CIBC and BNS were inherently similar claims, in that they were
"off-the-clock" overtime class actions. The main
issue was not whether the employees at issue were eligible for
overtime, but whether the policy requirement that overtime would
only be paid where employees obtained prior approval, is contrary
to the Canada Labour Code.
Certification was granted because, among other things, in reaching
a decision a trier of fact can focus on the overtime policies, and
not on characteristics of individual class members.
However, the Court refused to grant certification in CNR,
primarily on the basis that it was a "misclassification"
case. The main issue was whether the class members were
eligible for overtime, despite the fact that CNR had designated
their positions as managerial in nature, a category which is
overtime exempt. Certification was denied on the basis that
the issue could only be determined with reference to each class
member's individual factors.
Successful Certification: CIBC and BNS
While both the CIBC and BNS actions were based upon similar
allegations, the respective lower courts arrived at different
conclusions regarding the issue of certification: BNS was
originally certified; CIBC was not. Both were ultimately
appealed and were heard in December 2011. Given the inherent
similarity of the actions and the inconsistency of the lower court
decisions, the Court of Appeal stated that both certification
motions should "succeed or fail together."
In determining that both claims should be certified as class
actions, the Court adopted and made extensive reference to the
analysis of the motion judge in BNS. Ultimately, the Court
held that both cases presented common issues regarding whether the
respective employer's policies and practices prevented a group
of employees from receiving overtime pay.
In both cases, the Court rejected the plaintiffs' claim that
damages be assessed on an aggregate basis. Instead, the Court held
that damages would be determined individually, should the class
members be successful. This means that in order to prove
damages, each individual in the class, whether a current or former
employee, will need to testify regarding the quantity of overtime
pay owing to him or her. This finding is significant, as the
two cases involve approximately 30,000 employees, with damages
claimed in BNS amounting to $350 million, and in CIBC to $500
Unsuccessful Certification: CNR
In contrast, the Court of Appeal denied the request for
certification in CNR. The Court determined that there was no
ability to determine on a class-wide basis whether or not an
individual was a manager and therefore exempt from the overtime
provisions of the Canada Labour Code. In particular, there
were approximately 70 different job positions held by the managers
at issue and there was a significant range in regards to the level
of authority each possessed. Further, such authority varied
greatly depending on where a manager worked.
Thus, the Court held that such a determination would have to be
made on an individual basis, as it would involve a review of the
job responsibilities, reporting functions, and scope of work, each
of which would have to be considered on a singular level.
While the certification judge sought to address this issue by
reframing the common issue such that it sought to establish, in
relation to the Canada Labour Code, what the minimum
requirements were to be a managerial employee are at CN (rather
than determining whether the employees at issue were in fact
managerial), the Court of Appeal determined that this still not
address the fact that individual determinations would need to be
Given the magnitude of the respective decisions, it is
reasonable to assume that most, if not all, will be appealed to the
Supreme Court of Canada. While each of the above-noted cases
arose out of the Canada Labour Code, which applies only to
federally regulated employers and is therefore of relatively
limited direct application, we nonetheless encourage employers to
revisit their overtime policies to ensure that they: (i) meet the
statutory requirements; and (ii) do not create a situation whereby
employees are "permitted or suffered" to perform
unauthorized work in excess of applicable overtime
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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