THE EMPLOYERS' EDGE
Right to Terminate Employment in COVID-19 Mandatory Vaccine Policy Struck by Arbitrator
The latest ruling on an employer’s mandatory COVID-19 vaccination policy came on February 7, 2022 from Arbitrator Gail Misra. The outcome was not favourable to the employer. Arbitrator Misra ultimately ruled that the Employer’s vaccination policy contained an invalid termination clause that had to be struck. Many employers and businesses now have vaccination policies and are contemplating whether to include termination clauses, and this case should be reviewed with caution.
The Healthcare, Office and Professional Employees Union (“HOPE”) filed a policy grievance in response to the Employer, Chartwell Housing (“Chartwell”), implementing a COVID-19 vaccination policy in August 2021 that required staff to be vaccinated against COVID-19. Unvaccinated staff would be placed on an unpaid administrative leave of absence, or “may have their employment terminated” under the updated policy.
The Employer’s COVID-19 policy originally allowed unvaccinated employees to continue to work if they used additional PPE, underwent regular testing and attended vaccination education sessions. HOPE did not contest the original policy, pointing out that they are in support of vaccination. HOPE began to take issue in August 2021 when Chartwell publicly announced that as of October 2021, staff who were not vaccinated would be placed on an unpaid leave of absence, and may have their employment terminated. Chartwell did not consult with or notify the Union of the change in policy prior to August 2021. Shortly after, on October 1, 2021 the Ministry of Long-Term Care sent a memo to LTC licensees requiring that by November 15, 2021 all staff must provide proof of vaccination, and those who do not provide proof of vaccination would no longer be able to attend an LTC home to work. Chartwell homes modified the dates in their policy to align with the Ministry’s deadlines. Once the deadlines passed, Chartwell placed a total of 16 bargaining members on unpaid leave and later terminated 14 of those employees.
The decision focused on three issues that arose from the facts discussed above:
- Did the Employer breach Article 18.4 of the collective agreement, which required the Employer to discuss any significant rules or policy changes with the Union?
- Did the Employer breach Article 18.5 of the collective agreement, which required the Employer to maintain the status quo of working conditions unless the Union agreed to a modification?
- Was the September 2021 Mandatory Vaccination Policy reasonable, particularly with respect to the termination provision?
1. The Employer failed to discuss changes or policies with the Union
Arbitrator Misra found that the Employer did effect significant changes in its vaccination policy when it announced publicly in August 2021 that it would be moving to a mandatory vaccination regime. She further found that the Employer violated Article 18.4 by failing to discuss the policy change with the Union. Following the announcement in August 2021, the Union immediately reminded the Employer of their obligation to discuss policy changes of such a magnitude prior to implementation. Despite the reminder, the Employer did not engage in discussions with the Union and did not send the Union the actual policy until several days later, even though managers had already been communicating the policy to staff. The Union received a copy of the policy after it had already been put into effect, and only then did they learn that employees may be subject to termination.
Finally, Arbitrator Misra found that the changes were significant. The prior policy allowed employees to remain unvaccinated but continue employment if they complied with the education, testing and PPE requirements. The new policy no longer offered those alternatives and for the first time, threatened termination for unvaccinated workers. Therefore, Arbitrator Misra found the Employer effected significant changes, without any consultation to the Union, violating the collective agreement.
2. The Employer failed to maintain the existing practice
Arbitrator Misra determined that there was an existing practice or working condition regarding vaccinations that was more beneficial to the bargaining unit than what the Employer implemented in its new policy. The Union pointed to the earlier COVID vaccination policy, noting that there were no disciplinary measures for failing to be vaccinated or taking the required vaccine education. Employees would only be put off work if they did not meet the PPE or testing requirements. The Employer argued that these past policies and practices did not indicate that the employer could not invoke discipline if an employee failed to comply with the previous policy. However, Arbitrator Misra found that there was no indication that Chartwell ever did implement disciplinary sanctions. Instead, the consistency between what the policy said and what the Employer actually did established the existing working conditions.
The Employer further argued that their management’s rights would be infringed if they were not permitted to implement the policy as intended. Arbitrator Misra dismissed this argument, pointing to a different Article in the Collective Agreement which read that the employer may “exercise any of the rights, powers, functions or authority which the Employer has prior to the signing of this Agreement except as those rights, powers, functions or authorities are specifically abridged or modified by this Agreement” (emphasis added). The Arbitrator found that the effect of Article 18.5 was to fetter the Employer’s management rights from altering any past practices that were more beneficial to employees.
Based on those findings, the Arbitrator determined that the past practice was to place non-compliant employees on unpaid leave and that practice was more beneficial to employees than the new Mandatory Vaccination Policy. Article 18.5 required that a more beneficial past practice be continued unless it is modified by mutual agreement between the parties. That past practice was modified without the Union’s agreement, and the Employer therefore violated Article 18.5 of the Collective Agreement.
3. Inclusion of the “discharge penalty” was unreasonable
Both parties recognized, based on case law, that a rule unilaterally imposed by the employer must be consistent with the terms of the Collective Agreement and considered reasonable. To assess whether a rule is reasonable arbitrators have used a “balancing of interest” approach. The Union made it clear that they were supporting vaccination generally, and did not oppose the mandatory nature of the policy – which was required by the ministry of Long-Term Care after all – but rather they felt that the discharge penalty for unvaccinated workers was unreasonable in the circumstances. Arbitrator Misra had earlier found that the termination provision violated Articles 18.4 and 18.5 of the collective agreement, and under labour jurisprudence could not be deemed “reasonable”. However, she further found that the discharge provision itself was unreasonable because it provided such short notice to employees and had an irrevocable consequence of termination.
Additionally, potential termination appeared unnecessary since there was no evidence that showed a health and safety or operational concern with keeping unvaccinated employees off work on unpaid leave, even indefinitely. As a result, Arbitrator Misra found that the policy was both unreasonable and inconsistent with the collective agreement to the extent that it included the termination provision.
By way of remedy, Arbitrator Misra ordered that the termination provision be struck from the Mandatory Vaccination Policy, and any other future revisions of the policy.
Some employers may be disheartened by this decision, but should keep in mind that in all labour arbitration cases, rulings are made in light of the particular circumstances of the case. Thankfully, Arbitrator Misra acknowledged other mandatory vaccination policies with termination clauses that were considered reasonable in their respective contexts, confirming that termination clauses themselves are not universally invalid. A reasonable vaccination policy will still be upheld, even if it includes a termination clause, so long as the circumstances support such a policy.
To bolster the reasonableness of a mandatory COVID-19 vaccination policy, employers can engage the union in crafting the policy, give employees and unions ample notice of the required vaccination date, and provide reasonable (but certainly not unlimited) alternatives to termination. Overall, this case is a lesson to employers that termination provisions within a unilateral employer policy should be approached with caution.
This recent decision highlights the need to create or review your vaccination policy with a qualified professional. If you need help creating a reliable vaccination policy, or updating your policy in light of recent trends in the case law, the lawyers for employers at CCPartners is here to help you. Contact one of our team members HERE to get started right away.
And if you want to keep an eye on similar case law outcomes as decisions are issued, be sure to review CCPartners’ Complete Rundown on COVID-19 Policy Decisions in Ontario.