Ontario’s Superior Court of Justice recently certified an unpaid overtime class action against Canada Cartage, a national trucking and distribution company. The claim could be worth more than $100 million. On June 15, 2015, the Court refused the employer’s application for leave to appeal the certification.
The class action is brought on behalf of approximately 7,800 current and former federally regulated employees who worked for the company between March 1, 2006 and the date of certification and who were entitled to receive overtime compensation under the Canada Labour Code.
One of the main issues at the certification hearing was whether the employer had a systemic policy or practice of avoiding or disregarding obligations to pay overtime. In deciding to certify this as one of the common issues, the Court pointed to a number of factors suggesting such a systemic practice may be in place:
- the employer had no written overtime policy during the relevant period;
- no document existed that employees could consult to learn how their overtime entitlement would be established;
- the employer never issued any written directives to managers, supervisors or payroll about how to apply overtime rules;
- a senior human resources director admitted that the mixed employment rules and their application were “quite a gray area” for her; and
- the employer did not coordinate or standardize its payroll process to determine what overtime thresholds applied.
The certification of this class action, and the Court’s refusal to grant leave to appeal, highlight the importance for employers of having effective, enforceable and compliant policies relating to overtime work by employees.
Questions relating to the content of this article may be directed to Matthew Cooperwilliams.