Isolate Boards – Amalgamation

OVERVIEW

In what is said to be an effort to provide students and teachers from the District School Area Boards (“DSABs”) with the same resources and supports of their District School Board (“DSB”) counterparts, as well as to improve support for Aboriginal students and increase student achievement, the McGuinty government is merging virtually all DSABs with the DSBs.  One of the options for the provincial government was to dissolve the DSABs, which would have resulted in the sale of assets, terminations and school closures. Instead, under the provincial plan, the DSABs will merge with DSBs on September 1, 2009.

Not all DSABs will be merged. The three school authorities located in the lower James Bay area (James Bay Lowlands Secondary School Board, Moose Factory Island District School Area Board, and Moosonee District School Area Board) as well as the Penetanguishene Separate School Board will remain DSABs, for at least some time period.

This report will highlight the important changes to assist School Boards through the merger. The wheels of change have already been set in motion. The legislation that has been drafted to effect the changes is, at face value, relatively simple and very brief. However, there is no doubt that, although simple on its face, the legislation will profoundly alter the educational landscape in Ontario. This restructuring of the northern school boards by the Ontario government is without a doubt Ontario’s largest educational restructuring since the days of Premier Mike Harris.

THE MERGER ON SEPTEMBER 1, 2009: How will it happen?

On September 1, 2009, virtually all of Ontario’s DSABs will merge with one or more corresponding DSBs. To properly understand how the DSABs will be merged with the DSBs, it is essential to understand how the DSABs came into existence.

The DSABs are created in part by s. 59 of the Education Act. Under s. 59, the DSABs’ jurisdiction is limited, essentially, to territorial districts outside the jurisdiction of DSBs. The DSBs jurisdiction is established under provincial Regulation 486/01 (“Regulation 486/01”). Section 4 of Regulation 486/01 parcels-out the various DSBs’ jurisdictions.

The majority of the mergers that will take place on September 1, 2009 will be accomplished in a six part process. All of the parts will occur on September 1, 2009 in this order:

1) The provincial legislature, through Regulation 212/09 has amended s. 4 of Regulation 486/01 to expand the jurisdictions of the DSBs to envelop virtually all of the territorial districts currently under the jurisdiction of the DSABs.

2) The employees of the DSABs will be transferred to the DSBs.

3) Immediately after the employees are transferred to the DSBs, the DSABs and the DSBs will merge.

4) Upon merger, the assets and liabilities of the Isolate Boards are transferred to the DSBs.

5) The interests of electors of the various Isolate Boards are then represented by specific trustees of the DSBs.

6) Former Isolate Board trustees will be “advisors” until November 30, 2010 and will be notified and consulted on matters previously under their jurisdiction, and receive an honorarium until November 30, 2010.

The mergers of the Hornepayne RCSSB, Moosonee RCSSB, Red Lake RCSSB, and Northern District School Area Board to corresponding DSBs will be subject to additional rules under Regulation 486/01 (see below).

Summary

The provincial legislature has restructured the jurisdiction of the DSBs so that virtually every school section currently occupied by the DSABs will be annexed by an enumerated DSB. The DSABs (also called Isolate Boards under Regulation 486/01) will merge with a corresponding DSB (also called a Successor or Receiving Board under Regulation 486/01). See table 1 attached at the end of the report for a list of which Isolate Boards will be merging with which Successor/Receiving Boards.

THE NEW REGULATION: Tweaking the merging provisions

On August 14, 2009 the Ontario government filed a new regulation (Regulation 309/09) which had the effect of further amending Regulation 486/01. The most salient provisions of Regulation 309/09 are as follows:

• merging each of the Hornepayne RCSSB, Moosonee RCSSB, and the Red Lake RCSSB into a respective English and French DSB
• allocation and distribution of the Hornepayne RCSSB, Moosonee RCSSB, and the Red Lake RCSSB assets, resources, personnel and liabilities to the English and French DSBs
• merging the Northern District School Area Board into not one but two DSBs
• allocation and distribution of the Northern DSAB assets, resources, personnel and liabilities to two receiving DSBs
• the treatment of DSAB Trustees
• the treatment of the Northern School Resource Alliance.

These provisions are dealt with in greater detail below.

THE  TRANSITION TEAMS

The provincial Government created “Transition Teams” that are currently working with both the DSABs and the receiving DSBs.   The teams are comprised of Ministry of Education staff in a variety of branches – Transfer Payments and Finance Branch, Capital Programs, Field Services, plus others.

The teams are led by Education Officers in the Ministry Regional Offices to which the DSABs are attached (Barrie, Thunder Bay, Sudbury/North Bay and Ottawa).

The Transition Team Leaders are located in Thunder Bay, one in Sudbury/North Bay and one in Ottawa.  The Leaders work the other members of the Transition Team to respond to questions that put forth from the DSABs and DSBs and to facilitate the merging process.. They are described by the Ministry as the “go to” person for the School Boards. The teams will remain in place following September 1, 2009 when the mergers take effect and will stay in place as long as necessary.

EFFECTS OF THE MERGER

The effects of the merger will be both dramatic and substantial. The effects will be especially important in relation to education labour and employment relations and education governance. Unfortunately, as mentioned above, the legislation responsible for affecting the merger is silent on several pertinent issues that will have to be addressed by the School Boards in the upcoming months or even years. The remainder of this report attempts to present the more salient consequences of the merger on both the DSABs and DSBs alike. These issues are:

1. Interim restrictions on DSABs;
2. Integration of former DSAB non-unionized employees;
3. Integration of former DSAB unionized employees;
4. Treatment of former DSAB Trustees;
5. Allocation and distribution of DSAB assets, and liabilities of DSABs;
6. Treatment of the Northern School Resource Alliance;
7. Funding for DSBs going forward.

1.  Interim Restrictions on the DSABs

Beginning May 31, 2009, virtually all DSABs were prohibited from engaging in certain conduct by way of s. 13.5(1) of Regulation 486/91. The regulation essentially freezes the DSABs and prohibits them from, amongst other things, incurring liabilities, conveying or acquiring property, entering into contracts, making certain payments, appointing or hiring new persons. The DSABs will be permitted to engage in such activities, however if they first obtain approval from the Minister or it is done in accordance with the board’s estimates of its revenues and expenditures prepared under subsection 231 (1) of the Education Act for the 2008-2009 school year, as reviewed by the Minister. See Appendix A for s. 13.5(1) in its entirety.

These restrictions are extensive and it is important to note that a  DSAB that engages in any of the enumerated activities may create significant legal problems not only for itself, but for its successor board.

2. Integration of non-unionized DSAB employees

The legislation affecting the merger is largely silent with regard integrating non-unionized DSAB employees into the DSBs. Regulation 486/01 (the Regulation which affects the merger) says that the Boards will “merge” and that the DSABs’ employees’ contracts of employment, along with all of the rights, benefits and obligations thereunder will be assumed and continued by the DSBs. Apart from these provisions, the legislation does not disclose how a DSB may appropriately deal with the transferred employees and union bargaining agents.

With the absence of statutory guidance under the Education Act and its Regulations, the issues surrounding the integration of non-unionized DSAB employees will be dealt with via provincial employment legislation (the Employment Standards Act and its Regulations),  the common law, and in compliance with the terms of the DSABs’ employment contracts (written or oral).

Some issues that we anticipate the DSBs will face in relation to the integration of non-unionized employees include:

• relocation of employees
• parity of wages/salaries between existing and incoming employees
• potential terminations of employment of incoming DSAB employees and notice periods
• severance if termination is necessary
• potential Employment Insurance issues
• vacation pay

Summary

On September 1, 2009 all of the non-unionized employees employed by the DSABs before June 1, 2009 will become employees of the Successor Boards, and all of the DSAB non-unionized employees will continue to have the same rights.

3. Integration of former DSAB unionized employees

The Ontario Labour Relations Act (“OLRA”) and the Education Act set-out provisions which govern the treatment of collective bargaining units, agents and agreements when two or more educational entities merge in Ontario.

The Education Act and OLRA apply to Teachers, their unions and their collective agreements. The OLRA applies to all non-Teacher collective bargaining units, their unions and their collective agreements.

The ORLA

In the event of a merger, the OLRA and Regulation 309/09 of the Education Act preserves the existing unions rights. A union which has been certified or has given or is entitled to give notice to bargain continues to be the bargaining agent for the employees of DSABs. Furthermore, the DSB occupies the same position as DSAB with respect to any collective agreement in effect or any certification or termination application pending before the Board.

However, the merger of School Boards may give rise to a number of issues affecting a union’s bargaining rights, as where

• two different unions representing employees performing similar work;

• a claim is made that a conflict exists between the bargaining rights of the union which represented the employees of the DSAB and the union which represents the employees of the DSB, and whether one union should represent all workers;

• should non-union employees be part of existing collective agreements?

Teachers

The effect of the merger on Teachers’ unions will be similar to that of their non-teacher unionized counterparts. An important difference to note is that unlike their non-teacher counterparts, the Education Act establishes teacher bargaining units for both district school boards as well as school authorities. Likewise, the Education Act specifically matches the statutory bargaining units with unions, i.e. ETFO and all elementary school teachers at a Board. As such, when the Boards merge, there will be no issue as to what constitutes a teachers like bargaining unit, as the bargaining units will be provided for by statute (the Education Act). How and when differing collective agreements for the same teacher group will be merged will require additional DSB labour relations work.

Summary

The effects of the merger on unions are far too substantial and context specific to go into in any greater detail in the report. The important thing to note is that the merger will effect both Teachers’ unions and non-teachers unions in similar and different ways, and moreover, both can be affected substantially.

4. Treatment of former DSAB Trustees

Section 13.6.3(1) of Regulation 309/09 has the effect of removing the current Isolate Board Trustees from their positions as Trustees and replacing them with DSB Trustees. Section 13.6.3(1) outlines which DSB Trustees will be taking over from the former DSAB Trustees.

However, under s. 13.6.3(2) of Regulation 309/09, the former DSAB Trustees will have a right to be “notified of and consulted on any matter considered by the members of its successor board that would have been within the jurisdiction of the isolate board before its merger with the successor board” until November 30, 2010. Furthermore, the former Isolate Trustees will continue to receive their honoraria until November 30, 2010, but they will not be receiving an expense allowance after September 1, 2009.

5. Allocation and distribution of DSAB assets, and liabilities

Section 13.6.1(1) of Regulation 309/09 deals with the distribution of the former Isolate Boards’ assets. Under s. 13.6.1(1), with the exception of four Isolate Boards, all assets and liabilities of the former Isolate Boards will be transferred to the Successor Boards from the Isolate Board.

The Isolate Boards subject to the exception are as follows:

• Hornepayne Roman Catholic Separate School Board,
• Moosonee Roman Catholic Separate School Board,
• Northern District School Area Board
• Red Lake Area Combined Roman Catholic Separate School Board.

(a) Splitting of Hornepayne RCSSB, Moosonee RCSSB, and the Red Lake RCSSB

Under the Regulation 309/09 Hornepayne RCSSB, Moosonee RCSSB, and the Red Lake RCSSB will be merging with one English School Board and one French School Board. You will note that the government has chosen to name one of the succeeding boards a “Receiving Board”. It appears that a Receiving Board is functionally identical to a Successor Board. The mergers will be as follows:

• Hornepayne RCSSB merging with the Northeastern Catholic DSB (English), and the CSD des Grandes Rivières (French);

• Moosonee RCSSB merging with the Northeastern Catholic DSB (English), and CSD des Grandes Rivières (French); and

• Red Lake RCSSB merging with the Kenora Catholic DSB (English), and CSDC des Aurores boréales (French).

(b) Splitting of Northern District School Area Board;

On September 1, 2009 the Northern District School Area Board (“NDSAB”) will merge into one Successor Board and One Receiving Board; namely, the Lakehead District School Board and the Keewatin-Patricia District School Board. Education Act, Regulation 295, which sets out the rules pertaining to the composition of the NDSAB will be revoked September 1st, 2009.

(c) Distribution of Hornepayne RCSSB, Moosonee RCSSB, Red Lake RCSSB and Northern District School Area Board assets and liabilities

The distribution of the Hornepayne Roman Catholic Separate School Board’s, the Moosonee Roman Catholic Separate School Board’s, the Northern District School Area Board’s and the Red Lake Area Combined Roman Catholic Separate School Board’s assets are outlined under s. 13.6.1 (1) paragraphs 1 through 5. A copy of these provisions is attached as Appendix B.

6. Treatment of the Northern School Resource Alliance

The Ontario government has added a specific provision under Regulation 309/09 dealing with the treatment of the Northern School Resource Alliance (“NSRA”). Under s. 13.6.1(2) and (3) the government has appeared to transfer at least financial management of the NSRA to the Lakehead District School Board (“LDSB”). We say “appeared” to have transferred because the provisions do not explicitly transfer management and control to the LDSB. Instead, the legislation provides that on September 1, 2009 the “financial obligations” of the NSRA members will be transferred to the LDSB to be held in trust on behalf of such members. The LDSB is to ensure that the NSRA provides the services it has contracted to provide the NSRA members until those services are no longer needed. After the NSRA has provided those services, the LDSB is to wind-up the NSRA. Interestingly, other bodies such as the AFGM (Asquith-Garvey, Foleyet, Gogama, Missarenda) School Boards Co-Operative Services Program and NEOSA (North Eastern Ontario School Authorities) are not dealt with by the new Regulations, even though similar issues may require similar treatment.

7. Funding for DSBs going forward

The legislation responsible for effecting the merger is silent on the issue of funding, going forward. Rather, it appears that the method the provincial government will adopt to address the mergers will be through amendments to the Grants for Students program and EPO grants.

The Supported Schools Program is very likely to continue. The money disbursed under this program, though transferred to the Successor Boards, will be earmarked for the specific DSAB schools going forward. Finally, there also does not appear to be amendments to the Territorial Student Program which operates for certain areas located in Northwestern Ontario.

SUMMARY

In its effort to provide DSAB students and teachers with better resources and supports the McGuinty government will merge all DSABs with the DSBs on September 1, 2009. Despite the relative simplicity of the legislation drafted to effect the change, the implications of the upcoming merger will be far reaching, and will undoubtedly raise significant work loads as DSBs attempt to provide and be seen to provide the services and representation the Isolate Boards have provided locally in the past. Start your engines….

• Appendix A
• Appendix B
• Table

No information contained here or on our web site should be expected to take the place of professional legal advice.  Laws and government policies are subject to frequent change. Accordingly, the firm of Cheadles LLP cannot assume any responsibility for actions taken solely or principally on the basis of the information contained herein.