Life after certification applications: Lawful outsourcing and scope of bargaining units

by Karine Fournier and Valérie Gareau-Dalpé

Union certification applications can have profound impacts on the workplace. The bargaining unit’s composition will have implications for the conduct of the employer’s business, and it bears close attention.

The union applying for certification will be the one proposing the scope of the bargaining unit. Merely showing there is a more appropriate unit than the one proposed by the union is not enough. To challenge the proposed unit, employers must show that the proposed unit is actually inappropriate in the specific context of the company. Employers also face potential unfair labor practice complaints for their conduct during union organization campaigns.

Recently, in L’Alliance internationale des employés de scène et de théâtre, des techniciens de l’image, des artistes et des métiers connexes des États-Unis, ses territoires et du Canada (IATSE), section locale 56 and Solotech inc., (2017 QCTAT 1913), the Administrative Labour Tribunal of Quebec issued an encouraging decision for employers. It should serve as a reminder that business operations are key when challenging the composition of bargaining units and that mere timing between an employer’s action and unionization activities is insufficient to ground a complaint for unfair labor practice.

Facts
On September 21, 2016, the International Alliance of Theatrical Stage Employees, Moving Picture Technicians, Artists and Allied Crafts of the United States, Its Territories and Canada (IATSE), Local 56, filed three applications for certification to represent the employees of Solotech Inc., a company with offices in Canada and the United States specializing in the live performance and entertainment industry. The company does business nationally and internationally.

By way of these applications, IATSE sought certification for three separate bargaining units: (1) shop and repair technicians, (2) technicians assigned to touring performances, and (3) technicians assigned to local events. Solotech challenged the composition of the bargaining units on the basis that a single unit covering all of these employees was the only appropriate unit given the specific nature of its activities.

It’s important to note that these certification applications were filed on an urgent basis in response to Solotech’s decision to contract out its transportation service, which consisted of eight drivers who had recently joined IATSE.

Several weeks later, IATSE also filed an unfair labor practice complaint. In the union’s view, the decision to contract out the transportation service was aimed at intimidating the other employees and undermining the union campaign, which it had been engaged in since the fall of 2015.

Inappropriateness of the proposed units
The Tribunal began by acknowledging the existence of a community of interests among the groups of employees covered by the applications for certification. However, even though the various technicians didn’t perform their work under the same physical conditions or have the same employment status or terms of employment, the evidence on the whole showed that (1) they performed the same type of functions, (2) the qualifications required to hold any of these positions were the same, and (3) the various functions were interdependent and interchangeable.

The Tribunal held that the nature of Solotech’s business called for a pool of mobile and rapidly available technicians. Given its finding in that regard, the Tribunal concluded that a unit that covered only one part of that pool would be inappropriate since it would [translation] “exclude from its intended scope employees who are in frequent contact with one another, who hold interdependent and interrelated positions, and who may be moved from one category of personnel to another.”

No hindrance or interference
Applying the principles established by the Supreme Court of Canada in the Wal-Mart decisions (Plourde v. Wal-Mart Canada Corp., [2009] 3 SCR 465; United Food and Commercial Workers, Local 503 v. Wal-Mart Canada Corp., [2014] 2 SCR 323.), the Tribunal concluded that apart from pointing to the timing between the certification of the drivers and Solotech’s announcement of its decision to contract out local transportation, IATSE had not discharged its burden of proving that the impugned decision was tainted by anti-union animus.

The Tribunal found that Solotech’s decision was related to the need to free up additional money for the purchase of new equipment during a period of exponential growth. The Tribunal also accepted Solotech’s argument that an employer has the right to restructure part of its business to achieve better results, and not just when it’s experiencing financial troubles. In short, the decision to contract out the transportation activities had been made “in the ordinary course of business.”

Conclusions
This decision is a reminder that an employer can challenge the composition of a bargaining unit that it considers inappropriate in light of its activities and business characteristics. It is also an interesting application of the “business as usual” test to the situation of a rapidly expanding company. It shows that a company may not only continue its usual activities during that period, but may also make major decisions about its growth and the organization of its activities in that context.

About Karine Fournier and Valerie Gareau-Dalpe:
Karine Fournier is a member of our Labour, Employment and Human Rights practice group. She practises primarily in the areas of labour relations, employment law as well as occupational health and safety. Valérie Gareau-Dalpé is a member of Labour, Employment & Human Rights group in the Montreal office. She earned her law degree with honours from Laval University's Faculty of Law.
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