A-645-76
Attorney General of Canada (Applicant)
v.
Raymond Keith Jones (Respondent)
Court of Appeal, Pratte, Ryan and Le Dain JJ.—
Ottawa, March 17 and June 30, 1977.
Judicial review — Public Service — Labour relations —
Downward job classification — Red-circled — Whether or not
paid in accordance with collective agreement — Federal Court
Act, R.S.C. 1970 (2nd Supp.), c. 10, s. 28 — Conversion and
Post-Conversion Pay Regulations, T.B. 669255, (May 25,
1967), ss. 2, 4(1), 5(1), 6(1) — Public Service Employment
Regulations, SOR/67-129, s. 41(3).
This section 28 application is to set aside the Chief Adjudica
tor's decision allowing the respondent's grievance. Respondent,
his position reclassified downward and his salary red-circled,
sought reinstatement of his classification and a retroactive
upward adjustment of his salary. The issue is whether or not
the employee had been paid in accordance with the applicable
collective agreement.
Held, the application is allowed. One purpose of clause 32.05
of the collective agreement is to provide that, in determining
the pay of employees appointed to positions reclassified because
of a post-conversion review, the special problems that arise will
be dealt with as per the Conversion and Post-Conversion Pay
Regulations even though there might be inconsistent provisions
in the Public Service Terms and Conditions of Employment
Regulations. Another purpose is that employees whose pay may
be adversely affected by reappointment to positions with
reduced status will be protected by red-circling. In giving effect
to these purposes, clause 32.05 is to be construed as referring to
the Regulations as a whole, not merely a part of them, and
relates only to pay determination. The clause does not purport
to limit the power to reclassify positions or to make appoint
ments to them.
APPLICATION for judicial review.
COUNSEL:
W. L. Nisbet and L. S. Holland for applicant.
Maurice W. Wright, Q.C., for respondent.
SOLICITORS:
Deputy Attorney General of Canada for
applicant.
Soloway, Wright, Houston, Greenberg,
O'Grady, Morin, Ottawa, for respondent.
The following are the reasons for judgment
rendered in English by
RYAN J.: This is an application under section 28
of the Federal Court Act, R.S.C. 1970 (2nd
Supp.), c. 10, to review and set aside a decision of
E. B. Jolliffe, Chief Adjudicator, which is dated
the 4th day of September 1976. The decision was
made under a reference to adjudication by Mr.
Raymond Keith Jones, the respondent in this case,
pursuant to subsection 91(1), paragraph (a), of the
Public Service Staff Relations Act'.
Mr. Jones's grievance, the grievance which he
referred to adjudication, arose with respect to the
interpretation of provisions of certain collective
agreements between the Treasury Board and the
Public Service Alliance. The bargaining unit to
which the agreements applied comprised the
employees of the employer 2 "... in the Engineer
ing and Scientific Support Group, Technical Cate
gory, as described in the certificate issued by the
Public Service Staff Relations Board on October
12, 1967". In his grievance, Mr. Jones described
himself as being employed in the Construction and
Design Section of the Department of Public Works
in the Ontario Region. He gave these details of his
grievance:
On June 28, 1972 my position was downgraded from
EG-ESS-9 to EG-ESS-8.
Effective on that same date my salary was frozen in the
existing pay range and from that date until July 2, 1973 I
received no economic increases. On June 28, 1972 I was
demoted from EG-ESS-9 to EG-ESS-8.
Since November 6, 1972 I have not been paid at the rate of pay
to which I am entitled by operation of Article 32 of the
1973-1974 agreement and appendix "A" thereto. [It is not
disputed that the reference should be to appendix "B".]
He requested this corrective action:
I now ask that—
(a) I be re-instated at my proper classification of EG-ESS-9
on and from June 28, 1972;
(b) my salary be adjusted upward retroactively to the cor
rect rate on and from June 28, 1972.
' R.S.C. 1970, e. P-35.
2 "employer" was defined in the agreements in this way:
"Employer" means Her Majesty in right of Canada as
represented by the Treasury- Board, and includes any person
authorized to exercise the authority of the Treasury Board.
The reference to adjudication was made on
August 25, 1975. As the Chief Adjudicator stated
in his reasons for decision, the proceeding was
required to be continued to its conclusion under
the Public Service Staff Relations Act as it stood
before the 1975 amendments to the Act became
operative on October 1, 1975. He therefore heard
and determined the case as Chief Adjudicator.
The Chief Adjudicator said that the case had
been termed a test case. Possibly it would be as
well to indicate, as did the Chief Adjudicator, why
this was so. The Chief Adjudicator wrote:
A superficially similar issue was taken to adjudication in
Morency. On June 29, 1973, the grievance was upheld by
Adjudicator Abbott, and on January 29, 1974, it was sustained
by a unanimous decision of the Board, which concluded with
the following statement at pages 49 and 50:
We accordingly find that the adjudicator did not err in law
in construing Article 27.02 to mean that the aggrieved
employee was entitled to be paid in the current scale of rates
set out in Appendix "B" of the collective agreement for the
classification of a CR5 prescribed in his certificate of
appointment dated April 30, 1969, notwithstanding that the
position he occupied as a CR5 was reclassified downward to
the lower level of a CR4.
There are differences between Morency and this case. In my
view, variations in the employment history of the two grievors
are not of real significance. The important distinction is that
Morency involved the interpretation or application of what was
then Article 27 of the collective agreement in respect of the
Clerical and Regulatory Group, while this case turns on the
quite different language of an agreement made in 1971 in
respect of the Engineering and Scientific Support Group. In
particular, the agreement in Morency contained no express
reference to the Conversion and Post-Conversion Pay Regula
tions, but here there is the reference quoted above.
The Test Case Memorandum
The distinction between Morency and this case is clearly
reflected in the Memorandum of Understanding (Exhibit 21)
arrived at between the employer and the Alliance on January
30, 1975, whereby, after one year of review and discussion, the
parties achieved settlement of numerous pending grievances,
but failed to settle many others. It will be seen in paragraphs 3
and 4 of the memorandum about to be quoted that the employ
er agreed to concede a large number of cases resembling that of
Morency, but it was also agreed that in relation to red-circling
grievances where the applicable agreement made specific refer
ence to the Conversion and Post-Conversion Pay Regulations, a
"grievance selected by the parties" would be taken to adjudica
tion. This reference, that of Mr. Jones, is of course the one
selected.
The Chief Adjudicator quoted the memorandum
of understanding in its entirety, but I will quote
only its opening words and its paragraphs 3 and 4:
This Memorandum of Understanding between the Treasury
Board of Canada and the Public Service Alliance of Canada
sets forth certain conditions in respect of the incumbents of
positions which are classified downward and certain undertak
ings respecting grievances arising out of red-circling actions.
3. With regard to all red-circling grievances other than those
excluded by the preceding paragraph arising from red-cir
cling action where the employee was subject to a collective
agreement that did not contain specific reference to the
Conversion and Post Conversion Pay Regulations, the Trea
sury Board has agreed:
(a) to reinstate the grievor retroactively to the classifica
tion held by him immediately prior to the red-circling
action;
(b) to pay the grievor retroactively at the rate of pay
provided in the collective agreement for the classification
held by him immediately prior to the red-circling action,
effective from the date on which he was red-circled;
(c) to apply the provisions of this Memorandum of Under
standing to all grievors referred to in this paragraph,
effective the date of the signing of this Memorandum of
Understanding.
4. With regard to grievances arising from red-circling action
where the employee was subject to a collective agreement
which contained specific reference to the Conversion and
Post Conversion Pay Regulations at the time of red-circling
action, it is agreed that a grievance selected by the parties
will be taken before an adjudicator to resolve the question of
whether the Employer had the right to red-circle employees
who were subject to collective agreements that contained
specific reference to the Conversion and Post Conversion
Regulations. The parties reserve all right to appeal the
decision of the adjudicator in this matter, but agree that the
ultimate decision rendered will be applied to all grievances
arising from red-circling action where the employee was
subject to a collective agreement which contained specific
reference to the Conversion and Post Conversion Regulations
at the time of red-circling action. In this regard the Employ
er agrees not to contest the question of timeliness of these
outstanding grievances.
Despite its importance as a test case, the Chief
Adjudicator stated, and I agree with him, that for
present purposes, "... the issue is simply whether
or not one employee has been paid in accordance
with the provisions of the applicable collective
agreement." This Court is concerned with the
question whether the decision of the Chief
Adjudicator in substance allowing Mr. Jones's
grievance should be set aside.
The Chief Adjudicator, in his reasons for deci
sion, said:
At issue is Mr. Jones' pay entitlement following the reclas-
sification of his position at a lower level. From September,
1968, to June, 1972, his position (numbered P.W.-OTO-71)
had been classified EG-ESS-9, and he was paid according to
the scale for that level specified in the first, second and third
collective agreements between Treasury Board and the Alliance
in respect of the Engineering and Scientific Support Group,
made effective on May 22 and July I, 1969, and May 10, 1971.
With effect on June 28, 1972 (while the third agreement was in
force) the position occupied by him was reclassified EG-ESS-8
with the same number, P.W.-OTO-71. For some time, however,
Mr. Jones was not paid according to the scale then specified for
that level, the EG-ESS-8 level. Instead, he was "red-circled"
and placed in what is known as a "holding range." The
meaning or effect of these terms simply is that he continued to
receive his former rate (which happened to be $15,303 per
annum, the maximum at that time of the EG-ESS-9 range) but
did not receive any of the negotiated increases for the
EG-ESS-9 range which became effective with the making of
new agreements later in 1972 and in subsequent years. Thus
Mr. Jones continued to be paid at the rate of $15,303 per
annum until July 2, 1973, when he received an increase to
$15,490, being the newly-negotiated maximum rate for the
EG-ESS-8 level.
To understand the issues involved in the case, it
is helpful to go back to the time when Mr. Jones
entered the Public Service and to follow his vari
ous appointments over the years, and also to note
certain significant changes in the law relating to
employment and collective bargaining in the
Public Service that occurred during that time.
Mr. Jones was first employed in the Public
Service in 1961. From then until August 31, 1966,
he was promoted several times. Effective Septem-
ber 1, 1966, he was promoted to a position classi
fied as Technical Officer 4. According to the
statement of facts agreed upon by the parties for
the purpose of the adjudication, Mr. Jones's "class
and grade on appointment was also Technical
Officer 4." Effective September 1, 1967, Mr.
Jones was appointed to a position classified as
Technical Officer 6. "The Grievor's [Mr. Jones's]
class and grade on appointment to this position
was Technical Officer 5 and he was paid at that
rate.... Effective September 1, 1968, the Grievor
was promoted to Technical Officer 6. He thereby
acquired the class and grade of appointment that
corresponded to the classification of the position to
which he had been appointed effective September
1, 1967".
It is significant that the parties, in their agreed
statement of facts, recognized that an employee
may be appointed to a position which is classified
at a level that differs from the employee's personal
class and grade. This becomes important when one
comes to consider the terms of the collective agree
ments involved in this case.
On March 13, 1967, two new statutes relating to
the Public Service came into force, the Public
Service Employment Act 3 and the Public Service
Staff Relations Act 4 , and the Civil Service Act'
was repealed. The Financial Administration Act
was also amended 6 . A purpose of these enactments
was to introduce a new system of collective bar
gaining into the Public Service. Before these
changes, the power of appointment to the Public
Service was by and large vested in the Civil Ser
vice Commission, as was the authority to classify
positions in the Public Service. After the changes,
the power to appoint or to provide for appointment
to the Public Service was vested in the Public
Service Commission, the successor to the Civil
Service Commission, and the authority to classify
Public Service positions was vested in the Treasury
Board, as was personnel management, including
the determination of terms and conditions of
employment in the Service. Determination of the
terms and conditions of employment is, of course,
subject to the provisions of the Public Service
Staff Relations Act in relation to collective
bargaining.
The Public Service Staff Relations Act, S.C.
1966-67, c. 72, in section 2, paragraph (r), defined
the term "occupational category" as follows:
2....
(r) "occupational category" means any of the following
categories of employees, namely,
(i) scientific and professional,
(ii) technical,
(iii) administrative and foreign service,
3 S.C. 1966-67, c. 71; the current citation is R.S.C. 1970, c.
P-32.
S.C. 1966-67, c. 72; the current citation is R.S.C. 1970, c.
P-35.
5 S.C. 1960-61, c. 57.
6 An Act to amend the Financial Administration Act, S.C.
1966-67, c. 74.
(iv) administrative support, or
(v) operational,
and any other occupationally-related category of employees
determined by the Board to be an occupational category;
"Occupational group" was in turn defined, in
paragraph 2(s), in this way:
2....
(s) "occupational group" means a group of employees speci
fied and defined by the Public Service Commission under
subsection (1) of section 26;
Apparently in preparation for the new system of
collective bargaining, the Civil Service Commis
sion had undertaken, as mentioned in subsection
26(2) of the Act, a program of classification revi
sion. The Public Service Commission was required
by subsection 26(1) of the Act to specify and
define the occupational groups within each occu
pational category so as to comprise within them all
employees of the Public Service in respect of
whom Her Majesty, as represented by the Trea
sury Board, is the employer. By virtue of subsec
tion 26(2), the groups were to be specified and
defined on the basis of the grouping of positions
and employees, according to their duties and
responsibilities, under the program of classification
revision that had been undertaken by the Civil
Service Commission prior to the coming into force
of the Act. The Public Service Commission was
required to complete this task within fifteen days
after the coming into force of the Act, and was to
publish in the Canada Gazette notice of the occu
pational groups specified and defined by it. This
notice was published in the Canada Gazette on
March 20, 1967, one week after the Act was
proclaimed in force.
It was necessary to convert Public Service posi
tions, as they stood before the adoption of the new
classification system, into positions classified in
accordance with the new system, a responsibility
vested in the Treasury Board. Presumably as an
instrument for making adjustments in pay that
might become necessary or desirable as a conse
quence of the conversion of positions, Treasury
Board, on May 25, 1967, adopted the Conversion
and Post-Conversion Pay Regulations'. The cir
cumstances in which the Regulations were to apply
were described in section 2 as follows:
7 T.B. 669255, May 25, 1967.
2. These Regulations shall apply to the conversion of positions
and employees to new groups and levels, and where necessary
may be applied retroactively to employees converted to the
Administrative Support and Administrative and Foreign Ser
vice Categories; to alterations in conversion; and to post-conver
sion reclassification.
In connection with the conversion of positions to
the new classification system, the Regulations
appear, on their face, to have envisaged problems
arising at the conversion stage itself and during a
closely-related adjustment stage. Sections 4 to 12
of the Regulations appear to relate to problems
arising immediately on conversion, and sections 13
to 17 to problems arising for reasons directly
related to conversion. Sections 18 and 19, on the
other hand, have to do with matters that may arise
in connection with a subsequent reclassification of
converted positions following an audit or review 8 .
8 Sections 6, 7, 18 and 19 of the Regulations are particularly
pertinent to this case and are, accordingly, reproduced below:
Pay Entitlements for Employees Appointed to Positions
Having a Lower Classification
6. (1) Notwithstanding subsection (1) of section 63 of the
Public Service Terms and Conditions of Employment Regu
lations, an employee who is appointed, other than at his
request or by demotion, to a position with a lower maximum
rate of pay than the maximum rate of the position he held,
shall be entitled to be paid for services rendered
(a) the remuneration applicable to the position held by
him in the new classification and pay plan;
(b) the scale of rates applicable to the position held by
him on that date in the former classification and pay plan;
or
(c) the scale of rates applicable to the position held by him
in the new classification and pay plan immediately before
the appointment to another position in the new classifica
tion and pay plan;
whichever has the highest maximum rate.
(2) The entitlement referred to in paragraph (c) of subsec
tion (1) of section 6 above shall not apply to an employee on
the date of a demotion in the former class or level or on the
date of an appointment to a lower level in the former class
which was requested by the employee.
7. The entitlement referred to in paragraphs (b) and (c) of
subsection (1) of section 6 shall continue until such time as
the maximum rate for the employee's position, or any posi
tion to which he may have been transferred having the same
maximum rate as his position, or the maximum rate of any
higher position to which he may later be appointed, is
(Continued on next page)
It will be recalled that on September 1, 1967,
Mr. Jones had been appointed to a position classi
fied as Technical Officer 6, although his personal
classification was Technical Officer 5, a personal
classification he retained for a year until he was
personally promoted. The Technical Officer 6
position held by Mr. Jones was one of seventy-
eight similar positions, all of which were classified
as Technical Officer 6, and all of which formed
part of Job DPW-272. On July 24, 1967, all of the
Technical Officer 6 positions in Job DPW-272
were evaluated by point rating for the purpose of
converting them to the new plan of classification
for the EG-ESS Group. This evaluation was based
on a common or "lead" job description. The point
rating given to these positions placed them at level
9 of the EG-ESS Group.
A Classification Revision Form, signed on Janu-
ary 28, 1969, by "J. Clarke" for the Chief, Person-
(Continued from previous page)
equivalent to or higher than the maximum rate to which he is
entitled. Similarly, where an employee is being paid in a
scale of rates with a maximum rate higher than the normal
maximum for the performance pay scale for his position, the
entitlement to the higher pay scale shall continue until such
time as the normal maximum for his position is equivalent to
or higher than the maximum rate to which he is entitled, or
until he is paid at an exceptional merit rate equal to or
higher than the maximum rate to which he is entitled.
Reclassification Following Audit or Review of Post-Conver
sion Actions
18. Where, as a result of audit or review, a converted position
is found to be underclassified, it shall be reclassified to a
higher level on an effective date to be determined by the
competent classification authority, taking into consideration
the date on which the current duties and responsibilities were
assigned to the position, and the rate of pay and increase date
of the employee on appointment to that higher level shall be
calculated in accordance with section 66 and section 71 of
the Public Service Terms and Conditions of Employment
Regulations.
19. Where, as a result of audit or review, a converted position
is found to be overclassified
(a) the employing department shall be notified of the
correct lower classification and if, within a period of sixty
days the duties and responsibilities of the position have not
been altered to justify the existing classification, the posi
tion shall be classified at the lower level with effect from
the date on which the sixty-day period commenced, and
(b) the employee holding the position in that lower level
shall be paid in the manner described in paragraphs (b)
and (c) of subsection (1) of section 6 of these regulations.
nel, Ontario Region of the Department of Public
Works, and purporting to be approved on January
30, 1969, by the "Civil Service Commission",
shows that Mr. Jones's position (P.W.-OTO-71)
was converted from Technical Officer 6 to
EG-ESS-9. The form also shows that the effective
date of conversion was July 1, 1967, that
EG-ESS-8 was his personal grade and class during
the period from July 1, 1967 to August 31, 1968,
reflecting the period during which he was paid as a
Technical Officer 5, and that thereafter it was
EG-ESS-9. Mr. Jones was informed by a letter,
sent to him on or about May 16, 1969, that his
appointment to the position he then held had been
approved at level 9.
A collective agreement between the Public Ser
vice Alliance and the employer was signed on May
22, 1969, covering the bargaining unit of which
Mr. Jones was a member. Three other collective
agreements were in turn operative during the
period with which we are concerned. It is agreed
that the pay articles of these agreements included
these clauses appearing within Article 32 of the
agreement which became effective on May 10,
1971:
ARTICLE 32
PAY
32.01 Except as provided in Clauses 32.02, 32.03, 32.04 and
32.05, the terms and conditions governing the application of
pay to employees are not affected by this Agreement.
32.02 An employee is entitled to be paid for services rendered
at:
(a) the pay specified in Appendix "B" for the classification
of the position to which he is appointed, if the classification
coincides with that prescribed in his certificate of appoint
ment, or
(b) the pay specified in Appendix "B" for the classification
prescribed in his certificate of appointment, if that classifica
tion and the classification of the position to which he is
appointed do not coincide.
32.05 The pay of employees resulting from conversion to the
new classification and pay plan effective July 1, 1967, will be
governed by the Conversion and Post-Conversion Pay
Regulations.
It may be noted that, under section 40 of the
Public Service Staff Relations Act, an employee
organization, certified as the bargaining agent for
a bargaining unit, has the exclusive right to bar
gain collectively on behalf of the employees in the
bargaining unit and to bind them by a collective
agreement. Also, by virtue of section 54 of the Act,
the Treasury Board may enter into a collective
agreement with the bargaining agent for a bar
gaining unit applicable to employees in the unit.
Section 58 provides that, subject to the Act, a
collective agreement is binding upon the employer,
on the bargaining agent, and on the employees in
the bargaining unit.
It is not in dispute that, when Mr. Jones's
position was converted from Technical Officer 6 to
EG-ESS-9 and that when his appointment in that
position at level 9 was approved, there was no
reason to red-circle him. It appears that he was
paid, under clause 32.02 of the collective agree
ment, as an employee whose position classification
coincided with the classification prescribed in his
certificate of appointment, that is to say, with his
personal classification.
A_ memorandum dated April 8, 1971, from R.
O. Mitchell, who was described as Chief, Classifi
cation & Compensation, was sent to the Chief,
Personnel Administration, Western Region. The
memorandum is headed: "Review—Territorial
Technical Officers, Job DPW 272—EG-ESS-9".
It reads:
1. Job DPW 272 contained a total of 78 Technical Officer 6
positions which were converted EG-ESS-9 with a point rating
of 196-196-075-146(36-30-50-30)-058-0671. Evaluation was
based on a Questionnaire prepared for Position PW-WW1-48,
now PW-514-630.
2. Review of the EG-ESS Conversion resulted in 29 positions,
in this job, being re-evaluated at a lower level in the Group.
There are now 44 positions remaining in Job DPW 272 as
EG-ESS-9; five positions were abolished subsequent to
conversion.
3. In view of the results of the Review of Conversion, in
relation to Job DPW 272 the duties of all positions, vacant or
filled, remaining in this Job as EG-ESS-9 will be up-dated and
submitted for review to this Headquarters by June 30, 1971.
The up-dated duties and responsibilities will be reviewed and
evaluated by a Headquarters Review Committee established
for that specific purpose. Regions must also advise Headquar
ters of positions in which down-grading would result in "red-
circling" of the incumbent.
4. The following are attached:
(a) List of Positions remaining in Job DPW-272 as
EG-ESS-9
(b) Position Duties and Working Conditions on which Con
version was based.
Mr. Jones signed a Department of Public Works
Position Description form, dated July 23, 1971.
The descriptive title of the position, appearing in
the form, is "Territorial Officer". The position
number is given as PW-411-401, and the "present
position classification" is entered as EG-ESS-9.
"K. Jones" is typed in the heading to the form as
the "name of incumbent", and the "certified group
& level of incumbent" is shown as EG-ESS-9. Mr.
Jones, in signing, certified that the form contained
" ... an accurate and complete description of the
duties of my position. ..." Mr. Jones's supervisor
also signed the form immediately under the words:
"The above description is an accurate and com
plete statement of duties assigned to the position
effective July 1, 1971 ... and are being performed
by the employee ...."
A classification action form, dated March 30,
1972, signed by H. J. Traynor, Classification Offi
cer, and headed "Treasury Board Secretariat",
relates to the reclassification of position Number
PW-411-401. The form shows that the point rating
of the position had changed from 671 to 597, and
that the position had been changed from the previ
ous group and level EG-ESS-9 to group and level
EG-ESS-8, effective June 28, 1972. Under the
heading "Remarks", it is stated: "This action
results from Audit Board Review of positions in
Job DPW 272, converted EG-ESS-9, and not
reviewed in the Post-Conversion period ending
December 31, 1969, nor subject to any classifica
tion review subsequent to the date of conversion,
July 1, 1967." It seems clear from this notation
that this reclassification was not a conversion, nor
was it a consequence of a review during the post-
conversion period; it resulted from a review by the
Audit Board (whatever that may have been) of
positions in Job DPW 272 that had previously
been converted to EG-ESS-9. So far as I can tell,
it was a reclassification as a result of the sort of
audit or review contemplated by section 19 of the
Conversion and Post-Conversion Pay Regulations.
It may have been a consequence of the review
mentioned in the memorandum of April 8, 1971
from Mr. Mitchell to the Chief, Personnel
Administration, Western Region, although that
memorandum states: "The up-dated duties and
responsibilities will be reviewed and evaluated by a
Headquarters Review Committee established for
that specific purpose."
A further step was taken in carrying the reclas-
sification through to completion. A "Certificate of
Appointment" was issued. It contained both the
recommendation of Mr. Jones's appointment to
the reclassified position and an approval of the
appointment. This action seems to have been based
on the view that, for purposes of appointment, a
Public Service position is not merely a position
with a number; it is a position within an occupa
tional group so that, if the classification of a
position is changed from one occupational group to
another or from one level to another level within
an occupational group, the position itself changes
and the incumbent must be reappointed to what is
considered to be the new position. This view of the
effect of a reclassification on a position is reflected
in certain of the materials before us. Section 4 of
the Regulations, for example, provides in subsec
tion (1) that:
4. (1) Where a new group is established ... and an
employee is appointed to a position in such a group, he shall be
paid on the effective date of that appointment at the rate of pay
that is nearest to but not less than the rate of pay he is entitled
to receive on that date.
Subsection 5(1) provides that:
5. (1) ... the first increase in pay following the appoint
ment referred to in section 4 shall be calculated as if that
appointment constituted a transfer from the position held on
that date in the former class and grade....
Section 6, quoted above, refers in subsection (1)
to:
6. (1) ... an employee who is appointed ... to a position
with a lower maximum rate of pay than the maximum rate of
the position he held ....
And section 18, also quoted above, refers to
18. ... the rate of pay and increase date of the employee on
appointment to that higher level ...
where a position is reclassified to a higher level. It
is also of some significance that subsection 41(3)
of the Public Service Employment Regulations 9
provides in part as follows:
9 SOR/67-129.
41....
(3) This section and section 12 do not apply where the
appointment of a person is made from within the Public Service
without competition
(a) to a reclassified position held by that person immediately
prior` to the reclassification,
and in such cases there shall be deemed to be no person whose
opportunity for advancement has been prejudicially affected.
I mentioned earlier that Mr. Jones's position, at
the time he was a Technical Officer 6, had been
converted to EG-ESS-9 effective July 1, 1967, and
that Mr. Jones had been notified by letter in May
1969 that his appointment to the position he then
held had been approved at level 9. In connection
with the conversion of the positions to the EG-ESS
Group, a memorandum dated July 8, 1969, en
titled "Conversion of and Pay Implementation for
Engineering and Scientific Support Group Posi
tions", and signed by C. A. Smith, Director, Per
sonnel Administration, was sent to the Regional
Chief, Personnel Administration. It contains this
paragraph:
This is to advise you to proceed with incumbent pay action on
CSC 245's for positions converted to the EG-ESS group. This
action is to be based on the original conversion decision with
the one exception—those positions which, as a result of a
subsequent review, were re-evaluated at a higher level. For the
latter positions the higher level will be recognized as the
converted level. The level to be paid will of course be governed
by the level at which the PSC is prepared to certify the
incumbent.
I have put in italics the words I find significant for
present purposes.
On July 18, 1972, a personnel action form, the
"Certificate of Appointment" mentioned above,
was issued in respect of Raymond Keith Jones. Its
effective date was June 28, 1972. The form
describes itself as a "Certificate of Appointment—
Type 4". The Public Service Staffing Manual
defines a Type 4 appointment as: "The appoint
ment of an employee to a lower level of the
occupational group." In space 14 of the form
appears the entry:
Group and level before effective date
(a) of employee EG-ESS-9
(b) of classification decision EG-ESS-9
In space 18 is the entry:
Group and level as of effective date
(a) of classification decision EG-ESS-8
(b) of appointment EG-ESS-8
(paid as EG-ESS-9)
In space 38, under "Remarks", appears the
notation:
Mr. Jones is to be maintained in the Holding Range of $13,464
to $15,303 in accordance with the Conversion and Post Conver
sion Regulations—articles 19 and 6.
The completed form shows that the appointment
was recommended by W. D. McKee, Manpower
Planning & Development Officer, DPW, 25 St.
Clair Avenue E. It was approved by E. Cruick-
shank, Staffing Officer, P.S.C., Ottawa, Ontario.
It is thus apparent that at least the attempt was
made, not only to reclassify Mr. Jones's position,
but also to appoint him to the reclassified position.
For reasons that appear more fully toward the end
of this judgment, I am of the view that this
attempt succeeded in producing a new certificate
of appointment.
This ends the rather lengthy review of the back
ground material. As I indicated previously, the
Chief Adjudicator allowed Mr. Jones's grievance
in its essentials. I quote him:
In the result, this grievance succeeds. The changes in Mr.
Jones' pay entitlement recorded in Exhibit 13 were contrary to
the provisions of the applicable collective agreement. He is
entitled to the retroactive adjustment of his salary on the basis
of the same status in respect of pay which he enjoyed immedi
ately prior to June 28, 1972. In other words, he should receive
the salary he would have received if the group and level of his
position and his personal classification had continued to be
treated as EG-ESS-9 after June 28, 1972. Thus, he should be
paid the increase in the EG-ESS-9 maximum rate which
became effective on November 7, 1972, and also subsequent
increases for that group and level agreed to by the parties.
As I understand him, the Chief Adjudicator was
of opinion that the Regulations had no relevance in
determining Mr. Jones's pay after the reclassifica-
tion of his position. This was so because, in the
Chief Adjudicator's view, clause 32.05 applies only
to the determination of pay resulting from conver
sion and by implication excludes the Regulations
from the determination of pay resulting from
reclassification. It followed, in his opinion, that the
reclassification of Mr. Jones's position (whatever
other consequence it may have had) and the cer
tificate of appointment issued to him in respect of
the reclassified position (whatever its precise
nature may have been and whatever other conse
quences it may have had) were of no consequence
in fixing his pay. For purposes of clause 32.02, Mr.
Jones's certificate of appointment continued to be
the document by which he was appointed to the
EG-ESS-9 position in 1969.
The issue before us is whether the Chief
Adjudicator erred in law in interpreting the collec
tive agreement as he did.
It seems to me that there are two questions to be
answered. The first is this: for the purpose of
determining Mr. Jones's pay after his position was
reclassified from EG-ESS-9 to EG-ESS-8, was his
certificate of appointment the letter he received in
1969 informing him that he had been confirmed in
the EG-ESS-9 position, or was it the personnel
action form issued on July 18, 1972, the "Certifi-
cate of Appointment—Type 4"? The other ques
tion is whether, if his certificate of appointment
was the personnel action form, he was entitled to
the red-circling protection afforded by section 19,
paragraph (b) of the Regulations.
Clause 32.02 of the agreement, despite its com
plex wording, seems clear enough: an employee is
to be paid at the rate specified in Appendix "B" as
being applicable to the classification prescribed in
his certificate of appointment. In this case, the
employer obviously treated Mr. Jones's certificate
of appointment as the personnel action form issued
on July 18, 1972. The classification prescribed in it
was: EG-ESS-8. The employer did not, however,
reduce Mr. Jones's pay. The position was taken
that, because of clause 32.05, Mr. Jones was en
titled to the red-circling protection afforded by
section 19, paragraph (b) of the Regulations.
Indeed, the personnel action form stated that this
was so.
The Chief Adjudicator was of the view, as
already indicated, that the employer was wrong in
proceeding in this way: the employer should have
ignored the personnel action form and kept paying
Mr. Jones at the rate applicable to classification
EG-ESS-9, not because of red-circling protection,
but because that was the classification specified in
his certificate of appointment before his position
was reclassified.
Clause 32.05 is not free from doubt. Its wording
is awkward. What, for example, does it mean when
it says: "The pay of employees ... will be governed
by the Conversion and Post-Conversion Pay Regu
lations"? All other things being equal, the pay of
employees must be determined by clause 32.02.
"Governed by" surely means no more than that
the Regulations must also be applied when, in the
situation specified in the clause, pay is being
determined.
And what is the significance of the following
words appearing in the clause: "... resulting from
conversion to the new classification and pay plan
effective July 1, 1967 ..." ? Does the clause mean
what the Chief Adjudicator said it means? Or does
it mean that the Regulations are to be applied,
along with clause 32.02, in determining the pay of
employees appointed to positions reclassified fol
lowing a post-conversion audit or review as well as
the pay of those appointed to converted positions?
It is appropriate, in seeking the correct interpre
tation of the clause, to look to relevant circum
stances at the time the agreement was first made
and at the time of its renewals. It is also appropri
ate to search for the purposes of the clause and to
consider the consequences of different readings.
What is now clause 32.05 was included in the
first of the collective agreements covering the
EG-ESS Group, the agreement effective in May
1969. This agreement was apparently made shortly
after the conversion of the Technical Officer posi
tions to the new system of classification. In the
letter of May 1969 notifying Mr. Jones that his
appointment had been approved, after the conver
sion of positions, at level 9 in the Engineering and
Support Group, the Chief, Personnel Administra
tion, stated that: "When negotiation of the collec
tive agreement is completed, and we receive notice
of the new wage rates, they will be implemented
and you will be advised."
It is not surprising that express mention was
made in the new agreement of the provisions in the
Regulations dealing with the problems that would
in all probability arise in respect of pay changes
consequent on conversion. Again, I quote from the
reasons of the Chief Adjudicator:
The conversion of a position from a classification under the
old system to a new group and level—and designation—under
the new plan was certain to raise difficult questions as to the
pay treatment of incumbents. The formulae for resolving such
questions were set out by Treasury Board in the Conversion and
Post-Conversion Pay Regulations, adopted on May 22, 1967, to
which reference was made in many of the collective agreements
concluded in the ensuing period.
Clause 32.05 was also included in the agree
ments signed on June 4, 1971 and on December
19, 1972. Both of these agreements were signed
well after the impact of conversion. This is itself a
circumstance supporting the interpretation of the
clause as covering reclassification as well as
conversion.
It may be of assistance, in determining the
purpose and scope of clause 32.05, to advert to a
suggestion made to us in connection with the
relationship between clauses 32.01 and 32.05. It
was suggested that the words in clause 32.01, "..
the terms and conditions governing the application
of pay to employees ..." include the terms and
conditions governing the application of pay con
tained in the Regulations. It was then suggested
that a purpose of clause 32.05 was to limit the
application of the Regulations, so included by
clause 32.01, to the determination of the pay of
appointees to converted positions. This would have
been a strange way of achieving the purpose. I
would have thought, if that were the purpose, that
clause 32.05 would have provided in so many
words that the Regulations would not apply to
appointments to reclassified positions. But that is
not what the clause provides. It provides affirma
tively for matters that would already be covered by
clause 32.01 if that clause incorporated the Regu
lations by its reference to "the terms and condi
tions governing the application of pay to
employees".
My own view is that the words quoted from
clause 32.01 do not refer to terms and conditions
appearing in the Regulations. They refer to terms
and conditions governing pay appearing principal
ly, if not exclusively, in the Public Service Terms
and Conditions of Employment Regulations' 0 .
This reading enables one to make sense of the
exception expressed in clause 32.01 as it relates to
clause 32.05.
To mention quite another matter, it is signifi
cant that, if the Chief Adjudicator were right in
his reading of clause 32.05, an employee who
might be appointed to a position reclassified to a
higher level would not be entitled to the higher
rate of pay to which clause 32.02 would otherwise
entitle him. It seems unlikely that the parties
would have intended this consequence.
With these various considerations in mind, I
conclude that the purposes of clause 32.05 are to
provide that, in determining the pay of employees
who are appointed to converted positions or to
positions reclassified because of a post-conversion
audit or review, the special problems that may
arise will be dealt with in accordance with the
Conversion and Post-Conversion Pay Regulations
even though there might be inconsistent provisions
in the Public Service Terms and Conditions of
Employment Regulations, and that employees
whose pay may be adversely affected by being
reappointed to positions reduced in status in the
process of reclassification will be protected by
red-circling. I interpret clause 32.05 as giving
effect to these purposes.
In the course of reaching my conclusion, I gave
very careful attention to what might be considered
a more literal meaning of the words of the clause
itself, the meaning which the Chief Adjudicator
gave to them. Having in mind, however, the con
text of the clause, its purposes, and the conse
quences of the different interpretations, I have
construed it as referring to the Regulations as a
whole and not merely to part of them. I interpreted
the clause within the total context of the pay
article".
I would add that it does not seem to me to be a
purpose of the clause to isolate the wage determi
nation of employees appointed to reclassified posi
tions from the administrative provisions of the
Conversion and Post-Conversion Pay Regulations
as they relate to pay or from their red-circling
10 T.B. 665757 (SOR/67-118, as amended).
" See E. A. Driedger, The Construction of Statutes
(Toronto, 1974), at p. 2.
safeguards. Nor does it seem to me to be a purpose
of the clause to require the employer, in determin
ing an employee's pay, to disregard his current
certificate of appointment and look to a certificate
that has been replaced by it.
Even if I were of the opinion that the clause
should be interpreted so as to limit it to the pay
determination of employees appointed to converted
positions and so as, by implication, to make the
Regulations inapplicable to the pay determination
of employees appointed to reclassified positions, I
would not reach the same conclusion as did the
Chief Adjudicator on the consequences of that
reading.
The clause relates only to the determination of
pay. It does not purport to limit the power to
classify positions or to make appointments to
them. It deals with the pay consequences of such
actions.
There is no doubt that Mr. Jones's position was
reclassified. Authority for the reclassification was
supplied by paragraph 7(1)(c) of the Financial
Administration Act 12 . Paragraph 19(a) of the
Regulations imposed a duty to reclassify the
EG-ESS-9 position to EG-ESS-8 because, as a
result of the audit or review, it had been found to
be overclassified. The reclassification had no
consequence so far as the determination of Mr.
Jones's pay was concerned. Clause 32.02 of the
agreement makes that clear. The question of a
change in Mr. Jones's pay did not arise until he
was reappointed to the reclassified position by the
personnel action form issued on July 18, 1972. Au
thority for the reappointment was derived from the
Public Service Employment Act and Regulations
made under it, not from the Conversion and Post-
Conversion Pay Regulations. The pay consequence
of the issuance of the new certificate of appoint
12 R.S.C. 1970, c. F-I0. Paragraph 7(1)(c) provides:
7. (1) Subject to the provisions of any enactment respect
ing the powers and functions of a separate employer but
notwithstanding any other provision contained in any enact
ment, the Treasury Board may, in the exercise of its respon
sibilities in relation to personnel management including its
responsibilities in relation to employer and employee rela
tions in the public service, and without limiting the generality
of sections 5 and 6,
(c) provide for the classification of positions and
employees in the public service;
ment would have been determined in accordance
with clause 32.02 of the agreement without the
protection of red-circling if paragraph 19(b) of the
Regulations were excluded by clause 32.05. It
seems to me that the narrow reading of clause
32.05, a reading that would restrict it to appoint
ments to converted positions, would have deprived
him of that protection. This is, to me, an indication
that the broader reading is the more likely one.
I now summarize. Mr. Jones's position had been
converted from Technical Officer 6 to EG-ESS-9;
he had been notified of that conversion; he had
been informed by letter that his appointment to
level 9 of the converted position had been
approved; he was paid for some three years in
accordance with the provisions of subclause
32.02(a) of the agreement on the basis that his
classified position and his personal position coin
cided; his converted position was reclassified from
EG-ESS-9 to EG-ESS-8; his appointment to the
EG-ESS-8 position was approved by the personnel
action form (certificate of appointment)—Type 4,
signed by E. Cruickshank, Staffing Officer, Public
Service Commission, the form issued on July 18,
1972; this form constituted Mr. Jones's certificate
of appointment for purposes of clause 32.02 of the
agreement; the Regulations are applicable by
virtue of clause 32.05; Mr. Jones was accordingly
entitled to the protection afforded by the red-cir
cling provision in paragraph 19(b) of the Regula
tions; and his salary was determined and paid by
the employer with proper regard to these
circumstances.
Before concluding, I wish to refer particularly to
two submissions that were made to us on behalf of
the respondent.
It was submitted that the alleged reappointment
of Mr. Jones to the reclassified position was a
demotion, and that the Public Service Commission
lacks authority to demote unless it proceeds under
section 31 of the Public Service Employment
Act". In purporting to reappoint Mr. Jones, the
Commission was obviously not acting under sec-
" Section 31 of the Public Service Employment Act provides:
31. (1) Where an employee, in the opinion of the deputy
head, is incompetent in performing the duties of the position
(Continued on next page)
tion 31: there was no suggestion whatever that Mr.
Jones was incompetent in performing the duties of
his position or that he was incapable of performing
them. It follows, it was argued, that Mr. Jones's
reappointment was a nullity, and accordingly that
the certificate of appointment issued on July 18,
1972, was not and could not be a certificate of
appointment for purposes of the collective agree
ment.
In my view, however, the Treasury Board, for
the reasons I have given, did have author
ity to reclassify the position that Mr. Jones had
occupied, the EG-ESS-9 position. I am also of the
view that the Public Service Commission had au
thority to appoint Mr. Jones to the reclassified
position by virtue of section 8 of the Public Service
Employment Act and the Regulations made pursu
ant to the Act, even though the reappointment was
to a position at a lower level. I see nothing in the
collective agreement or in relevant legislation or
Regulations to limit this authority.
(Continued from previous page)
he occupies or is incapable of performing those duties and
should
(a) be appointed to a position at a lower maximum rate of
pay, or
(b) be released,
the deputy head may recommend to the Commission that the
employee be so appointed or released, as the case may be.
(2) The deputy head shall give notice in writing to an
employee of a recommendation that the employee be
appointed to a position at a lower maximum rate of pay or be
released.
(3) Within such period after receiving the notice in writ
ing mentioned in subsection (2) as the Commission pre
scribes, the employee may appeal against the recommenda
tion of the deputy head to a board established by the
Commission to conduct an inquiry at which the employee
and the deputy head concerned, or their representatives, are
given an opportunity of being heard, and upon being notified
of the board's decision on the inquiry the Commission shall,
(a) notify the deputy head concerned that his recommen
dation will not be acted upon, or
(b) appoint the employee to a position at a lower max
imum rate of pay, or release the employee,
accordingly as the decision of the board requires.
(4) If no appeal is made against a recommendation of the
deputy head, the Commission may take such action with
regard to the recommendation as the Commission sees fit.
(5) The Commission may release an employee pursuant to
a recommendation under this section and the employee there
upon ceases to be an employee.
The other submission was that the purported
appointment to the reclassified position was not an
appointment within the meaning of the Public
Service Employment Act or of the collective agree
ment because it was not made on the basis of an
assessment of Mr. Jones's qualifications. To put it
rather more broadly, it was argued that, after the
reclassification, the duties required of the occupant
of the position were the same as at the time the
position was converted; that neither the qualifica
tions required nor the qualifications which Mr.
Jones had to offer had changed; and that there was
no occasion to reassess Mr. Jones's qualifications,
nor were they reassessed.
It is to be noted, however, that the memoran
dum dated April 8, 1971, from the Chief, Classifi
cation & Compensation, to the Chief, Personnel
Administration, Western Region, stated in part
that "... in relation to Job DPW 272 the duties of
all positions, vacant or filled, remaining in this job
as EG-ESS-9 will be up-dated and submitted for
review to this Headquarters by June 30, 1971. The
up-dated duties and responsibilities will be
reviewed and evaluated...." It is also to be noted
that in the position description, dated July 23,
1971, and signed by Mr. Jones, Mr. Jones's super
visor certified the statement as a statement of the
duties assigned to the position effective July 1,
1971.
It also seems to me to be unwarranted to assume
that the personnel action form issued on July 18,
1972, and approved by a staffing officer of the
Public Service Commission, was issued without
consideration having been given to Mr. Jones's
qualifications to perform the duties of the reclassi
fied position. Mr. Jones's satisfactory performance
of the duties of the position at level 9 would itself
be cogent evidence of his qualifications to perform
the duties required at level 8. I am satisfied that
the personnel action form issued on July 18, 1972,
is Mr. Jones's "Certificate of Appointment" as
that term is used in clause 32.02 of the collective
agreement.
It was suggested in argument that, to interpret
the collective agreement in such a way as to make
the Conversion and Post-Conversion Pay Regula
tions applicable to the determination of the pay of
employees, covered by the collective agreement,
whose positions might be reclassified during its
term would be to place them at the mercy of the
employer because Treasury Board is the classify
ing authority under the Financial Administration
Act. It is significant, however, that the respondent
did not question that the reclassification was car
ried out in good faith, that it was in truth a
reclassification. We do not have here any sugges
tion of a subterfuge undertaken for the purpose of
undermining the collective agreement.
The question whether this Court has jurisdiction
to hear this section 28 application was considered.
The question was raised because of subsection
100(1) of the Public Service Staff Relations Act
which, in its present form, was enacted in 1975 by
way of substitution for the previous subsection
100(1) 14 . The decision of this Court in the Attor
ney General of Canada v. Public Service Staff
Relations Board 15 case makes it clear that we do
have jurisdiction.
I would grant the application and set aside the
decision of the Chief Adjudicator dated September
4; 1976. I would refer the matter back to him to be
decided on the basis that Mr. Jones's grievance be
dismissed and the relief he sought denied.
* *
PRATTE J.: I agree.
* * *
LE DAIN J.: I agree.
14 S.C. 1974-75-76, c. 67, s. 29.
15 [1977] 2 F.C. 663.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.