Employer incorrectly deducted holiday pay from paycheque
A long-time employee of Canadian Blood Services in New Brunswick was on sick leave for more than four months and was surprised to find out that four statutory holidays were not paid to her during her time off.
Ana Boboescu worked as a regular part-time donor-care associate since 1999, when she went on leave from May 1 to Sept. 11, 2017. At the time, she testified she had about 1,000 sick-leave credit hours in her bank.
“On each paycheque, regular part-time and temporary employees shall be paid in addition to their regular rate of pay, four per cent of their gross earnings in lieu of paid holidays,” according to article 6.04 of the collective agreement.
Normally, part-time workers were given holiday pay based on hours worked, but because Boboescu was on leave, it wasn’t relevant. Instead, the collective agreement (article 21.09) called for an employee’s holiday-pay hours to be calculated based on the 12-week period immediately before the leave began.
In Boboescu’s case, this meant she was entitled to holiday pay of 7.18 hours per paycheque, based on an average of 71.8 hours per pay period and her sick-leave bank.
On her first pay period of sick leave, Boboescu was paid the proper amount. However, the following pay period, May 28, she was paid for only 62.5 hours. Boboescu informed the payroll representative, who told her the mistake would be rectified on the next cheque.
On the next pay period, Boboescu was also short-changed but she said she didn’t bring it up with the employer as she was focused on her health.
On the June 25 pay cheque, Boboescu was paid for the May shortfall, but her overall hours were too short and 7.18 hours were removed from her pay. When she informed the payroll department, Boboescu was told she wasn’t eligible for Victoria Day or Canada Day holiday pay.
Further corrections and deductions were made but again on a September cheque, 7.18 hours were deducted for Labour Day.
Upon her return from sick leave, and after looking over her pay stubs, Boboescu and the Canadian Union of Public Employees (CUPE), Local 1655 filed a grievance on Oct. 20 and asked for Boboescu to be compensated for the four holidays she wasn’t paid for (Victoria Day, Canada Day, New Brunswick Day and Labour Day).
The union argued that nowhere in the collective agreement did it say employees were not entitled to receive holiday pay while on sick leave. The employer countered and said it was long-standing practice to not pay employees holiday pay while they were on sick leave.
Arbitrator Michel Doucet agreed with the union and he ordered Canadian Blood Services to pay Boboescu four days of holiday pay at 7.18 hours per day.
“The employer, for its part, suggested in its closing arguments that whatever the interpretation of article 21.09, there was evidence of past practice supporting its position that statutory holidays should be deducted from the amount obtained after having applied the formula of article 21.09,” said Doucet.
“The evidence on which the employer based its argument of past practice is the evidence of both witnesses of the union where they stated, on cross-examination, that they had no knowledge of the employer having interpreted the provision in a different way in the past. I do not believe that this is sufficient evidence to establish a past practice and I will also not deal with this argument,” said Doucet.
By making the deductions, the employer was incorrectly interpreting the agreement, according to the arbitrator.
“Nowhere in that formula is it stated that a statutory holiday must be deducted from the ‘average.’ Therefore, having considered the plain language used by the parties as well as the whole agreement, I see no reason for concluding that deducting statutory holidays was within the common intention of the parties when they agreed to the formula in article 21.09. If it had been they would have clearly said so.”
Reference: Canadian Blood Services and Canadian Union of Public Employees, Local 1655. Michel Doucet — arbitrator. Christopher Stewart for the employer. Michael Davidson for the employee. Oct. 9, 2018. 2018 CarswellNB 400
Ana Boboescu worked as a regular part-time donor-care associate since 1999, when she went on leave from May 1 to Sept. 11, 2017. At the time, she testified she had about 1,000 sick-leave credit hours in her bank.
“On each paycheque, regular part-time and temporary employees shall be paid in addition to their regular rate of pay, four per cent of their gross earnings in lieu of paid holidays,” according to article 6.04 of the collective agreement.
Normally, part-time workers were given holiday pay based on hours worked, but because Boboescu was on leave, it wasn’t relevant. Instead, the collective agreement (article 21.09) called for an employee’s holiday-pay hours to be calculated based on the 12-week period immediately before the leave began.
In Boboescu’s case, this meant she was entitled to holiday pay of 7.18 hours per paycheque, based on an average of 71.8 hours per pay period and her sick-leave bank.
On her first pay period of sick leave, Boboescu was paid the proper amount. However, the following pay period, May 28, she was paid for only 62.5 hours. Boboescu informed the payroll representative, who told her the mistake would be rectified on the next cheque.
On the next pay period, Boboescu was also short-changed but she said she didn’t bring it up with the employer as she was focused on her health.
On the June 25 pay cheque, Boboescu was paid for the May shortfall, but her overall hours were too short and 7.18 hours were removed from her pay. When she informed the payroll department, Boboescu was told she wasn’t eligible for Victoria Day or Canada Day holiday pay.
Further corrections and deductions were made but again on a September cheque, 7.18 hours were deducted for Labour Day.
Upon her return from sick leave, and after looking over her pay stubs, Boboescu and the Canadian Union of Public Employees (CUPE), Local 1655 filed a grievance on Oct. 20 and asked for Boboescu to be compensated for the four holidays she wasn’t paid for (Victoria Day, Canada Day, New Brunswick Day and Labour Day).
The union argued that nowhere in the collective agreement did it say employees were not entitled to receive holiday pay while on sick leave. The employer countered and said it was long-standing practice to not pay employees holiday pay while they were on sick leave.
Arbitrator Michel Doucet agreed with the union and he ordered Canadian Blood Services to pay Boboescu four days of holiday pay at 7.18 hours per day.
“The employer, for its part, suggested in its closing arguments that whatever the interpretation of article 21.09, there was evidence of past practice supporting its position that statutory holidays should be deducted from the amount obtained after having applied the formula of article 21.09,” said Doucet.
“The evidence on which the employer based its argument of past practice is the evidence of both witnesses of the union where they stated, on cross-examination, that they had no knowledge of the employer having interpreted the provision in a different way in the past. I do not believe that this is sufficient evidence to establish a past practice and I will also not deal with this argument,” said Doucet.
By making the deductions, the employer was incorrectly interpreting the agreement, according to the arbitrator.
“Nowhere in that formula is it stated that a statutory holiday must be deducted from the ‘average.’ Therefore, having considered the plain language used by the parties as well as the whole agreement, I see no reason for concluding that deducting statutory holidays was within the common intention of the parties when they agreed to the formula in article 21.09. If it had been they would have clearly said so.”
Reference: Canadian Blood Services and Canadian Union of Public Employees, Local 1655. Michel Doucet — arbitrator. Christopher Stewart for the employer. Michael Davidson for the employee. Oct. 9, 2018. 2018 CarswellNB 400
