COURT FILE NO.: CV-18-00598257-CP
DATE: 20201023
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: D’ANDRA MONTAQUE, Plaintiff
– and –
HANDA TRAVEL STUDENT TRIP LTD. o/a I LOVE TRAVEL, CAMPUS VACATIONS HOLDINGS INC., 2504027 ONTARIO INC. o/a S-TRIP! and 2417988 ONTARIO INC. o/a BREAKAWAY TOURS, ALEXANDRE JIT HANDA a.k.a. ALEXANDRE HANDA a.k.a. ALEXANDER HANDA a.k.a. ALEX HANDA, JUSTIN VAN CAMP and EUGENE WINER, Defendants
BEFORE: E.M. Morgan J.
COUNSEL: Jody Brown and Joshua Mandryk, for the Plaintiff
David Di Paolo and Nadia Effendi, for the Defendants
HEARD: October 22, 2020
CERTIFICATION OF CLASS ACTION
I. The misclassification claim
[1] The Plaintiff brings this motion, with consent of the Defendants, for certification of the action under section 5(1) of the Class Proceedings Act, 1992, SO 1992, c. 6 (“CPA”).
[2] The hearing of this motion was held over Zoom. The representative Plaintiff, along with several other class members, were in attendance. There were no objections to the proposal to certify the action.
[3] In brief, the claim is a variation on what has become a familiar pattern of employment classification cases. The Plaintiff claims that she and those she represents have been misclassified by their employers – i.e. the corporate Defendants – and that they are entitled to wages and benefits commensurate with their proper classification.
[4] The claim has been brought on behalf of a group of people who work as “Trip Leaders” on guided tours for students. The corporate Defendants operate a travel company under a number of different brand names. They sell and deliver vacation packages to student-age travelers. Trip Leaders such as the Plaintiff are alleged to play an important role in the Defendants’ operations.
[5] Trip Leaders’ job duties and responsibilities are set out in their standard-form Trip Leader Agreements prepared by the Defendants. These include:
(a) Customer service and passenger assistance;
(b) Communication with trip organizers, passengers and all full-time staff and volunteers;
(c) Assisting with all activities, events, excursions, info desks and check-in and check-out procedures;
(d) Collecting code of conduct letters and damage deposits/damage insurance from travellers;
(e) Performing room checks and passenger sign-ins;
(f) Completing detailed incident reports;
(g) Escorting passengers on excursions and/or to the hospital or clinic;
(h) Promoting trip program calendar;
(i) Attending morning and evening staff meetings;
(j) Ensuring passengers are having a great and safe trip; and
(k) Following the S-Trip handbook and procedures.
[6] Further, Trip Leaders are required to follow detailed procedures and protocols set out in the Destination Staff Manual. These procedures relate to pre-trip planning and procedures, airport and flight procedures, emergency and on-site procedures, briefing sessions, hotel check-ins, student sign-in and room checks, and check-out and return trip procedures.
[7] The Defendants classify the Trip Leaders as volunteers. They are paid only a small honorarium, which is well under the province’s minimum wage. Moreover, they do not receive the range of benefits that employees are required to receive under the Employment Standards Act, 2000, SO 2000, c. 41. The Plaintiff claims that the Trip Leaders are, in fact, employees, who are therefore underpaid and deprived of the employment benefits to which they are entitled.
[8] The question of whether the putative class members are employees or volunteers appears to be a novel one for Ontario class actions. However, the general structure of an employment classification claim is by now familiar. The Amended Statement of Claim describes a dispute that fits the pattern of previous cases that have been certified under section 5(1) of the CPA.
II. Requirements for certification
[9] Although they are well-known, it is worth setting out the bases for certification under the CPA:
5 (1) The court shall, subject to subsection (6) and to section 5.1, certify a class proceeding on a motion under section 2, 3 or 4 if,
(a) the pleadings or the notice of application discloses a cause of action;
(b) there is an identifiable class of two or more persons that would be represented by the representative plaintiff or defendant;
(c) the claims or defences of the class members raise common issues;
(d) a class proceeding would be the preferable procedure for the resolution of the common issues; and
(e) there is a representative plaintiff or defendant who,
(i) would fairly and adequately represent the interests of the class,
(ii) has produced a plan for the proceeding that sets out a workable method of advancing the proceeding on behalf of the class and of notifying class members of the proceeding, and
(iii) does not have, on the common issues for the class, an interest in conflict with the interests of other class members.
[10] The claim satisfies each of the section 5(1) criteria. I will briefly go through them, one at a time.
a) Cause of action
[11] The certification motion is a procedural inquiry. As such, it is not intended to rule on the merits of the issues to be determined at trial: Pro Sys Consultants Ltd. v. Microsoft Corporation, 2013 SCC 57, [2013] 3 SCR 477, at paras 102, 105.
[12] The Amended Statement of Claim pleads the following causes of action:
• breach of contract;
• breach of duty of good faith;
• unjust enrichment;
• denial of employment benefits by common employer; and
• directors’ statutory liability.
[13] Similar causes of action have been permitted to go forward in other employment actions: see, Fresco v. Canadian Imperial Bank of Commerce, 2012 ONCA 444, at paras 74, 83. All of the causes of action have been recognized by the courts as existing and have been used in the context of employment actions. They easily meet the cause of action requirement in section 5(1)(a) of the CPA.
b) Identifiable class
[14] The proposed class is defined by Plaintiff’s counsel as follows:
All persons who worked as Trip Leaders for the Defendants on trips under their Breakaway Tours and/or S-Trip brands commencing in or departing from Ontario at any time during the period from June 3, 2014 to the date of certification.
[15] Trip Leaders are alleged to be the Defendants’ front-line staff. They are the first point of contact between the Defendants and their customers during their trips, and are the main point of contact whenever their passengers have questions or concerns. As indicated above, they share many duties in common and have a common compensation arrangement.
[16] To satisfy the class requirement in section 5(1)(b) of the CPA, the class must be composed of “two or more persons” and must also be objectively defined and limited by rational criteria bearing a relationship to the common issues. The class definition set out above fulfills the overall purpose of a class definition in that it identifies those with a potential claim, forms the parameters of the claim itself, and describes those entitled to notice of certification: Goodridge v. Pfizer Canada Inc., 2010 ONSC 1095, at para 113.
[17] The class definition agreed upon by the parties satisfies the requirement in section 5(1)(b) of the CPA.
c) Common issues
[18] The critical question under section 5(1)(c) of the CPA is whether resolution of the common issues would significantly advance the action. The resolution of any one or all of the common issue does not have to be, in and of itself, sufficient to support relief: Cloud v. Canada (Attorney General), 2004 45444 (ON CA), [2004] OJ No 4924 (CA), at para 53, leave to appeal dismissed [2005] SCCA No 50.
[19] At this stage, all that a Plaintiff needs to show is that there exists a minimal evidentiary basis to establish the existence of common issues. The requirement that a plaintiff provide “some basis in fact” for the proposed common issues is a significantly lower threshold than the obligation imposed upon a respondent on a summary judgment motion: Pro-Sys, at paras 99-105. Here, the evidence that the class members have similar job functions and that there is a common compensation structure and control of them by the corporate Defendants suffices to meet the standard.
[20] The evidence put forward in the Motion Record is certainly sufficient to establish some basis in fact for the commonality of the issues. In this respect, the case is distinguishable from cases such as Brown v. CIBC, 2012 ONSC 2377, at para 101, where there were 52 positions at issue. The issues are even more common than in Rosen v. BMO Nesbitt Burns Inc, 2013 ONSC 2144, which was certified as an employment misclassification class action involving three substantially similar positions.
[21] The following are the common issues proposed by the Plaintiff and agreed upon by the Defendants:
As against the Defendants Handa Travel Student Trip Ltd. o/a I Love Travel, Campus Vacations Holdings Inc., 2504027 Ontario Inc. o/a S-Trip! And 2417988 Ontario Inc. o/a Breakaway Tours:
(1) Are the Class Members “employees” of the Defendants pursuant to the Employment Standards Act, 2000 (“ESA”)?
(2) If the answer to (1) is “yes”, are the Class Members in “pensionable employment” of the Defendants pursuant to the Canada Pension Plan (“CPP”)?
(3) If the answer to (1) is “yes”, are the Class Members in “insurable employment” of the Defendants pursuant to the Employment Insurance Act (“EI”)?
Contractual Terms and Breach
(4) If the answers to (1) and (3) are “yes”, do the minimum requirements of the ESA with regard to minimum wage, overtime pay, vacation pay, and public holiday and premium pay form express or implied terms of the contracts with the Class Members?
(5) If the answers to questions (1) and (4) are “yes”, do the Defendants owe contractual duties and/or a duty of good faith to:
(a) Ensure that the Class Members were compensated with the minimum wage?
(b) Ensure that the Class Members’ hours of work were monitored and accurately recorded?
(c) Properly classify and advise Class Members of their entitlement to overtime pay for hours worked in excess of 44 hours per week which the employer required or permitted?
(d) Ensure that the Class Members were compensated with vacation pay?
(e) Ensure that the Class Members were compensated with public holiday and premium pay?
(6) Did the Defendants breach any of their contractual duties and/or a duty of good faith? If so, how?
(7) If the answers to (1) and (4) are “yes”, did the Defendants fail to pay the Class Members minimum wage, overtime pay, vacation pay, and/or public holiday and premium pay as required by the ESA?
(8) If the answers to (2) and/or (3) are “yes”, did the Defendants fail to make the prescribed employer CPP and/or EI contributions on behalf of the Class Members?
Unjust Enrichment
(9) Were the Defendants unjustly enriched by failing to compensate Class Members with minimum wages, overtime pay, vacation pay and public holiday and premium pay owed to them, in accordance with the ESA, and/or failing to make the prescribed employer CPP and/or EI contributions on behalf of the Class Members?
As against the Defendants Alexandre Jit Handa a.k.a Alexandre Handa a.k.a. Alexander Handa a.k.a. Alex Handa, Justin Van Camp and Eugene Winer:
Directors’ Liability
(10) Are Alexandre Jit Handa a.k.a Alexandre Handa a.k.a. Alexander Handa a.k.a. Alex Handa, Justin Van Camp and/or Eugene Winer liable for unpaid wages under sections 80 and 81 of the ESA and/or section 131 of the Ontario Business Corporations Act, 1990 (the “OBCA”)?
d) Preferable procedure
[22] In Cloud, at para 73, the court explained that the overarching policy goals that inform the preferability analysis are: (a) judicial economy, (b) access to justice, and (c) behaviour modification. Here, there are 1000 affected class members, each with basic minimum wage and overtime claims. The individual claims of these 1000 will be very small and would not warrant individual litigation despite the importance of that income to these low-income workers. Common determinations on their employment status will significantly contribute to these claimants’ access to justice.
[23] In similar employment classification actions, the courts have held that a class action is the preferable procedure: see, Rosen, supra; Fresco, supra. The Court of Appeal in Fulawka v. Bank of Nova Scotia, 2012 ONCA 156, 2012 ONCA, at para 156, observed that, like here, “there is every reason to believe that a common issues trial judge, assisted by the parties and their experts, will be able to design and successfully implement a satisfactory compensation system.”
[24] In these circumstances, a class action is undoubtedly the preferable procedure, as required by section 5(1)(d) of the CPA.
e) Proposed representative Plaintiff
[25] It is by now well accepted that a proposed representative need not be ‘typical’ of the class, but must be ‘adequate’ in the sense that she must be capable of instructing counsel and willing to vigorously prosecute the claim: Rosen, at paras 73-74.
[26] Plaintiff’s counsel submit that the Plaintiff here has undertaken all the essential steps of a class representative in litigating this action. She has apparently been involved in reviewing evidence produced to date, retaining and instructing class counsel and providing them with evidence for use in this motion. She shares common interests with the other class members, and there has been no suggestion that she is in any form of conflict with them.
[27] The Plaintiff is therefore a suitable representative Plaintiff.
f) Litigation plan
[28] The plaintiff has produced a litigation plan which appears to set out a workable method of advancing the current proceeding. If necessary, it can always be modified as the litigation progresses, and at the common issues trial: Rosen, at para 75; Cloud, at para 95.
[29] At the certification stage, the litigation plan is always a tentative one. Its purpose at this stage is to assist the court in determining whether the goals of the CPA will be served by certification, not to provide a concrete plan with all procedural elements spelled out in detail. The current plan submitted by the Plaintiff satisfies the requirement for a litigation plan set out in section 5(1)(e)(ii) of the CPA.
III. Disposition
[30] The action is certified as a class proceeding pursuant to section 5(1) of the CPA.
[31] The class is as defined in paragraph 14 above. The Plaintiff is the representative Plaintiff for the class.
[32] Plaintiff’s counsel are appointed as class counsel.
[33] The common issues are as set out in paragraph 21 above.
Morgan J.
Date: October 23, 2020