In this interim decision, Arbitrator Ian Anderson addressed the question of whether a new building service provider could choose which of an old building service providers’ employees to hire.
This question arose in the context of a grievance filed on behalf of a grievor who was on an extended medical leave when Compass Canada, the new building service provider, took over a food services contract from Nutra Services, the previous building service provider and the grievor’s former employer.
Compass took the position that as a new provider, they were entitled to hire whoever they wanted, and had not made an offer of employment to the grievor. Compass relied on s. 10 of the Employment Standards Act (“ESA”), which they argued does not place an obligation on a new provider to hire the employees of the replaced provider. Compass further took the position that the addition of section 69.1 to the Ontario Labour Relations Act (“OLRA”) did not take away a new building service provider’s right to choose whether or not to hire a particular employee.
The Union argued section 69.1 effectively added successor rights with respect to building service providers to section 69, which meant that the employees of the replaced building service provider remained protected by the collective agreement. The Union relied on long-standing Ontario Labour Relations Board jurisprudence that made clear that as a result of the application of the collective agreement, successor employers “inherit” predecessor’s employees.
Arbitrator Anderson agreed with the Union’s position and found that as a result of section 69.1 of the OLRA, new providers do not have the right to choose whether or not to hire an individual employed in the bargaining unit by the replaced provider, unless such a right is afforded by the collective agreement.
Labourers’ International Union of North America, Local 3000 v Compass Group Canada, 2023 CanLII 54206 (ON LA)