P&H Milling Group a Division of Parrish & Heimbecker, Limited Saskatoon Appellant (Respondent) v. United Food and Commercial Workers, 2023 SKCA 14

Court of Appeal for Saskatchewan Docket: CACV3974 Citation: P&H Milling Group a Division of Parrish & Heimbecker, Limited Saskatoon v United Food and Commercial Workers Local 1400 2023 SKCA 14 Date: 2023-01-26 Between: P&H Milling Group a Division of Parrish & Heimbecker, Limited Saskatoon Appellant (Respondent) And United Food and Commercial Workers Local 1400 Respondent (Applicant) Before: Caldwell, Kalmakoff and McCreary JJ.A. Disposition: Appeal dismissed Written reasons by: The Honourable Madam Justice McCreary In concurrence: The Honourable Mr. Justice Caldwell The Honourable Mr.

Justice Kalmakoff On appeal from: 2021 SKQB 310 , Saskatoon Appeal heard: September 15, 2022 Counsel: Dustin Gillanders for the Appellant Heath Smith for the Respondent McCreary J.A. I. INTRODUCTION [ 1 ] This is an appeal from the judicial review of a labour arbitration award ( United Food and Commercial Workers, Local 1400 v P&H Milling Group (a division of Parrish & Heimbecker Ltd.

Saskatoon) (2021), 325 LAC (4th) 249 [ Award ] ) under which the arbitrator considered whether a group of employees was entitled to sick pay when they were required to self-isolate and were not permitted to work as scheduled, because of their possible exposure to SARS-CoV-2 [Covid-19]. [ 2 ] The appellant, P&H Milling Group a Division of Parrish & Heimbecker, Limited Saskatoon [Employer], and the respondent, United Food and Commercial Workers Local 1400 [Union], are parties to a collective bargaining agreement, the relevant version of which has a term of March 1, 2018, to February 28, 2021 [Collective Agreement]. [ 3 ] The Award relates to four grievances filed by members of the Union in respect of events that occurred in March and April of 2020, in the very early days of the Covid-19 pandemic in Saskatchewan.

In each of the grievances, Union members were absent from work because they were required to self-isolate as a result of possible exposure to the Covid-19 virus. None of the grievors were symptomatic, nor were they tested for Covid-19.

All testified that they were otherwise “ready, willing, and able to work as scheduled”, but that they did not work because of the requirement to self-isolate ( Award at para 7). [ 4 ] In the Award , the arbitrator concluded that the sick leave provisions of the parties’ Collective Agreement did not entitle the grievors to sick pay because they were not actually sick, which she interpreted to mean having symptoms or an infection verified by a positive Covid-19 test.

Upon judicial review, a Court of Queen’s Bench Chambers judge found the arbitrator had too narrowly construed the grievors’ entitlement to sick leave benefits, resulting in the Award being unreasonable. The Chambers judge set aside the Award , declaring that the grievors were entitled to their earned sick pay: United Food and Commercial Workers Local 1400 v P&H Milling Group a Division of Parrish & Heimbecker, Limited Saskatoon , 2021 SKQB 310 , [2022] 1 WWR 708 [ Chambers Decision ]. [ 5 ] For the reasons that follow, I would dismiss the Employer’s appeal from the Chambers Decision .

I agree with the Chambers judge’s conclusion that the Award is unreasonable, and I would not interfere with his decision to set it aside. On any reasonable

interpretation of the Collective Agreement, the grievors are entitled to their earned sick pay. II. ISSUES AND STANDARD OF REVIEW [ 6 ] There are two principal issues in an appeal from a judicial review of a labour arbitration award. The first is whether the reviewing judge identified the correct standard of review. The second is whether the reviewing judge correctly applied the applicable standard of review: Dr.

Q v College of Physicians and Surgeons of British Columbia , 2003 SCC 19 at paras 43–44 , [2003] 1 SCR 226 . [ 7 ] In this case, the parties agree that the Chambers judge correctly identified that the Award should be reviewed on the reasonableness standard.

Accordingly, the sole issue in this appeal is whether he correctly applied that standard, which requires this Court to “step into the shoes” of the Chambers judge and conduct its own reasonableness review: Teamsters Canada Rail Conference v Canadian National Railway Company , 2021 SKCA 62 at paras 41–42 , 327 LAC (4th) 322 . [ 8 ] At a high level, a reasonableness review is concerned with a decision-maker’s reasoning process and the outcomes of the decision. It determines whether the decision in question is based on an internally coherent and rational chain of analysis that is defensible

in relation to the relevant facts and the law. Conceptually, there are two types of fundamental flaws that tend to render a decision unreasonable. The first is a failure of rationality internal to the decision-maker’s reasoning process. The second is when the decision is untenable in some respect, given the relevant factual and legal constraints that bear on it. See, generally: Canada (Minister of Citizenship and Immigration) v Vavilov , 2019 SCC 65 , [2019] 4 SCR 653 [ Vavilov ]. In this case, the Award is flawed in both ways. III.

ANALYSIS [ 9 ] As I will explain, because it does not reveal a rational chain of analysis and is untenable given the relevant factual and legal constraints that bore on the arbitrator’s decision-making, I find that the Chambers judge correctly concluded that the Award is unreasonable and correctly set it aside. A. Factual and legal constraints – collective bargaining agreement

interpretation [ 10 ] Addressing first the legal constraints that bore on the arbitrator’s decision-making in this case, I find that the Award is unreasonable because the arbitrator failed to interpret the relevant contractual language – i.e.,

Schedule “B” of the Collective Agreement, Company Sick Leave Program [Sick Leave Provisions] – in accordance with the principles of contract

interpretation that apply to collective bargaining agreements. [ 11 ] In Saskatchewan, arbitral consensus accepts and adopts the approach to interpreting collective bargaining agreements outlined by Arbitrator Bob Pelton in SEIU-West v Saskatoon Regional Health Authority , [2010] SLAA No 9 (WL) at paras 87–88 [ SEIU-West ]: … The modern principle of

interpretation is a method of

interpretation rather than a rule, but still encompasses the many well-recognized

interpretation conventions. The modern principle directs interpreters: 1. to consider the entire context of the collective agreement. 2. to read the words of the collective agreement • in their entire context • in their grammatical and ordinary meaning 3. to read the words of a collective agreement harmoniously • with the scheme of the agreement • with the object of the agreement and • with the intention of the parties. … Once an

interpretation is settled upon, it should be tested by asking these questions: • is the

interpretation plausible – is it reasonable? • is the

interpretation effective – does it answer the question within the bounds of the collective agreement? • is the

interpretation acceptable in the sense that it is within the bounds of acceptability for the parties and legal values of fairness and reasonableness? [ 12 ] Viewed in its labour relations context, the method set out in SEIU-West is consistent with the approach to contractual

interpretation taken by the Supreme Court of Canada in Sattva Capital Corp. v Creston Moly Corp. , 2014 SCC 53 , [2014] 2 SCR 633 , and Corner Brook (City) v Bailey, 2021 SCC 29 , 460 DLR (4th) 169. The core principle of this approach is that the language of a collective agreement must be interpreted purposefully and in its context.

As the Supreme Court has directed: “To do so, a decision-maker must read the contract as a whole, giving the words used their ordinary and grammatical meaning, consistent with the surrounding circumstances known to the parties at the time of formation of the contract” ( Sattva at para 47). [ 13 ] While arbitrators are not bound by a strict doctrine of stare decisis , when a consensual view exists respecting a point of law, that consensus is a valuable benchmark for assessing the reasonableness of a decision that is challenged through judicial review.

See: Communications, Energy and Paperworkers Union of Canada, Local 30 v Irving Pulp & Paper, Ltd. , 2013 SCC 34 , [2013] 2 SCR 458; and Retail, Wholesale Department Store Union v Yorkton Cooperative Association , 2017 SKCA 107 at para 35 [ Yorkton Coop ].

The majority of the Supreme Court confirmed this in Vavilov , stating that administrative decision-makers must be concerned with the “general consistency” of their decisions because the parties “are entitled to expect that like cases will generally be treated alike and that outcomes will not depend merely on the identity of the individual decision maker” (at para 129).

The majority in Vavilov went on to state that the question of whether an administrative decision is consistent with past decisions is something that “the reviewing court should consider when determining whether an administrative decision is reasonable” (at para 131). [ 14 ] In this case, the arbitrator did not perform any analysis of the language relating to benefit entitlement in the Sick Leave Provisions.

Instead, she simply concluded that the language was “clear” and then proceeded to contemplate the purpose of the Sick Leave Provisions, without considering how that purpose was informed by the actual words used by the parties to describe their bargain. The

arbitrator’s failure to employ the approach to collective bargaining agreement

interpretation consistently adopted by her arbitral peers is a departure from established arbitral authority. As such, the arbitrator bore the “justificatory burden of explaining that departure in [her] reasons”. The majority in Vavilov instructed that where a “decision maker does not satisfy this burden, the decision will be unreasonable” ( Vavilov at para 131 ). Notably, the Award does not explain or attempt to justify the arbitrator’s departure from the approach to collective agreement

interpretation described in SEIU-West . This results in a reasoning process that does not allow this Court to discern a legal or factual justification for the finding that sick leave benefits were not available in the circumstances. As such, the outcome of the Award is unreasonable. [ 15 ] The following portions of the Sick Leave Provisions are relevant, and I have emphasized the language that requires close attention: 2. Employees entitled to payment of wages for earned sick leave shall be paid at the regular rate of pay for the hours they would have worked . 3.

Benefits commence the first day of disability and expire on the thirtieth (30th) day of disability . … 8. In order to qualify for sick pay, an employee must provide a Doctor’s Certificate from the attending physician upon the third day of absence that confirms the employee’s illness or injury and estimated date of return to work. … 10.

Employees absent from work because of sickness or accident shall be obliged whenever it is reasonably possible to notify the Company their approximate length of absence . (Emphasis added) [ 16 ] When the highlighted words are read in their entire context and in their grammatical and ordinary sense within a labour relations scheme, it is significant that “disability”, “illness”, “injury”, “accident” and “sickness” are used interchangeably to describe situations in which an employee is entitled to sick pay.

Similarly, it is equally important to their meaning that the words “disability” and “absence” are each used to refer to time when the employee is away from work and receiving sick pay benefits. For example, the Sick Leave Provisions state that sick pay benefits will start on the first day of “disability”, but that confirmation of “illness” or “injury” is required on the third day of “absence”. In contrast, employees who are “absent from work” because of “sickness” or “accident” must notify the Employer of their approximate length of “absence”.

Because these words are used interchangeably to describe what must be understood as the same state of absence from work, this connotes, in its ordinary sense, that the parties intended that a broad range of health-related situations would trigger entitlement to sick pay. Given the interpretive principle that the use of different words is intended to convey different meaning, the fact that the parties used several different words to describe an employee’s absence from the workplace for health-related reasons means that the language is arguably either very broad or is ambiguous.

Regardless, determining the scope of the grievors’ entitlement to benefits under the Sick Leave Provisions was the first-order question in this arbitration and, because it went unanswered by the arbitrator, the Award is unreasonable. [ 17 ] Instead, in a narrow

interpretation of the Collective Agreement, the arbitrator relied on only s. 8 of the Sick Leave Provisions, which requires employees to provide the Employer with a doctor’s certificate beyond the second day of their “illness” or “injury”, as supporting the conclusion that an employee had to be symptomatic or verifiably infectious in order to qualify for sick pay. In my respectful view, this

interpretation is unjustifiable given the language of the Collective Agreement and general principles of labour law. [ 18 ] When the Sick Leave Provisions are considered in the context of the applicable labour law principles, the scheme and object of the Collective Agreement, and the parties’ intentions at the time the bargain was struck, it is clear that the parties did not intend to restrict sick leave benefits to circumstances where an employee was either symptomatic or verifiably infectious. [ 19 ] First, when it is understood that the language of the Sick Leave Provisions is either very broad or is ambiguous, it follows that a broad and purposive approach to

interpretation must be taken. This interpretive approach is also consistent with

Article 5.3 (Reservation of Management Rights) of the Collective Agreement, under which the Employer agreed to “carry out the terms of this contract in letter and in spirit”, thus indicating that the parties agreed to employ a broad and purposive approach to the

interpretation of the Collective Agreement if their intentions were later found to be unclear. [ 20 ] Second, under the Sick Leave Provisions, the parties negotiated for employees to receive an earned benefit when they must be absent from work for a host of reasons (i.e., illness, disability, sickness, accident and injury).

The purpose of that benefit, as the arbitrator partly identified, is to ensure employees remain financially whole in the relatively short term when they must be absent from work for a variety of reasons that are all health related . [ 21 ] Third, in the milieu of labour relations, the well-understood purpose of a bargained provision that entitles an employer to require a doctor’s certificate is to verify the legitimacy of an employee’s absence; it does not speak to which health-related situations qualify for sick leave benefits.

In this case, there was no issue respecting the legitimacy of the grievors’ reasons for being absent from work. The Employer understood and accepted that the grievors were required to self-isolate and were therefore prohibited from working, because they were deemed by a public health order to be possibly infectious.

In addition, while the legitimacy of the grievors’ absence from work was not challenged, it seems very likely that any physician would have confirmed the requirement to self-isolate in these circumstances, particularly when it arose as a matter of law under a public health order issued by Saskatchewan’s Chief Medical Health Officer. [ 22 ] In this context, it was not reasonable for the arbitrator to conclude that the requirement to provide a doctor’s certificate after two days of absence was an indication that the parties had intended that employees would not be eligible for sick pay unless they were symptomatic or verifiably infectious.

As I said, this is an unreasonably narrow

interpretation of the doctor’s-note provision. In fact, a considerable amount of arbitral authority has developed in the labour relations realm over how much, if any, personal health information

must be disclosed in a doctor’s certificate in order to verify a short-term absence from work for a health-related reason: see, for example,Communications, Energy and Paperworkers Union of Canada, Local 1-S v SaskTel (2011), 211 LAC (4th) 387 (Arbitrator: Bob Pelton);Saskatchewan Union of Nurses v Prince Albert Parkland Regional Health Authority, [2016] SLAA No 15 (Arbitrator: William F.J.Hood); Cypress Health Region v Service Employees International Union – West, [2014] SLAA No 13 (Arbitrator: Daniel Ish); and BritishColumbia Teachers’ Federation v British Columbia Public School Employers’ Association, [2004] BCCAAA No 177 (Arbitrator: ColinTaylor). [23] In conclusion on this point, failing to employ the proper analysis to interpret the Collective Agreement and failing to analyze itskey terms led to a decision that is untenable given the relevant factual and legal constraints that existed in this case.

B. Irrational chain of analysis [24] The Award also reveals that the arbitrator’s chain of analysis was not internally rational. [25] The arbitrator initially identified that the issue before her was whether the Employer had violated the Sick Leave Provisions“by failing to provide sick pay to the Grievors who were absent from the workplace pursuant to federal/provincial health requirements and[the Employer’s] direction” (Award at para 13).

She later noted that “[t]his dispute is essentially about who bears the loss [caused by therequirement to self-isolate] within this workplace; the individual employees or the Employer” (at para 23). She reviewed several mattersthat were not material to an

interpretation of the Sick Leave Provisions, including: provincial legislation (the Employer is federallyregulated); common law principles of employment respecting unpaid leave (federal employment standards legislation applies in theabsence of contractual language); the overall effects of the Covid-19 pandemic; and, governmental, societal and the Employer’s responsesto it.

The arbitrator then reframed her inquiry as being a question about “whether the [Covid-19] pandemic is a circumstance whichengages the benefit provisions of the Collective Agreement which provide that [the grievors] may be paid, even when not working asscheduled” (at para 30).

Respectfully, reframing the dispute in this way led the arbitrator to approach it from the wrong direction, tooverlook the breadth of the entitlement language used in the Sick Leave Provisions and to ignore the labour relations context of thebargain the parties had struck in relation to paid sick leave. [26] Having reframed the question, the arbitrator started her analysis by stating that the “obvious purpose” of “sick leave/sick pay”was to “ensure employees who cannot work due to a relatively short-term illness can continue to receive their usual income” (Award atpara 32, emphasis added).

She rejected the argument that, under a contextual and purposive understanding of the Sick Leave Provisions,the Covid-19 pandemic and isolation requirements “create an obligation on [the Employer] to provide sick pay arising from a broad publicpolicy obligation … [to] take active steps to prevent the spread of Covid-19 at workplaces” (at para 34).

Although she had not analyzedthe language of the Collective Agreement, she concluded that neither a public health directive, nor the Employer’s direction, which eachhad required the grievors to self-isolate as a result of exposure to Covid-19, was “described by or implicit in the clear language of the SickLeave Program”, so as to entitle them to paid sick leave (Award at para 34). [27] Here, the Award lacked rational and logical coherence because the arbitrator reached her conclusion by working backwardsfrom an unfounded generalization.

The arbitrator concluded that the language was “clear” but she did not turn her mind to what the partiesmeant by “illness” or whether its meaning differed from what was meant by “disability”, “sickness”, “accident” and “injury” – all of whichare used interchangeably under the Sick Leave Provisions.

Whether broadly or narrowly framed, the issue the arbitrator identified requiredher to interpret the language of the Sick Leave Provisions to determine, at the outset, the meaning or intention behind the words used and,particularly, why they decided to use words having similar but different meanings as though they were synonyms. The Employer and theUnion chose to use five words, “disability”, “sickness”, “injury”, “accident” and “illness”, to define the circumstances that would entitleUnion members to sick pay in respect of an absence from work.

Put simply, the arbitrator’s failure to interpret them is, in my assessment,fatal to the rationality of the reasoning process shown in the Award. [28] While the parties had bargained for sick pay to be provided in cases where an employee was absent from work due to a range ofhealth-related concerns (and, again, the Sick Leave Provisions stated this might be due to illness, disability, sickness, injury or accident),the arbitrator nevertheless concluded that a circumstance where an employee was possibly infectious, but not symptomatic, was excludedfrom the sick leave regime unless the employee could prove they were actually infectious.

She stated: 36. … Paragraph 8 of the Program requires a Doctor’s Certificate to support a sick pay claim. By extension, a positive COVID-19 testresult would serve the same purpose for individuals infected with the virus who have no discernable symptoms. The mere possibility anemployee might be infectious is insufficient to gain access to the sick bank. … 39. … [T]he evidence in this matter is that the Grievors were neither exhibiting nor reporting symptoms of illness.

I cannot find, as afact, that “potentially infectious” means the same as “sick” in order to find the Employer’s direction that the Grievors self-isolate wasemployer mandated sick leave. The evidence does not support such a conclusion. [29] With respect, this reasoning is not internally rational. First, the arbitrator generalized, without foundation, that the requirementto provide a doctor’s certificate meant that the parties only intended for employees to have paid sick leave when they were actuallyinfectious.

Then, the arbitrator concluded that because the grievors were not exhibiting or reporting symptoms of Covid-19, “theevidence” did not support the conclusion that “‘potentially infectious’ means the same as ‘sick’” so as to entitle the grievors to paid sickleave, even though the Employer had prohibited them from working on that basis (Award at para 39). This is circular reasoning and is alogical fallacy because the conclusion is derived from premises that presuppose or contain a disguised version of the conclusion.

As themajority observed in Vavilov, “the internal rationality of a decision may be called into question if the reasons exhibit clear logicalfallacies, such as circular reasoning, false dilemmas, unfounded generalizations or an absurd premise” (at para 104). Here, thedemonstrated problems with the internal rationality of the Award render it unreasonable. [30] On appeal to this Court, the Employer argued that two Ontario arbitration awards from the healthcare sector, ParticipatingNursing Homes v Ontario Nurses’ Association, (ON LA), 320 LAC (4th) 258 (Ont) (Arbitrator: John Stout), and

Rouge Valley Health System v Ontario Nurses’ Association , 2007 CarswellOnt 11594 (WL) (Arbitrator: L.M. Davie), are authority for the proposition that an employee must be verifiably “sick” in order to access sick leave benefits. These awards are easily distinguishable: they were decided under entirely different collective agreement language and in a markedly different bargaining sector – healthcare – where the risk of disease contagion is frequently at issue (unlike in an industrial mill).

The collective agreements under consideration in these awards used specific, non-ambiguous language to describe entitlement and, in the case of Participating Nursing Homes , the parties had expressly turned their minds to the effects of the influenza vaccine and the consequences for employees who refused to take anti-viral medication during an influenza outbreak. In short, the sophisticated collective agreements in the cited healthcare arbitration decisions are highly distinct from the Collective Agreement at issue and do not provide support for the arbitrator’s reasoning in the Award . C.

Unreasonable outcome [ 31 ] Overall, the Award ’s outcome is unreasonable because the arbitrator did not grapple with the language of the Collective Agreement relevant to the grievances put before her. She failed to come to a conclusion on its key terms and to approach its

interpretation appropriately, leading her to unreasonably conclude that its language was clear and did not obligate the Employer to pay sick leave benefits to the grievors. When properly interpreted, the language of the Sick Leave Provisions entitles employees to paid sick leave in a wide variety of health-related circumstances. Thus, taking a purposive approach, the parties have bargained for employees to receive pay when they are legitimately required to be absent from work for health-related reasons.

It is unreasonable to infer that because, under this Collective Agreement, employees are required to prove the legitimacy of their health-related absences, it follows they must be able to demonstrate observable symptoms or a confirmed infection to qualify for sick pay. This

interpretation misconstrues the general purpose of requiring a doctor’s certificate. [ 32 ] The grievors were mandated, by public health order and by the Employer’s direction, to self-isolate because they might be infected with a highly contagious virus and, if attending at work, might infect others.

In the industrial environment in which the Collective Agreement was negotiated, and given its language, it is hard to imagine a circumstance in which the parties would not have intended that employees could access their earned sick leave benefit when a public health protocol deemed them so potentially infectious that they were prohibited from leaving their homes. [ 33 ] As the Chambers judge determined, the only reasonable

interpretation of the Sick Leave Provisions is that the parties intended for employees to be entitled to paid sick leave when they were required to be absent from work for legitimate health-related reasons. A public health order, or the Employer’s direction, which prohibits an employee from attending work because they are potentially infectious is a legitimate health-related reason under the broad entitlement framework of the Collective Agreement. In these circumstances, I agree with the Chambers judge that, because there is only one reasonable

interpretation, there is no need to refer this matter back to arbitration: Yorkton Coop at paras 48–51 . IV. CONCLUSION [ 34 ] In the result, I would dismiss the Employer’s appeal. The Union is entitled to the costs of this appeal, in the usual way. “McCreary J.A.” McCreary J.A. I concur. “Caldwell J.A.” Caldwell J.A. I concur. “Kalmakoff J.A.” Kalmakoff J.A.