Federal Court Decisions

Date: 20050930

Docket: T-1177-04

Citation: 2005 FC 1345

BETWEEN:

JACQUES HEPPELL

Applicant

and

ATTORNEY GENERAL OF CANADA

(CANADA CUSTOMS AND REVENUE AGENCY)

Respondent

REASONS FOR ORDER

HARRINGTON J.

[1]                It is well established within the Public Service that if an employee in fact carries out duties of a higher job classification he or she is to be paid accordingly. The question in this case is whether an employee is entitled to be paid the higher classification rate for work performed before that higher classification was created.

[2]                Jacques Heppell is employed by the Canada Customs and Revenue Agency. A few years ago the Agency underwent restructuring. New job classifications were being developed. In October 2001, Mr. Heppell was given advance notice that he would be elevated from his then current AU-03 group and level to a new group and level to be created, MG-05. This was good news as the new position carried with it a raise. He was officially informed in August 2002 that the effective date of his appointment was 31 March 2002.

[3]                In government circles, the 31^st of March is a significant date. It is the last date of the fiscal year. More to the point, year end performance bonuses are based on one's rate of salary on the last day of the year.

[4]                Mr. Heppell received a performance bonus based on the higher MG rate even though he only officially held that classification for one day.

[5]                The Agency's policies in this regard for the evaluation period of 1 April 2001 to 31 March 2002 required amongst other things: "The manager must have performed the MG duties for at least six consecutive months during the performance management review period."

[6]                Mr. Heppell says that he in fact carried out MG functions from 14 October 2001 to 31 March 2002. That being so, he says he should have been paid at the MG level during that time. The employer disagreed and so the matter was grieved.

[7]                During the hearing before Jean-Pierre Tessier, a member of the Public Service Staff Relations Board, the employer argued that he had no jurisdiction as this was a classification matter. Mr. Tessier agreed that section 7 of the Public Service Staff Relations Act precludes him from dealing with classification. However, he was of the view that the matter could be examined on an acting pay basis. It is that part of the decision which is under judicial review.

[8]                In addition to Mr. Heppell, evidence was also taken from witnesses from the Agency. A memorandum of settlement between the Agency and the Professional Institute of the Public Service of Canada was exhibited. It stated that the parties "...have agreed to recommend to their respective principals and for ratification" changes to terms and conditions of employment then in place. It provided that rates of pay for the management group - MG would be effective as of 31 March 2002.

[9]                The Agency's witnesses explained that a 31 March date was chosen to in effect increase the bonuses for the year ending 31 March 2002.

[10]            Mr. Tessier held that the grievance could not be evaluated on the basis of acting pay, even if Mr. Heppell performed duties which as of 31 March 2002 fell within the MG group:

[Translation]

[21]     The grievor asks for the pay rate for the MG group for a period prior to March 31, 2002. I note that this rate did not exist at that time; the grievance therefore becomes moot and must be denied. A grievance adjudicator cannot amend a collective agreement according to section 96, subsection 2 of the P.S.S.R.A., which reads as follows: :

96.(2) No adjudicator shall, in respect of any grievance, render any decision thereon the effect of which would be to require the amendment of a collective agreement or an arbitral award.

MR. HEPPELL'S CASE IN JUDICIAL REVIEW

[11]            Mr. Heppell's case is that Mr. Tessier wrongly relied on the memorandum of settlement which provided that rates of pay for the MG group would be effective 31 March 2002. He cited the third edition of Canadian Labour Arbitration by Brown and Beatty at paragraph 4-1100 for the proposition that when, as in this case, a memorandum of settlement has been followed by a formal collective agreement, the memorandum will not be considered part of that collective agreement. Therefore, the collective agreement was silent as to when the new rates of pay came into effect. Although based on different statutes, and regulations, there is ample jurisprudence in this Court and in the Federal Court of Appeal to support the proposition that an employee who in fact performs the duties of a higher job classification should be compensated accordingly. Reliance was placed on Blais v. Canada (Public Service Staff Relations Board) A-846-85, decided in 1986, Stagg v. Canada (Treasury Board) (1993) 71 F.T.R. 307, [1993] F.C.J. No. 1393 (QL) and Chadwick v. Canada (Attorney General), 2004 F.C. 503, (2004) 249 F.T.R. 293, [2004] F.C.J. No. 605 (QL).

THE AGENCY'S CASE

[12]            The Agency submits that even if the memorandum was merged into the collective agreement, which is silent on effective dates of rates of pay, the Board member referred to the proof as a whole. He referred to evidence as to why the 31^st of March was selected as the effective date of the new MG classification, which resulted in increased bonuses.

[13]            The cases cited by Mr. Heppell were not contested. It was submitted that they were simply not relevant because in each of those cases the grievor was carrying out the duties of a higher classification which was in place at the time the duties were performed. The Board member was right in refusing to analyse Mr. Heppell's work in the light of a classification which did not exist when that work was performed. Even if he erred in law, his decision cannot be set aside unless it was unreasonable.

STANDARD OF REVIEW

[14]            It is well established in judicial review that the Court must adopt a pragmatic and functional analysis in order to determine the appropriate standard of review, which might be correctness, reasonableness, or patent unreasonableness (Dr. Q.v. College of Physicians and Surgeons of British Columbia, [2003] 1 S.C.R. 226, Law Society of New Brunswick v. Ryan, [2003] 1 S.C.R. 247). Consideration must be given to the expertise of the tribunal whose decision is being reviewed relative to the expertise of the Court. Normally, the Court owes no deference on questions of law, which would include contract interpretation. However, particular deference is owed when it comes to the interpretation of collective agreements. In Voice Construction Ltd. v. Construction & General Workers' Union, Local 92, [2004] 1 S.C.R. 609, the Court held that the appropriate standard of review was reasonableness. As Major J. said::

27       The arbitrator in this case was required to interpret the collective agreement. Collective agreements, although similar to, are different in some respects from other types of contracts. While interpreting contracts falls squarely within the [page621] expertise of courts, arbitrators, who function within the special sphere of labour relations, are likely in that field to have more experience and expertise in interpreting collective agreements. Consequently, this favours a certain degree of curial deference to arbitrators' interpretation and application of collective agreements.

[15]            As stated in Voice Construction, ibid. and the cases which preceded it, a decision is reasonable if it can stand up to a somewhat probing examination, if there is a line of analysis within which could have reasonably led the tribunal to the conclusion it reached.

[16]            There is logic in Mr. Heppell's position. A performance bonus is not granted in lieu of a raise; it is a reward for a job well done. If he received a bonus, based on a MG rate of pay for a job well done for at least six months, it follows that during that time he should have been paid at a MG rate.

[17]            On the other hand, quite apart from the memorandum which stated when the new rate of pay became effective, the Board member's decision was also logical. How can one compare a job which exists to a job which at the time did not exist?

[18]            There was nothing unreasonable about the decision and so the application for judicial review must be dismissed, with costs.

[19]            Following Voice Construction, supra, Binnie J. speaking for the Supreme Court in Vaughan v. Canada, 2005 SCC 11, [2005] 1 S.C.R. 146 said at paragraph 1:

The terms and conditions of employment of the federal government's    quarter of a million current workers are set out in statutes, collective agreements, Treasury Board directives, regulations, ministerial orders, and other documents that consume bookshelves of loose-leaf binders. Human resources personnel are recruited into the system, spend a career attempting to understand it and die out of it. Procedures for the enforcement of employment rights and obligations also differ in some respects from those in the private sector.

[20]            As the great American jurist Oliver Wendell Holmes, Jr. said: "The life of the law has not been logic; it has been experience." The Court owes considerable deference to the Board because of the Board's experience, and should not interfere, even in the interpretation of a collective agreement, unless the decision is unreasonable.

[21]            The above reasoning assumes that the pragmatic and functional analysis approach to judicial review applies as much to the Federal Court as it does to provincial superior courts. This is so notwithstanding section 18.1(4)(c) of the Federal Courts Act which provides:

(4) The Federal Court may grant relief under subsection (3) if it is satisfied that the federal board, commission or tribunal ... (c) erred in law in making a decision or an order , whether or not the error appears on the face of the record;

(4) Les mesures prévues au paragraphe (3) sont prises si la Cour fédérale est convaincue que l'office fédéral, selon le cas : ... (c) a rendu une décision ou une ordonnance entachée d'une erreur de droit, que celle-ci soit manifeste ou non au vu du dossier;

[22]            This assumption derives from the fact that some of the leading decisions on the pragmatic and functional approach came from the Federal Court including Pushpanathan v. Canada (Minister of Citizenship and Immigration), [1998] 1 S.C.R. 982. However, in Mugesera v. Canada (Minister of Citizenship and Immigration), 2005 SCC 40, [2005] S.C.J. No. 39 (QL), all eight Members of the Court who participated in the decision stated at paragraph 37:

Applications for judicial review of administrative decisions rendered pursuant to the Immigration Act are subject to s. 18.1 of the Federal Court Act. Paragraphs (c) and (d) of s. 18.1(4), in particular, allow the Court to grant relief if the federal commission erred in law or based its decision on an erroneous finding of fact. Under these provisions, questions of law are reviewable on a standard of correctness.

[23]            One might wonder if the Supreme Court has signalled a change of approach to judicial reviews by the Federal Court on errors of law because of the express language of section 18.1(4)(c). If so, one would have thought that an explanation would have been provided. On the other hand, it may be that the broad language of paragraph 37 in Mugesera, supra, must be considered in context. The Federal Court was reviewing a decision of the Immigration and Refugee Board. It has been well established that the Court owes that Board no deference on questions of law.

[24]            In Voice Construction, supra, Major J. stated at paragraph 19 that "...only after the standard of review is determined can the administrative tribunal's decision be scrutinized". The functional and pragmatic approach to judicial review is grounded in the interpretation of the relevant statute. When it comes to construing labour agreements, the courts, absent contrary language, assume that Parliament intended that some deference be given, even on questions of law. Put another way, as long as the decision is reasonable, it is not for the reviewing Court to say that the decision is wrong in law.

[25]            Be that as it may, Mugesera, supra, does not affect the outcome of this case. In my opinion, the decision of the Board to reject Mr. Heppell's claim was not only reasonable; it was correct in law.

[26]            For the above mentioned reasons, the application for judicial review of the decision of Jean-Pierre Tessier, Member of the Public Service Staff Relations Board, dated 20 May 2004, is dismissed with costs.

"Sean Harrington"

Ottawa, Ontario

30 September, 2005