Class-action lawsuits against CIBC and Scotiabank seeking hundreds of millions of dollars for unpaid overtime can go ahead, the Ontario Court of Appeal ruled in a pair of decisions Tuesday.
The suits allege thousands of workers were denied overtime pay even though they were assigned more work than could be completed within their standard hours. The cases come amid a slew of similar cases over wage and hour issues south of the border.
"The proposed common issues raise the requisite degree of commonality for purposes of certification," Chief Justice Warren Winkler wrote in the decision on the Scotiabank (TSX:BNS) case.
"I also agree that a class proceeding is the preferable procedure for resolving these issues."
A lower court had denied class action status to the CIBC (TSX:CM) case, while a different court had allowed class action status be granted to the Scotiabank lawsuit.
However, the Appeal Court felt both cases, which have not been proven in court, should be handled the same way.
In the CIBC case, teller Dara Fresco filed a lawsuit in June 2007.
Fresco launched the case on behalf of more than 31,000 tellers and other front-line customer service employees working at more than 1,000 CIBC branches across Canada, including assistant branch managers, financial service representatives, financial service associates and branch ambassadors.
Cindy Fulawka, a personal banking representative at Scotiabank, filed her class-action lawsuit against the bank in December 2007 seeking to represent some 5,000 Scotiabank personal or senior bankers, financial advisers and small business account managers.
"We are gratified by the court's decision in respect to the CIBC and Bank of Nova Scotia cases," Louis Sokolov, a lawyer with the firm Sack Goldblatt Mitchell, which brought the bank cases with the firm Roy Elliott O'Connor.
"For five years, the plaintiffs in those cases have been attempting to get access to the courts so that they could have their claims resolved on their merits and today the court said unequivocally that they are entitled to have the same kind of access that corporations have."
David O'Connor, co-lead counsel in the case, said Fulawka, who lives in Saskatchewan, told him that she was very encouraged by the Appeal Court decision.
"She also added that she was sure her co-workers would feel exactly the same," O'Connor said. "She said it was a great way to start her day."
Scotiabank said Tuesday it was disappointed by the ruling.
"We are reviewing this decision and are keeping all options on the table," the bank said in a statement.
"We are confident that the bank's employee policies have been applied fairly and consistently and we will continue to put that case forward while defending ourselves vigorously."
CIBC declined to comment Tuesday.
Despite the ruling to allow the bank class-action lawsuits to go ahead, the Appeal Court found a similar lawsuit against Canadian National Railway Co. (TSX:CNR) lacking.
The court overturned a lower court decision and ruled a lawsuit seeking unpaid overtime in that case may not go ahead as a class action.
"The absence of commonality is fatal to the certification of this action," Winkler wrote.
The bank cases were heard by the same three-judge panel, while the CN case included Winkler and two different judges.