Last month, the Divisional Court of the Ontario Superior Court of Justice (Divisional Court) upheld a decision that refused to certify class proceedings for unpaid overtime against the Canadian Imperial Bank of Commerce (CIBC) and CIBC World Markets (CIBCWM).

In Brown v. Canadian Imperial Bank of Commerce, 2013 ONSC 1284, the Divisional Court reviewed Justice Strathy’s April 27, 2012 decision denying certification of a proposed class action for failing to satisfy the certification criteria. The proposed representative plaintiffs, Michael Brown and Brian Singer, alleged that CIBC and CIBCWM had misclassified approximately 5,000 “Analysts”, “Investment Advisors” (IAs) and “Associate Investment Advisors” (AIAs) making them ineligible for overtime in violation of both Ontario’s Employment Standards Act (ESA) and the Canada Labour Code (CLC).

Justice Strathy found that since many of the proposed class members, particularly Analysts, exercised managerial responsibilities, the determination of who was actually eligible for overtime was critical to the case and could not be determined on a common basis – making individual assessment necessary. Aside from job title, the lack of commonality in the proposed class members functions made it unsuitable for a class action.

On the heels of the Ontario Court of Appeal’s “Overtime Trilogy” of class proceedings: Fulawka v. Bank of Nova Scotia, 2012 ONCA 443; Fresco v. Canadian Imperial Bank of Commerce, 2012 ONCA 444; and McCracken v. Canadian National Railway Company, 2012 ONCA 445, which helped clarify certification criteria, the plaintiffs appealed Justice Strathay’s decision with a revised class definition encompassing only IAs and AIAs in an attempt to exclude supervisory and/or managerial employees.

In dismissing the appeal, the Divisional Court relied on the Court of Appeal’s analysis in McCracken which stated that class action was the appropriate procedure for misclassification cases “where the similarity of job duties performed by class members provides the fundamental element of commonality.” The Divisional Court noted that the plaintiffs failed to demonstrate that there was a common issue to be tried which would make class proceedings the preferable procedure for resolution. The fact that some proposed class members might have been eligible for overtime did not negate the fact that substantial differences in job duties existed and many IAs and AIAs still performed supervisory and/or managerial functions making individual assessment necessary for determining overtime eligibility.

The Divisional Court’s decision in Brown confirms that the key impediment to certification in misclassification cases is the lack of commonality between class members. Unless the proposed class can demonstrate sufficient similarity in job duties, an individualized assessment of each employee will be required and certification will not be possible.

Matthew Demeo