances over five months is, in my view, evidence of a pattern of non-compliance with the Award. Similarly, workweeks exceeding 49 hours cannot be characterized as negligible non-compliance.

The number of workweeks where employees worked 52 hours or more also demonstrate a pattern of significant non-compliance with the Award. [ 35 ] The Respondent has failed to demonstrate compliance by way of its efforts to implement a unilateral averaging plan and it is not in dispute that the Respondent’s employees have repeatedly worked in excess of 48 hours per week in the first five months of 2023. [ 36 ] Had I concluded that the Respondent had succeeded in demonstrating that it was in a position to validly average employee hours, which it has not, I would still have concluded that the Respondent has failed to demonstrate that the contempt has been purged.

This is because a review of the time card evidence discloses a number of instances where employees identified by the Respondent as not being eligible for averaging (Affidavit #2 Exhibits “B” and “C”) have worked in excess of 48 hours a week during the first five months of 2023 (Affidavit #2 Exhibit “K”, pages 165 and 169, and Exhibit “L”, pages 265, 269, 270, 284 and 308). These instances are limited – seven have been identified – but they reflect ongoing non-compliance with respect to a group of employees that are undisputedly limited to a maximum workweek of 48 hours under the Code . IV.

Conclusion [ 37 ] The Respondent has not demonstrated that its contempt has been purged. ORDER IN T-1938-19 THIS COURT ORDERS that : 1 . The Respondent, Viterra Canada Inc., not having demonstrated that its contempt has been purged, shall pay a fine in the amount of

$400,000 by delivering to the Federal Court Registry a certified cheque or bank draft made payable to the Order of the Receiver General of Canada, in accordance with the Court’s May 31, 2023 Order. “Patrick Gleeson” Blank Judge FEDERAL COURT SOLICITORS OF RECORD DOCKET: T-1938-19 STYLE OF CAUSE: GRAIN WORKERS’ UNION LOCAL 333 ILWU v VITERRA INC. WRITTEN SUBMISSIONS CONSIDERED AT OTTAWA, ONTARIO ORDER AND REASONS: GLEESON J. DATED: August 24, 2023 WRITTEN SUBMISSIONS BY : William Clements Lily Hassall For The Applicant Donald J. Jordan, K.C.

Natalia Tzemis For The Respondent SOLICITORS OF RECORD : Koskie Glavin Gordon, LLP Vancouver, British Columbia For The Applicant Harris & Company, LLP Vancouver, British Columbia For The Respondent