INDUSTRIAL RELATIONS IN CANADA INDUSTRIAL RELATIONS IN CANADA Second Edition Fiona A. E. McQuarrie Prepared by Kenda Murphy, Saint Mary’s University Kenda Murphy, Saint Mary’s University

Chapter 10 Third-Party Intervention during Negotiations

At the end of this chapter you should be able to:At the end of this chapter you should be able to:  Explain why a third party would be used to help negotiators reach a collective agreement  Understand the difference between conciliation, mediation, and arbitration  Outline the conciliation process  Define interest arbitration and understand how it is used  Explain the role of mediators  Discuss industrial inquiry commissions  Understand the purpose of a disputes inquiry board Chapter 10 Objectives

Third-Party Intervention During Negotiations Most Canadian jurisdictions provide for various forms of third-party intervention in collective bargainingMost Canadian jurisdictions provide for various forms of third-party intervention in collective bargaining Neutral third parties are brought into the bargaining process to help parties resolve their differences without using a strike or lockoutNeutral third parties are brought into the bargaining process to help parties resolve their differences without using a strike or lockout

Types of Third-Party Intervention The main types of third-party intervention used in Canadian jurisdictions are:The main types of third-party intervention used in Canadian jurisdictions are:  Conciliation  Mediation  Arbitration The use of these types of intervention may be voluntary or mandatoryThe use of these types of intervention may be voluntary or mandatory Less common types of third-party intervention:Less common types of third-party intervention:  Mediation-arbitration  Industrial inquiry commissions  Dispute-resolution boards

Conciliation In all Canadian jurisdictions except B.C. and Alberta, conciliation is the first step in attempting to resolve an impasse in negotiationsIn all Canadian jurisdictions except B.C. and Alberta, conciliation is the first step in attempting to resolve an impasse in negotiations The conciliator’s role is to assess the parties’ positions and submit a report of those findings to the Minister of Labour; the report is usually a pre- condition to a strike or lockoutThe conciliator’s role is to assess the parties’ positions and submit a report of those findings to the Minister of Labour; the report is usually a pre- condition to a strike or lockout The conciliator, who is usually a government employee, does not participate in bargaining but attempts to capture what the real issues are between the partiesThe conciliator, who is usually a government employee, does not participate in bargaining but attempts to capture what the real issues are between the parties

Conciliation In most Canadian jurisdictions, if the report of the conciliation officer fails to produce an agreement, the Minister of Labour may appoint a tripartite conciliation boardIn most Canadian jurisdictions, if the report of the conciliation officer fails to produce an agreement, the Minister of Labour may appoint a tripartite conciliation board This board is comprised of:This board is comprised of:  An individual appointed by the employer  An individual appointed by the union  A neutral third party, either appointed jointly by the parties or by an external authority

Conciliation The major difference between a tripartite board and an officer or commission—the board will hold a formal hearing at which both parties present their positions, a conciliator observes and notesThe major difference between a tripartite board and an officer or commission—the board will hold a formal hearing at which both parties present their positions, a conciliator observes and notes If parties agree in advance, board recommendations can be binding, i.e., the parties agree to accept the board’s recommendationsIf parties agree in advance, board recommendations can be binding, i.e., the parties agree to accept the board’s recommendations Conciliation is used in public sector disputes because these disputes often involve essential servicesConciliation is used in public sector disputes because these disputes often involve essential services

Conciliation Conciliation rarely resolves disputes and is most often seen only as the necessary first step to taking the real action that will resolve the issuesConciliation rarely resolves disputes and is most often seen only as the necessary first step to taking the real action that will resolve the issues Because of the timing of conciliation the parties have seldom reached the stage where they are prepared to compromiseBecause of the timing of conciliation the parties have seldom reached the stage where they are prepared to compromise One study indicated that the use of conciliation did not significantly reduce either the number or the length of strikesOne study indicated that the use of conciliation did not significantly reduce either the number or the length of strikes

Mediation Mediation is a more intensive form of third-party intervention than conciliationMediation is a more intensive form of third-party intervention than conciliation The mediator usually proactively participates in the actual bargaining process, meeting jointly and separately with the parties during bargaining sessionsThe mediator usually proactively participates in the actual bargaining process, meeting jointly and separately with the parties during bargaining sessions In most Canadian jurisdictions, a mediator is appointed at the request of one or both parties, or at the initiative of the Minister of LabourIn most Canadian jurisdictions, a mediator is appointed at the request of one or both parties, or at the initiative of the Minister of Labour In all jurisdictions except P.E.I., the mediator’s recommendations are not binding, but the report will often contain possible settlement termsIn all jurisdictions except P.E.I., the mediator’s recommendations are not binding, but the report will often contain possible settlement terms

Mediation While mediators or conciliators are not required to complete their work before a strike or lockout begins, the usual practice is that they will “book out” of the negotiations before the strike or lockout occursWhile mediators or conciliators are not required to complete their work before a strike or lockout begins, the usual practice is that they will “book out” of the negotiations before the strike or lockout occurs Booking out means that the mediator stops trying to help the parties overcome their differences and formally leaves the proceedingsBooking out means that the mediator stops trying to help the parties overcome their differences and formally leaves the proceedings

Fact Finding In B.C., a labour relations board official can appoint a fact finder to meet with the partiesIn B.C., a labour relations board official can appoint a fact finder to meet with the parties The fact finder reports on issues agreed to and those in dispute and may include other relevant findingsThe fact finder reports on issues agreed to and those in dispute and may include other relevant findings Copies of the fact finder’s report are given to the parties and may be made publicCopies of the fact finder’s report are given to the parties and may be made public The fact finder, while technically a mediator, serves a function similar to that of a conciliatorThe fact finder, while technically a mediator, serves a function similar to that of a conciliator

Interest Arbitration Interest arbitration is the most intensive and invasive form of third-party interventionInterest arbitration is the most intensive and invasive form of third-party intervention The arbitrator establishes some or all of the terms and conditions of the collective agreementThe arbitrator establishes some or all of the terms and conditions of the collective agreement The arbitrator’s decision is bindingThe arbitrator’s decision is binding One or both of the parties can make the request and the minister will appoint an individual or a tripartite panel and a formal hearing is heldOne or both of the parties can make the request and the minister will appoint an individual or a tripartite panel and a formal hearing is held Interest arbitration can still be used voluntarily during collective bargainingInterest arbitration can still be used voluntarily during collective bargaining

Interest Arbitration In the majority of Canadian jurisdictions, interest arbitrators traditionally use final offer selectionIn the majority of Canadian jurisdictions, interest arbitrators traditionally use final offer selection There are two types of final offer selection:There are two types of final offer selection:  Total-package final offer selection  Item-by-item final offer selection

Total-Package Final Offer Selection Each party presents the interest arbitrator with a total package of offers covering outstanding issues and leads evidence on its superiorityEach party presents the interest arbitrator with a total package of offers covering outstanding issues and leads evidence on its superiority The interest arbitrator then selects one party’s total package, and the selected package forms part or all of the terms and conditions of the collective agreementThe interest arbitrator then selects one party’s total package, and the selected package forms part or all of the terms and conditions of the collective agreement The advantage of this process is that it forces the parties to present realistic proposals, the disadvantage is that it creates a win-lose scenarioThe advantage of this process is that it forces the parties to present realistic proposals, the disadvantage is that it creates a win-lose scenario

Item-by-Item Final Offer Selection Each party submits its package of proposals and the arbitrator selects a proposal for each outstanding item and can choose from either party’s proposalEach party submits its package of proposals and the arbitrator selects a proposal for each outstanding item and can choose from either party’s proposal A collective agreement could contain all, some, or none of the proposals made by a particular sideA collective agreement could contain all, some, or none of the proposals made by a particular side  Advantage – this selection method lessens the possibility that a particular side will have its suggestions ignored  Disadvantage – the resulting agreement does not integrate both sides’ suggestions in a way that could satisfy both parties; neither party is likely to be completely satisfied

Interest Arbitration Two significant problems with interest arbitration or binding conciliation:Two significant problems with interest arbitration or binding conciliation:  chilling effect: There may be a reduction in the parties’ desire to resolve outstanding issues on their own  narcotic effect: The parties may become addicted to the habitual use of compulsory conciliation or interest arbitration and lose the ability to resolve disputes on their own Studies have been conducted regarding the existence of the narcotic effect, however results vary and appear contradictoryStudies have been conducted regarding the existence of the narcotic effect, however results vary and appear contradictory

Mediation/Arbitration In some Canadian jurisdictions, parties can use mediation-arbitration (med-arb)In some Canadian jurisdictions, parties can use mediation-arbitration (med-arb) In med-arb, a third party enters the bargaining process in the role of a mediator but becomes an arbitrator and chooses conditions of an agreement if the issues cannot be resolvedIn med-arb, a third party enters the bargaining process in the role of a mediator but becomes an arbitrator and chooses conditions of an agreement if the issues cannot be resolved Med-arb’s advantages include bargaining dispute resolution, avoids the delay of failed mediation, promotes higher quality solutions by the arbitratorMed-arb’s advantages include bargaining dispute resolution, avoids the delay of failed mediation, promotes higher quality solutions by the arbitrator Drawbacks include the length of the process and questionable neutrality of the arbitrator after such protracted involvement with the partiesDrawbacks include the length of the process and questionable neutrality of the arbitrator after such protracted involvement with the parties

Third-Party Intervention in Private Sector Bargaining Disputes Conciliation and arbitration are seldom used in private sector disputes, except where required by lawConciliation and arbitration are seldom used in private sector disputes, except where required by law Management and unions in this sector prefer mediation because it gives the parties practical assistance in resolving their disagreements while allowing them to retain control over details of the pending agreementManagement and unions in this sector prefer mediation because it gives the parties practical assistance in resolving their disagreements while allowing them to retain control over details of the pending agreement Private sector bargainers can use either a mediator supplied by the labour relations board or Ministry of Labour, or privately choose their own mediatorPrivate sector bargainers can use either a mediator supplied by the labour relations board or Ministry of Labour, or privately choose their own mediator

Other Forms of Intervention in the Bargaining Process Three methods of resolving bargaining disputes do not always actively involve a third party in the bargaining process:Three methods of resolving bargaining disputes do not always actively involve a third party in the bargaining process:  Final Offer Votes  Industrial Inquiry Commission  Disputes Inquiry Board

Final Offer Votes Most Canadian labour relations legislation provides for a final offer vote to be taken during a strike or lockoutMost Canadian labour relations legislation provides for a final offer vote to be taken during a strike or lockout The Minister of Labour may order that bargaining unit members or the employers in an employers’ association be given an opportunity to vote secretly on the other party’s last offerThe Minister of Labour may order that bargaining unit members or the employers in an employers’ association be given an opportunity to vote secretly on the other party’s last offer If the majority of votes of either party accept the offer, then the parties must conclude a collective agreement incorporating the terms of that offerIf the majority of votes of either party accept the offer, then the parties must conclude a collective agreement incorporating the terms of that offer

Industrial Inquiry Commission All Canadian jurisdictions, except New Brunswick and Saskatchewan, provide for the appointment of an industrial inquiry commission to investigate bargaining disputesAll Canadian jurisdictions, except New Brunswick and Saskatchewan, provide for the appointment of an industrial inquiry commission to investigate bargaining disputes The appointment of such a commission is a relatively rare eventThe appointment of such a commission is a relatively rare event When an industrial inquiry commission is created, the Minister of Labour provides it with a statement of the matters in dispute that are to be investigatedWhen an industrial inquiry commission is created, the Minister of Labour provides it with a statement of the matters in dispute that are to be investigated

Industrial Inquiry Commission If the parties do not settle the matters in dispute within a short time (usually 14 days), the commission must report the results of its investigation, along with its recommendations for settlement, to the MinisterIf the parties do not settle the matters in dispute within a short time (usually 14 days), the commission must report the results of its investigation, along with its recommendations for settlement, to the Minister While industrial inquiry commissions are usually appointed in relation to a bargaining dispute, a strike, or a lockout, most legislation permits such an appointed for any situation that the Minister of Labour or the parties consider appropriateWhile industrial inquiry commissions are usually appointed in relation to a bargaining dispute, a strike, or a lockout, most legislation permits such an appointed for any situation that the Minister of Labour or the parties consider appropriate

Disputes Inquiry Board In Alberta and Ontario, the Minister of Labour can establish a disputes inquiry board during a legal strike or lockoutIn Alberta and Ontario, the Minister of Labour can establish a disputes inquiry board during a legal strike or lockout This board is usually composed of three individuals who gather evidence about a disputeThis board is usually composed of three individuals who gather evidence about a dispute Disputes inquiry boards are appointed relatively infrequentlyDisputes inquiry boards are appointed relatively infrequently

Disputes Inquiry Board The board usually holds a formal hearing at which the employer and the union present oral and written evidenceThe board usually holds a formal hearing at which the employer and the union present oral and written evidence The board then presents recommendations for the resolution of all outstanding issues to the MinisterThe board then presents recommendations for the resolution of all outstanding issues to the Minister In Ontario, the Minister is then free to act on the recommendations as he or she sees fitIn Ontario, the Minister is then free to act on the recommendations as he or she sees fit In Alberta, if the recommendations are not accepted by the representatives of one side, that side’s members are given the opportunity to vote; this vote is similar to a final offer voteIn Alberta, if the recommendations are not accepted by the representatives of one side, that side’s members are given the opportunity to vote; this vote is similar to a final offer vote

Disputes Inquiry Board If a majority votes to accept the recommendations, they are considered binding and incorporated into the terms of the collective agreementIf a majority votes to accept the recommendations, they are considered binding and incorporated into the terms of the collective agreement Unlike an industrial inquiry commission, a disputes inquiry board is specifically charged with investigating disputes that have led to a strike or lockoutUnlike an industrial inquiry commission, a disputes inquiry board is specifically charged with investigating disputes that have led to a strike or lockout The recommendations of a disputes inquiry board have more formal weight than the recommendations of an industrial inquiry commissionThe recommendations of a disputes inquiry board have more formal weight than the recommendations of an industrial inquiry commission

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