Kelowna Modular Home Builder Fined for Violating Union Wage Agreement

In a significant arbitration ruling, SRI Kelowna, a company specializing in the construction of modular homes in Kelowna, has been ordered to compensate the union representing its workforce, United Steelworkers Local 1-423, with a payment of $30,000. This decision was reached after it was determined that the company had not adhered to the terms of the collective bargaining agreement it had negotiated with its employees.

The dispute originated in February 2022 when the union lodged a grievance against SRI Kelowna. The crux of the issue was the company’s unilateral adjustment of the wage scale, a move executed without the union’s authorization and in direct contravention of the collective bargaining agreement finalized in December 2021. According to the union, this adjustment not only undermined the agreement but also sowed seeds of discontent among the workforce.

SRI Kelowna attributed this oversight to an “innocent mistake,” arguing that the difficulty in attracting new staff and retaining competitiveness in the market led to this predicament. The company’s response to a significant backlog, which had surged by 220%, was to engage a third-party recruiter and seek assistance through the Temporary Foreign Workers Program (TFWP). To qualify for the TFWP, SRI Kelowna advertised positions at a starting wage of $20 per hour, exceeding the minimum wage of $18.27 per hour stipulated in the collective bargaining agreement for new employees within their first 60 days, effective from July 1, 2021.

This wage discrepancy triggered the labor dispute, culminating in the arbitrator’s decision to award the union $30,000 in compensation for the breach. Furthermore, the union’s request for additional compensation for more senior employees was partially met, with SRI Kelowna ordered to disburse $1,500 to each full-time employee as of January 12, 2022, who had not received compensation above the collective agreement rate.

Arbitrator Randall K Noonan’s ruling emphasized that while no employees were paid below the agreed rates, the lack of transparency from the employer deprived more senior employees of the chance to negotiate higher wages. Noonan’s decision also included a provision to reserve jurisdiction over any issues arising from the interpretation or implementation of this award, ensuring that any subsequent disputes would be addressed promptly and fairly.

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