Arbitrator Mark Asbell has dismissed a grievance filed by Ironworkers Local 805, which alleged that AP Infrastructure Solutions failed to provide adequate termination pay to a group of employees in Alberta who received non-temporary layoffs. The case revolved around the interpretation of the company’s obligations under the Collective Agreement and the Employment Standards Code (ESC).
The Union’s grievance was triggered after AP Infrastructure Solutions issued non-temporary layoff notices to 28 employees in late 2019 and early 2020 as the company wound down its operations. The employees had each worked for the company for more than 10 years, and they received pay in lieu of notice equal to 40 working days, as stipulated in Article 17(C)(2)(f) of the Collective Agreement.
The Union argued that the company owed additional termination pay under the ESC. However, the employer maintained that the payments made under the Collective Agreement satisfied all obligations under both the agreement and the ESC. In his ruling, arbitrator Asbell sided with the employer, concluding that the payments provided fulfilled the company’s legal obligations.
Background
AP Infrastructure Solutions announced in January 2019 that it intended to cease operations once its existing contracts were completed. By late 2019, as work contracts were concluding, the company issued non-temporary layoff notices to 28 employees. These layoffs were considered “non-temporary” as they were indefinite in duration. The employees received eight weeks of pay in lieu of notice as per the Collective Agreement.
However, the Union contested that, while the company complied with the Collective Agreement, it did not meet its obligations under the ESC, which governs termination pay for employees in Alberta. The Union filed a group grievance on behalf of the affected employees, and in January 2022, Asbell initially ruled in favour of the company.
Following that decision, the Union applied for a review by the Alberta Labour Relations Board, which remitted the case back to Asbell for further explanation. The Board found that Asbell’s original decision contained reasoning gaps, particularly regarding whether the Collective Agreement’s provisions allowed the company to treat non-temporary layoffs as equivalent to termination under the ESC.
Arguments and ruling
The key issue was whether the company’s payment of 40 working days’ notice under the Collective Agreement also satisfied its obligations for termination pay under the ESC. The Union argued that the employees’ employment did not terminate until their recall rights under the Collective Agreement expired 12 months after the layoff, meaning they should receive termination pay at that later point in time. According to the Union, the notice period in the Collective Agreement was separate from, and in addition to, termination pay required by the ESC.
In contrast, AP Infrastructure Solutions argued that non-temporary layoffs under the Collective Agreement were effectively terminations for the purposes of the ESC. The employer contended that the 40 working days’ notice provided under the Collective Agreement fulfilled both the agreement’s and the ESC’s termination pay requirements.
Arbitrator Asbell ultimately agreed with the employer’s interpretation. He determined that the notice provided to employees at the time of the layoffs met the company’s obligations under the ESC and did not require any additional payment. “I find that the Employer did not breach the Collective Agreement by failing to make a second 40 working day / 8-week payment to the employees,” Asbell wrote in his decision.
He also rejected the Union’s argument that termination only occurs at the expiry of recall rights. Asbell noted that the Collective Agreement allows for non-temporary layoffs without automatically terminating employment, but this does not mean the employees were entitled to additional compensation beyond what was provided in the Collective Agreement.
“The more plausible reading,” Asbell wrote, “is that the employee is to receive five working days’ notice at the outset of the temporary layoff,” adding that if the temporary layoff extended beyond 60 days without recall, employees would then be entitled to further pay to meet their termination notice entitlements.
Legal context
The decision rested on a close reading of both the Collective Agreement and the ESC. Under Alberta’s ESC, employees with 10 years or more of service are entitled to eight weeks’ notice or pay in lieu of notice upon termination. The Collective Agreement mirrored this provision, requiring the employer to provide 40 working days of notice or pay in the case of non-temporary layoffs for employees with 10 or more years of service.
The Union had argued that these provisions should be read as separate obligations, but Asbell found that the notice provided at the time of layoff satisfied the company’s legal obligations under both the Collective Agreement and the ESC.
In concluding, Asbell dismissed the Union’s grievance and confirmed that AP Infrastructure Solutions met its obligations to the laid-off employees. “The Employer did not violate the Collective Agreement by failing to provide the employees with an additional payment. The Grievance is dismissed,” Asbell stated in his ruling.
For more information, see Ironworkers Local 805 v AP Infrastructure Solutions, 2024 CanLII 92123 (AB GAA).
