An Ontario arbitrator has dismissed a union grievance after finding that a wage reopener agreement containing an additional year of increases beyond what was intended could be rectified due to mutual mistake.
The case involved Community Addictions and Mental Health Health Services of Haldimand Norfolk (CAMHS) and the Ontario Nurses Association (ONA), where a wage reopener agreement signed in June 2023 incorrectly included increases for April 1, 2022 — a period already covered by an existing collective agreement.
Background on Bill 124
The dispute stemmed from negotiations following the repeal of Ontario’s Bill 124, which had restricted public sector compensation increases to one per cent annually for three consecutive years.
ONA had challenged the legislation and negotiated “reopener” clauses in collective agreements that would allow them to renegotiate compensation if their court challenge succeeded. When the Ontario Court of Appeal struck down Bill 124 in February 2024, these reopener provisions became active.
The contested agreement
After Bill 124 was repealed, an ONA labour relations officer sent an email to CAMHS in March 2023 requesting to “meet to discuss dates to re-negotiate the monetary terms of our collective agreement effective from April 1, 2020 to March 31, 2022.”
However, when the employer responded in May 2023, they proposed wage increases for three years: 2020, 2021, and 2022. The parties signed an agreement by June 2, 2023, that included all three years of increases.
Shortly after, the employer contacted the union claiming a mistake had been made, as wage increases for April 1, 2022, had already been negotiated in the current collective agreement covering April 1, 2022, to March 31, 2024.
The parties’ positions
The employer argued that both parties had mistakenly believed there was a wage reopener for April 1, 2022. The employer’s representative testified she had incorrectly assumed the same reopener periods that applied to a related hospital ONA bargaining unit also applied to CAMHS.
The union contended there was no error and that the signed agreement accurately reflected what the parties had negotiated, regardless of whether there was a reopener provision for 2022 in the collective agreement.
Key testimony from union representative
During cross-examination, the union’s labour relations officer acknowledged there was no reopener in the April 1, 2022-March 31, 2024 collective agreement.
When asked if she assumed the employer was going to “gift” another increase two months after negotiating wage increases in the renewed agreement, she answered “Yes.”
She admitted knowing the employer representative had made a mistake in the May 2023 email regarding wage calculations, but said “it never crossed my mind that there was a second mistake.” When asked if she knew there was no reopener for 2022, she replied “Yes,” but explained: “It’s not unusual to do this sort of thing in negotiations… It’s the nature of labour relations.”
The arbitrator’s findings
The arbitrator determined that for rectification to occur, “it is necessary to identify a ‘true agreement’ which precedes (and is not accurately recorded by) the written instrument.”
Based on the evidence, the arbitrator found “that the Association’s and Employer’s intentions are not in accord with the June 2, 2023 agreement between the parties. I find the parties both made a mistake in agreeing to the June 2, 2023 agreement. The Association mistakenly agreed to a 3-year wage increase where it had intended a 2-year wage increase. The Employer mistakenly applied the Hospital/ONA bargaining unit’s 3-year wage increase.”
Alternatively, the arbitrator found the employer made a unilateral mistake, and the union representative “knew or ought to have known that the three-year calculation… was not what the Association had intended on March 2, 2023.”
In this circumstance, the arbitrator concluded “the Association ought not be allowed to take advantage of the Employer’s mistake in garnering a wage increase effective April 1, 2022 under the June 2, 2023 agreement.”
Principles of rectification
In making the ruling, the arbitrator cited the Supreme Court of Canada’s Fairmont Hotels decision, which established that “rectification is limited solely to cases where a written instrument has incorrectly recorded the parties’ antecedent agreement.”
The arbitrator noted that rectification “is not equity’s version of a mulligan” and courts do not rectify agreements where their faithful recording “has led to an undesirable or otherwise unexpected outcome.”
Instead, the test focuses on whether the recorded agreement accurately reflects the parties’ true intentions.
Agreement rectified
The arbitrator concluded that the June 2, 2023 agreement could properly be rectified to include only wage increases for April 1, 2020, and April 1, 2021, dismissing the union’s grievance.
While acknowledging the union’s argument that parties often make agreements outside the scope of their collective agreement, the arbitrator emphasized that the issue was whether rectification was appropriate in this specific case.
The ruling underscores that mistakes in labour relations agreements can be corrected through rectification when the evidence clearly demonstrates the agreement does not reflect the parties’ original intentions.
For more information, see Community Addictions and Mental Health Services of Haldimand Norfolk v Ontarion Nurses Association, 2025 CanLII 42296 (ON LA).
