Employment Class Actions in Ontario: where are we now and where are we headed?

Where are we now?

It has been nearly nine years since the Ontario Court of Appeal’s unpaid overtime class action certification trilogy (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) was released, settling the law regarding certification of unpaid overtime and employment misclassification class actions. With the benefit of the intervening years, what can be said now about the state of employment class actions in Ontario?

The starting point is that any initial skepticism regarding the viability of misclassification class actions post-McCracken has been dispelled. These cases have flourished, and become commonplace. While not all such cases have been successful,[i] Ontario courts have now certified misclassification claims in a wide range of industries and contexts, including with regard to:

• the misclassification of investment advisors as overtime-exempt managers;[ii]
• the misclassification of salespeople as independent contractors;[iii]
• the misclassification of document reviewers as independent contractors;[iv]
• the misclassification of cable and internet installers as independent contractors;[v]
• the misclassification of teachers as independent contractors;[vi]
• the misclassification of major junior hockey players as amateur student athletes, interns/trainees or independent contractors;[vii] and
• the misclassification of “trip leaders” on student vacation packages as volunteers.[viii]

As employment class actions continue to expand in Ontario, they have increasingly involved an array of complex issues, such as directors’ liability, and common employer claims against multiple defendants,[ix] including claims arising in the context of franchise relationships[x] and sales of businesses.[xi] These developments suggest that the class action vehicle has proven adaptable to seek recovery across a spectrum of circumstances.

Speaking qualitatively, employment class actions have been an effective and workable method for the resolution of unpaid wage and overtime claims. As a primary matter, given the settled state of the law, these claims are increasingly being certified on full[xii] or partial[xiii] consent. After certification, recent settlements have distributed millions of dollars to classes of workers.[xiv] This is particularly significant given the low rate of individual complaint filing and the dismal record of the Ontario Ministry of Labour, Training and Skills Development (the “Ministry”) in enforcing employment standards, discussed further below.