A complicated road to compensation: the MPAC LOU #1 decisions

A complicated road to compensation: the MPAC LOU #1 decisions

Four jars different amounts of coins
Four jars different amounts of coins

Sometimes the road to enforce negotiated benefits is complicated and involves a lot of stops on the way.

This is a post about a series of decisions about a letter of understanding in the MPAC Collective Agreement. This letter outlined the compensation that employees were entitled to when leaving their employment and was intended to dovetail with payments received on the transfer of OPAC to MPAC.

1. Transfer and the 2001 Decision

MPAC (then called OPAC) was created by statute on December 31, 1998 to perform property assessment functions previously performed by the Ontario Ministry of Finance. Most of the members doing property assessment functions were offered jobs with OPAC. This included both classified and unclassified (or fixed-term/ contract/ temporary) employees. When OPAC was created, classified employees received notice or severance, while unclassified employees were given notice, but no severance. Workers with contracts at MOF were hired as contract employees at OPAC.

In their very first Collective Agreement, and in every subsequent OPAC and MPAC Collective agreement, was Letter of Understanding #1 (LOU #1). This Letter reads as follows:

This will confirm that full-time employees who accepted employment with MPAC at the time of the transfer, December 31, 1998, or who accepted positions with MPAC as a result of job postings for approximately “29 Corporate Services positions” posted on or before December 31, 1999 will receive a special compensation entitlement equal to one (1) week per year of combined service with OPS and MPAC to a maximum of twenty-six (26) weeks ending January 1, 2016 less one (1) week per year of OPS service for which termination or severance pay had been paid at the time of the transfer, multiplied by the MPAC salary as of January 1, 2016. This includes any severance pay under the Employment Standards Act. The payment of this money shall satisfy MPAC’s obligations pursuant to LOU#1 notwithstanding the fact that the eligible employees have not died or been terminated. The money shall be paid out pursuant to the options in the Memorandum of Settlement dated June 17, 2016.

This entitlement also applies to full-time Ministry of Finance employees who were on long-term disability prior to December 31, 1998 who have returned to work and commenced full-time employment with MPAC in the bargaining unit on or before December 31, 1999 or who were able to return to work on or before December 31, 1999 under a medically-approved rehabilitation program which will lead to full-time employment shortly thereafter.

(The original LOU #1 provided that the payment would be made upon termination or death. This was amended in 2016 by agreement of the parties to January 1, 2016)

Soon after transfer, OPSEU/SEFPO filed a grievance about whether temporary employees of OPAC were entitled to receive compensation under LOU #1. On April 30, 2001, Arbitrator Robert Howe issued a decision Agreement. in favour of the Employer. He concluded that temporary employees were not entitled to receive compensation under LOU #1 because the entitlement provided   was a benefit within the meaning of Article 6.02 of the Collective Agreement. Article 6.02 specifically provided that temporary employees shall receive 10% of their base wages in lieu of holidays, vacations, and benefits.

2. 2018 Decision and 2019 Judicial Review

This was not the end of the matter. Following the amendments to LOU #1 in 2016, the Employer calculated and paid out the special compensation to the some but not all employees, in what they said was a manner consistent with the 2001 decision. Forty OPSEU/SEFPO members filed grievances because they felt that MPAC had made errors in their calculations. These grievances were consolidated and heard by Arbitrator Howe again, and he issued a decision on December 6, 2018.

There were several different issues at play, Arbitrator Howe ultimately upheld his earlier decision that temporary employees were not entitled to compensation under the LOU #1. However, notably for OPSEU/SEFPO members, he also found that any temporary employee who became permanent before January 1, 2016 would be entitled to compensation under the LOU #1 for any period of time they did not receive 10% pay in lieu of benefits. He further agreed with OPSEU/SEFPO that nothing in LOU #1 required service to be continuous or unbroken. This win for Union members meant that 35 of the 40 Grievors would receive additional money.

The Employer was upset with their loss and filed for Judicial Review. OPSEU/SEFPO won at Divisional Court, where this decision was upheld.

3. 2020 Payouts and Interest Grievances

The Employer paid the 35 grievors between February and March 2020 – about two or three months later. However, the Employer also paid similarly-situated employees who had not filed a grievance.

Following the payouts, several OPSEU/SEFPO members who grieved in 2016 filed new grievances, claiming interest on that money. As well, several OPSEU/SEFPO members who received the LOU #1 money, but had not filed a grievance in 2016 also grieved that they should have been paid interest. Finally, there were a few people who grieved that they were also similarly-situated to the original Grievors, but had not received payouts, so they should receive both the LOU #1 money as well as the interest.

4. 2022 Settlement and Interest Decision

On July 14, 2022, we settled many, but not all, of the interest grievances. The Employer agreed to pay post-judgement interest (from the date of the decision on December 6, 2018 until the date payment was made) to all of the 35 original Grievors who had received payment, even if they hadn’t grieved regarding interest. The Employer also agreed to pay 7 other members the money, but not interest, because they had not filed at the beginning but were similarly situated. As part of the settlement, the Union agreed that we would not file new grievances about LOU #1 or interest.

There were then ten remaining grievances that were filed by OPSEU/SEFPO members who received the LOU #1 money without grieving, but still didn’t get interest and grieved for interest. Arbitrator Wright issued a decision in these grievances on October 4, 2022; he found that because none of these grievors had filed an original Grievance back in 2016, they didn’t have a legal entitlement to payment under the December 6, 2018 Howe award, because the Employer had no legal obligation to pay them, but had done so gratuitously. He therefore concluded that since none of these grievors had a legally enforceable claim under the 2018 award, then they also didn’t have a legally enforceable claim for interest, and so he dismissed their grievances.

It was a long road of negotiation and litigation, but members stuck it out to the end to determine and enforce their rights.  Those who came together in solidarity at the beginning saw the best result.

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