Overtime Class Actions Gaining Traction in Canada: Is the Oil Patch Next?

Written By Justin Lambert and Christine Plante

On October 12, 2016, a former GoodLife personal trainer filed a class action lawsuit for $60 million in damages under Ontario's Class Proceeding Acts, 1992. The proposed class members include current and former non-managerial employees of GoodLife employed in Ontario since October 2014. The Action alleges, among other things, that GoodLife:

• failed to maintain accurate records of all actual hours worked;
• failed to advise employees of entitlement to overtime pay;
• imposed an unlawful overtime policy; and
• required and permitted employees to work more hours than scheduled, but failed to pay those regular and overtime hours.

This is one of a number of recent high-profile and high-stakes class actions by employees seeking compensation for unpaid overtime. In July 2016, the Ontario Superior Court of Justice approved the settlement of two unpaid overtime class actions filed by BMO Nesbitt Burns Inc. and Bank of Nova Scotia investment advisors (Rosen v BMO Nesbitt Burns Inc., 2016 ONSC 4752, and Fulawka v Bank of Nova Scotia, 2016 ONSC 1576). In both cases, the employers agreed to create a compensation fund ($12 million for BMO Nesbitt Burns Inc. and $93.3 million for Bank of Nova Scotia) and pay the class members' legal fees.

These types of class actions have been more popular in the United States, and entrepreneurial Canadian class actions counsel appear to be taking note.

In the United States, the oilfield services industry is a current target for employment class actions. The common use of blended day rates, independent contractors, and time off in lieu of overtime policies make the industry susceptible to these types of claims, particularly because these practices are often not properly implemented by employers.

In Alberta, many employees and contractors would not have been eager to either initiate or participate in such a class action because of reputational risk and the risk of being "blacklisted" by the industry. However, now that many oilfield workers are out of jobs, these disincentives may not be as great. Time will tell if the combination of an increasingly entrepreneurial Alberta-based class actions bar and out of work oilfield workers leads to an increase in this type of class action litigation.

There are steps employers can take now to mitigate that risk. If you have questions about how to proactively address claims for unpaid overtime, or would like to review employment policies and procedures to minimize exposure to class action lawsuits, please contact members of the Bennett Jones employment and class action teams.

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