We have now had two Family Day holidays since the Ontario Government’s creation of the ninth paid public holiday under the Employment Standards Act, 2000 (“ESA”). Since then, there have been several arbitration awards regarding whether employers are required to provide Family Day as a paid holiday.
As we noted in our previous Legal Alert on Family Day, in situations where employers are currently providing a “greater right or benefit” to employees, subsection 5(2) of the ESA applies, and provides that:
If one or more provisions in an employment contract or in another Act that directly relate to the same subject matter as an employment standard provide a greater benefit to an employee than the employment standard, the provision or provisions in the contract or Act apply and the employment standard does not apply.
Here is how some recent cases have decided the greater right or benefit argument.
The Focus of the Comparison
One of the union arguments raised in a number of the awards was that the above amended wording of the ESA now required a comparison based on the specific holiday, as opposed to the usual global comparison. The arbitrators, however, have all adopted the approach set out in the Divisional Court’s decision of Queen’s University v. Fraser(1), where the Court explained that one must look at the entirety of the terms in the agreement respecting holidays and not compare each individual item. Accordingly, the general consensus remains that an assessment of whether the employer is providing a greater benefit necessarily involves a consideration of the entire holiday scheme, including such factors as the number of holidays provided, the qualification period, the requirement to work the day before and the day after the holiday, the pay rate for working on the holiday, and any other qualifying condition.
With respect to whether the floater days can be counted in the comparison, the cases confirm that it will depend on as little as where the floater provision is located in the agreement and/or whether the floater days have a “use them or lose them” character. This issue was considered in at least two of the family day awards. In Agropus, Division of Natrel and Teamsters, Local 647(2), the collective agreements provided four floater days, in addition to nine holidays. Similarly, the collective agreement at issue in U.S. Steel Canada and USW Loc 8782(3) had 10 holidays, including one Floating Holiday to be observed within the bi-weekly period in which each employee’s birthday actually occurred. In both cases, the union relied on Toronto Zoo and C.U.P.E., Local 1600(4), where the arbitrator refused to consider two floating days provided for in the collective agreement as part of the holiday benefit being compared. In that case, in concluding that the floating holidays did not relate to the same subject matter as statutory holidays, the arbitrator noted that the two floating days were listed in a separate provision and the days were forfeited if they were not taken within the year allotted. In Agropus and U.S. Steel, however, the arbitrators held that the floating days related to the same subject matter as holiday pay, since the floating days were listed with the other statutory holidays, and there were no “use them or lose them” policies. Accordingly, the collective agreements were held to provide a greater benefit.
Whether Employers are Required to Consider Employees’ Individual Entitlement
Recent decisions have raised the question of whether, in determining greater right or benefit, an adjudicator must look at each employee’s entitlement individually. At least one arbitrator had found that the comparison must be made in respect of each individual employee. In Zehrs Markets and U.F.C.W., Local 175(5), the arbitrator held the employer will generally not contravene the ESA by applying the articles of the collective agreement rather than the provisions of the ESA. However, he ruled that since the comparison must be made on an individual employee basis, if an employee received less holiday pay under the agreement than he/she would have received under the ESA, the employer was required by the ESA to pay the employee the amount of the shortfall.
In the context of Family Day, a similar approach was taken in at least two awards: Shepherd Village Inc(6)., and Erie St. Clair(7). In Shepherd Village, the collective agreement did provide for the forfeiture of two floater holidays. In that case, the arbitrator held that the forfeited floater days were of no benefit to an employee and meant that the agreement did not provide a greater benefit in respect of the employees who did not take the floater days. Accordingly, he concluded that the grievance was dismissed as it applied to the employees who received a floater holiday. However, he remained seized to deal with any situation where the collective agreement allowed for the forfeiture of the floater days in respect of any employee.
Similarly, the arbitrator in Erie St. Clair found that certain part-time employees under the Sarnia-Lambton collective agreement might not receive a greater benefit under the collective agreement. Although the arbitrator dismissed the grievance, it was subject to the proviso that the award did not deal with whether a parttime employee who would be entitled to greater or equal holiday pay under the ESA over the course of the calendar year enjoyed a greater benefit under the agreement, and he remained seized to deal with such a situation.
In another Zehrs case decided earlier this year(8), the union filed a grievance respecting the employer’s refusal to pay holiday pay to parttime employees for the Family Day holiday. In this case, the evidence demonstrated that the holiday provisions of the collective agreement provided a greater benefit than the ESA to the vast majority of employees in the bargaining unit (92% of active employees were better off), but not every individual employee was better off in any given year. The union took the position that the employer
ought to treat Family Day as a paid holiday for all employees, given that the collective agreement was not a “greater right” for all employees. In the alternative, the union was of the view that, because the method used by the employer for applying the holiday pay provisions of the collective agreement resulted in a lesser benefit for approximately 8% of the employees, the employer was in breach of the ESA with respect to these employees, and so was required to remedy the breach in a similar manner as directed by Arbitrator Howe in the 2002 Zehrs case.
Arbitrator Albertyn dismissed the grievance and upheld the collective agreement as a “greater right or benefit”. In his view, the “vagaries” of scheduling and availability meant that the 8% did not in fact get paid more than the employment standard, but they were nonetheless entitled to the full holiday pay benefit of the collective agreement. Further, the fact that in a particular period, or on termination, they did not in fact get paid the greater benefit, was not a typical characteristic of the holiday pay term of their employment. Arbitrator Albertyn therefore found that the employees were not entitled to the employment standard since the benefit contained in the collective agreement was what applied and prevailed, as contemplated in section 5(2) of the ESA. The union has applied for judicial review of arbitrator Albertyn’s decision.
Whether an Employer can Require Employees to take Family Day as an Unpaid Holiday
While there were a number of creative arguments raised in the cases, an interesting issue discussed in Sterling Ford Sales (Ottawa) Inc. and CAW-Canada, Loc 4270(9) was whether an employer is permitted to force employees to take an additional unpaid holiday on a date which the government has set as a paid holiday. The union in this case argued, among other things, that the employer has an obligation to provide work, or at least pay, to employees, which it could not ignore by deciding to close its business on Family Day. The arbitrator did not accept the union’s argument, finding that the collective agreement provision concerning the hours of work to be provided to employees did not constitute a guarantee that they would be permitted to work for pay on each and every day within the normal work week. It remains to be seen how this issue would be
decided where a collective agreement contains a guaranteed pay or guaranteed hours of work clause, or some other restriction in the collective agreement limiting an employer’s ability to shut down without paying its employees.
It is clear from the recent decisions that arbitrators are in general agreement that if a collective agreement contains more paid holidays, which are not administered more restrictively, the collective agreement will be held to provide a greater benefit and the ESA provisions will not apply. It remains unclear, however, whether employers are required to consider employees’ individual entitlement in determining whether it is providing a greater right or benefit. Hopefully, this issue will be decided by the Divisional Court in its judicial review of the recent Zehrs case.