FPSLREB Decisions
Decision Information
After filing a grievance challenging his termination, the grievor was reinstated with a six-month suspension without pay – among other things, the Board ordered the payment of back pay, less the customary deductions, and retained jurisdiction over the calculation of amounts owed to the grievor – the employer asked the Board to clarify that although the order did not mention the mitigation of damages, it implicitly included deductions related to an employee’s obligation to mitigate his or her damages, to avoid unjust enrichment – the Board determined that it remained seized for the calculation of the amounts owed to the grievor but not on the issue of damages as a whole – despite the employer’s argument, the Board was not convinced that the term “customary deductions” is ambiguous or that it should be given a broad interpretation that includes amounts for the mitigation of damages – “customary deductions” refers to the customary deductions provided for by law, as well as other common deductions from a federal-public-sector employee’s pay, such as income tax, Canada Pension Plan contributions, Employment Insurance contributions, Public Service Pension Plan contributions, union dues, healthcare insurance premiums, dental care insurance premiums, long-term disability insurance premiums, and other similar deductions – while the application of the principle of the mitigation of damages is not unusual, it is not implicit in every decision – the employer’s request came too late, and the Board did not reserve jurisdiction for mitigation.
Application dismissed.
Decision Content
File: 566-02-9445
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(Correctional Service of Canada)
Nadeau v. Deputy Head (Correctional Service of Canada)
In the matter of an individual grievance referred to adjudication
Before: Steven B. Katkin, adjudicator
For the Grievor: Mathilde Baril-Jannard, counsel
For the Respondent: Kevin P. Dulude, counsel
(FPSLREB Translation)
REASONS FOR DECISION
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FPSLREB TRANSLATION
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I.
Application before the Board
[1]
Martin Nadeau (“the grievor”) was terminated for disciplinary reasons from his position classified at the CX-02 group and level with the Correctional Service of Canada (“the employer” or CSC).
[3]
Among other things, I ordered the following at paragraphs 318(b) and (c) of the decision:
(b) that the grievor be reinstated to a correctional officer position classified at the CX-02 group and level, with pay and without loss of benefits, starting from May 22, 2014;
(c) that within 60 days of this decision, the deputy head compensate the grievor for his salary at the CX-02 group and level starting from May 22, 2014, less the customary deductions ….
[5]
After the decision was issued in April 2018, the parties tried to resolve issues related to the grievor’s reinstatement. In July 2018, the parties advised the Federal Public Sector Labour Relations and Employment Board (“the Board”) that they could not agree on the meaning of “customary deductions”.
[8]
In the letter, the bargaining agent noted that a verbal agreement and a transaction between the parties took place within the prescribed 60-day time limit and that the parties agreed that the amounts earned by the grievor between the date of his termination and the date of my decision would not be deducted. It also noted that this matter was clarified at the outset of the discussions. The bargaining agent added that on July 4, 2018, which was outside the 60-day period, the employer backtracked and requested documents from the grievor such as tax statements and assessment notices. The bargaining agent also noted that it was common practice for the employer not to seek mitigation of damages in similar cases that it requested a hearing to determine the issues that were raised.
[10]
One of the documents entered into evidence was an email dated July 4, 2018, from Joshua Alcock (Exhibit S-1-P), an employer counsel, to Olivier Rousseau, the bargaining agent’s union advisor who was assigned to the case, about the terms of the grievor’s reinstatement. In his email, Mr. Alcock wrote that it was brought to his attention that “[translation] … the issue of mitigation of damages had not been discussed by the parties”. He also noted that as a matter of general principle, amounts earned between the termination date and the reinstatement date should be deducted from the amounts owed to the grievor as retroactive pay, and he asked for the grievor’s assistance to determine those amounts.
[13]
The documents entered into evidence by the employer and the bargaining agent included significant correspondence between the parties that was related to the employer’s efforts to reinstate the grievor. The employer also entered into evidence handwritten notes taken by its representatives during meetings or discussions about the reinstatement process. The documents dealt with issues, such as the amounts owed to the grievor and the terms of payment, the Phoenix pay system, the institution where the grievor would be reinstated, the type of work that the grievor could do, etc. No correspondence between the parties before Mr. Alcock’s July 4, 2018, email referred to mitigation of damages. I find that the employer first raised that issue on July 4, 2018, and the email seemed to recognize that.
II.
Summary of the evidence
A.
For the grievor
1.
Mr. Rousseau
[14]
Mr. Rousseau is a union advisor who was assigned to the bargaining agent’s files. His responsibilities include providing advice and making representations to the employer, representing members at adjudication, and following up on decisions. He followed up on the grievor’s file and the implementation of the order. Marie-Christine Viens, Regional Labour Relations Manager for the Quebec Region, also coordinated the implementation of the order.
[15]
The first discussion of the grievor’s case took place by telephone on Friday, April 27, 2018. The participants on the call were Ms. Cobb, Ms. Viens, Mr. Rousseau, and Frédérick Lebeau, the bargaining agent’s regional president. This was a follow-up discussion about several of Ms. Cobb’s files, including the grievor’s.
[16]
Among other things, the discussion focused on the time limit for calculating and paying the amounts owed to the grievor, a request for an emergency salary advance, and confirmation of the grievor’s employment. On May 1, 2018, Mr. Rousseau sent an email to Ms. Viens (Exhibit S-1-A) requesting a follow-up on the items that were discussed. There were email exchanges about those items in the days that followed.
[17]
The parties discussed the grievor’s file during a bilateral meeting on May 15, 2018, as well as at a labour–management meeting on May 17, 2018. The employer’s participants were Alessandria Page, the regional deputy commissioner, Ms. Cobb, Cynthia Racicot, also an assistant deputy commissioner, and Ms. Viens. The bargaining agent’s representatives were Mr. Lebeau, Mr. Rousseau, and two vice-presidents of the bargaining agent. Mr. Rousseau said that they had several arguments about an emergency salary advance, which the grievor did not receive. He testified that he told Ms. Cobb that it did not appear to be the employer’s practice to make deductions for damage mitigation. She asked what this was about, and she said that it would be checked and that the employer would get back to Mr. Rousseau.
[18]
In a June 1, 2018, email to Ms. Viens and Isabelle Legault, Compensation Team Leader (Exhibit S-1-G), among other things, Mr. Rousseau asked for a copy of the grievor’s retroactive pay calculations once they were completed. He also asked if it would be possible if part of the retroactive pay could be placed in a registered retirement savings plan (RRSP). When she returned from leave on June 8, 2018, Ms. Viens informed him by telephone that the RRSP was not possible.
[19]
A monthly labour–management meeting was held on June 14, 2018. The attendees were Ms. Page, Ms. Cobb, Ms. Racicot, Ms. Viens, Mr. Lebeau, Mr. Rousseau, as well as the union local presidents for each institution. Mr. Rousseau requested a separate meeting with Ms. Viens to discuss the grievor’s file. She asked for another person to be a witness, and Mr. Rousseau asked the grievance coordinator and the union local president of Archambault Institution to be a witness.
[20]
Ms. Viens believed that the grievor received an amount that was not retroactive pay; but after calling the grievor, Mr. Rousseau informed her that the grievor did not receive any amount and that he asked how he could have received his pay without the employer’s calculations. Mr. Rousseau said that the employer was in contempt of court, and Ms. Viens replied that she could not tell him what to do. Mr. Rousseau raised the issue of mitigation of damages, to which Ms. Viens apparently replied: “[translation] We won’t go there.” Mr. Rousseau said that at his level, there was no follow-up by Ms. Cobb or Ms. Viens about the grievor’s retroactive pay and that he heard nothing further from the employer about the mitigation of damages.
[21]
Mr. Alcock’s July 4, 2018, email was a surprise to Mr. Rousseau. Since the email did not indicate that either Ms. Cobb or Ms. Viens was copied, he did not know where his mandate came from. Neither Ms. Cobb, Ms. Viens, nor anyone from the employer had requested the grievor’s tax statements. No one from the employer had asked if the grievor had worked or where he would have worked. As stated earlier in this decision, Mr. Rousseau replied to Mr. Alcock the same day. He did not receive a reply, nor did he hear back from Ms. Viens about Mr. Alcock’s email; there was only the employer’s letter to the Board, which was dated July 10, 2018.
[22]
Mr. Rousseau never received from the employer a copy of the calculations of the amounts owed to the grievor; nor could he quantify the amounts he had received. He found out from the grievor that he had received some money during the summer. He said that he did not recall that he had a telephone conversation with Ms. Viens in July 2018.
[23]
In cross-examination, Mr. Rousseau said that he took notes during the April 27, 2018, telephone discussion. Mitigation of damages was not discussed; he would have noted it if such a discussion had taken place.
[25]
Mr. Rousseau acknowledged that he did not refer to mitigation of damages in his May 22, 2018, email to Ms. Viens, which was a follow-up to the bilateral meeting about the grievor’s file; nor was it mentioned in Ms. Viens’ reply the following day (Exhibit S-1-F). He said that they would discuss that matter in the future.
[26]
Mr. Rousseau also acknowledged that in Mr. Lebeau’s May 29, 2018, email to management, in which Ms. Page and Ms. Cobb were copied, with respect to a follow-up to the bilateral meeting (Exhibit S-1-J) about the grievor’s file, Mr. Lebeau raised only the pay remittance and the request for an emergency salary advance; he did not refer to the mitigation of damages. Management’s June 4, 2018, response (Exhibit S-1-J) did not mention the mitigation of damages.
[27]
With respect to Mr. Rousseau’s email to Ms. Viens dated June 1, 2018, he said that although the mitigation of damages was not specifically mentioned, the first paragraph requesting calculations for the grievor’s retroactive pay was linked to it. Once he received a copy of the calculations, the issue of mitigation of damages would have become clear and would have been discussed.
[28]
At the June 14, 2018, meeting, Ms. Viens was accompanied by Marie-Claudia Côté, a labour relations intern. Mr. Rousseau believed that it was possible that Yann Garneau, the union local president, attended. Mr. Rousseau said that the discussion began with the grievor’s pay and ended with the mitigation of damages. He did not take notes because he was standing in the room. When he was told that Ms. Viens and Ms. Côté would testify that they had taken notes, he said that Ms. Viens stood next to him. He believed that Ms. Côté also stood next to him, but he was not sure. Mr. Rousseau stated that he was convinced that he had talked about the mitigation of damages. Ms. Viens stated that an amount was paid to the grievor. That is why Mr. Rousseau immediately checked with the grievor, who told him that he had not received anything.
[29]
In his reply to Mr. Alcock’s email, Mr. Rousseau copied Ms. Viens, but she did not reply. In a July 10, 2018, email to Ms. Page and Ms. Cobb about the grievor and the employer’s letter, which was sent that same day (Exhibit S-1-S), Mr. Rousseau asked, among other things: “[translation] Does Ms. Marie-Christine Viens acknowledge that she said, ‘We will not go down that road’ in response to the question she was asked about mitigation of damages?” Ms. Cobb replied by email on July 11, 2018, stating that the issue of mitigation of damages was before the Board and that it would be decided.
[30]
Mr. Rousseau said that the mitigation of damages had already been raised with Ms. Page and the two assistant deputy commissioners. Ms. Cobb and Ms. Viens attended the meeting held on May 15, 2018. When he was told that Ms. Viens would testify that she did not attend that meeting, Mr. Rousseau replied that according to his memory, she sat to his right at the table, and it was Ms. Cobb who responded about the mitigation of damages. He raised the issue of mitigating the damages on June 14, 2018, and he understood that the case was closed. No one from the employer raised the issue before Mr. Alcock’s email.
B.
For the employer
1.
Ms. Viens
[31]
As a regional labour relations manager for the employer, Ms. Viens manages a team of labour relations consultants and assistants. She assigns tasks, evaluates performance, coaches, and deals with complex labour relations files. She coordinated implementing the order in the grievor’s case.
[32]
Ms. Viens took notes during the April 27, 2018, telephone discussion (Exhibit E-1, Tab 1). The discussion focused on the payment of the grievor’s salary, the request for an emergency salary advance, and the confirmation of employment. In early May 2018, she followed up, including a pay-action request prepared on May 2 that was accompanied by a memo (Exhibit E-2). She understood that the grievor should have received a regular pay cheque on June 13, 2018, but it was sent to the wrong address. He reportedly received his June 27, 2018, pay and his retroactive pay in July 2018. The grievor went back to work on July 30, 2018.
[34]
Ms. Cobb asked Ms. Viens to forward to her any discussions she had with Mr. Rousseau about the mitigation of damages. Through a July 11, 2018, email (Exhibit E-1, tab 4), Ms. Viens forwarded to Ms. Cobb the June 1, 2018, email that Mr. Rousseau sent to her, as well as the June 4, 2018, reply, which indicated that they could discuss the matter when Mr. Rousseau returned from his leave. In her email to Ms. Cobb, Ms. Viens wrote, “[translation] The discussion took place outside the labour-management meeting.”
[35]
Ms. Viens was referred to the first paragraph of Mr. Rousseau’s June 1, 2018, email, which reads as follows: “[translation] When the calculations are completed for Martin Nadeau’s retroactive pay, we would like to have a copy of those calculations for validation.” Ms. Viens said that she understood that Mr. Rousseau wanted to know the number of pay days, the rate of pay, and the total amount.
[36]
As for the bilateral and labour–management meetings that were held in May 2018, Ms. Viens did not recall that she attended the bilateral meeting, but she attended the labour‑management meeting. She did not recall whether the May 2018 discussion with Mr. Rousseau took place in the presence of Ms. Page, Ms. Cobb, and Ms. Racicot. Managers were present, but she did not recall who they were. She did not recall whether the grievor’s case or the mitigation of damages were discussed.
[37]
Ms. Viens’ next discussion with Mr. Rousseau took place at the labour‑management meeting on June 14, 2018, in the presence of Mr. Garneau and Ms. Côté. Ms. Viens took notes at the meeting (Exhibit E-1, Tab 8-B); although her notes are not dated, she said that she wrote them that day. Ms. Viens claimed that the approximately 15-minute discussion focused on the June 13, 2018, pay cheque, retroactive pay, interest, and contempt of court.
[38]
Ms. Viens was referred to Mr. Rousseau’s reply email to Mr. Alcock, which was sent on July 4, 2018, and contained the following sentence: “[translation]… it has already been discussed between the parties (ref. Marie-Christine Viens) because CSC would not require mitigation of damages”. She testified that she did not recall that she had a conversation with Mr. Rousseau about the mitigation of damages, let alone that they reached an agreement.
[39]
Ms. Viens said that she first heard about the mitigation of damages in early July 2018, when Ms. Page summoned her to a conference call with counsel, including Mr. Alcock. Counsel said that it was possible in the grievor’s case to request the mitigation of damages and asked Ms. Page whether she wanted to go down that road. Mr. Alcock was to write to Mr. Rousseau to request the grievor’s tax statements.
[41]
In cross-examination, Ms. Viens said that she attended bilateral and labour‑management meetings when she was involved in a case. When she is not invited, Ms. Cobb usually provides her with a follow-up on a file.
[42]
Ms. Viens attended the labour–management meeting on May 17, 2018, but she did not recall whether the grievor’s case was discussed. Before her July 11, 2018, email, Ms. Cobb did not ask Ms. Viens about the mitigation of damages.
[43]
Ms. Viens was referred to the email Mr. Rousseau sent on July 10, 2018, to Ms. Page and Ms. Cobb, in which he asked, among other things, “[translation] Does Ms. Marie-Christine Viens acknowledge that she said, ‘We will not go down that road’ in response to the question she was asked about mitigation of damages?” Ms. Viens said that on July 11, 2018, she spoke with Mr. Rousseau alone, outside the labour-management meeting without other employer representatives. That was the only discussion she had with Mr. Rousseau, and they did not reach an agreement. Ms. Viens said that if Ms. Page and Ms. Cobb had been part of the discussion, Mr. Rousseau would not have asked her whether she had said that. Ms. Cobb asked Ms. Viens whether she had had a meeting alone with Mr. Rousseau and whether she had said that.
[44]
Ms. Viens said that she did not receive instructions on implementing the order or the mitigation of damages. She read the decision and implemented it. When she had questions, she had support. She did not raise any issues about the mitigation of damages.
[45]
Ms. Viens acknowledged that during the discussion on June 14, 2018, an $800 cheque was discussed; it was not included in her notes. She said that they were talking about another employee with salary protection, whom she and Mr. Rousseau knew. When asked whether her notes were complete, Ms. Viens replied that they were her notes from the meeting with Mr. Rousseau.
2.
Ms. Côté
[47]
Ms. Côté is a labour relations consultant on an acting basis for the employer. From May 15 to August 17, 2018, she was an intern. She attended the labour–management meeting on June 14, 2018, at Ms. Viens’ invitation as part of her internship.
[48]
Ms. Côté took notes at the meeting with Mr. Rousseau (Exhibit E-1, Tab 8-A). After they discussed the grievor, they moved on to another file that she referred to in her notes.
[49]
In cross-examination, Ms. Côté said that she took notes at meetings as an observer. When it was brought to her attention that while interest on the retroactive pay was touched on in the discussion, which was not in her notes, Mr. Côté explained that it was Ms. Viens who checked those details and followed up on them. However, she acknowledged that her notes referred to the retroactive pay, which Ms. Viens had to follow up on. Ms. Côté also acknowledged that the discussion was about the $700 to $800 that the grievor should have received, but that this was not included in her notes.
[50]
Ms. Côté said that the issue of the grievor’s appointment with his physician might have been discussed but that it was not in her notes. She did not recall whether the grievor’s functional limitations were discussed. Finally, she acknowledged that the issue of contempt of court was touched on in the discussion but that it was not in her notes.
III.
Summary of the arguments
A.
For the employer
[52]
To assess the amounts owed to the grievor, the employer sought the bargaining agent’s assistance to confirm the amounts earned during the retroactive period between May 22, 2014, and July 30, 2018, by Mr. Alcock’s email sent on July 4, 2018, as well as the letter to the Board dated July 10, 2018. The employer pointed out that these requests were made within the 90-day period set out in the order and that they were not answered.
[53]
The doctrine of the mitigation of damages is a fundamental concept that takes precedence when calculating amounts owed to compensate for loss of salary in cases of reinstatement in a unionized workplace. It has two components: efforts to mitigate, and the deduction of income from other employment between the termination date and the reinstatement date. The employer argued that the compensation owed to the grievor for his salary loss during the retroactive period should take into account income earned elsewhere.
[54]
Referring me to certain authorities, the employer argued that the mitigation-of-damages principle is applied consistently when the amounts owed upon reinstatement to work are assessed. In Red Deer College v. Michaels, [1976] 2 SCR 324, 1975 CanLII 15 (SCC), the first question to answer is determining the losses. The accepted principle is to deduct the amounts earned between the termination date and the reinstatement date. This principle has not changed as indicated at paragraph 22 of Bahniuk v. Canada (Attorney General), 2016 FCA 127(“Bahniuk FCA”), and in Brown and Beatty, Canadian Labour Arbitration, Fifth Edition, at paragraph 2:1512. Failure to deduct the amounts earned elsewhere is an enrichment because had it not been for the termination of employment, the grievor would not have worked elsewhere. The grievor cannot be placed in the position he was in without considering the income earned during the retroactive period.
[55]
The employer also referred me to the following decisions: Firestone Steel Products of Canada v. UAW Local 27, [1974] O.L.A.A. No. 4 (QL), 6 L.A.C. (2d) 18; Dover Corporation (Canada) Ltd., Turnbull Elevator Division v. International Association of Machinists, Elevator Lodge 1257, [1980] O.L.A.A. No. 73 (QL), 26 L.A.C. (2d) 7 (“Dover Corporation (Canada) Ltd.”); Giroux v. Treasury Board (Canada Border Services Agency), 2008 PSLRB 102; and Giroux v. Treasury Board (Canada Border Services Agency), 2009 PSLRB 45.
[56]
According to the employer, it was necessary to seek clarification from the bargaining agent about the amounts the grievor earned during the retroactive period, to determine his actual loss. The corrective measures requested in the grievor’s grievance include “[translation] … any lost wages and other benefits …”. The wording of paragraphs 318(b) and (c) of the order should be examined together in the context of the corrective actions requested by the grievor and the findings in the decision.
[57]
The issue is not simply whether the term “customary deductions” includes recognition that an obligation to mitigate damages applies. The question is whether the order ruled on the effect that the mitigation of damages should have when calculating the balance owed to the grievor.
[58]
The employer acknowledged that arbitral awards often include a statement that certain amounts must be deducted at source. According to the employer, the term “customary deductions” is unclear and rare. It argued that case law confirms that in reinstatement cases, income from other employment is deducted from the damages that the employer must pay; it cited Bahniuk FCA to support its argument.
[59]
According to the employer, the use of the word “d’usage” or “customary” has a broader meaning than the terms “[translation] statutory deductions” or “[translation] mandatory deductions”. It argued that it follows that a broader interpretation of “customary deductions” includes amounts earned during the retroactive period.
[60]
Even though the customary deductions did not include income from other employment, the question arose as to whether the order includes the obligation to consider those amounts. Paragraph 318(b) of the order deals with the retroactive reinstatement of the grievor with pay and without loss of benefits; paragraph 318(c) deals with the act of repaying the grievor.
[61]
The order does not refer to the mitigation of damages, but that does not mean that the principle does not apply; rather, it indicates that the issue was not decided. That is why adjudicators tend to remain seized of the matter to assist parties to implement corrective measures.
[62]
In this case, the employer argued that the basic rule for breach of contract should be considered and that the rule was implicit in the order. It argued that paragraphs 318(b) and (c) seek to put the grievor back in the same situation he would have been in financially had it not been for the contract breach. The purpose of the compensation for loss of wages was not to enable the grievor to improve his lot and be in a better financial position but, to the extent possible, to put him into a similar position. The amount to be paid for compensation for lost wages during the retroactive period cannot indirectly do what it cannot do directly. An amount determined in the calculation to replace a loss of wages must be equal to the actual loss incurred by the grievor.
[63]
The rule is clear that when an employee is reinstated, the income from other employment during the retroactive period must be deducted by calculating the compensation for loss of wages (see Bahniuk FCA). To assess the amounts to which an employee is entitled in a reinstatement case, the exercise is to correctly measure the loss beforehand, to compensate for the actual losses incurred.
[64]
The employer requested that I confirm that the order includes the deduction of income earned by the grievor between May 22, 2014, and July 30, 2018, in accordance with the calculations required at paragraph 318(b).
B.
For the grievor
[66]
The grievor argued that the customary deductions relate to normal deductions, such as unemployment insurance, taxes, and pension plans. At s. 2(2) of the Income Tax Act (R.S.C., 1985, c. 1 (5th Supp.)), the word “deductions” refers to deductions at source. According to the order, only the customary deductions were to be deducted from the amounts owed to the grievor. To conclude otherwise would amend the order as it does not include income earned by the grievor during the retroactive period.
[67]
At paragraph 33 of Marchand v. Deputy Head (Canada School of Public Service), 2015 PSLREB 63, the adjudicator indicated that he would subsequently decide the issue of the deduction of any amount earned during the relevant period.
[68]
At paragraph 234 of Sandhu v. Deputy Head (Correctional Service of Canada), 2018 FPSLREB 63, the adjudicator ordered the reinstatement of Ms. Sandhu and compensation for the loss of her salary “… less the customary deductions, and less any employment income earned by Ms. Sandhu …”. The grievor argued that the employer had not raised the issue of employment income before me.
[69]
The grievor referred me to paragraph 181 of Nehmé v. Deputy Head (Department of Public Works and Government Services), 2017 PSLREB 14, in which the adjudicator ordered the deduction of any income earned by the grievor. The grievor argued that the order in this case is not silent; it limits deductions that must be made from his salary. Had the income deduction been ordered, it would have appeared in Ms. Viens’ memo that accompanied the pay-action request.
[70]
The grievor argued that it was surprising that only as of July 4, 2018, two-and-a-half months after the decision, did the employer request through its counsel the grievor’s tax statements, rather than through the person on record. Ms. Viens never asked for tax statements while she was implementing the decision. If the employer considered the income earned significant, it should have raised that at the outset; it cannot do so now. If the employer said that the mitigation of damages resulted from any reinstatement order, it should have requested the tax statements in a timely manner. The employer could have subpoenaed the grievor to submit his tax statements at the hearing before me for the deduction of income in the event that I ordered his reinstatement. The employer did not submit any such evidence.
[71]
The grievor also referred me to the following decisions: Bassett v. Treasury Board (Correctional Service of Canada), 2017 PSLREB 60; Szigeti v. Traffic-Tech inc., 2016 QCTAT 4338 at para. 96; and Syndicat de la fonction publique et parapublique du Québec (SFPQ) v. Québec (Immigration, Diversité et Inclusion), 2017 CanLII 15824 (QC SAT) at paras. 12 and 20.
[72]
The grievor commented about the authorities submitted by the employer. In Giroux (2008 PSLRB 102), the issue of remuneration earned after the termination had to be determined at a later date. The adjudicator did not issue a repayment order. In this case, the order is clear about the amount to be paid to the grievor. In Bahniuk 2014, the order specified the deduction of amounts earned following the termination.
[73]
The grievor cited the arbitral award referred to in footnote 3 to paragraph 2:1512 of the Canadian Labour Arbitration: Smucker Foods of Canada Co. v. U.F.C.W., Local 175 (2011), 215 L.A.C. (4th) 1 (“Smucker Foods”) at para. 13. The arbitrator reinstated the complainant after her termination, and the employer paid her the amounts owed. It was only later that the employer raised the mitigation of damages when it learned that the complainant did not make any effort to mitigate her damages. Even later, the employer gave notice that it would seek repayment of all or part of the amounts paid. The arbitrator refused to order the complainant to repay the employer because it had paid her the amounts without inquiring about her efforts to mitigate her damages.
[74]
The grievor argued that as I made the decision I was functus officio, which means that I no longer have jurisdiction over the issue in dispute. To support this doctrine, the grievor referred me to Chandler v. Alberta Association of Architects, [1989] 2 SCR 848, 1989 CanLII 41 (SCC). The grievor argued that if I decided that he should pay back the income earned during the relevant period, I would add to or amend the order referred to at paragraphs 318(b) and (c), which is contrary to the functus officio doctrine. The employer should have raised the issue of income earned in a timely manner, which it did not do.
C.
Employer’s reply
[75]
As for the issue of functus officio, the employer argued that the only matter before me is the calculation of amounts owed under the order. It pointed out that as indicated at paragraph 319 of Nadeau 2018, I remained seized of any issues related to the calculation of amounts owed at paragraphs 318(b) and (c). Therefore, I am not functus officio.
[76]
The employer then commented on certain decisions the grievor submitted. As for Smucker Foods, the employer argued that the context was different from the case at hand. In Sandhu, it is not clear whether the parties claimed the mitigation of damages; that is not indicated. Paragraph 182 states that it is the amount of the loss that the adjudicator must deduce. In Nehmé, it is not clear whether the employer claimed the mitigation of damages or the effect it would have on the amounts earned. That is not indicated in the summary of the employer’s arguments or in the analysis.
[77]
The employer argued that with respect to its behaviour, the reality of the Phoenix pay system must be considered. Ms. Viens coordinated the implementation of the decision. On May 2, 2018, approximately three weeks after the decision was issued, she prepared the instructions for the pay-action request, which incorporated the text of the order to carry out the repayment, and she followed up several times.
[78]
The employer was sensitive to the grievor’s pay issues and the time limits set out in the order. With respect to the fact that it raised the mitigation of damages only on July 4, 2018, the employer argued that it was entitled to clarify the issue and to appear before the adjudicator again to address it. The employer raised the issue within the 90-day period set out in the order.
IV.
Analysis
[79]
The body of evidence submitted by the employer contained a large amount of correspondence between the parties about the employer’s efforts to reinstate the grievor, as well as handwritten notes taken by its representatives during meetings or discussions about the reinstatement process. Those documents covered issues that included the amounts owed and how they would be paid, the Phoenix pay system, the correctional institution in which the grievor wished to be reinstated, the grievor’s position on his reinstatement, and the type of work he wished to avoid among others. None of the correspondence before Mr. Alcock’s email that was sent on July 4, 2018, refers to the mitigation of damages. I find that while the grievor raised that issue during the parties’ discussion about the implementation of Nadeau 2018 to confirm that mitigation was not an issue, the employer first raised that issue on July 4, 2018. Its letter dated July 4, 2018, acknowledged that fact, and the evidence did not contradict it. Therefore, the fact that my order does not directly mention the mitigation of damages is common ground for the parties.
[80]
The employer argued that although the order did not refer to mitigation, it did not mean that the principle did not apply, that the silence on this issue meant that the issue was not decided, or that this was why adjudicators remain seized of the application of their orders. I am not convinced of the merits of the employer’s argument. In Nadeau 2018, I made an order, and my being called upon in this case is defined by that order, which makes it clear that I will remain seized only for any matter related to the calculation of amounts owed at paragraphs 318(b) and (c) of my order; not for the issue of damages as a whole.
[81]
I also find that despite the employer’s argument to the contrary, it has not convinced me, on the balance of probabilities, that the term “customary deductions” is ambiguous and that it should be given a broad interpretation that includes amounts for the mitigation of damages. While perhaps it is not the most common term used by the Board, I find that in the context of this case, nonetheless, it is clear and unambiguous. I note that at paragraph 234 of Sandhu, which was cited by the grievor, the adjudicator ordered the employer to pay Ms. Sandhu compensation “ … less the customary deductions, and less any employment income earned …”. In Sandhu, which involved the same employer as the case before me, it was made clear that the phrase “less the customary deductions” was a concept that was separate and apart from any sums earned in mitigation. I find that the term “customary deductions” refers to the customary deductions provided for by law, as well as other common deductions from a federal public sector employee’s pay, such as income tax, Canada Pension Plan contributions, Employment Insurance contributions, Public Service Pension Plan contributions, union dues, healthcare insurance premiums, dental care insurance premiums, long-term disability insurance premiums, and other, similar deductions. On this point, the employer’s witness appeared to support the aforementioned finding, given that Ms. Viens testified that she had paid the grievor the amounts owed “with only the customary deductions under the pay-action request, without deductions for the mitigation of damages”. The employer has not convinced me that the term is ambiguous, such that I should interpret it broadly, and I should find that it includes the deduction of sums for the mitigation of damages.
[82]
While the application of the principle of the mitigation of damages is not unusual, I also find that its application is not implicit in every decision. A review of the Board’s jurisprudence on this issue, which was submitted to me by the parties, supports this finding. While I have read each of the decisions they cited, I will refer only to those of primary importance.
[83]
Giroux supports my decision on this point. Ms. Giroux was reinstated, and according to the adjudicator, it was incumbent on the parties to establish a remedy themselves, failing which he would, after the parties presented their arguments. When the parties were unable to reach an agreement, a hearing was held, and the decision on the remedy (2009 PSLRB 45) indicated that the parties were able to agree on the mitigation and that it applied to the case. That decision, which was cited by the employer, does not confirm that applying the principle of mitigation by the Board is automatic and is to be assumed. On the contrary, if necessary, it states that the subject matter must be discussed between the parties or be part of the evidence before the Board; it is not automatically applied.
[84]
With respect to the employer’s reference to Bahniuk 2014 on the issue of mitigation, I find that while it applies the principle of mitigation to the issue of compensation in lieu of reinstatement, it is simply an example of the Board applying mitigation after it was argued by the employer during the hearing. In this case, no such argument was made during the hearing on behalf of the employer, and nothing prevented it from raising the issue at the appropriate time.
[85]
In Nehmé, Ms. Nehmé was terminated from her executive position for allegedly using unauthorized documents when she participated in staffing processes. The adjudicator found the termination to be without cause and reinstated Ms. Nehmé. At paragraph 170, she stated that Ms. Nehmé was entitled to not only her salary but also to performance bonuses and interest, with any income earned since her termination deducted from the amount payable. Again, I find that this does not confirm that the deduction of amounts earned is the Board’s standard practice. The decision had no discussion of the issue of mitigation or how it arose or came to be included in the decision. The only conclusion to be drawn is that for whatever reason, the adjudicator in that case chose to apply the principle of mitigation.
[86]
In Marchand, the employer conceded the termination grievance but maintained the suspension imposed on Mr. Marchand. As the employer conceded the termination grievance, Mr. Marchand sought a provisional execution, and the decision dealt with the Board’s jurisdiction to make such an order. Evidence that pertained to Mr. Marchand’s remuneration during the period in question was brought forward, and in his decision, the adjudicator enumerated the parameters that had yet to be determined, one of which was the possibility of deducting the income earned. Again, while the issue of mitigation was raised in this decision, I see nothing that indicates that its application was the result of a standard Board practice.
[87]
I also find that there is insufficient evidence before me to allow me to conclude that the parties reached an agreement during their discussions. Mr. Rousseau testified that he raised the issue of what he claimed to be the employer’s practice not to consider mitigation with Ms. Cobb in May 2018 and that she responded that she would look into it and get back to him. He testified that he raised the issue again in June 2018 in a conversation with Ms. Viens, and he alleged that she replied, “[translation] We won’t go there”. However, Ms. Viens denied that an agreement was reached about mitigation. None of those who were reportedly present during the meeting, in which the grievor alleged that the agreement was reached, was called to testify. I find that the context of the alleged conversation and the words allegedly spoken by Ms. Viens mean that the words, “[translation] We won’t go there”, seem ambiguous to me and may mean either “[translation] we will not seek mitigation” or “[translation] let’s not talk about that.” I find that the onus is on the grievor to demonstrate that an agreement exists and that he has not, on the balance of probabilities, convinced me that an agreement exists that the Board should apply the issue of mitigation of damages. Both Ms. Viens and Mr. Rousseau were credible on this issue, but I find that the words in question, even if they were spoken by Ms. Viens, are not clear enough to constitute proof of an agreement that the Board should uphold.
[88]
In Red Deer College, which was a wrongful termination case, the College appealed a Supreme Court of Alberta, Appellate Division, decision to the Supreme Court of Canada, and the issue of the burden of proof of mitigation was raised. The Supreme Court of Canada denied the employer’s appeal and, on the issue of mitigation, held that the burden was on the employer-respondent to raise the issue if it alleged that the applicant could have avoided all or some of the losses incurred. During the hearing before me, the employer did not raise the issue of mitigation, and Nadeau 2018 was silent on this issue.
[89]
In Dover Corporation (Canada) Ltd., which the employer cited, the arbitrator stated that the principles for assessing compensation hold that a grievor is entitled, as far as money can compensate, to be put in the situation that he or she would have been in had the agreement been properly executed. The arbitrator added that the employer was responsible for all foreseeable damages but that on the other hand, the employee was responsible for mitigating his or her damages, and cited Red Deer College for that proposition. However, while Dover Corporation (Canada) Ltd. determined that the application of the duty to mitigate is not unusual, this case also accepts that the duty to raise the issue of mitigation during the hearing falls to the employer.
[90]
I find that this case is most similar to the decision in Smucker Foods, which both parties cited. In that case, in an earlier decision by the arbitrator, the complainant was reinstated, with compensation. The employer paid her the amounts owed her but did not ask about any mitigation efforts on her part; nor did it deduct any amount for mitigation. Only months after the payment was made did the employer begin to ask about the complainant’s efforts to mitigate damages and to claim the repayment of some amounts that had been paid. Before the arbitrator, the employer recognized that it was pursuing an extraordinary remedy, but it argued that it was reasonable and that it was within the reserved jurisdiction set out in the order section of the earlier decision. The arbitrator acknowledged that had the issue been raised earlier in the case, he would likely have reduced the damages substantially, given the complainant’s complete failure to mitigate the damages. However, he declined, in those circumstances, to exercise his jurisdiction to reduce compensation for mitigation; he found that the employer’s request was made too late and that it might have prejudiced the complainant by leading her to believe that it had waived that issue. Although a waiver is not at issue in this case, I also find that the employer’s request came too late. My reservation of jurisdiction over my order is limited to matters related to the calculation of amounts owed at paragraphs 318(b) and (c) of Nadeau 2018, in which mitigation does not appear. I find that I did not reserve jurisdiction for mitigation.
[91]
In Nadeau 2018, I remained seized for the purpose of calculating the amounts owed for two specific sections of my order, including paragraph 318(b), which refers to retroactive pay and the customary deductions at issue in this case. The grievor argued that I am functus officio on the issue of mitigation, and he cited the Supreme Court of Canada’s decision in Chandler. In that case, architects were disciplined after a report was published by the Alberta Association of Architects’ Practice Review Board. That decision was overturned because that board did not have jurisdiction to make findings or orders about discipline. However, the board did not drop the issue; it notified the parties that it would continue the original hearing to determine whether it should publish a new report for other organizations of the Alberta Association of Architects. In this context, the Alberta Court of Queen’s Bench allowed the request for a prohibition order, and it found that the board was functus officio as it had fulfilled its function. I do not accept that this decision necessarily determines that I am functus officio on the mitigation of damages. More importantly, I note that the employer stated that it merely asked me to act within the terms of my order in Nadeau 2018. At paragraph 57 of this decision, the employer’s arguments relate to the terms of my initial order and what it included. Therefore, the issue of functus officio does not play a role in this decision.
[92]
For all of the above reasons, the Board makes the following order:
(The Order appears on the next page)
V.
Order
[93]
The employer’s application is dismissed.
FPSLREB Translation