Company stops recognizing new holiday not included in collective agreement
A British Columbia company has agreed to stop pursuing overpayments it accidentally made to employees when it decided to stop voluntarily recognizing a new statutory holiday that wasn’t included in its collective agreement.
During collective bargaining in 2008, Richmond, B.C.-based pulp and paper company Catalyst Paper and its union, Unifor, negotiated an annualized pay system for employees at the company’s mill in Port Alberni, B.C.
The payment method was adopted from a similar technique used in New Zealand, which divided employees’ pay equally among 26 pay periods over the course of the year. Holiday pay and other elements were included in each employee’s total pay, which was then divided up.
The pay system was meant to normalize and flatten vacation scheduling by standardizing the time off and making hours of work and financial demands consistent over the course of the year. In addition to establishing 26 equal pay periods, the system created pre-set schedules for shift employees consisting of nine tours followed by 22 consecutive days off, four times per year. Each tour consisted of four working days — two day shifts and two night shifts — followed by four days off.
The formula for calculating each employee’s salary to be divided up into 26 equal parts involved actual hours worked, vacation entitlement, floater hours, Sunday time and statutory holiday pay differential based on a set number of statutory holidays in the collective agreement. The 26 pay periods ran on an annual basis from May to April.
New statutory holiday
In 2013, the B.C. provincial government introduced a new statutory holiday during the stretch between Christmas and Easter — Family Day — to be recognized on the second Monday in February. The new holiday wasn’t immediately negotiated into Catalyst’s collective agreement as a recognized holiday but Catalyst decided to voluntarily recognize it that year and did so again in 2014.
As a result, holiday pay for the new Family Day was added to each employee’s total pay and divided into 26 pay periods.
The company told Unifor that under the existing collective agreement, it only had to recognize the holidays outlined in the agreement and it had no obligation to recognize Family Day, so there was no guarantee it would continue to do so. It added that a decision on the holiday for 2015 would be made at a later date.
On Jan. 19, 2015, Catalyst notified Unifor it would no longer be recognizing Family Day, so the day would be a normal working day. The holiday would have to be negotiated into a new collective agreement when the time came to do so.
However, it was too late to remove Family Day from the annualized pay system for 2015 because the Catalyst payroll department had decided to include the holiday as part of the statutory holiday pay for 2015 back in April 2014 when preparing the system for the 2014-15 pay cycle.
As a result, Family Day statutory holiday pay was included in the equalized payments to shift employees as far back as May 2014 while the company was able to change the codes for day shift employees scheduled to work on Family Day 2015 from holiday hours worked to straight hours worked.
The company sought to recover the overpayment to affected employees but Unifor objected, arguing Catalyst was not entitled to deduct money from payments it had already made to employees. While the union agreed employees who didn’t receive holiday pay for Family Day 2015 weren’t entitled to it, it grieved the company’s attempts to recover the overpayment to other employees.
Settlement agreement reached
Catalyst and Unifor were unable to resolve matters during the grievance procedure, so they took things to the B.C. Collective Agreement Arbitration Board for mediation.
Arbitrator Dalton Larson conducted the mediation process, during which the company and the union were able to reach a settlement agreement to the satisfaction of both parties.
Catalyst agreed to stop its attempts at recovering the overpayment, allowing employees who were paid statutory holiday pay for Family Day 2015 to keep the extra money, while Unifor accepted that the rest of the employees were not entitled to holiday pay for that day.
“Not only were the parties able to reach a consensus on the nature of the dispute and agree on a comprehensive statement of facts that led to it, they were able also to reach agreement on the terms by which it should be settled,” said Larson.
He noted he was issuing a consent award to record the agreement rather than an enforcement award.
During collective bargaining in 2008, Richmond, B.C.-based pulp and paper company Catalyst Paper and its union, Unifor, negotiated an annualized pay system for employees at the company’s mill in Port Alberni, B.C.
The payment method was adopted from a similar technique used in New Zealand, which divided employees’ pay equally among 26 pay periods over the course of the year. Holiday pay and other elements were included in each employee’s total pay, which was then divided up.
The pay system was meant to normalize and flatten vacation scheduling by standardizing the time off and making hours of work and financial demands consistent over the course of the year. In addition to establishing 26 equal pay periods, the system created pre-set schedules for shift employees consisting of nine tours followed by 22 consecutive days off, four times per year. Each tour consisted of four working days — two day shifts and two night shifts — followed by four days off.
The formula for calculating each employee’s salary to be divided up into 26 equal parts involved actual hours worked, vacation entitlement, floater hours, Sunday time and statutory holiday pay differential based on a set number of statutory holidays in the collective agreement. The 26 pay periods ran on an annual basis from May to April.
New statutory holiday
In 2013, the B.C. provincial government introduced a new statutory holiday during the stretch between Christmas and Easter — Family Day — to be recognized on the second Monday in February. The new holiday wasn’t immediately negotiated into Catalyst’s collective agreement as a recognized holiday but Catalyst decided to voluntarily recognize it that year and did so again in 2014.
As a result, holiday pay for the new Family Day was added to each employee’s total pay and divided into 26 pay periods.
The company told Unifor that under the existing collective agreement, it only had to recognize the holidays outlined in the agreement and it had no obligation to recognize Family Day, so there was no guarantee it would continue to do so. It added that a decision on the holiday for 2015 would be made at a later date.
On Jan. 19, 2015, Catalyst notified Unifor it would no longer be recognizing Family Day, so the day would be a normal working day. The holiday would have to be negotiated into a new collective agreement when the time came to do so.
However, it was too late to remove Family Day from the annualized pay system for 2015 because the Catalyst payroll department had decided to include the holiday as part of the statutory holiday pay for 2015 back in April 2014 when preparing the system for the 2014-15 pay cycle.
As a result, Family Day statutory holiday pay was included in the equalized payments to shift employees as far back as May 2014 while the company was able to change the codes for day shift employees scheduled to work on Family Day 2015 from holiday hours worked to straight hours worked.
The company sought to recover the overpayment to affected employees but Unifor objected, arguing Catalyst was not entitled to deduct money from payments it had already made to employees. While the union agreed employees who didn’t receive holiday pay for Family Day 2015 weren’t entitled to it, it grieved the company’s attempts to recover the overpayment to other employees.
Settlement agreement reached
Catalyst and Unifor were unable to resolve matters during the grievance procedure, so they took things to the B.C. Collective Agreement Arbitration Board for mediation.
Arbitrator Dalton Larson conducted the mediation process, during which the company and the union were able to reach a settlement agreement to the satisfaction of both parties.
Catalyst agreed to stop its attempts at recovering the overpayment, allowing employees who were paid statutory holiday pay for Family Day 2015 to keep the extra money, while Unifor accepted that the rest of the employees were not entitled to holiday pay for that day.
“Not only were the parties able to reach a consensus on the nature of the dispute and agree on a comprehensive statement of facts that led to it, they were able also to reach agreement on the terms by which it should be settled,” said Larson.
He noted he was issuing a consent award to record the agreement rather than an enforcement award.
