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Indemnity agreement would have protected workers' awards

Oct 08 2012
Michael Burling is a former VIHA worker awaiting the schedule of paybacks he has to make on the settlement for being part of the mass firing by Gordon Campbell in 2004. 

Michael Burling is a former VIHA worker awaiting the schedule of paybacks he has to make on the settlement for being part of the mass firing by Gordon Campbell in 2004.

Photograph by: Bruce Stotesbury, Times Colonist , Times Colonist

It took hospital unions, health authorities and the province four months to grind out a deal to pay $85 million after 9,000 workers were fired in 2002 in the wake of Bill 29.

So somewhere in that deal, dating to early 2008, there should have been an indemnity agreement that anticipated and remedied the clawback now faced by 2,200 former hospital union workers whose jobs were contracted out, says Royal Roads business professor Terry Power.

The clawback affects only workers who claimed employment insurance benefits at the time.

Among them is Victoria resident Michael Burling, 60, who worked at Royal Jubilee Hospital for 30 years and received benefits for 30 weeks after he lost his job.

He said he'll exhaust his life savings to pay back $6,800 of the $8,200 he received from a pot of $68 million paid directly to former employees.

Ottawa views the money as earned income, meaning employment insurance benefits were overpaid.

"It's not his fault," Power said. "So the question is: Who let him down?"

The Hospital Employees' Union interprets the payments as an award for the violation of members' constitutional right to freedom of association, as determined by the Supreme Court of Canada in 2007.

The Employment Insurance Commission's view that the money is earned income has survived two appeals.

In April 2012, umpire Guy Goulard said that even if Andrea Rachel, a former hospital housekeeper, had the right to damages for losing her job due to unconstitutional legislation, "no such damages were awarded or referred to in the agreement that led to the payment of the money she received."

Goulard said the evidence "clearly established that the money was paid for loss of employment and income."

Power, who also holds a law degree, says caretakers and housekeepers should not be penalized for the possible shortsightedness of lawyers who put the settlement agreement together.

The union's lawyers should have turned their minds to the possibility of a clawback and included an indemnity agreement, he said.

"It's pretty hard to come back later and say, 'We intended that to be in there,' " Power said.

Mike Old, spokesman for the Hospital Employees' Union, said he is convinced that the union did everything to get the best agreement it could during the closed-doors discussions.

"We're very confident that we pursued every angle that we could during those in-camera talks," Old said.

He called Power's view "an interesting academic comment," but said the union is "absolutely not concerned that we did anything but the best job possible to represent [our members]."

"We pushed the envelope as hard as we could on every aspect of the settlement [negotiations] ... and as a result, we got a very significant settlement for our members."

Power also takes issue with the EI Commission looking at hardship claims by HEU members on an individual basis - as the union says it has been told - rather than as a class action.

"Let's not chew up any more of your money and my money having a hearing for each one of these things," he said.

kdedyna@timescolonist.com

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