In the summer of 2009, many employers let out a sigh of relief when the Ontario Superior Court of Justice refused to certify a proposed class action seeking unpaid overtime that was brought forward by certain CIBC employees (see MT communiqué dated June 24, 2009). The employees are appealing that decision.

Employers may have to take another deep breath, as last week, a different judge of the same Court certified a class action for unpaid overtime allegedly owing to approximately 5,000 sales staff working in the retail branches of Scotiabank (Fulawaka v The Bank of Nova Scotia, 1010 ONSC 1148), leaving the law on this matter once again unsettled. An application for leave to appeal that decision has been filed by The Bank of Nova Scotia. The judge in this case distinguished the CIBC case on certain differences between the respective employers’ overtime policies and hours tracking practices.  

he Canada Labour Code (the “Code”) governs the employment relationship of federally regulated employers such as banks, telecommunications companies, and cross border transportation and shipping companies. The Code provides that employers may not cause or permit employees covered under the Code to work more than 8 hours in a day or 40 hours in a week, must pay overtime where excess hours are worked, and must accurately record all hours worked by such employees and maintain such records.

The Employment Standards Act, 2000 (the “Act”) expressly provides that employees may enforce the provisions of that Act by way of civil action. There is no such provision in the Code, which has its own enforcement mechanisms.

Federally regulated employees covered under the Code who want to enforce the minimum provisions of the Code must bring the proceedings by way of adjudication and not court action. Absent an express provision in the governing statute, a court has no jurisdiction to enforce a claim under that statute. However, the Court held that the minimum requirements of the Code and its regulations (for example the duty to pay overtime and to keep accurate records of hours worked) are implied terms of the employment contract and that an employer may well owe employees a contractual duty of good faith and fair dealing to comply with such provisions, the breach of which can form a civil action.  

In light of the foregoing, employers would be well advised to review not just their overtime policies, but also their practices. It is a good idea to make sure actual hours worked are properly tracked, records are maintained, overtime worked is paid, and that the reasons employees work unauthorized overtime are considered and properly addressed by either changes in work expectations or appropriate performance management.