The Rise of Employment Class Actions?

As we discussed in an earlier blog post, a class action alleging BMO Nesbitt Burns failed to pay overtime to its current and former investment advisors was certified in August 2013. Rosen is the first certified class action where the plaintiff class alleges that they were “misclassified” as managerial or supervisory employees. The other certified overtime class actions involved allegations that the employer failed to record or pay overtime to otherwise entitled employees.

BMO Nesbitt Burns sought leave to appeal the decision to the Divisional Court (unsuccessful defendants do not have an automatic right of appeal from certification decisions). On December 17, 2013, Justice Harriet Sachs dismissed the motion, effectively sending the class action onto trial.

The test on a motion for leave to appeal is onerous: the moving party has to demonstrate that there is a conflicting decision or there is “good reason” to doubt the correctness of the decision.

Seemingly fortunate for BMO Nesbitt Burns, CIBC successfully defended an overtime misclassification class action involving investment advisors in April. Justice Sachs didn’t accept that Brown v Canadian Imperial Bank of Commerce was a conflicting decision. To be a conflicting decision the judges have to have applied different legal principles. In her view, Brown and Rosen relied on the same law but are different on the facts. BMO Nesbitt Burns also tried to argue, to no avail, that the certification decision was likely incorrect because the motion judge misapprehended some of the evidence.

Though it is likely cold comfort to BMO Nesbitt Burns, the Court of Appeal for Ontario granted leave to appeal in Brown in September.