Supreme Court clears way for employees’ overtime suits against banks

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A pair of potentially massive class-action lawsuits filed on behalf of employees at two of Canada's largest banks alleging that they were unfairly denied overtime pay are now set to go ahead, after the Supreme Court of Canada declined to hear appeals in the cases on Thursday.

The Canadian Imperial Bank of Commerce and the Bank of Nova Scotia are facing lawsuits filed on behalf of thousands of employees alleging the banks improperly denied their workers hundreds of millions of dollars worth of overtime. The banks deny the allegations and argue they treat their employees fairly. The allegations have not been proven.

Last June, the Ontario Court of Appeal sided with the plaintiffs in both lawsuits, ruling the cases could proceed as class actions. The banks sought to appeal the decisions to the Supreme Court of Canada, but Canada's top court announced Thursday that it would not hear their appeals. As is customary, the court did not provide reasons.

The two cases date back more than five years. In 2007, Toronto CIBC teller Dara Fresco filed a $600-million class-action case against her employer on behalf of 30,000 fellow employees. The Ontario Court of Appeal certified her case as a class action, rejecting a previous court decision that there was no evidence of a "systemic policy or practice of unpaid overtime at CIBC."

In the other case, the Ontario Court of Appeal upheld a lower court's certification of a similar class-action lawsuit filed by Cindy Fulawka, a personal banker who worked for the Bank of Nova Scotia in Saskatchewan for 20 years. Her lawsuit alleges that 10,000 Scotiabank employees were denied overtime and demands $350-million. She filed her case after hearing about Ms. Fresco's case, using the same lawyers.

The plaintiffs have alleged that their employers expected employees to work late but that their overtime policies, such as requirements to secure approval before working extra hours, made it difficult for employees to get paid. They also alleged the banks had poor record-keeping systems for overtime.

David O'Connor, a lawyer for the plaintiffs in both lawsuits with Roy Elliott O'Connor LLP in Toronto, said he did not believe the Supreme Court ruling would result in a rash of other similar unpaid overtime lawsuits filed against other companies -- partly because big employers have been watching these cases over the past five years.

"A lot of institutions and a lot of companies looked at their practices, and some of them changed their practices," Mr. O' Connor said. " ... To the extent that there is some obvious error in a large employer organization, I would have thought that those people would have come forward by now."

Ann DeRabbie, a spokeswoman for Scotiabank, stressed that the case has still not been heard on its merits: "We are confident that the bank's employee policies were applied fairly and consistently. And we do regularly review these policies to make sure they meet all the regulatory requirements."

CIBC declined an interview request. A CIBC spokesman said in an e-mail that the bank would "defend its position vigorously" at trial.

"CIBC has a clear overtime policy that is easily accessible to employees and exceeds legislative requirements in Canada," said bank spokesman Kevin Dove. "Under that policy, where overtime is required or permitted of eligible employees, it is paid."