Docket: CACV2427 United Food v. Commercial Workers, Local 1400, 2014 SKCA 70

THE COURT OF APPEAL FOR SASKATCHEWAN Citation: 2014 SKCA 70 Date: 2014-06-24 Between: Docket: CACV2427 United Food and Commercial Workers, Local 1400 Appellant (Respondent) - and - Affinity Credit Union Respondent (Applicant) - and - Board of Arbitration chaired by William J. Campbell Respondent (Respondent) Coram: Klebuc, Ottenbreit and Whitmore JJ.A. Counsel: Drew Plaxton for the appellant Larry Seiferling, Q.C., for the respondent Appeal: From: 2013 SKQB 171

Heard: November 29, 2013 Disposition: Appeal dismissed Written Reasons: June 24, 2014 By: The Honourable Mr. Justice Ottenbreit In Concurrence: The Honourable Mr. Justice Klebuc The Honourable Mr. Justice Whitmore OTTENBREIT J.A. I. Introduction [ 1 ] This is an appeal from a Queen’s Bench Chambers decision dated May 7, 2013, cited as 2013 SKQB 171 , quashing a decision of a Board of Arbitration chaired by William J. Campbell (the “Board”) dated September 25, 2012.

United Food and Commercial Workers, Local 1400 (the “Union”) had filed a grievance under its Collective Bargaining Agreement (the “CBA”) with Affinity Credit Union (“Affinity”) challenging the process whereby an employee could move from a Relationship Banking Officer position (an “RBO”) at Affinity to a Senior Relationship Banking Officer position (an “SRBO”) as being unreasonable and violating the CBA. The Board sustained the Union’s grievance. Affinity then applied for judicial review to the Court of Queen’s Bench which quashed the decision of the Board. The Union appeals the Chambers judge’s decision.

Both parties seek to adduce fresh evidence on the appeal. For the reasons hereinafter set forth, the appeal is dismissed. II. Facts and Background [ 2 ] In early 2010 Affinity considered changing the classification process whereby RBOs could become SRBOs. [ 3 ] The two classifications were very similar in their purpose. Prior to the proposed changes there were a specified number of RBO and SRBO positions. These were allocated in relationship to the size of the various branches of Affinity.

The SRBO required somewhat increased levels of education and experience as well as an increased level of professional development. Under this arrangement the only means an RBO had to move to an SRBO position was if Affinity created a new SRBO position or an existing position became vacant. [ 4 ] Affinity’s proposal concerned changes in the qualifications required for an RBO to meet the criteria to advance to an SRBO. They were three-fold but two were uncontroversial.

There was no material change to the education and experience required and it was still expected that an SRBO have an advanced or superior level of expertise in handling complex loans. However, the last qualification was problematic.

In order to be an SRBO the RBO had to attain a minimum threshold of a book of business of $25 million and to maintain that book of business, and if an SRBO fell below the annual threshold for two consecutive years, that loans officer would be reverted to an RBO (the “BOB requirement”). [ 5 ] The Union, on becoming aware of this, filed a policy grievance dated July 5, 2010, saying: The Employer has implemented unreasonable rules for moving from a Relationship Banking Officer to a Senior Relationship Banking Officer which violate the collective agreement.

The Union requested “full redress”. [ 6 ] Affinity seeks to adduce fresh evidence that it has, by letter to the Union dated May 23, 2013, withdrawn its SRBO program and would not seek to further arbitrate the SRBO issue. [ 7 ] The fresh evidence proposed by the Union shows there are several individual grievances filed in 2011, 2012 and 2013 respecting the SRBO program. III. Decision of the Arbitration Board [ 8 ] The Board concluded that Affinity was not creating a new classification but was certainly establishing new qualifications and abilities within the classification of an SRBO.

This new qualification was the BOB requirement. [ 9 ] The Board stated the main issue before it was whether “the Union has proven that the insertion of the requirement for an SRBO to attain and retain the BOB infringes on the restrictions as set out in the CBA”. [ 10 ] The evidence before the Board concerned factors other than the employees’ abilities which may impact the book of business. The Board observed that there was much evidence provided about the proposed size of the book of business and whether $25 million was reasonable or too high.

[ 11 ] The Board first determined that the BOB requirement was clearly an incentive or bonus and that such a provision could not be implemented in the workplace without running afoul of management’s agreement to act in good faith under

Article 5.02 of the CBA which reads as follows: 5.02 The Employer agrees, that in exercising its management rights, it shall act in good faith and shall not evade, alter or encroach upon any of the specific provisions of the Agreement. The Employer will not, in exercising its rights under this

Article or under any other provision of the Agreement, discriminate against any employee because of such employee’s activity in or for the Union. [ 12 ] The Board then concluded that the BOB requirement could not truly be classified as a qualification or ability because there was not a sufficient degree of control over attaining and maintaining the qualifications by the employee.

The Board reiterated that employers would be acting in bad faith if they demoted an employee on the basis that they had failed to maintain a book of business when, in fact, it may have been as a result of the employer’s actions that the book of business was not maintained. The Board concluded: 21. In conclusion, I do not accept Affinity’s argument that the implementation of the BoB requirement is in any way an indication of a qualification or ability of an employee when Management retains some of the factors which affect that BoB.

Although Management may certainly have the right to set qualifications and abilities, they must do so in accordance with their Management rights which are restricted by their requirement to act in good faith. Affinity did not act in good faith when they implemented these proposed changes and, therefore, the grievance is allowed. IV.

Court of Queen’s Bench [ 13 ] Affinity applied to quash the Board’s decision on the basis that the Board breached the principles of natural justice and procedural fairness by basing its majority decision on good faith, an issue not argued by either party, and also on the basis that the Board’s conclusion that the BOB requirement was not a qualification or ability as provided by

Article 10.02 of the CBA was unreasonable. [ 14 ] The judicial review proceeded on the basis of the record from the Board supplemented by the affidavits of Darren Kurmey, a Union representative, and Lolita Humm, an Affinity representative, both of whom were present during the arbitration. [ 15 ] In addressing the natural justice issue, Mr. Kurmey stated in his affidavit that before the Board the Union specifically referred to

Article 5.02 in its opening and closing remarks and both the Union and Affinity filed copies of excerpts from labour arbitration text books which made reference to “bad faith”. He stated as well that when Affinity argued at the end of the arbitration that the grievance concerned the issue of reasonableness and there was no evidence of bath faith, that the Union had countered that the relevant provisions of the CBA referred to bad faith and that the changes were, in fact, made in bad faith and engineered to avoid the provisions of the CBA.

His affidavit also stated that Affinity did not seek an order for further particulars of the grievance nor did it apply to call any evidence respecting good faith. [ 16 ] Ms. Humm, in her affidavit, stated that the Union did not raise the issue of whether Affinity had acted in good faith in respect of the BOB requirement and that the grievance did not allege bad faith and, therefore, the employer called no evidence respecting that issue.

She stated that had there been any evidence or argument respecting good faith she would have instructed Affinity’s lawyer to present evidence and argument. [ 17 ] The Chambers judge determined that the Board’s finding that the BOB requirement is a matter out of the employee’s control and thus not a qualification or ability, and that such a finding met the reasonableness test as articulated in Dunsmuir v. New Brunswick , 2008 SCC 9 , [2008] 1 S.C.R. 190.

However, she found that the Board did not base its decision on its findings that the BOB requirement was an unreasonable qualification, but rather that Affinity had not acted in good faith when it proposed that change. [ 18 ] The Chambers judge made a number of factual determinations as to how the hearing before the Board proceeded. She determined that the Union had not alleged bad faith and that Affinity did not present its case before the Board on the basis of whether or not it had in bad faith manipulated the job description of an SRBO to subvert the just claims of employees for job advancement.

The Chambers judge determined that Affinity had presented its case on the basis that the BOB requirement was a reasonable one. She pointed out that the Union on the review before her argued that

Article 5.02 of the CBA meant that the good faith of the employer is always in issue. [ 19 ] The Chambers judge observed that if there was evidence supporting an allegation of bad faith, the Board would have referred to it in its decision but the decision is silent in this respect.

She therefore accepted Affinity’s view of the evidence adduced and its presentation before the Board, and that the case proceeded on the basis of whether the BOB requirement was a reasonable one and not on the basis of bad faith. [ 20 ] She determined that the parties conducted the hearing on the basis of unreasonable qualifications but the Board decided the arbitration on the basis of an issue other than what was before it, i.e. , bad faith. She concluded that Affinity was therefore not granted an opportunity to present its evidence on its bona fides and was therefore denied its right to a fair hearing.

She quashed the award and remitted the matter to a new arbitration board for a determination. V. Standard of Review [ 21 ] It is common ground that the standard of review of the decision of the Chambers judge is correctness ( United Food and Commercial Workers, Local 1400 v. Westfair Foods Ltd. (c.o.b. Real Canadian Wholesale Club) , 2008 SKCA 60 , 295 D.L.R. (4 th ) 542,

at para. 27). VI. Issues [22] Affinity raises a threshold issue related to the fresh evidence applications and whether the appeal is moot. [23] The Union sets out in its factum four issues. These may be conveniently grouped as follows: a. Did the reviewing judge err in her determination of the scope of issues before the Board and the basis on which the Board made itsconclusion? b. Did the reviewing judge err in exercising her jurisdiction to set aside the award when no prejudice was shown? [24] The Union also raises the significance of the dissent filed by the employer nominee to the Board.

This ground alleges no error bythe Chambers judge respecting the dissent but inexplicably merely muses about and questions the timing, form and content of thedissent. As such I need not address it. VII. Analysis A. Should fresh evidence be allowed and, if so, is the appeal moot? [25] The fresh evidence sought to be adduced by Affinity is the basis for its argument the appeal is moot.

The Union opposes theapplication of Affinity to adduce fresh evidence but alternatively argues that if Affinity’s application for such evidence is granted, that itas well seeks to adduce fresh evidence in reply to counter Affinity’s argument re mootness. [26] The Court has discretion under Rule 59(1) to grant leave to adduce fresh evidence of matters which occur after a decision is made (Thompson v. Thompson, 2007 SKCA 142, 288 D.L.R. (4th) 344; Maitland v. Drozda, (SK CA), [1983] 3 W.W.R.193 (Sask. C.A.)).

This is a case where it is appropriate to exercise that discretion and grant leave in both applications to adduce freshevidence. The evidence proposed by Affinity of the elimination of the SRBO classification was not in existence at the date of thehearing before the Chambers judge. However, it is credible and is relevant to the subject matter of the dispute and could reasonablyaffect the result in the sense that it potentially changes the complexion of the case and casts the appeal in a new light, i.e., mootness.

The fresh evidence proposed by the Union, although it was in existence prior to the Queen’s Bench decision, is explanatory of thecontext of the withdrawal of the SRBO program and is relevant with respect to the issue of mootness and collateral matters. Leave isgranted to adduce the fresh evidence proposed by both Affinity and the Union. [27] I now address the issue of mootness in the context of the fresh evidence. In United Food and Commercial Workers, Local 1400 v. Wal-Mart Canada Corp. (c.o.b.

Wal-Mart), 2012 SKCA 131, 358 D.L.R. (4th) 313, this Court said: 73 The classic statement of the law pertaining to mootness comes from Borowski v. Canada (Attorney General), (SCC), [1989] 1 S.C.R. 342. The doctrine of mootness applies “when the decision of the court will not have the effect of resolving somecontroversy which affects or may affect the rights of the parties” (at p. 353).

The Court in Borowski went on to express this formulationin these terms: (i) “[i]f the decision of the court will have no practical effect on such rights, the court will decline to decide the case”; and(ii) “if...events occur which affect the relationship of the parties so that no present live controversy exists which affects the rights of theparties, the case is said to be moot” (at p. 353). 74 Borowski establishes a two-step process. Once a court finds that a matter is moot, the matter may nonetheless be heard anddecided if the court in its discretion decides it should do so. [28] Borowski v.

Canada (Attorney General), (SCC), [1989] 1 S.C.R. 342, states that even if there is no livecontroversy, a court may nonetheless address a moot issue if the circumstances warrant (para. 16). Such circumstances include thatalthough the litigant bringing the proceeding may no longer have a direct interest in the outcome, there may be collateral consequencesof the outcome that will provide the necessary adversarial context.

Additionally, if it can be said that the court’s decision will have somepractical effect on the rights of the parties notwithstanding that it will not have the effect of determining the controversy which gave riseto the action, the court may entertain the matter. As well, if there is an issue of sufficient public importance which requires a resolutionin the public interest, the court may entertain the matter (para. 37).

In short, this Court has the discretion to decide the case on its meritswhere justice requires it. [29] While this decision was reserved, the Court was advised by letter dated June 10, 2014, from counsel for the Union that the partieshad entered into an agreement to resolve the Senior Relationship Banking Officer upgrade issue that was addressed in the award by theBoard. The Union acknowledged that this may well render the specific issue before the Court as being moot but requested that the Courtexercise its discretion and render a decision in the matter.

The position of Affinity remains that there is no issue that needs to be decided.

[30] This is a proper case for the exercise of the Court’s discretion to hear the matter. Although Affinity argues that the underlyingdispute regarding the SRBOs has been resolved by its withdrawal of the program and the recent letter from the Union acknowledges thatthe specific issue before the Court may be moot, I am satisfied that the decision by this Court may have collateral consequences. It is notclear from the Union’s letter whether outstanding individual SRBO grievances have been resolved by the parties involved.

Thus theviability of these grievances may remain to be determined by an arbitrator while having regard to Affinity’s withdrawal of the SRBOclassifications and the agreements mentioned by the Union. In that sense this appeal may have some practical effect on the rights of theparties or related parties or the conduct of the grievances notwithstanding that the underlying controversy which gave rise to the appealhas been resolved.

Moreover, this decision contributes to the resolution of a matter of sufficient public importance of which is in thepublic interest, i.e., the question of whether the issue of good/bad faith may be dealt with by an arbitration board hearing a policygrievance which is framed in terms of the unreasonable actions of the employer. The issue is likely to recur in the future. Judicialresources in this case will therefore not be wasted by the appeal proceeding. I therefore conclude that this case should be dealt with onthe merits. B.

Did the reviewing judge err in her determination of the scope of issues before the Board and the basis on which the Board madeits conclusion? [31] The Union makes several arguments with respect to this issue. The Union first argues that deference is owed to the Boardregarding its procedural rulings and implies that the Board’s handling of the good faith issue amounted to a procedural matter. TheUnion also argues that the Chambers judge should have determined whether the Board’s

interpretation of the substantive issues raised bythe grievance included good faith and was reasonable rather than substituting her own

interpretation of the issues raised by the grievanceas well as her own assessment of the evidence and

interpretation of the scope of the grievance and CBA. The Union next argues that infact lack of good faith was raised by it during the hearing and in any event is implicit in the grievance. The Union also argues that theBoard’s decision is sustainable because lack of good faith was not the primary or sole reason for its decision. [32] The starting point for analysis is the finding of the Chambers judge with respect to what transpired at the arbitration hearing andthe basis on which the hearing proceeded.

It was appropriate for the Chambers judge to receive and consider the affidavit evidencebecause there was an allegation alleging a breach of natural justice. [33] In such cases it is necessary to supplement the record as explained in Warren v. Ontario (Labour Relations Board), 2012 ONSC1735, 292 O.A.C. 303 (Div. Ct.), where the Court stated: 9 Affidavit evidence is only admissible to supplement the record of proceedings in applications for judicial review in limitedcircumstances: - where there is a complete absence of evidence on an essential point (Keeprite Workers’ Independent Union v.

Keeprite ProductsLimited (1980), (ON CA), 29 O.R. (2d) 513 (C.A.) at p. 8 (Quicklaw version) and Windsor Board of Education v.Windsor Women Teachers’ Assns., [1991] O.J. No. 2148 (C.A.) at p.8 (Quicklaw version)), or - where the evidence discloses a breach of natural justice that cannot be proven by reference to the record (142445 OntarioLimited (Utilities Kingston) v. International Union of Electrical Workers, Local 386, (ON SCDC), [2009] O.J. No.2011 (Div.

Ct.) at para. 18). [34] The Chambers judge’s finding that the case was not argued before the Board on the basis of bad faith rests on her view of theaffidavits of Mr. Kurmey and Ms. Humm as to the conduct of the hearing and the record as a whole. The significant factors sheidentified from the record were that the grievance did not mention lack of good faith, the Board was silent on the evidence that mighthave been presented as to Affinity’s bad faith, and if there had been evidence of bad faith before the Board, one would have expected it tohave been referred to in the decision.

On this basis she accepted Affinity’s affidavit evidence of how the hearing proceeded and whatissues were raised before the Board. This was bolstered by her observation that the position of the Union on the judicial review was thatits reference to

Article 5.02 of the CBA implicitly raised the issue suggesting that the issue had not been explicitly argued before theBoard. The Chambers judge’s conclusion that the issue had not been raised before the Board on the circumstances as a whole is areasonable determination. There is no basis to overturn it given the standard of review. [35] The Union’s argument that the reviewing judge owes a certain level of deference to a Board’s procedural rulings cannot succeed.

There is no indication the Board made any procedural ruling during the hearing respecting lack of good faith but merely proceeded todetermine the matter on the basis of lack of good faith. It is a substantive ruling which is subject to the normal scrutiny reserved for suchrulings. [36] Likewise, the Board made no specific determination prior to its decision or even in its decision that the grievance as it read raisedan issue of good faith in addition to the ostensible issue of unreasonableness, although it is clear that the Board considered managementrights circumscribed by an obligation of good faith.

While it is open to the Board to determine the scope of a grievance, if the Boardconsidered that good faith was a significant issue before it which was encompassed by the grievance it should have stated this to theparties and invited evidence and argument to address that issue. It is clear it did not. [37] It may be fairly said that lack of good faith and bad faith are synonymous: Canadian Union of Public Employees, Local 87 v.Schreiber (Township) (Job Description Grievance), [2003] O.L.A.A. No. 674 (Ont. Lab. Arb.), at paras. 13-15.

In Hamilton Public Library and C.U.P.E., Local 932 (2011-12), Re, 238 L.A.C. (4th) 116, Surdykowski (Arbitrator), gives a good description of bad faith incomparison to arbitrariness:

76 … Labour relations “bad faith” has been described as conduct motivated by conscious hostility, malice, ill-will, dishonesty, orimproper motivation. The essence of bad faith is dishonesty of purpose. Arbitrary conduct and bad faith conduct are not mutuallyexclusive categories. A decision made in bad faith may also be arbitrary… Given such a definition of bad faith one would, as the Chambers judge observed, have expected evidence on the issue. [38] The concept of good faith evinces subjective states of mind.

Where an action is believed to have merit, the action is taken in goodfaith even if the action turns out not to have merit. Conversely, where an action is taken in order to subvert a requirement of thecollective agreement, it is made in bad faith (C.U.P.E. v. Schreiber). [39] It is doubtful that lack of good faith is implicitly raised in an argument of unreasonableness such as was raised in support of thegrievance. There is a distinction between good faith and reasonableness. An action can be in good faith yet be unreasonable.

InSchreiber, the Board stated: 15 However, as established in the case law, a subjective genuine business concern or good faith, is not a complete answer. Even if anemployer acted in good faith, if the educational requirements imposed have no reasonable relation to the work to be performed whenseen objectively, the employer’s exercise of management rights would be improper. That would make the employer action arbitrary andunreasonable.

The employer adduced very extensive evidence as to why it decided to require a college diploma. … [40] Good faith and bad faith refer to subjective states of mind whereas reasonableness can be assessed on an objective basis. It isdifficult to say an action has been taken in bad faith without evidence to the effect that the employer had bad motives. Unreasonablenessby contrast is easily measured against either an abstract objective standard or the provisions of the collective agreement.

Given theforegoing, it is unusual that the Board would not have, at the outset, given notice to the parties that lack of good faith was a substantialissue affecting its analysis of the grievance. [41] Generally speaking, arbitrators are restricted to making rulings on issues brought forth in the grievance. In Halifax (RegionalMunicipality) v.

Canadian Union of Public Employees, Local 108, 2011 NSCA 41, 303 N.S.R. (2d) 156, the Nova Scotia Court ofAppeal ruled that the arbitrator unreasonably interpreted his authority in disposing of a grievance by injecting an issue that the partieshad decided to exclude from submissions. The case involved a disabled employee.

The parties had decided not to raise the issue of theemployee’s disability in bringing evidence and yet an arbitrator disposed of the grievance while leaving the issue of the employee’sdisability open to further submissions. [42] The Chambers judge was correct that the Board decided a question not before it. The Supreme Court of Canada in ServiceEmployees’ International Union, Local No. 333 v.

Nipawin District Staff Nurses Assn., (SCC), [1975] 1 S.C.R. 382,said the following at p. 389: A tribunal may, on the one hand, have jurisdiction in the narrow sense of authority to enter upon an inquiry but, in the course of thatinquiry, do something which takes the exercise of its powers outside the protection of the privative or preclusive clause.

Examples of thistype of error would include acting in bad faith, basing the decision on extraneous matters, failing to take relevant factors into account,breaching the provisions of natural justice or misinterpreting provisions of the Act so as to embark on an inquiry or answer a question notremitted to it.

If, on the other hand, a proper question is submitted to the tribunal, that is to say, one within its jurisdiction, and if itanswers that question without any errors of the nature of those to which I have alluded, then it is entitled to answer the question rightly orwrongly and that decision will not be subject to review by the Courts: Anisminic, Ltd. v. Foreign Compensation Commission et al. [1969]1 All E.R. 208; Noranda Mines Ltd. v. The Queen et al., supra; Farrell et al. v. Workmen’s Compensation Board, supra; R. v. QuebecLabour Relations Board, Ex p.

Komo Construction Inc. (1967), (CSC), 1 D.L.R. (3d) 125. [43] The argument of the Union that the Board’s decision can be sustained apart from lack of good faith fails as well. [44] The grievance does not make it clear which provisions of the CBA were allegedly violated. The provisions most important to theBoard appear to have been Articles 5.02 and 10.02 which read as follows:

ARTICLE 5 - MANAGEMENT RIGHTS 5.02 The Employer agrees, that in exercising its management rights, it shall act in good faith and shall not evade, alter or encroachupon any of the specific provisions of the Agreement. The Employer will not, in exercising its rights under this

Article or under any otherprovision of the Agreement, discriminate against any employee because of such employee’s activity in or for the Union.

ARTICLE 10 - PROMOTIONS, VACANCIES AND TRAINING 10.02 … all vacancies and new positions within the scope of this Agreement shall be filled on the basis of seniority, provided theapplicant(

s) has the qualifications and ability to handle the job to be filled. [emphasis added] [45] The Board uses the terms “good faith” and “qualifications and abilities” several times in various paragraphs of its decision, though“good faith” appears to be the primary concern. [46] The heading “Is Affinity Altering the Necessary Abilities and Qualifications in the SRBO Classification?” uses the language ofArticle 10.02.

[ 47 ] However, in the following paragraph the Board appears to be asking two related questions: first, whether any BOB is allowed (presumably pursuant to

Article 5.02) and, second, whether the BOB is a “qualification or ability” (certainly pursuant to

Article 10.02): 12. There was much evidence provided about the proposed size of the BoB and whether $25 million was reasonable or too high. For the purposes of this grievance, I do not believe the size of the BoB is relevant. The relevant issues are whether the insertion of any level of BoB is allowed under the provisions of the CBA and whether a BoB, as set out by Affinity, is truly a qualification or ability . Any attempt by Affinity to change the qualifications and abilities of a classification must be in accordance with its rights under the CBA. [ 48 ] Paragraph 13 of the decision refers to the language of

Article 5.02 and good faith exclusively. Paragraph 14 directly refers to the language of

Article 5.02. Paragraph 15 seems exclusively focused on the scope of management’s rights. [ 49 ] Paragraph 16 uses the language of management rights. But the words “an attempt to install bonuses or incentives” seems to imply that management has an ulterior motive, which would be most relevant to a claim of bad faith. [ 50 ] Paragraph 17 may be the key paragraph in deducing the reasoning of the Board. It reads as follows: 17.

The jurisprudence that suggests incentives or bonuses can be inserted into job descriptions where none existed before must be read in light of any restrictions of Management’s rights set out in the particular CBA. As I have set out earlier in this award, there are significant restrictions on Management’s rights under this CBA. Affinity argues that the BoB is not a method of incentives and bonuses, but is simply a new qualifier that must be met by an employee moving from an RBO to an SRBO position. I do not accept Affinity’s argument in regard to this issue.

The BoB may be the sole qualifier that moves an employee from a pay scale at Class 5 to a higher pay scale at Class 6, or from a Class 6 to a Class 5 if the BoB is not maintained. If they attain and retain a certain level of BoB, they are rewarded with the higher pay scale. If they do not retain that BoB, their salary is reduced when they are lowered to the RBO category.

This is clearly an incentive or bonus and such a provision cannot be implemented in this workplace without running afoul of Management’s agreement to “act in good faith”. [emphasis added] It uses the language of both “management’s rights” and “qualifications”. It is unclear whether the “restrictions on management’s rights” referred to are the duty of good faith, the “qualifications and abilities” requirement, or both. In the final sentence, though, it is clear that the “good faith” requirement in

Article 5.02 is applied. [ 51 ] Paragraph 18 is focused on “qualifications or abilities” and is the transition point between the first issue, bad faith, and the second issue, “qualifications or abilities”. [ 52 ] In paragraph 19, the Board denotes “qualifications or abilities” as a “last issue”. However, the analysis that follows again invokes “bad faith”. The Board’s conclusion that the implementation of the BOB was

an act of bad faith is, therefore, at least inextricably intertwined with its conclusion that the BOB was not really a “qualification or ability”. [ 53 ] Paragraph 21 reads as follows: 21. In conclusion , I do not accept Affinity’s argument that the implementation of the BoB requirement is in any way an indication of a qualification or ability of an employee when Management retains some of the factors which affect that BoB.

Although Management may certainly have the right to set qualifications and abilities, they must do so in accordance with their Management rights which are restricted by their requirement to act in good faith. Affinity did not act in good faith when they implemented these proposed changes and, therefore, the grievance is allowed. [emphasis added] Beginning the paragraph with “in conclusion” seems to indicate that the Board considers it to be a

summary of its chain of reasoning. In this paragraph the “qualifications or abilities” qualifier is secondary to the good faith requirement. The Board appears to state that the BOB is not a genuine “qualification or ability” and that it was implemented in bad faith. The two propositions appear to be interdependent. This again supports the proposition that the two questions are “inextricably intertwined”. [ 54 ] In my view, the reliance on “bad faith” by the Board cannot be considered obiter . If anything, the reliance on

Article 10.02 may be obiter . It is my view that the Chambers judge was correct that the primary reason for the decision of the Board was Affinity’s lack of good faith. However, even if the decision of the Board intertwines the issue of lack of good faith with the unreasonableness issue so that the two cannot be easily separated, it is still based in whole or in part on bad faith and Affinity had no opportunity to adduce evidence or properly argue the issue. Accordingly, I can find no error in the Chambers judge’s determination of the scope of issues before the Board and the basis on which it made its decision.

C. Did the reviewing judge err in exercising her jurisdiction to set aside the award when no prejudice was shown? [ 55 ] Given my determination of the previous issue, it is obvious that Affinity had no opportunity to call evidence on the very issue upon which the Board made its decision. Affinity is prejudiced thereby. VIII. Conclusion [ 56 ] I can find no error on the part of the Chambers judge in setting aside the award. The appeal is dismissed. The Union shall have its costs respecting the

fresh evidence application in the circumstances. Affinity shall have its costs on the appeal, apart from the fresh evidence application. DATED at the City of Regina, in the Province of Saskatchewan, this 24 th day of June, A.D. 2014. “Ottenbreit J.A.” Ottenbreit J.A. I concur “Whitmore J.A.” for Klebuc J.A. I concur “Whitmore J.A.” Whitmore J.A.