“Contracting In” or “Contracting Out”? Arbitrator Rules on Hospital’s Use of Agency Workers
Unity Health Toronto v CUPE, Local 5441, 2025 CanLII 1933 (ON LA) (Gedalof, January 20, 2025)
Background
The hospital faced a union grievance over using agency RPNs and PSWs. The union argued that these workers, though hired by third-party agencies, were effectively “contracted in” rather than “contracted out” and that this violated the collective agreement.
The Arbitrator provided as follows regarding the facts and the collective agreement:
3. There is no dispute that… the Hospital was contracted with some 16 third-party agencies to perform the work of RPNs and PSWs at the Hospital… The parties’ collective agreement does not prohibit contracting out. It does, however, in Article 11, prohibit “employees” not covered by the terms of the collective agreement from performing work normally performed by the Union’s bargaining unit members, “except for the purposes of instruction, experimentation, or in emergencies when regular employees are not readily available.”
4. There can be no dispute on the evidence before me, and it is not contested, that the Hospital has, extensively and over a period of years, retained agency RPNs and PSWs to perform bargaining unit work, in circumstances that do not meet the enumerated exceptions under Article 11. The question at the centre of this grievance is whether these agency RPNs and PSWs are properly “employees” of the referring agency, or whether they are instead “employees” of the Hospital for the purposes of Article 11, within the scope of the Union’s recognition clause. If the former, there has been no breach of the Collective Agreement. If the latter, however, there has been a contracting in of agency staff and the breach is clear. (Emphasis added)
Arbitrator’s Analysis
The Arbitrator considered the following factors to determine whether the hospital was the “true employer” of the agency staff:
- Direction and control: The hospital directed agency workers’ tasks, supervised daily work, and integrated them into its operations.
- Hiring and discipline: While agencies formally hired workers, the hospital influenced placements, onboarding, and removal from shifts.
- Remuneration: Agencies issued paychecks, but the hospital bore the financial burden, indicating economic dependency.
- Employment perception: Although agency workers viewed the agency as their employer, operational realities suggested otherwise.
Decision
The arbitrator ruled that the hospital had “contracted in” agency staff, breaching the collective agreement. The decision reinforces that employer control over agency workers can create an employment relationship, regardless of formal employment arrangements.
For another example of an arbitrator ruling that a hospital had “contracted in” agency staff, see our earlier healthcare update here that summarizes the decision in Canadian Union of Public Employees, Local 2119 v Perth and Smiths Falls District Hospital (Trachuk, May 10, 2024).
Undue Hardship Established in Disability Accommodation Case
Unity Health v CUPE, Local 5441, 2025 CanLII 119 (ON LA) (Hayes, January 3, 2025)
Overview
A recent arbitration examined an employer’s duty to accommodate an employee’s disability. The grievor, a part-time cleaner, sustained multiple injuries, including a non-workplace injury in 2021. The union claimed the employer did not fulfil its duty to accommodate, seeking compensation for lost earnings and damages.
Employer’s Position
The hospital argued that continued accommodation would create undue hardship under the Human Rights Code. The hospital maintained that the cleaner role was physically demanding, and no suitable alternative positions were available.
Arbitration Findings
- The grievor could not perform essential job duties due to physical limitations.
- Continued accommodation would impose undue hardship on the employer.
- Alternative positions were explored but deemed unsuitable.
- The employer failed in procedural obligations by not engaging in timely discussions with the union.
Decision
The grievances were largely dismissed, but the Arbitrator found a procedural breach in the duty to accommodate. The hospital was ordered to pay $600 in damages.
Reinstatement Ordered Following Dismissal for Mask-Related Incident
CUPE, Local 41 v Covenant Health, 2025 CanLII 5818 (AB GAA) (Asbell, Solomon, and Yang; January 30, 2025)
Background
A long-serving hospital porter at Grey Nuns Community Hospital in Alberta was terminated after two workplace incidents in March 2022: a rude interaction with an admitting clerk and improper mask use while walking down a basement hallway. During an April 2022 investigation meeting, the employee disclosed that he suffered from anxiety and depression. Shortly after, he took medical leave, and the employer’s Occupational Health and Safety Department contacted his doctor, who confirmed the condition but stated the employee could comply with workplace policies. The employer ultimately determined that accommodating the employee would cause undue hardship and terminated his employment in November 2022.
Arbitration
The union filed grievances, arguing that the employer had not properly assessed accommodation options.
The Arbitration Panel agreed, finding that the employer failed in its duty to accommodate and that termination was excessive given the employee’s long service and the minor nature of the incidents. The employee was ordered reinstated.
Paid Vacation Accrual During Pregnancy and Parental Leave
CUPE Local 5666 v Brockville General Hospital, 2025 CanLII 1927 (ON LA) (Lawrence, January 13, 2025)
Background
The issue in this case was whether two employees continued to accrue vacation pay under the collective agreement while on pregnancy and/or parental leave. The dispute centered on the interpretation of Article 9.04 of the collective agreement, which is the general unpaid leave provisions. This provision states that after 30 days of unpaid leave, service credit for vacation and other benefits is suspended.
Arguments
The hospital argued that this provision applied to pregnancy and parental leave and limited the employees’ entitlement to paid vacation accrual beyond the first month of leave. The union contended that Articles 12.06 and 12.07 of the collective agreement, which explicitly provided for the continued accumulation of service and seniority during pregnancy and parental leave, overrode the general unpaid leave provisions of Article 9.04.
Decision
The Arbitrator agreed with the union that Articles 12.06 and 12.07 were “the complete protocol for pregnancy and parent leaves,” to which the general leave provisions under Article 9.04 did not apply. Therefore, the accrual of service while on pregnancy/parental leave resulted in the accrual of vacation with pay because vacation pay was tied to service under the agreement. The decision emphasized that, unlike many collective agreements, the collective agreement in this case did not require “active service” for vacation pay accrual.
Position Eliminations and Nurse Transfers
Niagara Health System v Ontario Nurses’ Association, 2025 CanLII 3711 (ON LA) (Johnston, January 21, 2025)
This decision interprets the new language in the Central Hospital Agreement awarded in 2023 by an Interest Arbitration Board chaired by Arbitrator Kaplan. The new language in Article 10.08(e) establishes a process to transfer nurses to vacant positions before the hospital implements layoffs. Nurses on units subject to layoff can use their seniority to voluntarily transfer to vacant positions in the hospital known as ‘transfer opportunities’. The hospital can involuntarily transfer nurses who choose not to transfer voluntarily to vacancies that offer similar schedules, work hours, and pay rates at the same or nearby location.
A dispute arose regarding whether the hospital could limit the transfer opportunities to one site and whether jobs that were posted but not yet awarded were required to be included in the list of available transfer opportunities.
The revised article 10.08(e) of the collective agreement is excerpted below.
Article 10.08
…
(e) Process to Avoid Permanent or Long-Term Layoffs
i) Where in the Hospital’s determination there will be one or more layoffs of a permanent or long-term nature, the Hospital shall provide the Union and all nurses on the affected unit(s) with no less than thirty (30) calendar days written advance notice. The advance notice will describe the unit(s), reasons causing the layoffs, number of nurses that would be laid off and a list of vacant positions and any positions not yet posted to be used as transfer opportunities that may be filled in order to avoid the layoffs.
The union filed a policy grievance and nine individual grievances on behalf of seven full-time and two part-time nurses, asserting that the notice provided by the hospital under Article 10.08(e) did not include all eligible vacancies. Specifically, it did not include vacancies at other sites or positions that were posted but not yet filled.
Arbitrator Colin Johnston agreed with the union and concluded that “the hospital has no discretion in narrowing the list of vacant positions. The list must include all vacancies across the hospital that existed at the time notice was provided under Article 10.08(e)(i).”
Concerning the question of positions that were posted before the lay-off notice, he found as follows:
46. Regarding the second question posed in paragraph 32(b) are vacant positions for which the posting process has not been completed to be excluded; the answer is again no. Jobs that are currently in the posting procedure are included as transfer opportunities. The phrase ‘a list of vacant positions and any positions not yet posted’ in Article 10.08(e)(i) describes the broadest pool of vacant positions, including past, present, and soon-to-be job postings. Jobs that would not be included on the list are those already awarded under Article 10.07 or vacancies eliminated under Article 10.08(f)(ii).
The hospital was required to provide affected nurses with a complete list of all hospital-wide vacancies and include positions still in the job posting process if they remained unfilled.
When Student Workers Become Unionized Staff
Cornwall Community Hospital v CUPE, Local 7811, 2025 CanLII 3933 (ON LA) (Wilson, Wright, and Kleiner; January 24, 2025)
The issue in this case was whether Clinical Externs hired by the hospital on a temporary, part-time basis under the Ontario Ministry of Health’s Enhanced Extern Program (EEP) should have been included in the union’s bargaining unit.
The hospital argued that the externs were students in a training program, making them exempt under the collective agreement. It maintained that externs gained supervised practical experience, differentiating them from unionized staff. The union contended that the externs performed bargaining unit work without structured training, effectively filling staffing gaps.
A majority of the Arbitration Board (with the Employer Nominee issuing a dissent) found that the EEP lacked structured learning, evaluation, and defined training objectives. Instead, externs were integrated into daily hospital operations, assisting with patient care, answering call bells, and performing duties typically assigned to union members. Without clear educational oversight, the externs did not meet the criteria for exclusion as students in a formal training program under the collective agreement.
Character Evidence Inadmissible in Arbitration
University Health Network v Ontario Nurses’ Association, 2025 CanLII 421 (ON LA) (Price, January 9, 2025)
A registered nurse was terminated for adjusting a patient’s sedatives without a physician’s order. The hospital viewed this as a profound scope of practice violation, while the union argued the nurse acted based on clinical judgment and patient care needs.
During arbitration, the union sought to introduce letters from colleagues attesting to the nurse’s professionalism and skill, but the hospital objected, calling them irrelevant to the misconduct claim. The Arbitrator issued an Interim Award on the matter, siding with the hospital and ruling that the character evidence was inadmissible.
This decision reinforces that arbitration focuses on specific conduct, not general reputation, and admitting character evidence could unnecessarily prolong proceedings.
HRTO Declares Applicant a Vexatious Litigant
Papushina v. University Health Network, 2025 HRTO 269 (CanLII) (Todgham Cherniak, January 31, 2025)
The Human Rights Tribunal of Ontario (HRTO) declared the applicant in this case to be a vexatious litigant after they filed multiple complaints that were dismissed as an abuse of process. The Tribunal found that the applicant, working with a previously restricted litigant, repeatedly submitted meritless claims and ignored procedural rules.
The applicant had filed numerous human rights complaints against the hospital, many of which were dismissed for lack of jurisdiction or failing to show a valid discrimination claim. The Tribunal determined the applicant repeatedly tried to relitigate previously decided issues, filed redundant claims and disregarded procedural requirements, creating an undue burden on both the respondent and the Tribunal. The HRTO exercised its authority to restrict future applications, requiring prior approval before filing new claims.
HRTO Finds No Discrimination in Service Complaint
Treleaven v. Canadian Mental Health Association Brant Haldimand Norfolk, 2025 HRTO 250 (CanLII) (Hirshhorn, January 30, 2025)
The HRTO dismissed a disability discrimination complaint against the mental health services provider, ruling that the allegations were related to customer service dissatisfaction rather than discrimination under the Ontario Human Rights Code.
The applicant claimed she was mistreated during multiple interactions with the service provider’s staff. She alleged that an intake worker abruptly ended a phone call, a caseworker arrived late for an appointment with a cluttered car, and her questions about additional services were dismissed. She also reported that the caseworker did not accompany her into the store during a grocery shopping trip, which she believed was discriminatory.
The Tribunal found no evidence linking the applicant’s disability to how she was treated. Since the concerns centered on service quality rather than discrimination, the case was dismissed due to lack of jurisdiction.
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