Federal Court Decisions

     Date: 19971024

     Docket: T-2304-96

BETWEEN:

     ATOMIC ENERGY OF CANADA LIMITED

     Applicant

     - and -

     ROYA SHEIKHOLESLAMI

     Respondent

- and -

CLIVE McKEE

     Respondent

     REASONS FOR ORDER

RICHARD J.:

Nature of the Proceedings

[1]      The applicant seeks an order setting aside the following portions of a decision dated September 24, 1996 by Mr. Clive McKee:

(a)      dealing with the wage rate determination;

(b)      dealing with compensation to be paid to the respondent for the period from the date of termination to August 31, 1994;

(c)      dealing with accrual, entitlement, and eligibility for compensation in respect of vacation leave and personal business days;

(d)      dealing with the amount payable in respect of the costs of a witness, Dr. Wolfgang Schamberger;

(e)      dealing with the interest payable on the above amounts; and,

(f)      dealing with the quantum of deduction to be made by the applicant in respect of the foregoing.

[2]      The application is made on the following grounds:

(a)      that, in reaching its decision of September 24, 1996, the adjudicator acted beyond his jurisdiction;

(b)      that the adjudicator based his decision on erroneous findings of facts that were made in a perverse or capricious manner or without referral to the material before him; and

(c)      that the adjudicator's decision was patently unreasonable.

Background

[3]      In November 1990, the respondent Ms. Sheikholeslami, commenced work as a chemical engineer for Atomic Energy of Canada Limited (AECL) at its Chalk River Laboratories at the CSE-2 level, and performed scientific research. On January 5, 1993, while at work, she slipped on ice, fell backwards, and landed on the base of her spine. As a result, she suffered a severe injury to her lower back that caused her a great deal of pain and rendered her unable to walk. She was granted compensation benefits by the Workers' Compensation Board of Ontario (WCBO).

[4]      In June of 1993, a vocational rehabilitation counsellor of the WCBO concluded that any restriction on Ms. Sheikholeslami's ability to return to work could be accommodated by AECL. Ms. Sheikholeslami disputed the WCBO's conclusion that she was fit to return to work, maintaining that she was totally incapacitated.

[5]      On November 16, 1993, AECL advised Ms. Sheikholeslami that she would be required to return to her duties in accordance with the decision of the WCBO, on or before December 1, 1993. Failure to do so would be considered abandonment of her position. Ms. Sheikholeslami requested additional time to provide both AECL and the WCBO with additional medical information to support her contention of continuing disabling conditions.

[6]      The WCBO rejected the additional medical information as supporting a continuing disability. AECL advised Ms. Sheikholeslami that if absenteeism from work continued despite the WCBO's assessment that she was fit for her duties, her employment would be terminated, effective December 16, 1993. AECL later advised Ms. Sheikholeslami that because she refused to return to work, her employment was terminated effective immediately.

[7]      On January 11, 1994, Ms. Sheikholeslami filed a complaint of unjust dismissal pursuant to section 240 of the Canada Labour Code¹ seeking reinstatement to her former position and compensation for her lost wages and benefits. On October 17, 1995, a four day hearing to dispose of Ms. Sheikholeslami's complaint was commenced in Vancouver before Mr. Hugh R. Jamieson.

The Jamieson Award

[8]      By decision dated December 28, 1995, Mr. Jamieson found that Ms. Sheikholeslami had been unjustly dismissed. However, the adjudicator denied Ms. Sheikholeslami reinstatement in her employment. The position held by Ms. Sheikholeslami involved a high degree of trust and dependence. According to the adjudicator, the relationship between the parties had deteriorated to the extent a continued employment relationship was no longer viable. The adjudicator elected to award Ms. Sheikholeslami compensation under five headings as follows:

1)      Lost wages and benefits from the date of termination to August 31, 1994.

[...] [T]he complainant be compensated for lost wages and benefits in the amount that she would have earned but for the unjust dismissal from the date of termination of her employment to August 31, 1994. For clarity, this amount is to be calculated at her regular salary and is to include any incremental or other such raise that she may have been entitled to receive during that period [...]. Benefits will include where applicable, vacation, general holidays, personal business days, floating holidays and furlough leave as well as any other employment benefit which the Complainant would have been entitled to had she not been dismissed. The normal rules of mitigation will apply to this amount [...].

2)      Six months reinstatement calculated at the August 31, 1994 pay rate.

[...] [T]he complainant will receive a lump sum payment of six months salary in lieu of reinstatement [...] calculated at her August 31, 1994 rate of pay [...].

3)      Termination pay of one week salary for each completed year of service and a pro-rated amount for any balance less than one year.

She will also receive termination pay of one week salary for each completed year of service and a pro-rated amount for any balance less than one year.

4)      Party and party costs to compensate Ms. Sheikholeslami for the costs incurred by bringing this complaint.

AECL will also compensate the complainant for costs incurred by bringing this complaint. These costs will be on a party and party basis.

5)      Interest payable by AECL at the rate of 1% per month effective as of the date of the decision.

[...] [I]nterest will be payable by AECL at the rate of 1% per month effective as of the date of this decision.

[9]      Mr. Jamieson retained jurisdiction over the question of the quantum of compensation payable to Ms. Sheikholeslami and over any question arising from the remedy. The parties were unable to reach an agreement as to the quantum of the compensation.

Judicial Review of the Jamieson Award

[10]      Ms. Sheikholeslami sought to have set aside those portions of the Jamieson award which denied her reinstatement; which failed to award her damages for lost wages and benefits of employments; and, which refused to award interest or damages for lost wages and benefits.

[11]      On November 29, 1996, Mr. Justice Rouleau found that there is no reference in that decision to any evidence which supports a finding that there had been a breakdown in the relationship between the parties such as would make reinstatement an impossibility. Rather, the adjudicator's determination was based entirely upon his own observations of the parties during the four day hearing before him. That is not sufficient.

[12]      Mr. Justice Rouleau returned the matter to an adjudicator for reconsideration of the remedy of reinstatement in accordance with his reasons. He denied relief based on the remaining claims. This decision is under appeal by AECL².

The McKee Award

[13]      Mr. Jamieson was unable to continue the hearings due to health problems. Mr. Clive McKee was appointed on June 17, 1996 by the Minister of Labour as adjudicator to deal with outstanding issues arising from the award made by Mr. Hugh Jamieson.

[14]      The parties agreed to proceed by written submissions based on the Jamieson award. Mr. McKee published his award on September 24, 1996.

[15]      He noted:

While Mr. Jamieson retained jurisdiction in this matter in order to deal with any issues that might arise from his Award, including any difficulty with respect to its implementation or the calculation of the monetary portion thereof, he has since fallen ill and is unable to further act in this matter at this time. Thus, the reason for my appointment as Adjudicator.

[16]      He quoted from the Jamieson award to determine his intent and to determine if there was any substantive reason for the very long delay in making appropriate payments to the grievor.

[17]      He then concluded as follows:

Having read the award by the learned Adjudicator, I come to the following conclusions.

1.      Mr. Jamieson is an experienced arbitrator and it is clear to me that he gave studied attention to the complete award and to the many facets of the award.

2.      It is not my function to do other than read his award and from long experience assess what his intent was at the time of its publication. It is clearly not my function to change any part of his award. Whether or not Counsel and I agree with the award should not be at issue here and I make no decision that will change the intent of the award in any manner.

3.      The steps of the award are clear to me:

(a)      He did not reinstate the Grievor.

(b)      He did order a payment of money to be calculated on her wage rate for a certain period of time. This payment was not to include overtime but he additionally ruled that the Griever was to receive benefits, where applicable, of vacation, general holidays, personal business days, floating holidays, and furlough, "as well as any other employment benefit to which the complainant would have been entitled to had she not been dismissed". He ruled that interest not be paid as a part of mitigation.

(c)      He also ruled that the Griever receive a lump sum of six months salary in lieu of reinstatement and that she was also to receive termination pay of one week's salary for each completed year of service and a pro rated amount for any balance less than one year. For these purposes, he stated that one week's salary will also be whatever the complainant would have been earning as of August 31, 1994, and her service is to be considered as continuous from the date of her hiring, November 26, 1990, to August 31, 1994.

(d)      He also examined the question of costs incurred directly related to bringing the complaint forward and ruled that AECL is to compensate the Griever for such costs.

(e)      He also ruled that interest of 1% per month be paid by AECL on monies payable to the Griever in lieu of reinstated termination pay and costs.

One can only conclude after examination of this award that the learned Adjudicator, when making his decisions, has carefully thought out each step and ruled how each adjustment and payment is to be made.

It is clear to me that he full well understood the impact of each step in his awarded settlement. I, therefore, have no need or, moreover, have no jurisdiction to change or even attempt to fine tune his decisions.

[18]      He retained jurisdiction over this matter and, in particular, over any question arising from the remedy.

[19]      In his finding, Mr. McKee dealt with each of the issues before him:

a)      The annual wage rates were determined as follows:

i) from the date of termination to July 1, 1994: $55,800.00;

ii) after July 1, 1994: $59,400.00.

b)      Full compensation was awarded for all wages Ms. Sheikholeslami would have received had she actually been at work for the period from the date of termination to August 31, 1994.

c)      A cash payment, without deduction, was awarded in respect of the following leave entitlements:

i) vacation as of April 1, 1993: 20 days;

ii) personal business days as of April 1, 1993: 2 days;

iii) vacation from April 1, 1993 to August 31, 1994: 20 days; and

iv) floating holidays on termination: 3 days.

d)      Payment in respect of Dr. Schamberger's fees in the amount of $4,066.67.

e)      Payment for Ms. Sheikholeslami's photocopying and facsimile expenses, as supported by receipts for same.

[20]      Except for the amount of the solicitor party and party costs, AECL has not paid any of the compensation owing to Ms. Sheikholeslami under either the Jamieson award or the McKee award.

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Standard of Review

[21]      In Pezim v. British Columbia (Superintendent of Brokers)³, Mr. Justice Iacobucci stated:

[...] The central question in ascertaining the standard of review is to determine the legislative intent in conferring jurisdiction on the administrative tribunal. [...] The analysis [...] [must consider] the tribunal's role or function [...], whether the agency's decisions are protected by a privative clause [...], and whether the question goes to the tribunal's jurisdiction.

[...] [T]he courts have developed a spectrum that ranges from the standard of patent unreasonableness to that of correctness.

[22]      In Canada (Director of Investigation and Research, Competition Act) v. Southam Inc.⁴, the Court stated that:

The standard of review is a function of many factors and may fall between correctness, at the more exacting end of the spectrum, and patently unreasonable, at the more deferential end.

[23]      In the case at bar, the adjudicators acted pursuant to subsection 242(4) of the Canada Labour Code which reads as follows:

242(4) Where an adjudicator decides pursuant to subsection (3) that a person has been unjustly dismissed, the adjudicator may, by order, require the employer who dismissed the person to:

(a)      pay the person compensation not exceeding the amount of money that is equivalent to the remuneration that would, but for the dismissal, have been paid by the employer to the person;

(b)      reinstate the person in his employ; and

(c)      do any other thing that is equitable to require the employer to do in order to remedy or counteract any consequences of the dismissal.

[24]      Adjudicator's decisions are protected from review by the privative clause found in section 243 of the Canada Labour Code which reads as follows:

243(1) Every order of an adjudicator appointed under subsection 242(1) is final and shall not be questioned or reviewed in any court.

(2) No order shall be made, process entered or proceeding taken in any court, whether by way of injunction, certiorari, prohibition, quo warranto or otherwise, to question, review, prohibit or restrain an adjudicator in any proceedings of the adjudicator under section 242.

[25]      Section 242 of the Canada Labour Code is remedial in nature. Paragraph 242(4)(c) grants a very broad equitable jurisdiction to an adjudicator.

[26]      Pursuant to Mr. Justice Cory in Royal Oak Mines v. C.A.S.A.W., Local 4⁵,

There are four situations in which a remedy will be considered patently unreasonable:

(1)      where the remedy is punitive in nature;

(2)      where the remedy granted infringes the Canadian Charter of Rights and Freedom;

(3)      where there is no rational connection between the breach, its consequences, and the remedy; and,

(4)      where the remedy contradicts the objects and purposes of the Canada Labour Code.

[27]      None of these situations are present in the case at bar.

Analysis

[28]      The parties have proceeded on the basis of the Jamieson award. It is the McKee finding which is challenged in these proceedings. The issues raised by the applicant are all related to the quantum of damages.

[29]      The respondent submits that:

Although the AECL is alleging that the remedy imposed is patently unreasonable and is beyond the jurisdiction of the Adjudicator, the case put forward is really one of disagreement with the substance of the decision and the findings of fact behind it. The issues raised by the AECL are all related to quantum of damages, matters which parliament in its wording of sections 242 and 243 clearly intends to be decided by the Adjudicator with no right of appeal. Unless it can be shown that the decisions made by Adjudicators Jamieson or McKee are patently unreasonable there are no grounds for review.

[30]      Mr. McKee's interpretation of the Jamieson award is not unreasonable in the circumstances. He recognized that it was not a normal dismissal case. Although Mr. Jamieson found that her dismissal was unjustified, the grievor was not reinstated to her job. Mr. Jamieson fashioned an award which he considered best resolved the outstanding matters before him. His decision not to reinstate, even though the dismissal was unjustified, led him to fashion an award that is calculated differently from the assessment of damages for reinstated employees. In doing so, he did not exceed his jurisdiction under subsection 242(4) of the Canada Labour Code which grants wide and flexible remedial powers⁶.

[31]      Mr. McKee recognized that Mr. Jamieson had fashioned an award which took account of the special circumstances of this case. In his comments, under the heading Lost wages and benefits, he stated:

While this is not a usual finding of unjustified discharge in that the Grievor is not returned to her previous job, the order by the Adjudicator with respect to payment of wages and benefits lost by the Grievor due to the inappropriate action of the Company is normal. It is normal that a successful grievor be paid all outstanding monies and be "made whole".

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[32]      He added:

Mr. Jamieson, as Adjudicator, fashioned this award. On its face, in all the circumstances, it is clear to me what he intended. The language leaves me in no doubt of his intent that AECL is to pay to the Grievor an amount of money equivalent to her salary for the period defined. She will then have the responsibility of making any necessary payments to others from that amount.

[33]      He further added:

Clearly, the intent of the Jamieson award is that she receive all that she was entitled to receive as if her employment relationship with the Company had not been illegally interrupted by the discharge. Clearly, Mr. Jamieson intended that the Grievor be returned to the day of her discharge undisturbed in her employment pattern and without any loss whatsoever.

[34]      Mr. Jamieson and Mr. McKee were aware that Ms. Sheikholeslami had been paid long-term disability benefits representing two-thirds of her gross income from Mutual Life of Canada. There is also evidence of a reimbursement agreement between Ms. Sheikholeslami and Mutual Life allowing for recovery of monies paid to her during the period December 16, 1993 to August 31, 1994. Mr. McKee decided that it was her responsibility for paying outstanding debts to Mutual Life.

[35]      The applicant relied on the Sylvester case⁷ where the Supreme Court of Canada interpreted a contract of employment and concluded that it did not provide for the employee to receive both disability benefits and damages for wrongful dismissal. The circumstances of this case are different.

[36]      The applicant relied on the proposition that reinstated employees have been denied full compensation because they were incapable of working due to illness or on maternity leave. The cases cited by the applicant involve arbitrators determining wage loss entitlement for reinstated employees on facts different from those present in this case. Mr. McKee was aware of this line of decisions when he made his finding. He found that the particular circumstances here justified a different remedy.

[37]      It is not disputed that the provisions of the Collective Agreement between the Professional Institute of the Public Service of Canada and AECL are applicable in determining the rate of compensation owing to Ms. Sheikholeslami. She was classified at a CSE-3 level and her base salary was $52,300.00 prior to July, 1993. Ms. Sheikholeslami was entitled under the Collective agreement to a wage increase for 1993. A 2% increase was granted to CSE-3 level employees.

[38]      I agree with counsel for the respondent, Ms. Sheikholeslami, that Mr. McKee did not reach patently unreasonable conclusions in deciding that she was entitled to merit an increase.

[39]      Mr. McKee determined that Ms. Sheikholeslami was entitled to a merit increase of $2,700.00 on July 1, 1993 and $2,800.00 on July 1, 1994. Paragraph 29.02(b) dealing with the "Performance Pay Grid Effective for July 1" indicates that a CSE-3 in the "Exceeds Requirements" level is entitled to a merit increase up to $2,700.00. Ms. Sheikholeslami was consistently awarded increases at the highest end of her level. Ms. Sheikholeslami was eligible for a percentage or merit increase. Mr. McKee's decision is consistent with Mr. Jamieson's decision that the amount owing was to be calculated at "her regular salary and is to include any incremental or other such raise that she may have been entitled to receive."

[40]      Considerable evidence was submitted to Mr. McKee on the issue of Ms. Sheikholeslami's assessment. The appraisal covers the period from April 1, 1992 to June 30, 1993. It was never presented to her or discussed with her by her supervisor. This document was prepared by her supervisor on July 9, 1993, seven months after Ms. Sheikholeslami had been off work from her work injury.

[41]      Mr. McKee accepted evidence that the two prior employee performance appraisals for the years 1990-91 and 1991-92, Ms. Sheikholeslami was rated "Exceeds Requirements" category by the employer. The recommendation given on behalf of Ms. Sheikholeslami for membership in the Association of Professional Engineers and Geoscientists of British Columbia on February 6, 1992, almost a year and a half before the appraisal, shows that Ms. Sheikholeslami was considered by her supervisor and AECL as an outstanding employee.

[42]      Mr. Jamieson observed that AECL had an "anxiety to get rid of her" prior to the dismissal.

[43]      In the circumstances, it was not patently unreasonable for Mr. McKee to discount this assessment in calculating the increase she was entitled to.

[44]      The arguments concerning entitlements to benefits advanced by the applicant involve many of the same issues as the question of entitlement to full salary. The applicant argues that employees receiving disability payments would not normally receive the same benefits as those at work. Mr. Jamieson ordered compensation to be calculated as if Ms. Sheikholeslami would have received full salary and he expressly ordered that she would be compensated for benefits which would include "vacation, general holidays, personal business days, floating holidays and further leave [...]."

[45]      The applicant had the opportunity to present all of its arguments before Mr. McKee. Mr. McKee, in a reasoned and thorough finding made the calculations which flowed directly from Mr. Jamieson's award, which award is not challenged by the applicant AECL.

[46]      There are some areas where Mr. McKee is alleged to have committed technical errors. Those errors appear on the face of the record and the adjudicator should have been asked to rectify them. The judicial review process is not the appropriate forum to correct these mistakes. Mr. McKee has retained jurisdiction to correct such mistakes. In particular, the mistakes relate to:

1)      The amount of wage loss for the period from November 16, 1993 to July 1, 1994 should be calculated as 7" months, instead of 8" months.

2)      Compensation should be provided for two rather than three days of floating holidays, as is consistent with Mr. McKee's reasons;

3)      Mr. McKee awarded interest on the whole award when Mr. Jamieson had stated that no interest was to be paid on lost wages and benefits. Mr. McKee received no submissions by counsel on the scope of interest.

[47]      These errors should have been corrected by asking him to resolve them after receiving submissions from counsel.

[48]      Counsel for the applicant also raised the question as to whether any amounts awarded to Ms. Sheikholeslami are subject to mandatory statutory deductions by reason of the McKee award. Clearly, the employer must comply with any statutory deductions required by statute, such as the Income Tax Act⁸, the Canada Pension Act⁹ and the Employment Insurance Act¹⁰.

[49]      Counsel for the applicant raised the question as to whether Dr. Schamberger should be compensated for all the amounts claimed in the absence of supporting information as to the nature of the amounts. Mr. McKee's comments were as follows:

Over the years, many doctors and specialists have appeared before me and I have never previously heard of such a small per diem as $100 being paid for an appearance.

The evidence is clear. The doctor was employed and appeared at the hearing. As a practising professional, it is natural that he bill for his service. I accept his claim. The cost of calling a hearing and hearing evidence in respect of this matter would be prohibitive in relation to total costs.

[50]      Compensation is available, not only for the expert witnesses' reports and testimony, but also for their time spent in court listening to the evidence and advising counsel. It was open to the adjudicator to find that the cost related to Dr. Schamberger's report and testimony were reasonable.

[51]      The issues raised by the applicant in this application involve matters squarely within the jurisdiction of Mr. McKee. Mr. McKee's award on the issues raised before him was not patently unreasonable. Where he was faced with conflicting submissions on the interpretation of Mr. Jamieson's award, Mr. McKee looked at the wording of the award, and the material put before him by counsel, and came to reasonable conclusions. His findings should not be disturbed by judicial review.

Conclusion

[52]      Accordingly, the application for judicial review is dismissed.

[53]      Pursuant to Rule 1618 of the Federal Court Rules, costs should not be routinely awarded in an application for judicial review. There must be special circumstances justifying such an award¹¹. There is nothing in the parties conduct which constituted special reasons for an award of costs against the applicant or in favour of the respondent. Accordingly, I make no award as to costs.

     __________________________

     Judge

Ottawa, Ontario

October 24, 1997

__________________

¹      R.S.C. 1985, c. L-2 as amended.

²      Sheikholeslami v. Atomic Energy of Canada Limited, (November 29, 1996) T-178-96 [1996] F.C.J. No. 1547 (QL).

³      [1994] 2 S.C.R. 557 at pp. 589-90.

⁴      [1997] 1 S.C.R. 784.

⁵      [1996] 1 S.C.R. 369 at p. 409.

⁶      See: Slaight Communications Inc. v. Davidson, [1989] 1 S.C.R. 1,038 at 1,072.

⁷      Sylvester v. British Columbia (1997), 146 D.L.R. (4th) 207 (S.C.C.).

⁸      R.S.C. 1985 (5th Supp.), as amended.

⁹      R.S.C. 1985, c. 8.

¹⁰      S.C. 1996, c. 23.

¹¹      Zeneca Pharma Inc. v. Canada (Minister of National Health and Welfare) (1996), 66 C.P.R. (3d) 175.