In Toronto Transit Commission v. Amalgamated Transit Union, October 6, 2004 (Shime), a labour arbitration decision that could expose supervisors and unionized employers to significant damages, an arbitrator found the Toronto Transit Commission (TTC) and one of its supervisors liable for $25,000 in general damages for the supervisor’s harassment of a union employee.
In the case, the grievor alleged that the foreman engaged in a campaign of relentless harassment regarding his performance and productivity. The arbitrator found as fact that the foreman abused his authority and harassed the grievor by frequently and publicly telling the grievor to get back to work while others were not working, by unjustifiably complaining about the grievor’s work, by attempting to discipline the grievor where it was not warranted and by making unreasonable demands on the grievor with respect to work performance.
The TTC argued that the collective agreement and the collective bargaining regime do not provide for claims for damages based on tortious misconduct, such as negligence, defamation and harassment. Therefore the arbitrator did not have the jurisdiction to hear the grievance (an argument subsequently decided by the Ontario Divisional Court in the Seneca College decision referred to below). The arbitrator looked to both the management rights clause and the requirements under the Occupational Health and Safety Act to ground his jurisdiction and make the issue arbitrable. Because the collective agreement provided for the establishment of a Joint Health and Safety Committee, the arbitrator found that it was implied that management would exercise its rights with a view to the safety of the employee. In addition, the arbitrator held that the supervisor’s managerial authority was circumscribed by the Occupational Health and Safety Act, which requires supervisors to take every precaution reasonable to protect a worker.
The arbitrator found that "when a supervisor exercises his/her authority under the collective agreement, it is an implied term that the supervisor do so in a manner that is consistent with the legislation". This implied term required the TTC to exercise its management rights in a manner that ensures the safety of its employees, including their psychological safety. The arbitrator concluded that "a supervisor who abuses his/her authority and abuses and harasses an employee is not administering the management rights clause in a reasonable manner and is in violation of the collective agreement".
While the TTC raised the issue of whether such a finding would lead to increased claims by employees against their supervisors for any sort of ill-treatment, the arbitrator rejected the argument in the circumstances of this case. However this exercise of "arbitral creativity", as the arbitrator termed it, could indeed have that effect. This is a case that supports the maxim "bad facts made bad law". While the arbitrator found that he could imply a term into the collective agreement based on the school of thought that employers must exercise their managerial rights "responsibly", the arbitrator does not discuss the source of his jurisdiction to award general damages in the amount of $25,000 against the supervisor and the TTC, nor the grounds for awarding that particular amount.
The question is whether this decision will lead to grievances based on workplace disagreements between a supervisor and employee. It has been said that industrial shops are not debating societies. Arbitrators in the past have been unwilling to interfere with a supervisor’s discretion in how a workplace is run. They have recognized that "shop talk" will occur and there will be instances where ill will arises as a result of a supervisor’s direction.
However, it appears here that the arbitrator has crafted both a duty and a remedy in order to compensate a particular case of egregious conduct. By engaging in such "arbitral creativity", the arbitrator may have exposed employers to increased grievances and potentially significant liability. While employers clearly cannot condone behaviour by supervisors that offends the Human Rights Code (in the TTC case there was no such allegation), employers and supervisors could find that unpopular directions will expose them to claims of harassment and potentially make them liable in damages.
It remains to be seen whether this decision will open the floodgates on a variety of similar claims. What about a supervisor who feels aggrieved by the abusive behaviour of a particular bargaining unit employee? Would he be able to claim damages against the union and employer through the grievance and arbitration process? Will other arbitrators be as inclined as this one to deal with such disputes? In Ontario Public Service Employees Union v. Seneca College of Applied Arts & Technology,  O.J. No. 4440 (released November 1, 2004), the Ontario Divisional Court found that an arbitration board erred in law by not addressing a grievor’s claim for aggravated and punitive damages for defamation and intentional infliction of mental distress arising from his dismissal. The TTC and Seneca College decisions should be considered as the natural application of the Supreme Court of Canada’s decision in Weber v. Ontario Hydro (1995), 125 D.L.R. (4th) 583, which held that an arbitrator has exclusive jurisdiction where the essential character of the dispute arises either expressly or inferentially out of a collective agreement. Arbitrators now appear willing to both address such claims in the arbitration process and provide a remedy in damages. While some arbitrators may feel that this decision goes too far, it would not be surprising if it begins to be used to ground similar claims in the future.
We will be following this issue to see if similar grievances proceed to arbitration. In the meantime, should you have any questions or comments, or wish further information, please do not hesitate to contact any member of our Employee and Labour Relations group.
The foregoing provides only an overview. Readers are cautioned against making any decisions based on this material alone. Rather, a qualified lawyer should be consulted.
© Copyright 2004 McMillan Binch LLP