The Nova Scotia Supreme Court has upheld an arbitrator’s decision dismissing a union grievance against Halifax Shipyard, a division of Irving Shipbuilding Inc., over the cessation of double time pay for “early starts.”
Justice James L. Chipman found that the arbitrator’s award was reasonable and that the employer did not breach the collective agreement when it stopped paying double time for employees starting work before their regular shift.
The union sought judicial review of arbitrator Scott Sterns’ Dec. 8, 2023, award. The union alleged that the arbitrator failed to properly interpret Article 14.08 of the collective agreement, which they argued required the employer to pay double time for early starts.
Long-standing practice
The union represents all employees at the Halifax Shipyard and had a long-standing practice of employees receiving double time pay for early starts — a practice that had been in place for at least 30 years. However, on Aug. 3, 2022, the employer notified the union of its intention to stop paying double time for early starts, stating that such payments were not aligned with the collective agreement.
In its notice, the employer wrote: “Early starts will be eliminated and, if re-introduced during the life of the next collective agreement, will be payable at time and one-half only.” The union responded by filing a grievance, alleging that the employer breached Article 14.08 by unilaterally changing the overtime pay rate for early starts.
Article 14.08 of the collective agreement addresses overtime pay. It states:
“(a) Any work performed other than during the regular hours of work herein provided shall constitute overtime and shall be paid for at a rate of time and one half, except where double time is payable provided, however, that if such overtime does not exceed fifteen (15) minutes, it shall be paid for at straight time.
(b) Overtime worked over four (4) hours shall be paid at the rate of double time.
For all hours worked in the overtime period which starts four (4) hours after the end of the regular shift, employees shall be paid at the double time rate of pay.”
Union’s position
The union argued that the language of Article 14.08 required double time pay for early starts, asserting that the period “four hours after the end of the regular shift” included the hours before the next regular shift commenced.
Employer’s counter
The employer contended that the collective agreement did not mandate double time pay for early starts and that any such payments had been made as a matter of practice, not contractual obligation. At arbitration, the arbitrator found that the evidence was equivocal on whether double time for early starts was a binding practice and relied on the plain language of the collective agreement.
The union’s application for judicial review argued that the arbitrator’s award did not meet the reasonableness standard set out in Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65. Specifically, the union maintained that the arbitrator failed to properly apply the principles of collective agreement interpretation, rendering part of Article 14.08 superfluous.
Reasonableness standard of review
In his analysis, Justice Chipman applied the reasonableness standard of review, noting that “the reasonableness standard of review applies to the Award in accordance with the Supreme Court of Canada’s decision in Vavilov.” He emphasized that the court’s role is to review the decision for reasonableness and not to decide the issue anew.
Justice Chipman found that the arbitrator had accurately outlined the key principles of collective agreement interpretation and had applied them appropriately. “A fair reading of the Award reveals that the arbitrator was reasonably focused on the Union’s framing of its Grievance as an entitlement to overtime for early starts,” he wrote.
The court noted that the arbitrator considered the absence of the term “early starts” in Article 14.08 significant. While “early starts” were mentioned in Article 14.09 concerning overtime selection, they were not included in the overtime pay provisions of Article 14.08. “It would have been very easy to require the payment of double time for early starts if that is what Article 14.08 said,” the arbitrator had noted.
Justice Chipman agreed with this reasoning, stating that “the conspicuous absence of ‘early start’ from Article 14.08 was significant for the arbitrator and in keeping with appropriate collective agreement interpretation.” He found that the arbitrator appropriately considered the collective agreement as a whole and that different words have different meanings within the agreement.
The court also addressed the union’s argument that the arbitrator’s interpretation rendered part of Article 14.08 superfluous. Justice Chipman rejected this claim, stating: “When I read the Award in the proscribed manner, I find that the arbitrator’s analysis does not reflect a redundancy, but rather, a conclusion that is in accordance with the agreed-upon collective agreement interpretation principles.”
Examining the arbitrator’s award, Justice Chipman found that the arbitrator had considered extrinsic evidence and found that the union’s sole witness, J.V., “did not say, we nailed down double time for early starts. He said, we nailed down ‘double time after four hours’. That is consistent with the Employer’s argument.”
The arbitrator also observed that “a very important promise is likely to be clearly and unequivocally expressed,” emphasizing that the payment of double time for early starts was not expressly stated in Article 14.08. “If the parties intended an early start to attract double time, surely that is an important promise which must be clearly and unequivocally expressed,” the arbitrator had concluded.
Need for ‘express language’
Justice Chipman agreed, noting that established arbitral jurisprudence requires that “express language is required in a collective agreement to confer such a benefit” and that “the burden is on the Union to show in clear and unequivocal terms that the benefit is part of the compensation package.”
In concluding that the arbitrator’s decision was reasonable, Justice Chipman wrote: “I find the Award to be reasonable. The outcome is justifiable. Having analyzed the arbitrator’s decision in light of the history and context contained in the Record, I do not find any shortcomings. The Award is transparent and intelligible.”
As a result, the application for judicial review was dismissed, and costs were awarded to the employer. “Accordingly, I dismiss the application for judicial review with costs to the Respondent,” Justice Chipman stated.
For more information, see Unifor Marine Workers Federation, Local 1 v. Halifax Shipyard, 2024 NSSC 369 (CanLII).
