Executive Summary: Key Legal and Evidentiary Issues

• SaskTel challenged an arbitration decision interpreting the term “classification” in its collective agreement with Unifor Locals 1S and 2S.

• The arbitrator found the term unambiguous, rejecting SaskTel’s use of “bracketed descriptors” to narrow employee bumping rights.

• SaskTel argued the arbitrator ignored decades of past practice and made unreasonable findings of fact and interpretation.

• The court applied the reasonableness standard under Vavilov and upheld the arbitrator’s contextual approach to contract interpretation.

• The arbitrator accepted that an estoppel created by past acquiescence was properly terminated by notice from the union.

• SaskTel’s application for judicial review was dismissed, and the arbitrator’s decision was confirmed as within a range of acceptable outcomes.

Background of the dispute
This case arose from a disagreement between Saskatchewan Telecommunications (SaskTel) and Unifor, Locals 1S and 2S, regarding the interpretation of a collective agreement provision used when SaskTel declares certain jobs surplus. The relevant clause, Article 11(2), allows SaskTel to involuntarily transfer employees whose positions have been declared surplus, and allows those employees to exercise bumping rights based on seniority. SaskTel’s long-standing practice was to limit these rights to employees with matching “bracketed” job functions, such as specific departmental roles, rather than the broader job classification.

The union's grievance and arbitration decision
The union filed a grievance asserting that SaskTel’s practice improperly restricted seniority rights and deviated from the unqualified term “classification” as used in Article 11(2). The matter proceeded to arbitration before The Honourable Ted Zarzeczny, K.C., acting under the Canada Labour Code. In his decision dated May 17, 2022, the arbitrator ruled in the union’s favour, finding the term “classification” unambiguous and capable of only one interpretation. He held that SaskTel’s reliance on bracketed descriptors was a unilateral administrative practice that had not been negotiated with the union and was contrary to the collective agreement’s wording. The arbitrator concluded that all employees within a classification should be considered for bumping rights, not just those with matching bracketed job descriptors.

Judicial review application and union's preliminary objections
SaskTel sought judicial review of the arbitrator’s decision, alleging it was unreasonable and based on outdated principles. The union objected to the judicial review on grounds of undue delay and also moved to strike portions of an affidavit SaskTel had submitted. The court found the seven-month delay in bringing the application was not undue and dismissed the union’s preliminary objection. It did, however, strike one speculative sentence from the affidavit.

Standard of review and the court's reasoning
The court applied the reasonableness standard of review under Vavilov, which requires deference to administrative decision-makers unless their decisions are irrational or not supported by the record. The court found the arbitrator had engaged in a proper contextual interpretation of the collective agreement, consistent with established principles from arbitral jurisprudence and the Supreme Court’s guidance in Sattva. It ruled that the arbitrator appropriately considered the use of the term “classification” throughout the agreement, including in the wage schedules, and reasonably concluded that the absence of bracketed descriptors in Article 11(2) meant they should not limit bumping rights.

Arguments on past practice and estoppel
SaskTel argued that decades of consistent practice using bracketed descriptors should have influenced the interpretation. The arbitrator acknowledged the past practice but concluded it could not override the plain language of the agreement, particularly once the union gave formal notice in 2019 that it would insist on a strict reading going forward. The court accepted this reasoning and affirmed that the estoppel created by past acquiescence had been properly brought to an end by the union’s notice.

Final judgment and costs
The Court of King’s Bench found that the arbitrator’s interpretation was transparent, intelligible, and justifiable. SaskTel’s arguments about practical difficulties and historical practice did not outweigh the arbitrator’s reasonable analysis grounded in the language of the collective agreement. As such, the application for judicial review was dismissed, with costs awarded to the union on Column 2 of the court’s cost tariff.