Time To Look Beyond Overtime — A Survey Of Employment Class Actions In Canada

When the first overtime class actions broke onto the Canadian legal scene in 2007, observers wondered whether this signalled a move toward the class action culture to which U.S. employers have grown accustomed. With the expanded right to overtime under the new federal Fair Labour Standards Act 1(FLSA) — known as the "FairPay Rules" — adopted in 2004, the incidence of overtime class actions has mushroomed in the U.S. To date, attempts to follow this trend in Canada have been met with a lukewarm reaction from the courts. In those cases where overtime class actions have been certified, appeals are pending on the certification decisions, and we have yet to see a case go to trial on the merits.

But while mass overtime claims have occupied our attention over the past several years, that is not the only use for class action proceedings in employment-related claims. The increasing use of class action proceedings to contest unjust dismissals, workplace discrimination — or changes to pension and benefits that affect large groups of employees — could be a concern for all employers, even those who are not at particular risk of overtime claims.

Although the mere mention of a class action is enough to strike terror in the hearts of employers, there may be cases in which class action proceedings may actually serve as a vehicle for achieving final resolution of employment liabilities.

Status of Pending Overtime Class Actions

In stark contrast to the stream of overtime class action cases that make headlines in the United States, there are only four cases pending in Canada where a decision has been rendered — or is expected to be rendered shortly — on certification.2

Fresco v. Canadian Imperial Bank of Commerce,3 a $651-million claim on behalf of current and former non-management, non-unionized retail branch employees who were allegedly required or permitted to work overtime without additional pay as required under the Canada Labour Code. In June 2009, the Ontario Superior Court of Justice refused certification on the basis that the claims of the class members did not raise a common issue that would sufficiently advance litigation proceedings if determined on a class-wide basis. In essence, because there was no evidence of a systemic practice of unpaid overtime, the case would break down into individual inquiries, which was not appropriate for class proceedings. This decision was upheld by the Divisional Court in September 2010 and has now been appealed to...