The Future of Unions?

The Star ran a story today indicating that the CAW and CEP are trying to figure out ways to rejuvenate the relevance of unions in the 21st century, lest they slowly perish.  They're talking about a re-branding, trying to change their image.

The article notes a perception "that unions are primarily self-interested and outdated".

I think that's a fair criticism, and calls for a very deep change to not only how unions advocate, but what they advocate and why.

Unions are dealing with two major problems in terms of public perception.

Do Unionized Employees Have Unrealistic Expectations?

Firstly, there's some criticism that unions and their members are too greedy, pushing too hard and disrupting production for perks and benefits that non-union workers could never expect.  Is this jealousy?  Maybe.  But it goes beyond that, especially in the present economy - job security is something for which bargaining unit members have always been envied, but even they don't have much of it today.  Layoffs are a reality.  Unemployment is a reality.  It's true that it still isn't easy to fire a bargaining unit member for an unsatisfactory performance, but that's not why most people are losing their jobs these days.  Employers are struggling.  Consumer confidence is down, sales are down, revenues are down, and so many employers simply cannot afford to continue to pay the generous wages bargaining unit members receive.

But a union still presses for gains, wage increases, better benefits, etc., which would force layoffs.  So the most senior among the workforce may be better positioned, assuming the employer doesn't go under entirely, but this compounds the unemployment problem.

Of course, not all employers seeking concessions are in financial difficulty.  There's the Caterpillar lockout, and public sector entities looking to shave their budgets.

A colleague of mine from law school argues that the Caterpillar lockout, with a U.S. corporation in good financial shape buying a Canadian company and demanding massive wage concessions, is a symptom of the corporate greed that motivates the Occupy movement.  Perhaps.  But it's also an illustration of the effects of recession:  With higher unemployment, the value of labour goes down in most sectors.  If you won't do the job for x, I'm sure that I can find somebody who will.  The kneejerk "Be happy you have a job" reaction isn't just coming from the public, but also from employers.  Those who press for wage gains in a recessionary economy are often overvaluing themselves, and this is going to inevitably result in job losses.

If I'm employing one person for $60,000, when there are two qualified people on OW who would happily do the same job for $30,000 each, I think that there's a good argument to be made that the better social good is achieved by getting rid of my existing employee and hiring the other two instead.  Labour protections, however, make it very difficult for unionized employers to do that.  Indeed, only a company in a solid financial position like Caterpillar is able to take a hard stand against the union.  Other companies will just...fail.

Are Unions Protecting Their Members?

The second problem the unions are facing in their perception is something of an inversion of the first problem:  They are not seen as doing enough to protect their members.  They're happy as long as they're getting their union dues, and the less that they can do to earn their dues, the better.  It's more important to them that they convince the bargaining unit to ratify the collective agreement, rather than making sure that the bargaining unit is getting the best deal possible, because a collective agreement gives them protection against decertification.  I can't tell you how many employees I've seen with serious (and in many cases legitimate) gripes against the employer that the unions decline to address.

But the law holds unions to a very low standard in assessing their duty of fair representation, which means there are very few remedies against the union, and almost all of a bargaining unit member's remedies against the employer lie through the union, which means that if the union doesn't go to bat for the member, the member is essentially out of luck.

In many cases, it can be more of a 'tyranny of the majority' type of thing.  As long as they're maintaining majority support among the bargaining unit members, they're fine, and don't need to worry about a few disgruntled individuals.  But this causes a lot of animosity, though, because it isn't just a failure to pursue the individual's remedies; rather, the existence of the union is actually removing from the individual the remedies he would otherwise have.

And here's a fun point:  The collective agreement displaces the common law implied term that an employee will get reasonable notice of termination.  Accordingly, when layoffs do happen in a union context, unless there are negotiated terms of notice in the collective agreement, a laid off worker has very limited entitlements.  (Note:  A union has very little incentive to negotiate such terms into a collective agreement.  It essentially means that, when there's limited cash to go around, the employer has to pay more to the people leaving the bargaining unit, which leaves less for the people who are still going to be paying union dues and who can vote the union out if they want to.)

How to Reconcile and Address these Criticisms?


While the two criticisms may seem to be essentially opposites - unions aren't pressing hard enough, but they're pressing too hard at the same time? - there is a logical thread running through both.

Unions are, by their very nature, most concerned with those who are and who will continue to be members of the bargaining unit.  Layoffs are unpleasant for unions because it means fewer people paying dues, but pay cuts are more unpleasant for the union because it means an equal number of people to represent with smaller dues.  So if people are getting laid off, the union will usually be okay with that.  Security against layoffs is not high on the agenda for unions themselves.  Bargaining unit growth is not necessarily something that the unions are highly motivated towards, either.

The 'jealousy' phenomenon is actually something that unions want.  They want non-unionized people looking at unionized people and saying "My job's not that different from yours; why are you paid so much more?"  Whereupon someone from the union hands over a business card.

The result is that the union would rather have a prosperous environment for those who remain in bargaining units, to show others just how nice it is to be in a union, despite the fact that others have paid a steep price for that prosperity.

There's no easy answer.  I consider myself a centrist in terms of the "labour" debate.  I recognize that unions have a place, especially in times of economic growth, but I don't believe that they are assisting employees generally as it is, and in fact I think they're compounding the recessionary pressures.  But can a 'rebranding' work?

Maybe.  Unions need to change their purpose.  Traditionally, they've justified themselves as 'raising the bar', pushing hard for benefits for their members, as a way of pushing the envelope on how workers everywhere should be treated, so that everyone gets more from their employers.  (Is it just me, or does this sound a little bit like the capitalist mantra of the trickle-down effect?  A little strange to hear it from labour.)

The Occupy movement seems almost like an extension of the labour movement, but the facts underpinning the Occupy movement one thing extremely clear:

Labour Has Failed.

Yes, that's right.  The point of Labour is a redistribution of wealth from those who own the capital to those who produce the capital.  The growth of the income gap and the shrinking of the middle class was going on long before the current economic crisis - this is just increasing our awareness of the injustice.

So how did this happen?  How did we get into a situation where employees are being laid off or having compensation reduced everywhere around us while executives are still getting bonuses in the hundreds of thousands of dollars or more?

In terms of lobbying power and capital, the Labour movement is on nearly equal footing to Corporate interests.  Perhaps more importantly, the Labour movement in large measure owns the large corporations.  Union-administered pension plans have absolutely massive holdings in equity markets, and unionized employees often have quite significant stock portfolios as well.

So while executive compensation has been increasingly running off the rails, where have the unions been?  Why haven't the unions taken an active hand, as lobbyists and as shareholders, in bringing to bear massive pressure for greater corporate responsibility?  Perhaps it's because the unions regard capitalism and corporatism as being offensive to their labour sensibilities.  They don't want to be involved in corporate governance.  That's the realm of capitalists, about labour supporters are unwelcome.  Therefore, we end up in a situation where anyone sympathetic to the plight of employees quite willingly stays completely out of the running of corporations.  (Consider, then, who is left to run corporations.)

What have unions been up to, in the mean time?  Instead of pressing for greater accountability in corporate governance, what legislative reforms have they achieved?

They've been working almost exclusively on their own regulation, trying to protect and improve the existence of the labour movement itself, through amendments to statutes like the Labour Relations Act.  They got the McGuinty government to bring back "remedial certification", making it easier for them to get new bargaining units in the face of "anti-union animus" by employers.  So employers (including large unionized employers) are paying their executives ridiculous wages at the expense of employees and shareholders (read: employee pension plans), and the unions' biggest concern is that some small mom-and-pop employers are disrespecting unions.

What to do, then?


The labour movement needs to rise above this small-minded thinking, and address realities that they've tried to ignore as a matter of ideology:  They need to get out in front of the Occupy movement in a sustained way, using their clout to demand transparency and accountability from corporate executives.  They need to stop being victims, anti-capitalists living in a capitalist world, trying to achieve measly protections from the evil capitalists, and rise to a different level entirely, facing the "1%" on their own playing field.

They need to make economic prosperity and job growth their priority.  The goal of the labour movement has always been to earn the employees a place at the table, to become a partner in running the workplace; to truly earn that place, unions need to show that they can think bigger.

To get to this point, we need to re-evaluate our view of our entire labour relations model, which is built on a fundamentally adversarial relationship between unions and employers.  When unions start getting involved in proxy circulars, their representational role of employees in that adversarial relationship will be compromised.

We need to start recognizing that the needs of the business are not necessarily at odds with the interests of employees as a whole.  Employees should, by all rights, share in the successes and failures of the business; they are major stakeholders in the business.  There are certainly interests to be balanced between employees and shareholders as groups, but at the end of the day they are on the same side, with similar goals.

More to the point, the collective interests to be balanced between groups and the individual rights of specific employees are not the same thing.  This stands out particularly if you imagine a union that truly is a partner in running a workplace - sometimes, the best interests of the company and the bargaining unit as a whole will mean taking actions which are adverse to specific employees.  An enlightened union will know this, and will therefore be incentivized to bargain away the rights and remedies of these employees, and this creates immense unfairness.

Thus, unions need to change the way the see their role, and we need to change the way that their role is legislated.  Unions should be taking an interest in corporate governance, from a general policy viewpoint, and taking a greater interest in the operational success of the employers whose employees they represent, and to do so they will need to sacrifice the sanctity of the collective agreement as completely displacing the individual contract of employment.

How to Get Rid of a Union in Ontario

I recently involved myself in a debate on Professor David Doorey's blog about 'democracy' in labour relations.  I've followed his blog for some time, and I respect (though I often disagree with) his views, which are typically 'pro-union'.  My own view on unions is quite nuanced:  Unlike many lawyers who represent management, I don't oppose unions on principle.  I've seen employers who remind me of the reason why unions exist.  But I have had many occasions to question the activities of specific unions in specific contexts.

I believe that there are major problems with the current structure of our labour relations regime in Ontario, mainly because I believe that "labour" itself has become an entity with its own interests, and a powerful one at that.  Rather than, as I believe should be the case, an advocacy mechanism for workers.  The end result is that there are times when a union puts its own interests above those of individuals it represents, or even above entire bargaining units under its care.

So we frequently see cases in the jurisprudence involving employees trying to sidestep the union to deal with their employer (almost always unsuccessful, except in the Human Rights arena, where it *can* work), or taking on the union directly in a Duty of Fair Representation application (almost always unsuccessful, because there's a high threshold for it), and I have had plenty of employees call me directly because they aren't happy with the way that their unions are representing their interests.  (Think about how big a deal that is:  You've already paid union dues.  You're not getting them back.  Included in union dues is representation as against your employer.  How dissatisfied would you have to be before you would hire your own lawyer at your own expense, paying hundreds of dollars per hour, to do something you've already paid somebody else to do?)  The trouble is that there is seldom much to be done; under the statute, the union has the exclusive mandate to represent them, and they can't opt out of this.

Professor Doorey sees it thus:  The bargaining unit, if displeased with the union, can get rid of the union.  This is true.  But it seldom happens, because bargaining unit members usually don't have the sophistication or resources to successfully decertify a union, and any employer involvement or assistance will usually be fatal to the effort.  The rules governing decertification are actually fairly complicated.

So, for those employees who want to decertify a union, here's a general guide as to how.  Remember that every case is unique in its own way, and the best way to move forward, if you can afford to, is to hire a qualified lawyer to assist you.  The below is not legal advice, and does not cover every scenario.  Especially note that the process is different for construction industry matters.

Step 1:  Determine if you can bring the Application

The general rule is that you have to be a member of the bargaining unit in order to apply for termination of bargaining rights, and that any member of the bargaining unit can do so.  However, the application can't be tainted by management influence, and there have been cases in which unions have argued that the person making the application was too closely connected to the managerial team.

Step 2:  Find the Window

The Labour Relations Act sets out a variety of different circumstances in which you cannot make an application to terminate your union's bargaining rights.

The Application can be made under the following circumstances:

1. If more than a year has passed since the union was certified, and no collective agreement has been reached;
2. If a collective agreement exists and has a term of three years or less, then after the start of the last three months of its operation (and before a new collective agreement commences or a renewal of the agreement is effective);
3. If a collective agreement exists and has a term of more than three years, then between the start of the 34th month and the start of the 37th month of its operation, then for the last three months of each year of its operation thereafter (and for the last three months of its operation before it expires).

It really looks more complex than it is.  Let's use a few examples.

Let's say that my union and employer commenced a collective agreement with a 24-month term, starting May 1st 2011 and ending April 30th 2013.  If I want to decertify the union, the window opens on February 1st, 2013 (three months before the end), and closes when a new collective agreement becomes effective.  So if the employer and union are able to negotiate a new agreement to start for May 1st, 2013, I need to have my application in before then.

Or suppose my union and employer negotiate a long-term collective agreement, going from September 1st 2011 to August 31st 2016 (five years).  I would then have three month windows at the end of the third, fourth, and fifth years of operation.  (Window from June 1st to August 31st of 2014 and 2015, and then a window opening June 1st 2016 that ends when a new collective agreement becomes effective.)

One of many important things to remember is that, if the bargaining unit ratifies a new collective agreement, you're probably s.o.l. for a long time if you want to get the union out.  When most employees treat a new collective agreement as being inevitable, and a question of how long it will take and what actions (i.e. strikes) may be required to get a better deal, that's a problem; people are likely to vote in favour of a tentative agreement so long as it is tolerable, and this is especially true of those who would rather be without a union in any event.

But there are also bars to initiating an application, even within those windows.  There's a conciliation process available to the parties:  The union or the employer can ask the Minister to appoint a conciliation officer or mediator, which triggers a bar for a period which essentially allows that process to run its course.  In practice, this ends up being a way for the union to extend its protection.  So it has one year to get a first collective agreement, and if it fails to do so, it asks the Minister to appoint a conciliation officer or mediator.  Then, once that process runs its course, the bar is extended for a certain period of time beyond.  Similar principles apply when subsequently renegotiating expiring collective agreements - conciliation bars an application after the expiration of the existing collective agreement.

If a strike or lock-out begins, that also creates a bar - essentially, if the bargaining unit gives the union the go-ahead for a strike, they have to give the union at least 6 months to try to accomplish its objectives.

One of the major practical challenges for an employee trying to decertify a union surrounds the whole 'conciliation' concept.  How do you find out if the union has sought conciliation without asking questions that would tip off the union to your impending application?  Ultimately, the best bet for decertifying unions is by making sure the application gets started within those three-month windows, and not waiting for existing collective agreements to expire.

Step 3:  Get your "Evidence" together

In order to make an application to terminate bargaining rights, there are going to be two substantive requirements.  First, you're going to have to show 'evidence' that at least 40% of the bargaining unit no longer wants to be represented by a union, and then later when a vote occurs at least 50% plus one of the bargaining unit has to vote on your side.

But first things first, so let's look at the evidence.  It's best to think of it like a petition.  Every page has to show what they're signing, and each name should have the printed name, signature, and date of signature.  You also need to provide the OLRB with an alphabetical list of employees corresponding with the evidence filed, and a declaration verifying the evidence (OLRB Form A-80).

Step 4:  Serve the Union and Employer and File the Application

Well, first you need to complete all the below documents.  That's a given.  After you find them all on the OLRB website.  Which isn't quite as simple as it should be, but I've tried to simplify it with links to the PDF versions of everything.  There are Word versions available, too.

You need to serve a termination package on the union, including the following:

1. OLRB Form C-3, completed with the union's name and the date in the appropriate fields (the full name of the form is Notice to Union of Application for Termination of Bargaining Rights Under Section 63 of the Act...don't you love pithy names?);
2. A completed copy of Form A-6 (Application for Termination of Bargaining Rights Under Section 63 of the  Act);
3. A blank copy of Form A-7 (Response to Application for Termination of Bargaining Rights Under Section 63 of the Act);
4. A copy of Information Bulletin 2 (which is where this list is found, incidentally);
5. A copy of Information Bulletin 3;
6. A copy of Information Bulletin 5; and
7. A copy of Part III of the Board's Rules of Procedure.

And, on the employer, the following:

1. Form C-4;
2. The same Form A-6 as above;
3. A blank Form A-8;
4. A blank Schedule C (List of Employees)
5. A copy of Information Bulletin 2 (which is where this list is found, incidentally);
6. A copy of Information Bulletin 3;
7. A copy of Information Bulletin 5; and
8. A copy of Part III of the Board's Rules of Procedure.

Then, within two days, you need to file (by any means except email, fax, or registered mail) with the OLRB the following:

1. A signed original and a completed copy of Form A-6;
2. The evidence that the employees don't wish to be represented by a union;
3. The above-noted list of employees corresponding with the evidence;
4. Form A-80

See?  Couldn't be simpler.

Step 5:  Win the Vote

There are limits to what you are allowed to do in campaigning.  Threatening, intimidation, etc., these tactics aren't kosher.  But as a member of the bargaining unit, your speech isn't nearly as restricted as the employer's speech in terms of trying to persuade your fellow workers that the union isn't in their best interests.  Remember that this is your campaign; the employer is barely more than a bystander, and can't do much to help you.  And if they offer assistance, you should say no, or risk compromising the application.

*****

This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.

The author is a lawyer practicing in Newmarket, primarily in the areas of labour and employment law and civil litigation.  If you need legal assistance, please contact him for information on available services and billing.

Unions can be certified as bargaining agent even without majority support

One of the amendments made to the Labour Relations Act by the McGuinty government is the restoration of what is commonly referred to as the "remedial certification" clause: Where the employer has engaged in unfair labour practices that interfere with a union organizing campaign, it is possible for the union to apply for certification even notwithstanding that the members of the bargaining don't want to unionize.

There are a few different structures for union certification. The most general one is that, if the union can show that it has the support of at least 40% of the bargaining unit (i.e. the group of employees whom it would represent), the matter can be put to a vote. If the union gets 50% plus one support, it becomes the certified bargaining agent. The 40% support is usually shown through signed union cards. (In the construction industry, it is even possible that, if the majority of the employees have signed union cards, the union can be certified without a vote. This is called "card-based certification")

Many employers do not want to have to deal with unions, yet the Labour Relations Act prohibits employers from taking certain actions which would interfere with unions or the exercise of rights under the Act - "unfair labour practices". If the employer engages in unfair labour practices and this interferes with an organizing campaign, there are a number of remedies available to the union, such as holding a new representation vote and providing them with whatever access they need to the employees prior to the same...or, if these remedies would not suffice, remedial certification is now available.

The logic is this: The employer has a great deal of power over employees. If the employer actively takes steps to frighten or intimidate employees to oppose the union, then it may be impossible for any attempts at persuasion by the union to overcome the employer's intimidation. In such cases, the only way to get past the employer's intimidation is to certify the union even notwithstanding that it does not have the support of the members of the bargaining unit.

The most recent such decision out of the Ontario Labour Relations Board was in LIUNA v. 1652472 Ontario Inc. That case involved a pretty typical dispute about the termination of a union supporter.

Organizing campaigns often begin when the employer hires a new employee with union connections. Of course, the employer doesn't know about this, and it is in fact illegal to refuse to hire somebody because they have union connections. But the new employee goes to great lengths to keep this secret, and quietly begins discussing the union with co-workers to try to gain support.

The trouble - for the employer, as it turns out - is that union insiders often quickly develop adversarial relationships with management for reasons other than their union organizing efforts. Whether the union supporter is a new employee (whose priorities are obviously something other than demonstrating exemplary dedication and professional competence) or an existing employee (who would usually support the union because of an existing acrimonious relationship with management), it is neither unusual nor surprising that management frequently ends up disciplining and/or terminating union supporters in organizing campaigns. Then, the union simply has to allege that the employee was terminated because of their involvement with the union, and the employer bears the onus of proving that, in fact, union involvement had no bearing on the termination.

In most cases, as in this one, the fight on the facts becomes whether or not the employer knew or suspected that the employee was involved with the union.

(I've seen cases, however, in which there was reason to question whether or not a disciplined employee even was involved with the union prior to the discipline, where it looks like even the employee didn't know about the organizing efforts until approached after the discipline, and then alleging that the discipline was motivated by anti-union animus.)

In this LIUNA case, the foreman insisted that he had no knowledge of the employee's union involvement: The employee was fired for performance issues, and because the other guys on the team didn't like working with him. The Board didn't believe him...well, the Board accepted that he wasn't popular, and that the other guys didn't like him, but nonetheless the Board found it unlikely that he was fired when he was without his union involvement being a motivating factor.

That, alone, will usually be enough for remedial certification. But that wasn't everything. In addition, there was a confrontation between a union organizer and the foreman on the construction site, which the Board found was an effort to alienate the union. And then there was a letter which the employer read aloud to most of the employees to express their feelings about the union.

What an employer can and can't say to employees is the subject of much jurisprudence. An employer is allowed to say that it opposes unionization. It is allowed to educate employees about the process for unionization (i.e. to ensure that they know about the potential for card-based certification, that they may not in fact get a subsequent chance to vote aye or nay if they sign enough cards). But it cannot make or imply any threat to job security. This prohibition stands even if the 'threats' are nothing more than objectively true and verifiable facts - employers have been found to have breached the Act simply by walking through the numbers and showing why the additional costs of doing business with a union (and there are additional costs) would prevent the facility from continuing to be economically viable. There is also case law finding that an employer, when asked by employees whether or not job security would be endangered, breached the Act by refusing to answer.

The letter in this case contained the following sentence:

From my perspective, there are a lot of down-sides to unionization. We will have less flexibility in terms of where we work, the work that we do, how we structure our days and how we price projects so that we are the successful contractor.

The Board interpreted this as a threat to job security. Given all the factors, the Board found that the Act had been breached, and granted remedial certification.

Food for Thought

There are obvious policy concerns with remedial certification. While it can and has been argued that this is a way to ensure that employers "don't get away with" their unfair labour practices, thus discouraging unfair labour practices, that casts the certification itself as a punitive action. If punishment is appropriate in a given case, the ordinary sphere of quasi-criminal punishment should suffice: Hoisting a bargaining agent upon workers who don't want it is not an appropriate way of punishing the employer.

No, the real objective must be compensatory. Yet who are we concerned about compensating? The workers? Perhaps, but there is something patronizing and unsettling about saying to workers, "Because you're being kept from choosing what's best, we're taking the choice away from you." Perhaps more concerning is that remedial certification is automatic. The union need not show that it would have won the vote but for the employer's unfair labour practice. If you look at it as a way of compensating the workers, then you have to presuppose that workers, acting without coercion, will *always* want a union. And that is simply and obviously not true. In this case, on the facts as found by the Board it seems like a fairly safe bet that LIUNA was going to have a hard time winning a certification vote: Their insider was not well liked at all in the bargaining unit.

So it strikes me that the real objective of remedial certification is to compensate the union itself. Which concerns me: When the union's interests are put ahead of the interests of the employees, it seems to be a perversion of the very purposes of the Labour Relations Act.

Add to this the 'entrapment' potential for a union quietly engaging in an organizing campaign, and there are real policy concerns.

*****

This blog is not intended to, and does not, provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.