FPSLREB Decisions

I. Individual grievance referred to adjudication

1 On April 24, 2007, Ray Burzynski (“the grievor”) grieved that the Canadian International Development Agency (“the employer”) allegedly violated article 63 of the Program and Administrative Services (PA) group collective agreement (expiry date: June 20, 2007) (“the collective agreement”). The employer provided a reply at the final level of the grievance process on July 20, 2007. The Public Service Alliance of Canada referred the grievance to adjudication on November 15, 2007.

2 The grievor alleged that the employer violated the collective agreement in misinterpreting clause 63.02 by using an inappropriate method to calculate his severance pay on retirement.

II. Summary of the evidence

3 The parties provided a joint statement of agreed facts, which reads as follows:

…

Treasury Board (Canadian International Development Agency) and the Public Service Alliance of Canada agree not to present any additional evidence and that the following facts, relating to the grievance referenced above are not in dispute:

[1]      Ray Burzynski was employed at the AS-07 level with the Canadian International Development Agency (CIDA) at the time of this grievance. Consequently, the collective agreement between the Treasury Board and The Public Service Alliance of Canada (table 1 – expiry date: 20 June 2007) applies;

[2]      On August 15, 1969, he began his employment with the Canadian Forces. He retired from the Canadian Forces on June 8, 1980 and received a mandatory severance payment. Mr. Burzynski continued his employment with the Public Service at Correctional Services Canada on June 9, 1980 and retired from CIDA on January 4, 2008. His total continuous employment equates to 38 years and 143 days (10 years and 299 days with the Canadian Forces and 27 years and 209 days with the Federal Public Service);

[3]      His release from the Canadian Forces was under Queen’s Regulations and Orders article 15.01, (4d) item 4(c) which provided for a mandatory severance payment of one half week’s pay for each year served which is established at 10.82 weeks.

[4]      When he retired from CIDA on January 4, 2008, Mr. Burzynski received a severance payment of $33,238.56 which corresponds to 19 years and 66 days (which represents 19.18 weeks of pay) of continuous employment  with the public service. This amount was calculated based on article 63 – Severance Pay (especially articles 63.01 (d) and 63.02).

[5] Mr. Burzynski is claiming that Article 63 – Severance Pay of the relevant collective agreement has not been applied and interpreted correctly by the Employer resulting in the miscalculation of his severance payment.

[6]      The grievance was filed on April 24, 2007. It was rejected at the final level on July 20, 2007.

The parties further agree to the following documents being submitted by consent:

- Collective agreement between the Public Service Alliance of Canada and Treasury Board - Program administration (PA agreement – expiry date June 20, 2007) (article 63).
- Policy grievance response from Hélène Laurendeau dated May 4, 2007 on the alleged violation of severance pay – Architecture, Engineering and Land Survey, expiry date September 30, 2007. June 20, 2007) (article 19)
- Memo from Hélène Laurendeau to the Heads of Human Resources dated August 29, 2007.
- Collective agreement between the Professional Institute of the Public Service of Canada and Treasury Board – Architecture, Engineering and Land Survey, expiry date September 30, 2007. June 20, 2007) (article 19)

…

[Sic throughout]

III. Summary of the arguments

A. For the grievor

4 The method used by the employer to calculate the grievor’s severance pay is inequitable and violates the collective agreement.

5 The grievor worked 10.82 years for the Canadian Forces (“the Forces”) and 27.57 years in the federal public service. His total continuous employment for severance pay purposes was 38.39 years. When the employer calculated the grievor’s severance pay, it used the 30-week cap and then deducted 10.82 weeks for the period that the grievor served in the Forces. As a result, the grievor was paid 19.18 weeks of severance pay.

6 In applying clause 63.02 of the collective agreement, the employer should not have deducted 10.82 weeks for the time that the grievor served in the Forces but rather the amount of money that he received in severance pay when he left the Forces. The grievor was entitled to receive 30 weeks of severance pay, less $2791 received from the Forces as severance pay.

7 The problem results from the ambiguity contained in clause 63.02 of the collective agreement where time worked in previous employment is deducted from severance benefits payable to an employee. Time cannot be deducted from pay. The right interpretation is to deduct pay from pay, which is what the grievor is asking for.

8 In the alternative, the grievor submits that the interpretation provided by the Treasury Board on May 4, 2007, in response to a grievance filed by The Professional Institute of the Public Service of Canada (PIPSC) be applied in this case. Under that interpretation, the 10.82 years of service in the Forces would be deducted from the 38.39 years of service, resulting in a severance pay of 27.57 weeks.

9 To support his arguments, the grievor’s representative referred me to Martin v. Treasury Board (Transport Canada), PSSRB File No. 166-02-28191 (19981029), and Toronto Catholic District School Board v. Ontario English Catholic Teachers Association (Toronto Elementary Catholic Teachers) (2000), 88 L.A.C. (4th) 47. The grievor’s representative also referred me to paragraph 4:2100 of Brown and Beatty, Canadian Labour Arbitration, 4th ed.

B. For the employer

10 The method used by the employer to calculate the grievor’s severance pay is equitable and respects the collective agreement. The grievor was treated fairly.

11 The employer argues that the decision rendered by the Treasury Board in the policy grievance filed by the PIPSC is not applicable to this case since the language of the present collective agreement is different from that of the PIPSC collective agreement.

12 To calculate the grievor’s severance pay, the employer rightly applied the provisions of the collective agreement. It took into consideration the 30-week cap mentioned in clause 63.01(d). Then it deducted, as per clause 63.02, the period of severance pay already paid to him by the Forces.

13 The employer agrees that there could be more than one interpretation given to clause 63.02 of the collective agreement. However, it disagrees with the interpretation provided by the adjudicator in Martin. The decision in Martin creates anomalies. In applying that decision, the burden of paying full severance pay (one week per year of service) shifts from the Forces to the employer.

14 The real issue for the grievor is that when he left the Forces, it paid him one-half of one week per year of service as severance pay. Severance pay rules in the Forces are not under the control of the employer, and the employer should not have to pay for that.

IV. Reasons

15 The main question to be addressed in this grievance is whether the employer used the right method to calculate the severance pay payable to the grievor on retirement.

16 The following clauses of the collective agreement must be examined to address that question:

…

ARTICLE 63

SEVERANCE PAY

63.01 Under the following circumstances and subject to clause 63.02, an employee shall receive severance benefits calculated on the basis of the weekly rate of pay to which he or she is entitled for the classification prescribed in his or her certificate of appointment on the date of his or her termination of employment.

…

(d) Retirement

1. On retirement, when an employee is entitled to an immediate annuity under the Public Service Superannuation Act or when the employee is entitled to an immediate annual allowance, under the Public Service Superannuation Act,

   or

2. a part-time employee, who regularly works more than thirteen and one-half (13 1/2) but less than thirty (30) hours a week, and who, if he or she were a contributor under the Public Service Superannuation Act, would be entitled to an immediate annuity thereunder, or who would have been entitled to an immediate annual allowance if he or she were a contributor under the Public Service Superannuation Act,

a severance payment in respect of the employee's complete period of continuous employment, comprised of one (1) week's pay for each complete year of continuous employment and, in the case of a partial year of continuous employment, one (1) week's pay multiplied by the number of days of continuous employment divided by three hundred and sixty-five (365), to a maximum of thirty (30) weeks' pay.

…

63.02 Severance benefits payable to an employee under this Article shall be reduced by any period of continuous employment in respect of which the employee was already granted any type of termination benefit. Under no circumstances shall the maximum severance pay provided under clause 63.01 be pyramided.

…

[Emphasis in the original]

17 I agree with the grievor’s representative that there is an ambiguity contained in clause 63.02 of the collective agreement. The ambiguity is created by the fact that the article provides for severance payment in terms of one week’s pay for each year of service but speaks of deducting from this amount something that is calculated based on time. Time cannot be deducted from pay; that does not make sense.

18 In Martin, the adjudicator agreed that there was an ambiguity, and she resolved it by deducting pay from pay. The following excerpt summarizes her reasons:

…

[91] Although each word of clause 18.02 is not in and of itself ambiguous, a literal application of these words is unfeasible, both at the conceptual level and at the practical level. How does one subtract time, i.e. "a period of continuous employment", from money, i.e. "severance benefits"? The wording of this sentence contains an inherent illogicality and an absurdity which requires the reader to seek the intent of the parties. As well, it contains a latent ambiguity which becomes apparent when one attempts to apply it.

…

[93] The intent of the parties (one week's pay per year of continuous employment) and the purpose of clause 18.02 (to prevent double payment of severance pay and pyramiding) can both be respected by applying an interpretation of clause 18.02 which is founded on a logical premise, that is, that pay is deducted from pay and cannot be deducted from time.  Therefore, the grievor's severance pay should have been calculated by reducing the amount of severance pay owed to him and calculated on the basis of his continuous employment by the amount of severance pay which he received upon leaving the military. This result is in keeping both with the intent of the parties and the purpose of clause 18.02.

…

[100] In summary, I am of the view that the right to severance pay arises at the time of departure from Transport Canada, that the amount of severance pay is arrived at by multiplying one week's pay for each year of "continuous employment" (up to a maximum of 30 weeks' pay, which includes two weeks’ pay for the first year of continuous employment) and that the resulting amount of pay is reduced by the severance pay received by the grievor upon his departure from the Canadian Forces.

…

19 Even if I share the adjudicator’s comments in Martin on the ambiguity of clause 63.02 of the collective agreement (clause 18.02 of the collective agreement examined in Martin), I do not agree with her conclusion as to how it should be resolved. As the employer’s representative argues, her conclusion creates anomalies, and it has the potential to shift the burden of paying full severance pay from the Forces to the employer.

20 As reported in Martin, the Forces pays severance benefits of one week per year of service when a person leaves the Forces after 20 years. If the departure occurs after 9 years but before 20 years of service, the Forces reduces the severance pay by half. If the departure occurs before nine years of service are completed, no severance benefits are paid. In applying the calculation rule in Martin, the employer would have to pay severance pay for the years worked in the public service, plus the difference between the severance benefits actually paid by the Forces and the severance pay that the employee would have earned for that same period had he worked in the public service. In other words, the employer would be required to “top up” the severance pay paid by the Forces to the amount that the grievor would have earned had he worked for that period of time in the public service rather than the Forces.

21 An illustrative example of an anomaly created by the rule in Martin would be the case of an employee who is 60 years old and retires after 19 years in the Forces followed by only 1 year in the public service. To simplify the example, let us suppose that the employee was making $1000 per week on departure from the Forces and $1000 per week after leaving the public service. The employee would have then received $9500 ($19,000/2) from the Forces as severance benefits. The employer, applying the Martin rule, would be obliged to pay $10,500 ($20,000 - $9500) in severance pay.

22 The most logical way to resolve the ambiguity of clause 63.02 of the collective agreement is to deduct “time” from “time” and not “pay” from “pay” as in Martin. Clause 63.02 of the collective agreement specifies the following “… reduced by any period of continuous employment… .” That part of clause 63.02 is clear and does not need to be interpreted by an adjudicator, as was done in Martin. The part of clause 63.02 that creates problems and ambiguity is rather the first part, which refers to “[s]everance benefits payable.” In using those words, I believe that the parties took a shortcut. In reading article 63 of the collective agreement, one understands that the benefits are directly linked to the duration of employment and represent one week or one-half of one week per year of service. Therefore, in writing “[s]everance benefits payable” in clause 63.02, it seems logical to me that the parties were referring to the period used to calculate the severance benefits.

23 Now that we have established that “time” will be deducted from “time,” it is essential to look at the cap used to calculate “time.” There is nothing in clause 63.01(d) of the collective agreement that refers to a cap of 30 years. Rather, the cap refers to 30 weeks of severance pay and not to 30 years of service. When the employer imposes a limit of 30 years of service as a starting point for the calculation of severance pay, it deprives an employee of his or her rights and it violates the collective agreement.

24 On May 4, 2007, in its reply to a grievance filed by the PIPSC, the employer recognized that the cap applies to payable weeks rather than to years of service. I reject the argument from the employer that the interpretation provided in the PIPSC grievance does not apply to the present case because of the fact that the wording of the two collective agreements differs.

25 Even if it is true that the two wordings are not identical, there is no substantial difference. The wording of clause 63.01 of the PA group collective agreement is reproduced at paragraph 16 of this decision. The comparable wording of the collective agreement referenced in the PIPSC grievance to which I refer below, is included in clause 19.01(c):

ARTICLE 19
SEVERANCE PAY

…

Retirement

(c) On retirement, when an employee is entitled to an immediate annuity or to an immediate annual allowance under the Public Service Superannuation Act, a severance payment in respect of the employee's complete period of continuous employment, comprising [sic] of one (1) week's pay for each complete year of continuous employment and, in the case of a partial year of continuous employment, one (1) week's pay multiplied by the number of days of continuous employment divided by three hundred and sixty-five (365), to a maximum of thirty (30) weeks' pay.

26 In applying my interpretation of the collective agreement to the grievor’s situation, the employer should have paid him one week of severance pay for each of the 27.57 years that he worked in the public service. The grievor is not entitled to severance pay from the employer for the years that he worked in the Forces, considering that the Forces already paid him severance pay when he left.

27 The employer already paid the grievor 19.18 weeks of severance pay. In applying my decision, the employer will have to pay the grievor an additional 8.39 weeks of severance pay.

28 For all of the above reasons, I make the following order:

V. Order

29 The grievance is allowed in part.

30 I order the employer to pay to the grievor an additional 8.39 weeks of severance pay at the applicable rate.

31 I will remain seized for a period of 90 days from the date of this decision to address any matters relating to its implementation.

July 18, 2008.

Renaud Paquet,
adjudicator