Date: 20040518
Docket: T-862-02
Citation: 2004 FC 715
Ottawa, Ontario, this 18th day of May, 2004
Present: The Honourable Justice James Russell
BETWEEN:
CANADIAN PACIFIC RAILWAY COMPANY
Applicant
and
RON T. CLERK AND BRIAN A. DUNN
Respondents
REASONS FOR ORDER AND ORDER
[1] The Applicant, Canadian Pacific Railway Company ("CPR"), seeks judicial review of an interim adjudication as to discontinuance of a function and lack of work decided by Respondent Brian a. Dunn ("Adjudicator") sitting in the matter of Division XIV Part III of the Canada Labour Code ("Code") dated May 8, 2002 and received May 17, 2002 ("Decision") in which the Adjudicator dismissed the preliminary objection of the Applicant with respect to jurisdiction to hear the unjust dismissal complaint filed by the Respondent Ron T. Clerk ("Mr. Clerk").
BACKGROUND
[2] The Adjudicator was appointed pursuant to Division XIV Part III of the Code to hear the unjust dismissal complaint filed by Mr. Clerk. The Adjudicator issued an interim decision, dated May 8, 2002, dismissing the preliminary objections of the Applicant with respect to lack of jurisdiction pursuant to s. 242(3.1) of the Code.
[3] Mr. Clerk commenced employment with CPR on September 22, 1969 as a unionized electrical apprentice based at the Toronto Yard. After occupying a variety of positions, Mr. Clerk was appointed as a Mechanical Supervisor in New Brunswick in December, 1986. He continued to work in the CPR Mechanical Department in New Brunswick as a non-unionized employee until the termination of his employment.
[4] CPR's railway operations in New Brunswick and the rest of Atlantic Canada were carried out as a separate operating division known as the Canadian Atlantic Railway ("CAR"). By 1992, it was apparent to CPR that CAR had not sufficiently improved the viability of CPR's railway operations in Atlantic Canada. Accordingly, CPR made the decision to discontinue all railway operations in New Brunswick and the rest of Atlantic Canada. CPR formally applied to the Canadian Transportation Agency to discontinue these railway operations. The Canadian Transportation Agency, following consideration of extensive submissions by many interested parties, ordered the abandonment of the lines after finding they were uneconomic and were not likely to become economic (see CTA Decision No. 569-R-1993).
[5] The abandonment of the lines, closure of the mechanical shops and cessation of operations necessarily required the abolition of positions. Mr. Clerk was one of some 300 employees whose positions were abolished when the CAR was abandoned.
[6] The Applicant's position is that all positions on the CAR were abolished. There are no longer any CPR operating employees in Atlantic Canada.
[7] CPR does not, either itself or through related companies, operate a railway in New Brunswick, Nova Scotia nor anywhere else in Atlantic Canada. Further, most of CPR's railway lines in Quebec have been abandoned or sold. CPR now has fewer than 150 miles of railway line in the Province of Quebec and effectively does not operate east of the City of Montreal.
[8] As a result of the closure of the CPR railway operations in Atlantic Canada, there was a complete absence of work. CPR says that the discontinuance of the mechanical functions and closure of the CAR were the cause of the termination of Mr. Clerk's employment with CPR.
[9] At the same time, significant downsizing was and has continued generally in the CPR Mechanical Department. A nationwide downsizing and reorganization occurred that cut one third of all supervisory positions in the Mechanical Department of CPR. This was accompanied by on-going facility closures that have continued to date.
[10] Across the CPR system, between 1992 and the end of 1994, a total of 797 mechanical positions were eliminated. Since that time, several hundred more mechanical positions have been abolished. For the whole of CPR, 4,363 positions were abolished between 1992 and the end of 1994.
[11] The Applicant says that Mr. Clerk's position, the only remaining mechanical supervisory position in Atlantic Canada in CPR, was eliminated as a result of the discontinuance of the CAR. On May 19, 1994, a letter was sent to Mr. Clerk advising him that because of the CPR reorganization his position had been abolished and his employment with the company would terminate on July 1, 1994. He was offered, and accepted, a severance payment in the gross amount of $103,833, which represented approximately 86 weeks of regular salary.
DECISION UNDER REVIEW
[12] Mr. Clerk filed a complaint of unjust dismissal pursuant to s. 240 of the Code and the Adjudicator heard preliminary arguments concerning jurisdiction pursuant to s. 242 (3.1) of the Code on August 24, 2001.
[13] The Adjudicator issued a decision concerning the preliminary jurisdictional issue, dated September 16, 2001, requesting additional information.
[14] In the September 16, 2001 decision, the Adjudicator found that the CAR was a money -losing proposition and that, by January, 1995 CPR had abandoned all of its lines and discontinued all employment positions that came under the umbrella of the CAR.
[15] The only witness for CPR at the second hearing before the Adjudicator on February 28, 2002 was Mr. Denis Moreau, Senior General Manager, Strategy and Support. He gave evidence concerning the following: the structure of CPR in the early 1990's; the role of the Mechanical Department within CPR; the duties of a Mechanical Officer; the nature of operations within CAR; the discontinuance of CAR; what happened to employees on the CAR subsequent to discontinuance; the concurrent reorganization of the Mechanical Department; the process and outcome for the downsizing in the Mechanical Department; and an overview of the changes that had occurred within CPR generally.
[16] Mr. Moreau testified that there are no current CPR employees in New Brunswick. No one is doing the job of a mechanical officer in Atlantic Canada for CPR. This position has been abolished and the function has been discontinued. The job being done by Mr. Clerk at the time of his termination is not being performed by anyone today.
[17] The Adjudicator found that the jurisprudence clearly required that he first address the question of discontinuance of a function because this went to his jurisdiction.
[18] After reviewing the jurisprudence, the Adjudicator made the following finding:
The onus is on the employer to satisfy me that there was a discontinuance of Mr. Clerk's function. I find as a fact that there was not clear and cogent evidence to that effect. I cannot accept that an organization as large as CP Rail does still not require a Mechanical Officer or several of them to perform the duties set forth in Mr. Clerk's job description except for those that were unique to the New Brunswick location.
PERTINENT LEGISLATION
[19] The unjust dismissal complaint filed by Mr. Clerk is a statutory complaint pursuant to the following ss. 240-246 of the Code:
| 240. (1) Subject to subsections (2) and 242(3.1), any person
(a) who has completed twelve consecutive months of continuous employment by an employer, and
(b) who is not a member of a group of employees subject to a collective agreement,
may make a complaint in writing to an inspector if the employee has been dismissed and considers the dismissal to be unjust.
(2) Subject to subsection (3), a complaint under subsection (1) shall be made within ninety days from the date on which the person making the complaint was dismissed.
(3) The Minister may extend the period of time referred to in subsection (2) where the Minister is satisfied that a complaint was made in that period to a government official who had no authority to deal with the complaint but that the person making the complaint believed the official had that authority.
241. (1) Where an employer dismisses a person described in subsection 240(1), the person who was dismissed or any inspector may make a request in writing to the employer to provide a written statement giving the reasons for the dismissal, and any employer who receives such a request shall provide the person who made the request with such a statement within fifteen days after the request is made.
(2) On receipt of a complaint made under subsection 240(1), an inspector shall endeavour to assist the parties to the complaint to settle the complaint or cause another inspector to do so.
(3) Where a complaint is not settled under subsection (2) within such period as the inspector endeavouring to assist the parties pursuant to that subsection considers to be reasonable in the circumstances, the inspector shall, on the written request of the person who made the complaint that the complaint be referred to an adjudicator under subsection 242(1),
(a) report to the Minister that the endeavour to assist the parties to settle the complaint has not succeeded; and
(b) deliver to the Minister the complaint made under subsection 240(1), any written statement giving the reasons for the dismissal provided pursuant to subsection (1) and any other statements or documents the inspector has that relate to the complaint.
242. (1) The Minister may, on receipt of a report pursuant to subsection 241(3), appoint any person that the Minister considers appropriate as an adjudicator to hear and adjudicate on the complaint in respect of which the report was made, and refer the complaint to the adjudicator along with any statement provided pursuant to subsection 241(1).
(2) An adjudicator to whom a complaint has been referred under subsection (1)
(a) shall consider the complaint within such time as the Governor in Council may by regulation prescribe;
(b) shall determine the procedure to be followed, but shall give full opportunity to the parties to the complaint to present evidence and make submissions to the adjudicator and shall consider the information relating to the complaint; and
(c) has, in relation to any complaint before the adjudicator, the powers conferred on the Canada Industrial Relations Board, in relation to any proceeding before the Board, under paragraphs 16(a), (b) and (c).
(3) Subject to subsection (3.1), an adjudicator to whom a complaint has been referred under subsection (1) shall
(a) consider whether the dismissal of the person who made the complaint was unjust and render a decision thereon; and
(b) send a copy of the decision with the reasons therefor to each party to the complaint and to the Minister.
(3.1) No complaint shall be considered by an adjudicator under subsection (3) in respect of a person where
(a) that person has been laid off because of lack of work or because of the discontinuance of a function; or
(b) a procedure for redress has been provided elsewhere in or under this or any other Act of Parliament.
(4) Where an adjudicator decides pursuant to subsection (3) that a person has been unjustly dismissed, the adjudicator may, by order, require the employer who dismissed the person to
(a) pay the person compensation not exceeding the amount of money that is equivalent to the remuneration that would, but for the dismissal, have been paid by the employer to the person;
(b) reinstate the person in his employ; and
(c) do any other like thing that it is equitable to require the employer to do in order to remedy or counteract any consequence of the dismissal.
243. (1) Every order of an adjudicator appointed under subsection 242(1) is final and shall not be questioned or reviewed in any court.
(2) No order shall be made, process entered or proceeding taken in any court, whether by way of injunction, certiorari, prohibition, quo warranto or otherwise, to question, review, prohibit or restrain an adjudicator in any proceedings of the adjudicator under section 242.
244. (1) Any person affected by an order of an adjudicator under subsection 242(4), or the Minister on the request of any such person, may, after fourteen days from the date on which the order is made, or from the date provided in it for compliance, whichever is the later date, file in the Federal Court a copy of the order, exclusive of the reasons therefor.
(2) On filing in the Federal Court under subsection (1), an order of an adjudicator shall be registered in the Court and, when registered, has the same force and effect, and all proceedings may be taken thereon, as if the order were a judgment obtained in that Court.
245. The Governor in Council may make regulations for the purposes of this Division defining the absences from employment that shall be deemed not to have interrupted continuity of employment.
246. (1) No civil remedy of an employee against his employer is suspended or affected by sections 240 to 245.
(2) Section 189 applies for the purposes of this Division. |
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240. (1) Sous réserve des paragraphes (2) et 242(3.1), toute personne qui se croit injustement congédiée peut déposer une plainte écrite auprès d'un inspecteur si :
a) d'une part, elle travaille sans interruption depuis au moins douze mois pour le même employeur;
b) d'autre part, elle ne fait pas partie d'un groupe d'employés régis par une convention collective.
(2) Sous réserve du paragraphe (3), la plainte doit être déposée dans les quatre-vingt-dix jours qui suivent la date du congédiement.
(3) Le ministre peut proroger le délai fixé au paragraphe (2) dans les cas où il est convaincu que l'intéressé a déposé sa plainte à temps mais auprès d'un fonctionnaire qu'il croyait, à tort, habilité à la recevoir.
241. (1) La personne congédiée visée au paragraphe 240(1) ou tout inspecteur peut demander par écrit à l'employeur de lui faire connaître les motifs du congédiement; le cas échéant, l'employeur est tenu de lui fournir une déclaration écrite à cet effet dans les quinze jours qui suivent la demande.
(2) Dès réception de la plainte, l'inspecteur s'efforce de concilier les parties ou confie cette tâche à un autre inspecteur.
(3) Si la conciliation n'aboutit pas dans un délai qu'il estime raisonnable en l'occurrence, l'inspecteur, sur demande écrite du plaignant à l'effet de saisir un arbitre du cas :
a) fait rapport au ministre de l'échec de son intervention;
b) transmet au ministre la plainte, l'éventuelle déclaration de l'employeur sur les motifs du congédiement et tous autres déclarations ou documents relatifs à la plainte.
242. (1) Sur réception du rapport visé au paragraphe 241(3), le ministre peut désigner en qualité d'arbitre la personne qu'il juge qualifiée pour entendre et trancher l'affaire et lui transmettre la plainte ainsi que l'éventuelle déclaration de l'employeur sur les motifs du congédiement.
(2) Pour l'examen du cas don't il est saisi, l'arbitre :
a) dispose du délai fixé par règlement du gouverneur en conseil;
b) fixe lui-même sa procédure, sous réserve de la double obligation de donner à chaque partie toute possibilité de lui présenter des éléments de preuve et des observations, d'une part, et de tenir compte de l'information contenue dans le dossier, d'autre part;
c) est investi des pouvoirs conférés au Conseil canadien des relations industrielles par les alinéas 16a), b) et c).
(3) Sous réserve du paragraphe (3.1), l'arbitre :
a) décide si le congédiement était injuste;
b) transmet une copie de sa décision, motifs à l'appui, à chaque partie ainsi qu'au ministre.
(3.1) L'arbitre ne peut procéder à l'instruction de la plainte dans l'un ou l'autre des cas suivants :
a) le plaignant a été licencié en raison du manque de travail ou de la suppression d'un poste;
b) la présente loi ou une autre loi fédérale prévoit un autre recours.
(4) S'il décide que le congédiement était injuste, l'arbitre peut, par ordonnance, enjoindre à l'employeur :
a) de payer au plaignant une indemnité équivalant, au maximum, au salaire qu'il aurait normalement gagné s'il n'avait pas été congédié;
b) de réintégrer le plaignant dans son emploi;
c) de prendre toute autre mesure qu'il juge équitable de lui imposer et de nature à contrebalancer les effets du congédiement ou à y remédier.
243. (1) Les ordonnances de l'arbitre désigné en vertu du paragraphe 242(1) sont définitives et non susceptibles de recours judiciaires.
(2) Il n'est admis aucun recours ou décision judiciaire -- notamment par voie d'injonction, de certiorari, de prohibition ou de quo warranto -- visant à contester, réviser, empêcher ou limiter l'action d'un arbitre exercée dans le cadre de l'article 242.
244. (1) La personne intéressée par l'ordonnance d'un arbitre visée au paragraphe 242(4), ou le ministre, sur demande de celle-ci, peut, après l'expiration d'un délai de quatorze jours suivant la date de l'ordonnance ou la date d'exécution qui y est fixée, si celle-ci est postérieure, déposer à la Cour fédérale une copie du dispositif de l'ordonnance.
(2) Dès le dépôt de l'ordonnance de l'arbitre, la Cour fédérale procède à l'enregistrement de celle-ci; l'enregistrement confère à l'ordonnance valeur de jugement de ce tribunal et, dès lors, toutes les procédures d'exécution applicables à un tel jugement peuvent être engagées à son égard.
245. Le gouverneur en conseil peut, par règlement, préciser, pour l'application de la présente section, les cas d'absence qui n'ont pas pour effet d'interrompre le service chez l'employeur.
246. (1) Les articles 240 à 245 n'ont pas pour effet de suspendre ou de modifier le recours civil que l'employé peut exercer contre son employeur.
(2) L'article 189 s'applique dans le cadre de la présente section. |
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[20] The above sections confer, define and limit the jurisdiction of an adjudicator to consider a complaint of unjust dismissal.
ISSUES
[21] The Applicant raises the following issues:
What is the appropriate standard of review for the Adjudicator's Decision that he had jurisdiction to find Mr. Clerk was unjustly dismissed and that the limitation under subsection 242 (3.1) of the Code did not apply?
Did the Adjudicator err, or make a patently unreasonable finding, in concluding that there was not a discontinuance of a function or that the termination of employment was caused by lack of work pursuant to subsection 242 (3.1) of the Code?
ARGUMENTS
Applicant
Standard of Review
[22] In accordance with s. 242 (3.1) of the Code, the Applicant says there is no jurisdiction for an adjudicator to determine whether there has been an unjust dismissal where the dismissal results from a lack of work or discontinuance of a function.
[23] This is a threshold question of jurisdiction and the proper standard of review is "correctness" (Atomic Energy of Canada v. Jindal, [1998] F.C.J. No. 847 (C.A.), Canada Post Corporation v. Pollard, [1994] 1 F.C. 652 (T.D.))
[24] In Roe v. Rogers Cablesystems Ltd., [2000] F.C.J. No. 1457 (T.D.), the functional and pragmatic approach was applied to find as follows:
(ii) Standard of review
Of importance is the fact that section 243 of the Code contains a privative clause applicable to the adjudicator's decision now before the Court.
It is trite law that the existence of a privative clause attracts judicial deference. A privative clause is reflective of Parliament's intent that the Court not substitute its view for that of the adjudicator.
Notwithstanding the principle noted above, it is also well established that issues of jurisdiction may properly be subjected to judicial review. Jurisdictional errors have been held to include reaching a decision without regard to the relevant material before the adjudicator.
On this application for judicial review, I accept the submission of Ms. Roe's counsel that, in considering whether the adjudicator made findings of fact without regard to the material before him, the standard of review is patent unreasonableness. In determining whether the adjudicator had jurisdiction to proceed with the complaint, the standard of review is correctness.
[25] The Applicant says that the standard of review is one of correctness on the jurisdictional issue of whether Mr. Clerk was laid off due to a lack of work or discontinuance of a function. Any findings of fact, however, are subject to the standard of review of patent unreasonableness.
Jurisdiction
[26] The Applicant says that the termination of Mr. Clerk's employment with CPR was the result of lack of work and the discontinuance of a function within the meaning of s. 242 (3.1). In addition to Mr. Clerk's function, all of the mechanical functions in Atlantic Canada and the entire function of CPR's railway operation in Atlantic Canada were discontinued.
[27] The Adjudicator found that all of the mechanical functions in Atlantic Canada and the entire function of CPR's railway operations in Atlantic Canada were discontinued. Consequently, the Applicant argues that in accordance with s. 242 (3.1)(a), of the Code the Adjudicator had no jurisdiction to determine whether there has been an unjust dismissal, nor was there any jurisdiction to order a remedy.
[28] Where an individual is laid off, either permanently or temporarily, because of economic concerns related to lack of work or discontinuance of a function as a result of restructuring, the termination of employment cannot be considered as being "unjust dismissal." The employee can be entirely blameless and there may be no suggestion of "just cause," yet there will be no unjust dismissal (Atomic Energy of Canada, supra).
[29] For the purposes of the s. 242(3.1) the Applicant takes the position that "discontinuance" refers to the bundle of functions attributed to an office or position. If the activities in the bundle are no longer performed, or are redistributed, then there is a "discontinuance" of that function (Flieger v. New Brunswick, [1993] 2 S.C.R. 651; Moricetown Indian Band v. Morris, [1996] F.C.J. No. 1268 (T.D.); Atomic Energy of Canada, supra; Canadian Airlines International Ltd. v. Husain, [1998] F.C.J. No. 607 (C.A.)).
[30] The Applicant points out that an employer has the right to reorganize its business, to discontinue functions and to reduce employment levels. Section 242(3.1) entrenches that right to manage the business and this has been consistently confirmed by the courts and adjudicators. As long as the reorganization is not a sham aimed at eliminating a particular employee, the employer has the right to terminate the employment of individuals as part of the discontinuance of a function (Flieger, supra; Moricetown Indian Band, supra; Atomic Energy of Canada, supra; Canadian Airlines International Ltd., supra; Darwin Brown v. Canadian Pacific Railway, November 10, 2000 (Adjudicator Anderson) Unreported Adjudication under Division XIV, Part III of the Canada Labour Code; Roe, supra).
[31] Once it is determined that a complainant's employment was terminated due to discontinuance of a function or a lack of work, and not for some other reason, an adjudicator cannot consider anything further because s. 242(3.1) of the Code removes jurisdiction in such a case.
[32] In this case Mr. Clerk, along with dozens of other CAR employees, was laid off due to the closure of the entire CPR railway system in Atlantic Canada. At the same time, hundreds of other Mechanical Department employees and thousands of CPR employees in other departments were laid off over the same period of time due to reorganization. Since 1994, thousands more have been laid of and continue to be laid off as CPR attempts to respond to economic pressures and demands.
[33] The Applicant says there can be no doubt that Mr. Clerk was laid off due to both lack of work and discontinuance, in the most fundamental sense, of his function. Given that circumstance, the Adjudicator had no jurisdiction to consider this complaint and erred in not finding that it must be dismissed.
[34] The Applicant's position is simply that the Adjudicator made an error of law when he found that there had not been a discontinuance of a function in this instance. The test he applied, being whether or not an organization as large as CPR required a Mechanical Officer to perform those duties set forth in Mr. Clerk's job description, except for those that were unique to the New Brunswick location, was the wrong test.
[35] If the bundle of activities is no longer performed or the activities are redistributed among others, then there is a "discontinuance" of that function (Flieger,supra; Moricetown Indian Band, supra; Atomic Energy of Canada, supra; Canadian Airlines International Ltd., supra).
[36] The Applicant points out that this test has been properly applied by other adjudicators in circumstances less extreme than the discontinuance of an operating division resulting in the layoff of some 300 employees (Desgagne v. Purolator Courier Ltd., [1993] C.L.A.D. No. 919; Paeste v. Purolator Courier Ltd., [2002] C.L.A.D. No. 521; McMurty v. Air Canada, [2002] C.L.A.D. No. 536; Ritter v. Shaw Cablesystems G.P., [2002] C.L.A.D. No. 295).
[37] Because of this serious error of law, which resulted in the Adjudicator assuming jurisdiction contrary to the provisions of the Code, the proper remedy is an Order by this Court quashing the Decision and dismissing the unjust dismissal complaint filed by Mr. Clerk for a want of jurisdiction (Atomic Energy of Canada Ltd., supra; Canadian Airlines International Ltd., supra; Moricetown Indian Band, supra).
Respondent
General
[38] Mr. Clerk (who has ably represented himself in this matter) notes that the Applicant has contested a ruling on the issue of "jurisdiction" based on an alleged "discontinuance of function." The "function" of a Mechanical Services Organization ("MSO") supervisor was to exercise responsibility for the "inspection, maintenance and repair of motive power and rolling stock." Mr. Clerk says that this function was common to supervisors of the mechanical operations of the CPR and was continued at CPR after he was dismissed.
[39] Mr. Clerk says that he was not dismissed because of the abandonment of the CAR division of CPR. The Canadian Transportation Agency ordered the abandonment of CAR division effective January 1, 1995. Supported by the federal government under the National Transportation Act to reimburse the railway company for all losses associated with the continuance of the operation of the railway between the time of application to abandon until the order to abandon took effect, senior management advised all CPR supervisors working on CAR in February, 1993 that their positions would not be abolished until the CAR division completely closed, which occurred on January 1, 1995. Mr. Clerk says that he was the only supervisor whose position was inappropriately targeted six months early. He notes that 19 other supervisors working at CAR had a position abolishment date of December 31, 1994. He says that the abolition of his position was not chronologically consistent with, due to, resulting from, or because of the closing of CAR. He argues that it is not believable that any alleged reorganization, on July 1, 1994, in a company the size of CPR consisted of only one employee. CPR presently operates on about 14,000 miles of track, has about 15,500 employees, and has over 1500 locomotives and 44,000 railcars which are the responsibility of the MSO for inspection, maintenance and repair.
[40] Mr. Clerk says that, after his position was abolished on the CAR division, the MSO supervisory function was still performed until the division ceased operating. He says that after he had disproved degrading allegations made against him concerning the real cause of his dismissal, and because of his adamant refusal to sign anything which would end his career, he was convinced to sign for a "leave of absence with pay," on the understanding that he would have a job when his situation was straightened out. He says that promptly after he received permission to return to work, he accepted a transfer to Golden, B.C., in March 1995, and worked there, inspecting, maintaining and repairing locomotives and rolling stock, trusting in good faith that he would be given a permanent position. However, he was denied permanent employment and was later dismissed in spite of the fact that he always made it clear he was available to move again.
[41] Mr. Clerk asserts that the dismissal was carried out in bad faith. He says that he was advised, verbally and privately, by a senior MSO manager that he could no longer be a supervisor because of allegations against him. He says that an internal memo on this situation (dated June 29, 1994, from the Vice-President of MSO and circulated only amongst the upper hierarchy of CPR) made it clear that he would not be offered a position in mechanical services because he had been black-listed. Mr. Clerk says he did not know of this internal memo until February 2002, and, before being dismissed, he says that he was standing by for a transfer, incorrectly assuming that his disproving the false allegations made against him would allow him to take up a permanent position.
[42] Mr. Clerk says that evidence and testimony were presented to the Adjudicator in February 2002, that showed there was no discontinuance of the function of inspecting, maintaining and repairing motive power and rolling stock. This function is necessary for the safe operation of the CPR railway system across Canada and the USA, and is prescribed by the Railway Safety Act, and its American equivalent. The function is performed by the MSO.
[43] During the hearing of February 28, 2002, Mr Moreau gave testimony on how the CPR mechanical supervisors were restructured at CPR during 1993 (commencing almost two years before the CAR was abandoned). All supervisory mechanical positions were restructured into the new CPR Mechanical Services Organization (MSO), which is a CPR System entity that stretches across all of CPR in North America. Mr. Clerk says that he had submitted his resumé for, and had been considered for promotion from, a supervisory to a management position. He says that he was then reappointed as a supervisor of the CPR System MSO and was working on CAR division. During 1994, fifteen more MSO positions were eliminated, mostly through attrition.
[44] Mr. Clerk says that there are often attrition vacancies within CPR. Other supervisors with the same function as his at Saint John were duly transferred to functionally comparable positions within the MSO.
[45] Mr. Clerk argues that CPR has submitted a huge volume of mostly superfluous information that is not relevant to "the single order in respect of which relief is sought" in this application
[46] Mr. Clerk relies upon the decision of Rouleau J. in Frezza v. Canadian Pacific Railway, [1999] F.C.J. No. 105 (T.D.) at para. 38 for the following:
It is well established that the Court should allow administrative tribunals to perform the task conferred upon them by their enabling legislation and should exercise self-restraint when asked to review their decisions. This is particularly true where the enabling legislation contains a strong privative clause, such as the one found in section 243 of the Canada Labour Code. That provision reads as follows:
243(1) Every order of an Adjudicator appointed under subsection 242.(1) is final and shall not be questioned or reviewed in any court.
(2) No order shall be made, process entered or proceeding taken in any court, whether by way of injunction, certiorari, prohibition or quo warranto or otherwise, to question, review, prohibit or restrain an adjudicator in any proceedings of the Adjudicator made under section 242.
[47] In Frezza, supra, at para. 39, Rouleau J. referred to his decision in Kelowna Flightcraft Air Charter Ltd v. Kmet (1998), F.C.J. No. 740 (T.D.):
A privative clause of this nature means that a decision of an Adjudicator is not subject to judicial review unless it is so patently unreasonable that it cannot be rationally supported by its enabling legislation and justice requires the intervention of the Court. (..) It is immaterial therefore, whether the Court agrees with the tribunal's conclusion on the issue before it. Provided the decision does not contain such a grievous error of law as to be a misinterpretation of the statutory provisions under which it was made, it is not based on a material finding of fact for which there is no evidence, or the tribunal has not exceeded its jurisdiction in some other way, the decision will not be interfered with. In order for the Adjudicator's decision to be considered patently unreasonable, it must be found by the Court to be clearly irrational insofar as there is no evidence to support it.
[48] The Adjudicator indicated the following in his decision:
I do not intend to reinstate Mr. Clerk in his position so that the only outstanding question is that of compensation. The two areas to be considered are those of lost wages, if any, and the impact on Mr Clerk's pension. It is obvious that I will have to have the evidence of an actuary on the latter issue.
[49] Mr. Clerk says that it is clear that this conclusion is in favour of CPR on the issue of reinstatement. There are financial adjustments outstanding, the existence and documented proof of which CPR has not contested and which CPR has stated an intent to address. He says that to further delay final adjudication of the complaint and the financial adjustments involved would be against the principles of natural justice.
[50] Mr. Clerk is of the view that the Adjudicator has been "duly diligent" and has acted entirely within the discretion given to him under the authority of the Code. The CPR was allowed extra time to prepare and present its case. Mr. Clerk feels that the Adjudicator duly considered the evidence produced by both sides and rendered his Decision as required by law. There were no procedural errors or errors in the treatment of the evidence. He made a finding within his jurisdiction, which was supported by the evidence.
ANALYSIS
[51] In my view, this application involves consideration of a narrow jurisdictional issue. The Adjudicator gives a clear indication that he is fully aware of what is before him:
I agree with counsel for the employer. If I find that there was a discontinuance of Mr. Clerk's function that is the end of the matter. I have no jurisdiction to proceed.
[52] The Adjudicator then goes on to make several key findings of fact:
1. CP Rail is a national railway and until January, 1995, it operated the Canadian Atlantic Railway basically east of the Province of Quebec. At that time it received approval to shut down the whole of that operation as it was a money losing proposition.
2. CP Rail continued its operation throughout the rest of Canada after it shut down the Canadian Atlantic Railway.
3. As a result of the closing of Canadian Atlantic Railway about 302 employees lost their jobs, some of whom regained employment in other CP Rail locations throughout Canada.
4. In the case before me CP Rail did not cease to exist. One of its operating divisions, Canadian Atlantic Railway was shut down but the railway continued to operate as a major carrier.
5. The fact that CP Rail retained employees who were junior to Mr. Clerk and put at least one of them in a management position is not something that I can consider if I find that there was a discontinuance of Mr. Clerk's function.
[53] The key paragraph in the Decision occurs on page 7 and reads as follows:
The onus is on the employer to satisfy me that there was a discontinuance of Mr. Clerk's function. I find as a fact that there was not clear and cogent evidence to that effect. I cannot accept that an organization as large as CP Rail does still not require a Mechanical Officer or several of them to perform the duties set forth in Mr. Clerk's job description except for those that were unique to the New Brunswick location. As stated earlier, Mr. Moreau stated in his evidence that CP Rail still has operating supervisors across its system.
[54] So, notwithstanding that the Adjudicator accepted CAR was completely shut down, he found that there was no "clear and cogent evidence" of a discontinuance of Mr. Clerk's function. The basis for this apparent contradiction is that CPR still requires Mechanical Officers and people who perform the kinds of duties that Mr. Clerk performed.
[55] This suggests that the Adjudicator was of the view that a function is not discontinued provided someone working for an employer still does work of the same description, or provided the employer still needs personnel to perform similar duties.
[56] With respect, I do not believe that this is the meaning of discontinuation of a function as found in the relevant authorities.
[57] It is trite law that an employer has every right to decide how to organize its business and can lay off employees for legitimate business reasons without facing a wrongful dismissal claim. Muldoon J. made the following point in Moricetown Indian Band v. Morris, [1996] F.C.J. No. 1268 (T.D.) at paras. 30 and 31:
30. Although the Code places certain restrictions on employers it does not strip employers of the freedom to restructure and reorganize their businesses. Mr. Justice Pratte in Transport Guilbault Inc. v. Scott, A-618-85 (May 21, 1986) (F.C.A.), [1986] F.C.J. No. 321, speaking about decisions to cut staff, stated: "Provided [the] decision is genuine and there is nothing artificial about it, s.61.5(3)(a) [now s.242(3.1)(a) of the Canada Labour Code] cannot be interpreted otherwise without unduly limiting the employer's freedom to plan and organize its business as it wishes." Mr. Justice Pratte was of course referring to restructuring which resulted in "discontinuance of a function". Therefore, in circumstances such as these, provided the employer makes its decision in good faith as the adjudicator found, and for legitimate reasons there is said to be a discontinuance of a function.
31. It is sure that an employer's discontinuance of a function or functions to save overhead in this department, in order to subsidize the overhead in that department, is a legitimate reorganization of business, if ever there was one, where the employer, in good faith, believes that the unrelieved expense of all functions is too costly.
[58] It appears to me that there was really nothing in the evidence before the Adjudicator in the case at bar to suggest that CPR was not engaged in a legitimate business reorganization when it dismissed Mr. Clerk. Indeed, correspondence from Mr. Clerk himself makes it abundantly clear that he accepted the process when it occurred and his only concern was to try and find an alternative position within CPR somewhere else in the country.
[59] The relevant case law is also clear as to what "discontinuance of a function" involves. To quote Létourneau J. in Atomic Energy of Canada v. Jindal, [1998] F.C.J. No. 847 (C.A.) at para. 15, "a 'discontinuance of a function' occurs not only when a function is no longer carried out but also when the activities that form part of a bundle of activities are divided amongst other people."
[60] The Adjudicator specifically found that there "was no evidence before me that the type of work performed by Mr. Clerk was divided up and reallocated among the remaining employees."
[61] That being the case, the only issue is whether Mr. Clerk's function was "no longer carried out" when he was laid off.
[62] My review of the record leads me to the conclusion that there was no evidence before the Adjudicator that Mr. Clerk was dismissed for any reason other than the fact that CPR went through a massive reorganization and his position was discontinued. His position was eliminated.
[63] CPR did not find him an alternative position somewhere else in its organization as he would have liked, but this does not affect the basic fact that the reason he was laid off from his position was a legitimate business reorganization that required the elimination of his position along with that of many other CPR employees. The fact that other employees within CPR outside of CAR may have continued to perform similar functions and/or that CPR needed mechanical officers like Mr. Clerk elsewhere in its network is not relevant to this issue. Many other people who were laid off as part of the reorganization also sought to be relocated elsewhere within CPR. Some were lucky and succeeded in this regard. Others, such as Mr. Clerk, were not.
[64] But this does not change the fact that Mr. Clerk's position with CPR at CAR ceased to exist. It disappeared in the reorganization. This means there was a discontinuation of his function. As the Supreme Court of Canada made clear in Flieger v. New Brunswick, [1993] 2 S.C.R. 651 at paras. 25 and 26, "'Discontinuance' obviously refers to the termination of something that is termed a function. A 'function' must be the 'office' that is to say the bundle of responsibilities, duties and activities carried out by a particular employee or group of employees." The Supreme Court also says that "[i]t is this definition of 'function,' in the sense of 'office' which best comports with the environment of the work place."
[65] In other words, as was pointed out in Ritter v. Shaw Cablesystems G.P., [2002] C.L.A.D. No. 295, function refers to a position. Mr. Clerk's position disappeared. For this reason, his function was discontinued.
[66] Although he initially accepted that he had been laid off for legitimate business reasons, once he discovered he would not be re-hired, Mr. Clerk began to question whether his function had really been discontinued. He raised before the Court issues of timing and bad faith, and asserted that his job was done by someone else after he left. Quite apart from the fact that these issues are not really a part of the Adjudicator's Decision on the jurisdiction issue, my review of the record leaves me unconvinced that CPR in laying of Mr. Clerk did so for any other reason than as part of a bona fide reorganization. In addition, Mr. Clerk filed no affidavit to support the allegations he makes in this application so that his assertions do not have adequate evidentiary support.
[67] With all the sympathy in the world for the position that Mr. Clerk now finds himself in, I have to find that the Adjudicator was wrong on the issue of jurisdiction. I believe that the applicable standard of review in this case is "correctness" (see, for example, Roe v. Rogers Cablesystems Ltd., [2000] F.C.J. No. 1457 (T.D.)) but, irrespective of the standard I apply, I believe the Adjudicator committed a reviewable error in concluding that he had jurisdiction to consider this matter as an unjust dismissal. Mr. Clerk's employment was discontinued as a result of a lack of work and the discontinuance of the function he was performing at CPR. This means that under s. 242(3.1) of the Code, the Adjudicator had no jurisdiction to examine Mr. Clerk's complaint of unjust dismissal.
ORDER
THIS COURT ORDERS that
1. The Decision of the Adjudicator is quashed;
2. Mr. Clerk's unjust dismissal complaint is dismissed for want of jurisdiction under s. 242(3.1) of the Canada Labour Code;
3. No order is made as to costs.
|
"James Russell" |
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JFC |
FEDERAL COURT
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-862-02
STYLE OF CAUSE: CANADIAN PACIFIC RAILWAY COMPANY
- and -
RON T. CLERK AND BRIAN A. DUNN
PLACE OF HEARING: Ottawa, Ontario
DATE OF HEARING: March 29, 2004
REASONS FOR ORDER : RUSSELL, J.
APPEARANCES:
Mr. Marc Shannon FOR APPLICANT
Mr. Ron T. Clerk FOR RESPONDENT
SOLICITORS OF RECORD:
Mr. Marc Shannon FOR APPLICANT
Suite 2000, Gulf Canada Square
401 - 9th Ave. S.W.
Calgary, AB T2P 4Z4
Mr. Ron T. Clerk FOR RESPONDENT
(appearing on his own behalf)