The Bank of Nova Scotia (“Scotiabank”) has reached a settlement with its employees in a class action involving a claim for unpaid overtime.
In our previous blog posts, we have been following the case of Fulawka v. Bank of Nova Scotia. This case involved a bid by a group of Scotiabank employees to obtain certification for their class action.
The Scotiabank employees alleged that systemic flaws in Scotiabank’s policies and overtime record keeping practices made it impossible for them to claim overtime pay for overtime hours that they were permitted or expected to work. The class action involved roughly 5000 employees and a claim for $350 million in damages related to unpaid overtime.
In a class action proceeding, claimants are permitted pursue their claims as a group, rather than on an individual basis. For an individual bank employee with a small claim for unpaid overtime, the legal fees make it extremely difficult to pursue a claim for unpaid wages. Courts will certify class actions where there are common legal and factual issues among the class members and where allowing claimants to pursue their case as a group would promote access to justice and judicial economy, among other factors.
The employees’ claim was first certified as a class action in 2010 by a judge of the Superior Court of Justice. Scotiabank has appealed that decision twice, first to the Divisional Court and later to the Ontario Court of Appeal. In 2012, the Court of Appeal certified the class action proceeding, and found that the motion judge did not err in finding that the claims raised common issues that should be resolved in a class action proceeding. In a related judgment, the Court of Appeal also approved of a bid by CIBC employees to be certified as a class action for unpaid overtime, and found that the motion judge had erred in refusing to certify the CIBC employees’ class action: Fresco v. Canadian Imperial Bank of Commerce, 2012 ONCA 444.
In March 2013, the Supreme Court of Canada dismissed Scotiabank’s appeal of the Ontario Court of Appeal’s decision to certify the class action.
A settlement was reached in July 2014 and was approved by the Court in August 2014. The details of the settlement have not been disclosed. Under the settlement, individual Scotiabank employees will be permitted to submit their unpaid overtime claims for evaluation by the bank. If the employees are not satisfied with the bank’s decision, the employees will then have the option of appealing to an independent arbitrator who will adjudicate the claim for unpaid overtime. Under the settlement agreement, Scotiabank has agreed that employees who submit claims for unpaid overtime will not be subject to any adverse consequences in the workplace.