A Kelowna plant that builds manufactured and modular home has been ordered to pay compensation to some employees after violating a collective agreement.
A labour relations arbitrator heard arguments from SRI Homes and its union, United Steel Workers Local 1-423, in August and September of last year.
The union filed a grievance in February 2022 alleging that, “shortly after ratification the employer unilaterally changed [the] wage scale without authorization or agreement of the local union causing morale issues on the floor.”
The grievance centres on wages offered by SRI Homes under the Temporary Foreign Workers Program.
The company said that in 2021 it saw a 220% increase in backlog time for delivery of its products, losing business to competitors. It stated one of the key factors in the 36-week backlog period was challenges in recruiting new employees. It’s full time employee numbers had fallen from 140 to 118 by the end of the year and it needed to hire another 50-60 people.
After what witnesses for both sides described as a very difficult round of bargaining, SRI and USW reached a new collective agreement in December 2021 that set out the pay scale for all employees, starting at $18.27 per hour for workers in their first 60 days on the job.
However, arbitrator Randall J. Noonan noted in his decision that the employer had started advertised jobs with a starting rate at or exceeding $20 per hour at local job banks, Indigenous centres, and “Spider” using a third-party recruiter prior to the labour settlement.
One of the requisites for the temporary foreign worker program (TFWP) was that the employer had to show that it could not hire the staff it needed locally. To do that, it was required to advertise locally for at least 30 days and such advertisements had to show an “appropriate” wage rate.
The “appropriate” wage rate is determined by the TFWP which lists several categories of employees and the wage rate that must be offered for employees in that category. SRI selected a category that laid out a minimum appropriate rate of $20 per hour.
The union submitted a picture of a sign on a gate as an exhibit in the hearing. The sign read, “SRI Kelowna – Hiring Production Positions – STARTING at $21.89 per hour."
An agreed statement of facts points out that the collective agreement does not include wage increases specific to new employees or to one group of employees.
Several emails between the SRI human resources manager, who was hired in October 2021, and the union were submitted by the employer to try to highlight what it claimed was a "misunderstanding" over the wages offered to new hires.
Documents presented at the hearing show that the company hired 40 workers at the higher starting rate, before reverting them to the collective agreement rates after a letter from the union local president saying, “you should cancel the [TFWP] application as we have not agreed to any special wage increases for anyone.”
The USW argued that the company’s actions contributed to a “lack of confidence in the union by shop floor workers.” Noonan ruled in the union’s favour and ordered a compensation payment of $30,000.
He also awarded $1,500 to each bargaining unit employee who was a full-time employee as of January 12, 2022 and was not paid anything on top of the rates set out in the collective agreement. The payments will be prorated for all part-time employees, but if they were overpaid by more than $1500, they would not be entitled to any further payment.
