FPSLREB Decisions

I. Pre-hearing conference - ruling with respect to bifurcation

1 This matter was scheduled for a hearing on February 21 and 22, 2013, in Toronto, Ontario. Shortly before the hearing, counsel for the parties requested a pre-hearing conference to discuss several issues, the resolution of which could have had an impact on the length and nature of the hearing.

2 I conducted the pre-hearing conference on February 21, 2013 in Toronto. I heard the submissions and representations of counsel as to the background to the grievance and the issues, jurisdictional as well as procedural, raised by the grievance. I stress that my reference to “facts” in this preliminary ruling is not to be taken as findings of fact. I have made none. They are simply points of reference that explain both the need to make the rulings that I have made and the rulings themselves.

II. The factual context

3 In early 2011, the grievor, Shelley Hassard, held the position of Director, Enhanced Services Unit, with the Correctional Service of Canada (CSC) (“the employer”). She had roughly 36 years of service at that point.

4 At that time, a complaint was filed under the Public Servants Disclosure Protection Act, S.C. 2005, c. 46 (“PSDPA”), which is sometimes colloquially referred to as “whistleblower legislation.” The complaint was directed at, or involved, the alleged conduct of Ms. Hassard.

5 As a result of the complaint under the PSDPA, the investigation process outlined in the legislation was engaged. Shortly after the complaint was filed Ms. Hassard went on sick leave. An internal investigation under the PSDPA was carried out by two investigators who were employed or engaged by the employer. Ms. Hassard was interviewed at least once during the investigation.

6 The investigation concluded with a report that was issued on or about August 25, 2011 (“the report”). Ms. Hassard received a copy of it about a day later. She was initially given one week to respond. She retained counsel (Stephen Moreau), who was not able to meet with her until September 26, 2011. First Ms. Hassard and then Mr. Moreau requested extensions of time to respond to the report. An extension was granted until October 6, 2011.

7 Mr. Moreau submitted a response of roughly 10 to 15 pages on October 6, 2011. The next day, Ms. Hassard met with Ms. Macdonald, the Regional Deputy Director for Ontario for CSC.

8 On or about October 14, 2011, Ms. Macdonald imposed discipline on Ms. Hassard. The discipline included a demotion from a managerial to a non-managerial position. The demotion brought with it a drop in income of roughly 16%, or about $20 000. She was also to have no access to offenders. It was, in Mr. Moreau’s submission, “a significant demotion.” He stated that it amounted to a constructive dismissal of the grievor.

9 In the period between the release of the report and mid to late October 2011, a number of contacts apparently occured between Ms. Hassard and Ms. Macdonald. They took the form of emails and, I believe, some brief meetings.

10 Ms. Hassard resigned her position on or about October 21, 2011. It is not necessary for my purposes to state whether her resignation took effect then or on its apparent effective date of November 10, 2011.

11 On November 17, 2011, Mr. Moreau signed on Ms. Hassard’s behalf a grievance filed under paragraphs 209(1)(b) and (c) of the Public Service Labour Relations Act, S.C. 2003, c. 22, s. 2 (PSLRA). In her grievance she complained, amongst other things, that:

1. she had been unjustly demoted;
2. the demotion amounted to a constructive dismissal; and
3. she had been unjustly disciplined and unjustly demoted because of the investigation and unfairly treated during its course.

12 This is the grievance that was eventually filed with the Public Service Labour Relations Board (PSLRB) and with which I am seized.

13 With all of that in mind, I now turn to the issues, both substantive and procedural, which arise out of that factual context.

III. The issues

14 After hearing from and having discussions with counsel for the parties at the pre-hearing conference on February 21, 2013, it appeared that there were three main “clusters” of issues.

A. Issue 1: Resignation and jurisdiction

15 First was the jurisdictional issue that arose from Ms. Hassard’s resignation.

16 Caroline Engmann, counsel for the employer, submitted that employees who resign have no right to file grievances under the PSLRA. Once Ms. Hassard resigned, in law, she lost her right to grieve. That being the case, I have no jurisdiction to hear the grievance.

17 Mr. Moreau agreed that, if Ms. Hassard voluntarily resigned, I have no jurisdiction. However, he submitted that it is different if the resignation were coerced by way of a demotion that amounted to a constructive dismissal. He submitted that the jurisprudence recognizes that an adjudicator’s jurisdiction extends to grievances filed by former employees who were coerced into retiring or resigning. If the circumstances of Ms. Hassard’s resignation were such that her resignation was compelled rather than voluntary, then it could not be said that she resigned. She had been forced to resign, and that being the case, I have jurisdiction to hear her grievance. The other issue is that her resignation may not have the same meaning or effect under the PSLRA if in law she had already been constructively dismissed.

18 Mr. Moreau submitted that the jurisdictional issue had both evidentiary and legal aspects. From an evidentiary point of view, I would have to consider the following:

1. the communication between Ms. Macdonald and Ms. Hassard (and possibly her counsel and the employer) during the period between Ms. Hassard’s receipt of the report in August 2011 and her resignation in October 2011;
2. the evidence of Ms. Hassard in terms of her reaction to the report and the allegations contained in it and possibly that of Ms. Macdonald (although he left that decision to counsel for the employer); and
3. the report, to place this evidence in context.

19 The legal aspects would involve submissions based on the relevant statutory provisions and the jurisprudence. Mr. Moreau thought that everything could take two or possibly three days at most.

20 Ms. Engmann did not agree with Mr. Moreau’s submission that a finding that the resignation was coerced would grant me jurisdiction to hear the grievance. She submitted that as the grievance failed to raise the issue of coercive resignation, I lacked jurisdiction to hear an issue not directly raised in a grievance. I took her submission to be based on the decisions of the Federal Court of Appeal in Shneidman v. Attorney General of Canada, 2007 FCA 192; and Burchill v. Canada (Attorney General), [1981] 1 FC 109 (C.A.). She also submitted that the discipline in question was a demotion, not a constructive dismissal amounting to a termination.

21 Ms. Engmann agreed that the evidence surrounding the question of coercive resignation would involve the type of evidence outlined by Mr. Moreau in his submissions.

22 I note that, in setting out Ms. Engmann’s submissions (and, for that matter, those of Mr. Moreau), I am not to be taken as limiting them to those that I outlined. The discussions of the issues evolved in a somewhat off-the-cuff manner. For that reason, it would not be fair for me to limit counsel in the objections or arguments they may wish to make in the future.

B. Issue 2: Status of the report

23 This issue concerns the degree of reliance that an adjudicator and, for that matter, the employer, can place upon the findings and recommendations contained in a report of an investigation carried out under the PSDPA.

24 Ms. Engmann’s position in essence was that the employer was entitled to rely upon the findings set out in such a report. It did not have to go into what was behind the report. It did not have to carry out its own investigation into the events or facts disclosed in the report. That conclusion stemmed from the provisions of the PSDPA.

25 Mr. Moreau did not agree that Ms. Hassard or I were bound to accept the findings in the report. He submitted that the grievor could go behind the report and, in essence, force the employer to prove the appropriateness of its disciplining of her. However, he agreed that this issue was legal. Its resolution did not require any evidence. All it required was an analysis of the relevant provisions of the PSDPA and the PSLRA and the jurisprudence.

C. Issue 3: When should these determinations be made?

26 This issue concerned when and how I ought to decide the jurisdictional issues raised by the parties and, in particular, the employer.

27 The jurisdiction of an adjudicator is limited by the provisions of the PSLRA. When an objection to that jurisdiction to hear a grievance is raised, adjudicators tend to handle it in one of two ways. Sometimes they reserve a decision until they have heard all the evidence. For example, that often occurs when the issue is whether the termination of a probationary employee was conducted in bad faith. On other occasions, they will hear only the evidence (if any) necessary to determine the jurisdictional issue.

28 Mr. Moreau agreed that, on occasion, it made sense from a time and efficiency standpoint to bifurcate a hearing by splitting the evidence and submissions necessary to determine the jurisdictional issue from the evidence and submissions relevant to the substantive issues in the event of jurisdiction to hear a grievance on the merits. However, he submitted that this is not such a case.

29 Mr. Moreau submitted that, insofar as the coercive resignation issue was concerned, he would want to ask Ms. Hassard about her background and history with the employer. He would also ask her about several findings in the report and her reaction to them. He suggested that, to understand her reaction, I would want to know about the investigation and its findings. Moreover, if I found that I had jurisdiction, much of the same evidence would have to be gone over again. Such a result would not be an efficient use of the Board’s or the parties’ time. It would be better to hear all the evidence before addressing the jurisdictional issue.

30 Accordingly, Mr. Moreau submitted that the hearing ought to proceed as follows:

1. I would determine the issue respecting the report and its status, and in the event that I determine that the grievor can go behind the report, I would consider any issues respecting the sealing or confidentiality of evidence;
2. I would hear whatever evidence is appropriate, given my ruling with respect to the report; and
3. I would determine the coerced resignation issue.

31 Ms. Engmann did not agree with that order of proceeding or with the suggestion that bifurcation was not appropriate. In her submission, the jurisdictional issue arising out of Ms. Hassard’s resignation was precisely the type of issue that was well suited to bifurcation. The evidence and the law with respect to the issue were limited and discrete. The evidence concerning Ms. Hassard’s resignation, and whether it was coerced, was separate and distinct from the issues and evidence surrounding the merits of the employer’s decision to discipline her by way of a demotion. The evidence surrounding the latter (particularly if I ruled that the grievor could go behind the report) had the potential to be long and drawn out.

32 Ms. Engmann submitted that the hearing ought to proceed as follows:

1. I would hear the evidence and submissions concerning the coerced resignation issue (that is, whether I had jurisdiction to hear the grievance);
2. I would hear and determine the issue of the report and whether the grievor could go behind it; and
3. depending on my ruling on the first two points, I would make any necessary rulings with respect to sealing and confidentiality orders with respect to any evidence that might be called that goes to the grievance on its merits.

IV. Ruling

33 This grievance gives rise to a number of complex legal issues and questions. Based on my understanding of the factual context, it appears to me that I will have to determine a number of issues, which can be broken into clusters. The first cluster of issues is the following:

1. Does the common law doctrine of constructive dismissal apply to the grievor’s employment?
2. If so, then would her demotion constitute termination within the meaning of paragraph 209(1)(b) of the PSLRA, thus giving me jurisdiction to hear the grievance?
3. A second and related issue is whether her resignation was coerced or was so much a part of her demotion and constructive dismissal (if that is what it was) that it did not change her alleged legal position of being a terminated employee.

34 Those issues are interrelated in principle and fact. They are primarily legal. To the extent that they involve evidence, any such evidence would be essentially limited to what happened after the report was issued in August 2011.

35 If at the end of that exercise I decide that I have jurisdiction, I would then consider a second cluster of issues, all related to the question of whether the grievor or an adjudicator is entitled to go behind the report.

36 If the report does not stand on its own, and if the grievor is entitled to challenge its reliability, I would then enter into the third cluster of issues, all related to the question of whether she did anything for which discipline was warranted and whether the employer can support its discipline by relying on the report or whether it must, or is entitled to, prove its case again. That stage may require the evidence of many witnesses and may give rise to questions of privilege, confidentially and so on.

37 With that in mind, I turn to the issue of bifurcation.

38 Admittedly, there is a “… general reluctance on the part of arbitrators to bifurcate hearings”; see Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, Local 446 v. Citadel Halifax Hotel, 2009 CarswellNS 459, at para 35. However, the ultimate decision is dependent “… upon fairness to the parties, and the practicality and economy of time”; see Toronto (City) v. CUPE, Loc. 79 (2004), 128 L.A.C. (4th) 217, at 220; see also Canadian Broadcasting Corp. v. CUPE (Broadcast Council) (1991), 22 L.A.C. (4th) 9, at para 24 and 25; Ontario Liquor Boards Employees’ Union v. Ontario (Liquor Control Board) (2005), 142 L.A.C. (4th) 442, at para 13; and School District No. 27 (Cariboo-Chilcotin) v. Cariboo-Chilcotin Teachers’ Assn (1994), 46 L.A.C. (4th) 385, at 386 and 387.

39 What then is the best course of action for an adjudicator when considering a motion to bifurcate a hearing? In considering that question, I am guided by the arbitral jurisprudence and practice in the private sector. It has been suggested in Gorsky, Brandt and Usprich, Evidence and Procedure in Canadian Labour Arbitration, Part III, section 7.2, at 7-4 to 7-6 that, while the early practice of arbitrators was to hear both the preliminary objection and the merits in the same hearing, the more “orthodox” position, one that was in place by 1970 and is now “the best course of action,” is for such matters to be bifurcated; see Nova Scotia v. NSGEU (1999), 83 LAC (4th) 218, at 220 and 221. In support of that proposition, the text cites Hiram Walker & Sons Ltd. v. Distillery Workers, Local 61, (1973) 3 L.A.C. (2d) 203, in which the arbitrator suggested at paragraph 6 that requests for bifurcation should not be granted unless the following conditions are met:

1. the party requesting the bifurcation gave notice to the other party before the hearing that it would be seeking bifurcation to enable the other party the opportunity to refrain from having its witnesses attend;
2. the merits appear to be severable from the issue of arbitrability;
3. the delay will not seriously affect the availability of witnesses; and
4. no other serious prejudicial effect that could not be compensated by money will be experienced.

40 Applying those principles to the facts before me, I am satisfied that bifurcation is the preferable course of action. The facts and issues surrounding the question of whether the doctrine of constructive dismissal applies to convert a demotion into a termination, or whether the subsequent resignation was coerced, are separate and distinct from those surrounding the question of whether the discipline imposed on Ms. Hassard was justified or appropriate. The overlap between those two groups of questions is minimal. The number of witnesses and the documents necessary to provide a factual context for the legal submissions respecting the first set of questions is limited to, at most, two witnesses and a handful of documents. If, on the other hand, I have jurisdiction, and if, as well, the grievor can go behind the report, then I expect the possibility of a large number of witnesses. Their evidence would relate to a distinct and separate time. The evidence could also raise complicated issues of disclosure and confidentiality. To hear all the evidence and then decide that, as a question of law, I do not have jurisdiction would be an inefficient use of time. It would also impose significant cost in terms of money, time and resources on the parties, particularly the grievor.

41 In my view, the most efficient and the fairest approach is to divide the hearing into two stages.

42 During stage one, I will hear evidence and submissions concerning the following issues:

1. Does the common law doctrine of constructive dismissal apply to grievances governed by the PSLRA so as to convert, potentially, the grievor’s demotion into a termination within the meaning of the PSLRA;
2. Was the grievor’s resignation coerced, and if it was, does that give me jurisdiction to hear the grievance on its merits?
3. Can the grievor go behind the report, or are she and I bound to accept its findings as findings of fact?

43 Stage one will then be adjourned to await my decisions on those these three issues.

44 In the event that I decide that I have jurisdiction, I will proceed to stage two, which will deal with the grievance on the merits (without limiting the right of counsel to make whatever objections or submissions would be appropriate to hearing a discipline grievance on the merits).

45 Before stage two, I will hold a teleconference with counsel to discuss scheduling the second part of the hearing, together with any issues concerning evidence to the extent that such issues affect my ruling with respect to whether the grievor can go behind the report.

March 22, 2013

Augustus Richardson,
adjudicator