Summarized analysis of the CIRB Decision to UTU's complaints of unfair labour
practices and bad faith bargaining by CN
April 4, 2005

Unfair Labour Practices Complaint:

The Code provides that when a collective agreement is reached, not only is it binding upon the union, the employer and the
individual employees that it covers, but it must further provide for the final settlement of disputes arising there from.  The
settlement of disputes by way of a grievance procedure and binding arbitration is meant to introduce a period of industrial peace
for the duration of the collective agreement.

The Board's discretion to hear the unfair labour practice application, where there may be concurrent jurisdiction (with arbitration)
over the subject matter, has been canvassed in the past by the then Canada Labour Board (CLRB).  There appears to be a
general consensus that, under certain conditions, it may be appropriate to deal with broader collective agreement issues that
cannot be fully addressed by the grievance arbitrator.

In Weber, the Supreme Court of Canada held that an employee's recourse for damages for mental anguish and suffering arising
from unauthorized surveillance of his personal activities by the employer to detect benefits fraud was within the arbitrator's
jurisdiction to decide.

In the noted case, the Supreme Court found that is was not the legal characterization of the issue that should be considered but

The Board finds that the cumulative effect of recent Supreme Court of Canada Decisions gives arbitrators exclusive jurisdiction
over all disputes where the ESSENTIAL CHARACTER of the dispute arises under the collective agreement, regardless of how the
issue may be framed.

In keeping with such decisions the Board took the view that the same test should apply to the unfair labour practice complaints
presently before the Board.

In applying the test of the Essential Character of the dispute to the matter at hand, there is no doubt that the complaints
concerning the application and interpretation of the collective agreement have already been the subject of awards by an Arbitrator
as is evident by the arbitral awards submitted by the Union.

The issues before the Board can be divided into two groups. With the first group are the issues that have been referred to
arbitration, where the Union has been successful but that apparently remain the subject of continued violations by the Employer,
namely Articles 41 (Road Crews performing Yard work) and Article 51 (Rest provisions).

The second group of issues is the Employer's failure to respond to grievances, replies to grievances that are unresponsive or
inadequate, joint statements of issue that are not provided.

As to the second group of issues the Board finds that such issues are within the scope of the provisions of the collective
agreement (ESSENTIAL CHARACTER) and must be dealt with on a case by case basis by the CROA Arbitrator.

As to the first issue the Board finds two counts of unfair labour practices among the several alleged by the Union: the continued
violations of the provisions of Article 41 and 51 of the Collective Agreement(s).

This is not to say that the Employer's violations are not serious as they amount to a selective repudiation of the Bargaining
relationship with the consequent chilling effect on the constructive settlement of disputes and the determination of good working
conditions the very objectives set out by the Code in its Preamble.

The psychological impact for the employees of a finding of unfair labour practice is that the offender (CN) be required to
communicate to affected employees that it has been found guilty of violating the Code and that it will from now on conform to its
requirements. Making employees aware that their Employer cannot violate the Code with impunity and that they have meaningful
legal rights is essential to the enforcement of the Code.

To the extent where the employer repeatedly breaches the same section of the collective agreement, even after the interpretation
of these sections have been the subject of one or several arbitral awards, the grievances procedure may be said to have become
ineffective and the Union is entitled to some relief.

Bad Faith Bargaining Complaint:

With respect to the Union's second complaint of bad faith bargaining the Union makes the allegation (among other things) that
the CEO made declarations at shareholders meetings that were in breach of a confidentiality agreement within the context of
collective bargaining. These allegations relate to two declarations of CN's CEO that were reported in the media.

The first media report presents Mr. Harrison's reaction to the Union's position on his (Mr. Harrison's) "dream" regarding changes
to the collective agreement(s).

The second media report concerns Mr. Harrison's reference to increase in mileages (4300 to 7500) and dropping "old time" work
rules that Mr. Harrison considers to restrictive. All in exchange for "job security". A deal which Mr. Harrison believes is "good for
employees and CN".

The Board found that there was nothing coercive, intimidating, threatening or of the nature of undue influence in Mr. Harrison's
hope of trading job security for work rules. These are the personal views of Mr. Harrison to which he is entitled.

Only a new collective agreement will tell whether the CEO's "dream" will come true.

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