Law Times

Page 10 September 5, 2016 • Law timeS www.lawtimesnews.com Bank cases highlight issues about overtime BY MARG. BRUINEMAN For Law Times T here was no court deci- sion, no profound pro- nouncement from the bench, yet Fulawka v. Bank of Nova Scotia has im- pacted thousands of people di- rectly and possibly many more indirectly. And the class action that saw one of the country's largest banks pay out $39.3 million to about 15,000 employees is expected to open the doors for people work- ing for companies that have failed to pay them overtime. "It is a very important case. It will encourage more people to come forward with overtime class actions and overtime claims in general," says Andrew Monk- house, managing partner of To- ronto labour employment firm Monkhouse Law. "I see more employees starting overtime claims now because there's more of a knowledge that you can get compensation." He says settlements resulting from certification have proven they can be worth pursuing. And for the individual em- ployee, being part of a class means that they can still achieve a sense of justice without having to be singled out or even requir- ing them to take an active role. An individual worker is unlike- ly to go after an employer while still employed because of fear of reprisal. "It's become more normal to certify employment cases. I think that's a good thing for ev- eryone," says Monkhouse. Saskatchewan Scotiabank personal banking representative Cindy Fulawka, representing the class, accused the bank of breach- ing the Canada Labour Code's minimum standards of overtime compensation. She also claimed that the bank was unjustly en- riched by keeping money that should have been paid as wages. The class action was launched in 2007. Although Scotiabank admitted no liability or wrong- ful conduct, the bank did agree to settle with a compensation package for its employees two years ago. The settlement was updated earlier this year. Early on, there was some in- dication that the very threat of action prompted large compa- nies to sit up and take notice, says David O'Connor, a partner with Roy O'Connor LLP, where he practises general commercial litigation. O'Connor acted as a lead lawyer along with Sotos LLP and Goldblatt Partners LLP in the Scotiabank case. "When we launched both the Scotiabank and the CIBC cases, at that time, 2007-2008, I heard from a number of colleagues, mostly in the legal profession but some in the corporate world, telling me that the fact that the cases were launched themselves caused various corporations to review and re-analyze their own overtime policies and practices," says O'Connor. "So the very launching of the case may have had a positive effect on employ- ers that has gone unseen. "The ground that we have plowed with these cases I think has opened up a new exposure for employers of corporations that previously I don't think was really there." The same year Scotiabank was launched, another class ac- tion was launched against CIBC involving close to 30,000 people demanding payment for over- time. Classification initially failed, but it was successful fol- lowing the second appeal before the Ontario Court of Appeal. CIBC returns to court in De- cember for a summary judg- ment motion by the plaintiff. In Fresco v. Canadian Im- perial Bank of Commerce, for- mer customer service represen- tative Dana Fresco complained on behalf of the class, much like those involved in Scotiabank, that she was owed overtime. Attention to the cases has served as something of an edu- cation to many on salary who previously weren't aware they had the right to be paid for over- time work. O'Connor says he has learned during the intervening years that people feel compelled to work longer without addition- al compensation to get ahead, to not be perceived as a problematic employee or they're putting in extra hours trying to hit targets. Despite the successful out- come of Scotiabank and the positive attention it has attracted, Monkhouse says there's no true indication that class actions in- volving overtime will be univer- sally successful in the courts. In fact, the message coming out of certification hearings is mixed. He points to McCracken v. Canadian National Railway Company, which was not suc- cessful in classification. In the class action application by former CN employee Michael McCrack- en representing about 1,500 workers heard by the Court of Appeal at the same time as CIBC and Scotiabank, the court found a problem with the lack of com- mon issues making it difficult for a class action. Part of the problem in Mc- Cacken is the issue of misclas- sification, where many who were identified as being management were identified by the defence as employees and should, there- fore, be part of the class, result- ing in more individual issues. The challenge of misclas- sification cases is that layer of individualized assessments that is required, making it difficult for a class to proceed, observes Chris Naudie, a partner with Osler Hoskin & Harcourt LLP in Toronto. "The courts in this trilogy of cases (Scotiabank, CIBC and McCacken ) have indicated that off-the-clock transactions that are based on systemic practices are more susceptible to class, more amenable to class certifica- tion," says Naudie. LT FOCUS David O'Connor says two cases against major banks for unpaid overtime 'has opened up a new exposure for employers.' 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