Canada: Ontario Superior Court Dismisses Overtime Class Action Claim Brought Against CIBC In Fresco v. Canadian Imperial Bank Of Commerce

The Ontario Superior Court is currently considering several proposed class action claims for unpaid overtime. Last week, the court dismissed the first contested certification motion in this series. On June 18, 2009, the Ontario Superior Court dismissed a certification motion brought by Dara Fresco on behalf of a proposed class of front-line service workers in branches of the Canadian Imperial Bank of Commerce (CIBC) seeking damages for allegedly unpaid overtime. The court refused to certify the claim, finding that there was no evidence of systemic wrongdoing by CIBC and that claims for unpaid overtime were individual in nature and should be resolved on an individual basis.


The plaintiff sought damages estimated at $500 million for unpaid overtime on behalf of a large proposed class consisting of current and former non-management and non-unionized employees of CIBC working in front-line customer service at retail branches across Canada. Additionally the plaintiff claimed $100 million in aggravated, exemplary and punitive damages.

The plaintiff alleged that CIBC had systemically failed to compensate eligible employees for overtime as required by both the Canada Labour Code (CLC) and their employment contracts. In particular, the plaintiff alleged that CIBC's overtime policy was illegal because it required overtime to be pre-approved by management. The policy also gave employees who had worked authorized overtime the option of taking time in lieu instead of payment of overtime pay. The plaintiff's claim was based on breach of contract and unjust enrichment.

CIBC agreed that the proposed class was statutorily entitled to be compensated for overtime, but it maintained that there was no evidence of a systemic failure to adhere to its obligations.

Certification Denied

The court held that CIBC's overtime policy, which required pre-approval, was not illegal. To the contrary, the court found that the CLC contemplated an employer's right to pre-approve overtime as a way for an employer to meet its statutory obligation that an employee not exceed an overall maximum hours of work per week.

The court also found that offering employees the option of time in lieu or overtime pay was not illegal, as it provided contractual benefits that were more favourable to employees than the statutory guarantees in the CLC.

The plaintiff's claim failed on the common issues requirement. The court found that the individual issues in the case were "front and centre" and it would be almost impossible to engage in a common issues trial without an individual examination of the specific circumstances for each class members' claim. In the court's view, the main deficiency in the plaintiff's claim was its assertion that commonality arose from the illegality of the overtime policy itself and its pre-approval requirement. Although the court concluded that the policy was legal, it held that even if it had found to the contrary, the resolution of this issue would not advance any of the claims for unpaid overtime. The court found that the pre-approval requirement did not cause the wrongs that were alleged, but rather that required or permitted overtime worked may not have been paid. Liability hinged on the application of the overtime policy and the existence of a systemic practice of failing to pay overtime, not on the legality of the policy itself. On the facts of this case, the plaintiff was unable to provide sufficient evidence to demonstrate a systemic failure to pay overtime when required.

Ultimately, the court concluded that "the central flaw in the plaintiff's case is that instances of unpaid overtime occur on an individual basis" and the lack of commonality which was demonstrated by the evidence "[could not] be overcome by certifying an issue that asks whether the defendant had a duty to prevent a series of individual wrongs."

Implications of the Decision

The court made several key findings and observations that will have implications for the other overtime class actions before the court.

(1) "Misclassification" Versus "Off-the-Clock"

There are two general types of unpaid overtime claims. This decision is an example of what the court described as an "off-the-clock" case, in that the key issue is whether the plaintiff has led evidence of systematic unpaid overtime. In such cases, eligibility for overtime is not itself at issue. The second type of case is one of "misclassification" and involves an allegation that the employer has improperly classified employees who are eligible for overtime as being ineligible because of their managerial status (or otherwise). The court in Fresco takes care to distinguish the two types of cases, and future plaintiffs can be expected to argue the court's comments in Fresco suggest that commonality is more easily established in a misclassification case. However, it is important to note that these comments were made in obiter dicta without analysis of many issues. For example, the court's comments rest on the "assumption" that the job duties of the proposed class members are identical or similar. This may or may not be a source of debate amongst the parties in a misclassification case.

The court's decision suggests that the individual nature of overtime claims will make it difficult for any plaintiff to establish commonality in an "off-the-clock" case where statutory entitlement to overtime is conceded.

(2) Preferable Procedure

The court was persuaded by the plaintiff's argument that a class proceeding was preferable, despite the fact that the defendant had pointed to several means by which employee complaints could alternatively be addressed.

Specifically, the court held that the other means available to employees to raise concerns about their employment situation – for instance through an internal escalation process, or by filing a complaint with Human Resources and Social Development Canada ("HRSDC") – did not sufficiently address the objectives of class proceedings, namely access to justice and behaviour modification, to negate the preferability of a class procedure. In particular, the court found that the HRSDC's jurisdiction does not include investigating breaches of an employer's overtime policy or adjudicating claims for breach of contract and unjust enrichment. The court also noted that a power imbalance in the employment relationship may affect employees' decision to use alternative processes.

Defendants may want to consider leading further evidence on the effectiveness of alternative means for complaint resolution, including evidence of the desirability of the HRSDC complaint process, to support a preferred procedure argument in the future.

(3) Evidentiary Considerations

The court rejected the plaintiff's survey evidence regarding other class members and their experiences working unpaid overtime, on the grounds that this evidence was inadmissible hearsay. The court's adherence to the normal rules of evidence will provide certainty for both parties in the future on certification motions.

The court rejected the expert evidence led by the plaintiffs, on the basis that it spoke to general industry conditions and not to the specific experience at CIBC. In respect of two of the expert reports, the court commented:

"[i]t is not enough to show that there are problems with unpaid overtime at banks and credit unions and that CIBC is a bank in order to create some basis in fact that there is a problem of unpaid overtime at CIBC. This claim is not advanced against the banking industry, but against CIBC."

This observation may have an impact on parties' willingness to rely on this type of evidence in the future, given the significant expense associated with it.

The court also underscored the importance of cross-examination to test the evidence put forward by the parties. Three of the plaintiff's affiants refused to be cross-examined, and the court did not consider their evidence as part of its analysis. It will be important in the future for parties to assess the strength of their affidavit evidence as well as their affiant's availability and willingness to be cross-examined before materials are filed.


There is no question that the decision in Fresco will influence the existing overtime class actions currently before the Ontario court as well as any future overtime claims. Given the significance of this decision as well as its precedence, one would expect the plaintiff to exercise her right to appeal to the Divisional Court.

Larry Lowenstein is the Chair of the Osler Litigation Department. He is a member of the Corporate Securities and Class Actions Speciality Group. Laura Fric is a partner in the Litigation Department in the firm's Toronto office. She practises corporate-commercial litigation, specializing in defending class actions. Denise Sayer is an associate in the Litigation Department in the firm's Toronto office. Adam Hirshis an associate in the Litigation Department in the firm's Toronto Office.

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions