ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: CV-08-365119CP
DATE: 20120427
B E T W E E N:
Michael Brown and Brian Singer Plaintiffs/Moving Parties - and - Canadian Imperial Bank of Commerce and CIBC World Markets Inc. Defendants/Respondents
Kirk M. Baert, Jonathan Ptak & David Rosenfeld , for the Plaintiffs/Moving Parties
Patricia Jackson, Linda Plumpton, Stuart Svonkin, John C. Field & Lauri A. Reesor , for the Defendants/Respondents
HEARD: January 31 and February 1, 2012
Proceeding under the Class Proceedings Act, 1992
G.R. Strathy J.
[ 1 ] The plaintiffs move to certify this proceeding as a class action on behalf of a class composed of “Analysts,” “Investment Advisors” and “Associate Investment Advisors” employed by the defendants Canadian Imperial Bank of Commerce (CIBC) and CIBC World Markets Inc. (CIBCWM) (referred to collectively as CIBC unless otherwise apparent from the context.)
[ 2 ] The action follows two other overtime cases in the banking sector: Fulawka v. Bank of Nova Scotia , 2010 ONSC 1148 , [2010] O.J. No. 716 (S.C.J.) , aff’d 2011 ONSC 530 (Div. Ct.), which was certified at first instance, and Fresco v. Canadian Imperial Bank of Commerce (2009) , 2009 31177 (ON SC) , 71 C.P.C. (6th) 97 , [2009] O.J. No. 2531 (S.C.J.) , aff’d 2010 ONSC 4724 (Div. Ct.), which was not certified. Appeals in both proceedings have been taken under reserve by the Court of Appeal. Fulawka and Fresco were “off the clock” cases – that is, the class members alleged that while they were eligible for overtime, their overtime hours worked had not been recognized and paid by their employer. In this case, the plaintiffs allege that they and other similarly-situated class members have been wrongly classified by CIBC as ineligible for overtime.
[ 3 ] Overtime cases in other industries include: Wicke v. Canadian Occidental Petroleum Ltd. (1998), 1998 14863 (ON SC) , 40 O.R. (3d) 731 , [1998] O.J. No. 2818 (Gen. Div.) ; Kumar v. Sharp Business Forms Inc. (c.o.b. Bell Label Ticket & Tag) (2001), 2001 28301 (ON SC) , 5 C.P.C. (5th) 128 , [2001] O.J. No. 1729 (S.C.J.) ; Corless v. KPMG LLP (2008), 170 A.C.W.S. (3d) 464 , [2008] O.J. No. 3092 (S.C.J.) ; and McCracken v. Canadian National Railway , 2010 ONSC 4520 , [2010] O.J. No. 3466.
[ 4 ] The plaintiffs say that CIBC has classified its employees by job level and by job title. There is a generic job description attached to most job titles. Employees at and above certain job levels are generally treated by CIBC as ineligible for overtime. As well, employees with certain job titles have been classified as ineligible for overtime. The plaintiffs say that it can be determined, on a job-by-job basis, whether particular employees are legally entitled to overtime and therefore whether they have been misclassified. They say that the same circumstances that allow CIBC to define overtime eligibility by job level or job title will allow the court to determine whether particular groups of employees have been misclassified.
[ 5 ] In the first section of these reasons, I will outline the underlying facts and the evidence adduced by the parties. I will describe the parties, the organization and structure of CIBC’s workplace, the roles and responsibilities of analysts and Investment Advisors within CIBC and the expert and other evidence adduced by the parties. In the second section, I will explain the statutory and legal regime governing overtime under federal and provincial law. Finally, in the third section, I will review and apply the test for certification of a class proceeding set out in section 5(1) of the Class Proceedings Act, 1992 , S.O. 1992, c. 6 (the C.P.A.).
[ 6 ] For the reasons that follow, I have concluded that this action is not suitable for certification as a class action. Class members have little in common but their names. The key issue of fact – namely, whether or not a person has managerial responsibilities – which is critical to the determination of overtime eligibility, cannot be determined on a common basis. There is no workable methodology to resolve that issue. The action simply will not work as a class action.
I. The Facts
The Plaintiffs
[ 7 ] Michael Brown, one of the proposed representative plaintiffs, is a former employee of CIBCWM. He was employed from April 2003 to January 2004 as an “analyst.” He was a level 6 employee, with the job title “Analyst IV.” He claims that his business title was “Analyst, Corporate Client Support, Global Operations,” but CIBC says that his business title was “Senior Analyst.” His initial base salary was $48,000 per annum, which was increased to $50,000. His job was to provide support to United Kingdom lending syndicates, in which CIBCWM participated. He analyzed loan documents and processed the relevant information into CIBCWM’s system. Due to the time difference between Canada and the UK, he worked shifts from 4:00 a.m. to 12:30 p.m., including breaks. He says that he was frequently required to work overtime. When he asked about overtime pay, he was told that he was not entitled to it under the Bank’s overtime policy.
[ 8 ] Mr. Brown claims that he did not perform managerial functions, supervise other employees, have hire and fire authority, exercise discretion or independent judgment or have any of the other trappings of someone in a managerial or supervisory role. He states that his job and that of other analysts at CIBC was not managerial – it was to “analyze,” not to “manage.” According to his evidence:
The job title of analyst at CIBC is a common one and is descriptive of the role performed. The role of an analyst is not to manage people: it is to analyze and process information to support the various business processes of the area the analyst is employed in.
[ 9 ] The other proposed class representative, Brian Singer, was employed by CIBCWM in various capacities from 1994 to 2002. He started out as a bond salesperson and later became what is now known as an Investment Advisor. He claims that in that job, he worked 65-70 hours per week, including weekends, and was never paid overtime. He claims that CIBCWM knew that he was working more than a typical 44 hour work week and expected him to do so. He says that as an Investment Advisor, he did not perform managerial functions and did not supervise employees, have hire and fire authority, have the ability to make decisions on behalf of the company, exercise discretion in management or perform a leadership or administrative role. During Mr. Singer’s “rookie year” as an Investment Advisor, he was guaranteed certain minimum compensation. After this year passed, his remuneration was based entirely on a commission on fees generated by the sale of securities and other products. His earnings between 1998 and 2002 varied from a low of $55,000 in one year to as much as $115,000 in another.
[ 10 ] Mr. Singer says that this remuneration structure fostered a work place where an Investment Advisor needed to constantly work overtime to meet and sign up new clients and to increase the assets under management. He claims that all Investment Advisors at CIBCWM perform similar tasks. All were classified as ineligible for overtime.
[ 11 ] Mr. Singer was not originally a plaintiff in this action. He brought a motion to be added as a representative plaintiff in May 2009, after the action had been commenced by Mr. Brown with the proposed class limited to Analysts.
[ 12 ] Before starting this action, Mr. Singer had never asked CIBCWM for overtime pay and never complained that he had not been paid overtime. He said that he did not become aware that he might have a right to overtime until he had discussions with counsel.
The Defendants
[ 13 ] CIBC is a Canadian chartered bank. It is federally-regulated and thus governed by the Canada Labour Code R.S.C. 1985, c. L-2 (the Code ) . CIBCWM is the wholesale banking arm of CIBC and provides, among other things, investment advice and services to individual clients through Investment Advisors in its retail division, CIBC Wood Gundy. CIBCWM is provincially-regulated and thus is subject in Ontario to the Employment Standards Act, 2000 , S.O. 2000, c. 41 ( ESA 2000).
... (continues verbatim)
G. R. Strathy J.
Released: April 27, 2012
COURT FILE NO.: CV-08-365119CP
DATE: 20120427
ONTARIO SUPERIOR COURT OF JUSTICE
B E T W E E N:
Michael Brown and Brian Singer Plaintiffs/Moving Parties - and - Canadian Imperial Bank of Commerce and CIBC World Markets Inc. Defendants/Respondents
REASONS FOR JUDGMENT
G.R. Strathy J.
Released: April 27, 2012