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2019-02-01T15:38:47-05:00 December 14, 2018|Arbitration|

Alleged Breach of Settlement and Who Has Jurisdiction

Minutes of Settlement are, of course, common in labour matters.  What happens where it is alleged that a party has breached the terms of Minutes of Settlement entered into with respect to another proceeding?  Specifically, where it is alleged that the breach occurred during opening statements.  The issue, fortunately, doesn’t come up all that often, but it did in a case called William Osler Health Centre v Canadian Union of Public Employees Local 145, 2018 CanLII 118887 (ON LA).

A number of grievances were before the arbitrator:

  • one-day suspension dated March 17, 2017;
  • five-day suspension dated May 5, 2017; and
  • termination from employment on July 10, 2017. 

In the course of the Union’s opening statement certain statements were made which led the employer to make a motion claiming that the union had breached the terms of Minutes of Settlement (“MOS”) dated August 20, 2013.  The employer asked the arbitrator to make a variety of orders including issuing a declaration of the breach of the MOS, repayment of the funds previously paid to the Grievor pursuant to that settlement and damages payable by the union to the employer as a result of the breach of the MOS.  

The Union argues that the arbitrator was without jurisdiction to decide whether there has been a breach of the MOS.

Of note is that the union and employer agreed in the MOS, in part, as follows:

  • the agreement would not constitute a precedent between them, and “shall not be referred to or relied upon in any subsequent proceedings or grievances between the Employer and the Union or any of the bargaining unit members”
  • the terms and conditions of “this Agreement shall be kept strictly confidential.  The parties agree that this is a fundamental term of this Agreement”
  • that in the event of any breach of this Agreement by any of the Parties, this Agreement can be enforced by the Union or the Employer by way of grievance and arbitration as per the provisions of the Collective Agreement and that such grievance and or arbitration shall be the exclusive remedy for such breach.

The employer argued that the Union “egregiously breached the terms of the MOS” by the statements it made during opening and that these statements have coloured the arbitration.  

Notwithstanding the employers argument around colouring the hearing, it nonetheless did no request that the arbitrator recuse herself from these matters.   

The union argued that the arbitrator, being seized of three (3) grievances, lacked the jurisdiction to deal with the breach of the MOS.  The parties themselves had set out the manner in which alleged breaches of the MOS would be dealt with.  It also argued that, if the arbitrator found that she had jurisdiction to deal with alleged breaches of the MOS, that it would call evidence to show that the “employer has repeatedly breached the confidentiality provisions of the MOS, and that it therefore cannot now seek to enforce the MOS to the Union’s detriment.” 

The arbitrator agreed with the Union’s argument and found that she lacked the jurisdiction or authority to consider whether there has been a breach of the MOS.  The arbitrator referred to the settled principle that “an arbitrator’s jurisdiction is determined based on what has been submitted to arbitration before her, and that arbitrator has no authority to decide any other question”. 

Furthermore, the parties themselves agreed to a process by which breaches of the MOS would be handled and that the “exclusive remedy” would be obtained through that process. 

In saying this, the arbitrator, of course, noted that either party was free, in the course of the proceedings before her, to object to evidence that the other called and, in the employers’ case, evidence with respect to an alleged contravention of the MOS.  The objection could be dealt with at that time.