Employment standards branch, not courts, to handle B.C. overtime claims: Court

Appeal court decision eliminates potential for class action suits; all claims must be handled individually
By Nicole Byres
|employmentlawtoday.com

Until 2006, the British Columbia Employment Standards Branch was considered to have exclusive jurisdiction over overtime claims based upon the

Employment Standards Act

. Only claims for overtime pay based on an express contractual provision could be brought in court. In 2006, the B.C. Supreme Court found the substantive provisions in the act formed implied terms of the employment contract and, as such, overtime claims could be pursued in court. In other words, the court specifically found it had jurisdiction to hear claims based on the act provisions.

The B.C. Court of Appeal has now rendered its decision in

Macareg v. E Care Contact Centres Ltd.

The court made two important findings.

Firstly, an employee is not entitled to enforce a statutory right to overtime pay in a civil action. The exclusive jurisdiction to determine such claims lies with the director of employment standards, subject to an appeal to the employment standards tribunal, all pursuant to the provisions of the act.

Secondly, as a matter of law, the minimum overtime pay requirements of the act are not implied terms of a contract of employment.

Consequently, the only way an employee or ex-employee may make an overtime claim in court is if the claim is based on a separate contract between the employer and employee which grants the right to overtime pay. In the absence of such an express provision, the employee must bring an overtime complaint — based pm a breach of the act — to the director, which is a more limited claim than a civil action. There is a possibility the plaintiff will seek leave to appeal to the Supreme Court of Canada, however, for now, the law has reverted to what has been the standard practice in British Columbia for many years.

Employers are welcoming this decision because it also virtually eliminates the possibility that a class action lawsuit for overtime claims will be able to proceed in B.C. Previously, a number of employees could commence a single lawsuit in which each employee’s overtime claim would form part of the action. Similar class action lawsuits for overtime pay have been commenced in the United States and Ontario; for large employers, these claims can be significant. Since overtime claims in court are now limited to claims based on a breach of specific contracts, unless large numbers of employees have identical contracts on which to base a claim, each action will be limited to a single claim, thereby discouraging lawsuits unless the claim is of sufficient size to warrant the cost of a lawsuit, or it forms part of other claims by an employee.

Nicole Byres is a partner with Clark Wilson LLP in Vancouver, specializing in labour and employment law, energy and natural resources law and business litigation. She can be reached at (604) 643-3173 or nmb@cwilson.com.

For more information see:

Macaraeg v. E Care Contact Centers Ltd.

, 2008 CarswellBC 855 (B.C. C.A.).

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