Cancelled: How a local TV station destroyed a union

by Brad Walchuk
CUPE Local 1281 member

Upwards of 100 workers and community allies gathered in Hamilton, Ontario on February 29, 2016 for a rally in support of the roughly 170 unionized workers (Unifor Local M-1 Hamilton) at “CH”, a local Hamilton television station, who were terminated without cause in mid-December 2015 as part of what appears to be an orchestrated bankruptcy in a deliberate attempt by Channel Zero (CH’s parent company) to rid itself of the union. As former NDP MP Wayne Marston told the crowd at last week’s rally, “if it smells like union busting, it is union busting.”

Hamilton rally for CH workers, February 29 2016
Hamilton rally for CH workers, February 29 2016

The rally itself was well-attended and featured speakers from Unifor, the local labour movement, Hamilton MPPs Monique Taylor and Paul Miller, Niagara Falls MPP Wayne Gates, former Hamilton MP Wayne Marston, as well as union members represented by a variety of unions, including Unifor, USW Local 1005, UFCW, CUPE, the American Federation of Musicians Hamilton local, and others, who all condemned channel zero for its mass termination. As Hamilton and District Labour Council President Anthony Marco said, Channel Zero has “zero respect for its workers, zero respect for seniority and zero respect for workers’ rights.”

“A bloodletting”

129 full-time workers and 38 part-time workers, including both behind-the-scenes staff and on-air personalities, first became alarmed on December 11, 2015 when they noticed an additional sum of money in their accounts. This money ended up being accrued vacation and outstanding expense payments. Later in the day, they were informed that their employer, Channel 11 L.P. – an entity created in 2009 to produce local news for CH – had declared bankruptcy. At 4 p.m., the station cut off its live news content. Roughly 80 of those employees were immediately offered jobs with a new company. All the companies appear to be owned by the same parent company, Channel Zero. As of December 14, 2016, CH began broadcasting 17.5 hours per week of local news, a drastic drop from the previous 80 hours per week.

Former on-air personality Donna Skelly, a Unifor member (and interestingly a former provincial Progressive Conservative candidate under Tim Hudak) who spoke at the rally after losing her job referred to the restructuring as “a bloodletting,” while former news reporter Lauran Sabourin – who worked at CH for 30 years before her abrupt termination – expressed that she hoped for something more than “just being kicked to the curb.” Former reporter Cindy Csordas tweeted simply “I need a job.”

This exercise in corporate restructuring and union-busting is indicative of a situation far bigger than simply 170 workers losing their jobs without any notice, which in itself is a serious issue. The bigger issue is that Channel Zero appears to be playing fast-and-loose with both labour and bankruptcy laws, simply bankrupting one subsidiary, creating another subsidiary company, and hiring back only a portion of the former employees without the previous collective agreement. When a company is declared bankrupt, seniority rights under the collective agreement, which effectively ceases to exist, do not apply as – narrowly – there is nothing to apply them to. Similarly, severance pay (both legislated and anything additional granted under the former collective agreement) is theoretically available, but employees tend to end up at or near the bottom of the list of creditors, and generally do not see any money as the company is bankrupt. There is certain logic to this, albeit flawed and terribly unjust to workers, in the event that an independent company is legitimately bankrupt- but that appears to be the exact opposite of what has occurred at CH.

Channel Zero’s union busting

The news still continues, albeit less frequently. It is filmed and told by some, though not all, of the former employees (and certain not reflective of those with seniority rights under the collective agreement). Finally, Channel Zero, seemingly the parent company to all of these subsidiaries, continues to exist, operate, and presumably profit. A company playing fast-and-loose with bankruptcy to undermine workers’ entitlements – something all too familiar to Hamiltonians – has reared its ugly head once again.

imageSimilarly, it appears that Marston’s allegations of union busting are entirely true. In a leaked e-mail that was released shortly after the terminations, an account manager with CH noted to what appears to be a (perspective) client that “we just need to disband the previous company and form a new one where changes could be made, free from old Union employees and their demands…”. Although a public relations firm working for Channel Zero dismissed the e-mail as “just one person’s opinion,” a vice-president with Channel Zero has confirmed that, from his company’s perspective at least, a relationship between CH and a union “remains to be seen.”

In the case of CH workers, what appears to be a desire to break the union – something nominally illegal under the Canada Labour Code – is being facilitated by a legal loophole in bankruptcy law. In so doing, the Employer also seems to be avoiding the payment of severance pay (or notice in lieu). Essentially, an Employer is seeking to legally achieve under one law what it cannot legally achieve under another: to bust a union. In this sense, the issue is much bigger than the 170 terminated workers, as it may set an alarming trend if ultimately successful. In the short-term, many of the former workers find themselves without employment and are scrambling to secure work, a fact made worse by the absence of severance pay.

Successor rights

In the long-term, there will be a lengthy legal battle to secure the rights of the terminated workers. Unifor has stated that the new company, apparently also owned by Channel Zero, is a “successor corporation,” meaning that any collective agreement in place (and the rights and obligations contained therein) transfers to the new Employer. The union has added that “they can voluntarily recognize us, or we can argue in front of the Labour (Relations) Board.” At this point, it appears that the latter option is the route that Unifor will be forced to pursue, at least for continued representation of the existing employees at CH.

The resolution to this dispute has important implications for workers across the country as it jeopardizes hard-fought rights and benefits contained in collective agreements, as well as basic access to good employment. This is especially true in the private sector where the existence of small numbered subsidiaries of the same parent company is a reality. In the long run, it is hopeful – and perhaps even likely – that the court will find that Channel Zero is a successor employer, leading to severance pay for the terminated employees and a collective agreement with the new Employer.

A positive decision for the Union in this case is not important only for the now former CH employees, but also for workers across the country, as employers may become emboldened to try the same tactics if a weak decision that allows Channel Zero to skirt around what should be its legal obligations. As Unifor Local M-1 President Phil Fraboni, who lost his job in December told the crowd, “We need to tell government representatives that this can’t happen again. If it happens with this small company, what’s to stop large corporations?”

In that sense, not only is a strong decision from the Canada Industrial Relations Board (or the federal courts on the bankruptcy front) needed, but so too is legislative change that both strengthens workers’ rights and access to severance pay (and other entitlements) under bankruptcy law and bolsters successor rights in the event of a transfer of ownership, especially in the case of a subsidiary-parent corporation.

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