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CUPE Local 3252 v. Credit Valley Hospital

October 21, 2011

Hospital required to provide notice of layoff to employees whose jobs were to be eliminated and the work contracted out to a third party.

In June 2011, the Credit Valley Hospital advised CUPE Local 3252 that it planned to eliminate the sterile processing technician position and “transfer” the employees in that position to SteriPro Canada Limited Partnership (“SteriPro”), where they would become SteriPro’s employees.

In the hospital’s view, the contracting out of this work and the transfer of the employees to SteriPro did not trigger the layoff provisions of the collective agreement or any of the affected employees’ related seniority rights, including the right to bump into other positions within the hospital.  The union maintained that the elimination of a position required notice of layoff under the collective agreement, and that employees whose positions were eliminated were not required to follow the work to the contractor but could choose to exercise their seniority rights, including bumping rights, under the collective agreement.

Arbitrator Owen Shime accepted the union’s position, holding that the sterile processing technicians were entitled to notice of layoff and to exercise their seniority rights under the collective agreement. He  reached his decision by:

  • observing the longstanding and fundamental principle of the common law that employees are entitled to choose their own employer, and that this right may be eliminated only by express or specific language in a collective agreement
  • considering the importance of seniority rights in a collective agreement, and the deep-rooted principle that express language is required to remove such rights from employees
  • examining both the specific language of relevant articles of the collective agreement and the language of the collective agreement as a whole, and concluding that there was no express or specific language that would require employees to accept employment with a contractor or be deemed to have resigned from their employment and given up their collective agreement rights
  • considering the history of the contracting out provision over almost 30 years, which did not provide any basis to conclude that interest arbitrators or the parties themselves intended that employees could be required to accept employment with a contractor against their will or surrender their rights under the collective agreement, and
  • taking into account the hospital’s own repeated statements that it intended to “eliminate” the positions in question, thus triggering the notice of layoff provision in the agreement.

Both SteriPro and the hospital sought judicial review of the arbitration award. The Divisional Court dismissed SteriPro’s application for judicial review on November 7, 2012 and dismissed the hospital’s application on December 19, 2012.

Practice Areas

Labour Law