Employee action against employer for failure to pay wages during mandatory training program allowed
Cindy Huras sought damages from Primerica Financial Services Ltd. on her own behalf and on behalf of all her class members for Primerica’s failure to pay a minimum wage pursuant to the Ontario Employment Standards Act to individuals who participated in a mandatory training program.
A class action was commenced against Primerica with Ms. Huras as the representative plaintiff. The proposed class members were all persons who attended a mandatory Primerica training program after May 18, 1993, and prior to January 1, 1998, in order to become a licensed sales representative for the company.
In the spring of 1996 Ms. Huras began her training to become a sales representative for Primerica. She successfully completed the training program and secured a license to become an insurance agent. In August 1996 Ms. Huras signed a standard form contract to become a licensed sales representative with Primerica.
Ms. Huras received no compensation for attending the training sessions, despite spending 30 to 40 hours in these sessions. Ms. Huras argued that, under section 23 of the employment standards act, Primerica was required to pay her the minimum hourly wage.
Primerica challenged the class- action suit and moved for a stay of the action on the ground that the matter in dispute between the parties fell within an arbitration clause. The arbitration clause was part of the employment contract signed between Ms. Huras and Primerica on August 26, 1996.
The original motion for the stay was heard before Justice Cumming of the Ontario Superior Court of Justice. Justice Cumming refused to grant the stay. This decision was appealed by Primerica to the Ontario Court of Appeal. Ms. Huras defended both the original action and the appeal on the grounds that the dispute did not fall within the arbitration clause.
The dispute was whether the provisions of the Employment Standards Act required Primerica to pay Ms. Huras a minimum wage to compensate her for 30 to 40 hours during which she was required to attended Primerica’s training program. However if the dispute is covered by the arbitration clause within the contract, the action for wages must be stayed and the dispute must be submitted to arbitration.
In interpreting the arbitration clause contained in the contract, the motion judge looked to the relationship between Ms. Huras and Primerica and the nature of their dispute. He found two distinct relationships: first, while Ms. Huras was a trainee; and second, when she became a licensed sales representative of Primerica. This relationship was created when the parties entered into a contract in August 1996.
He further found that the contract could not properly be construed as to apply retrospectively to the earlier period of training. The motion judge held that the provisions of the contract related to Ms. Huras’ relationship as a licensed sales representative of Primerica and not when she was as a trainee. The motion to stay was dismissed.
The Court of Appeal found no reason to interfere with the motion judge’s interpretation of the arbitration clause. The dispute raised in Ms. Huras’ claim did not arise from her relationship with Primerica as a licensed sales representative. The appeal by Primerica was dismissed.
For more information:
• Huras v. Primerica Financial Services Ltd., Ontario Court of Appeal, Docket No. CA C34178, Aug. 17/01.
A class action was commenced against Primerica with Ms. Huras as the representative plaintiff. The proposed class members were all persons who attended a mandatory Primerica training program after May 18, 1993, and prior to January 1, 1998, in order to become a licensed sales representative for the company.
In the spring of 1996 Ms. Huras began her training to become a sales representative for Primerica. She successfully completed the training program and secured a license to become an insurance agent. In August 1996 Ms. Huras signed a standard form contract to become a licensed sales representative with Primerica.
Ms. Huras received no compensation for attending the training sessions, despite spending 30 to 40 hours in these sessions. Ms. Huras argued that, under section 23 of the employment standards act, Primerica was required to pay her the minimum hourly wage.
Primerica challenged the class- action suit and moved for a stay of the action on the ground that the matter in dispute between the parties fell within an arbitration clause. The arbitration clause was part of the employment contract signed between Ms. Huras and Primerica on August 26, 1996.
The original motion for the stay was heard before Justice Cumming of the Ontario Superior Court of Justice. Justice Cumming refused to grant the stay. This decision was appealed by Primerica to the Ontario Court of Appeal. Ms. Huras defended both the original action and the appeal on the grounds that the dispute did not fall within the arbitration clause.
The dispute was whether the provisions of the Employment Standards Act required Primerica to pay Ms. Huras a minimum wage to compensate her for 30 to 40 hours during which she was required to attended Primerica’s training program. However if the dispute is covered by the arbitration clause within the contract, the action for wages must be stayed and the dispute must be submitted to arbitration.
In interpreting the arbitration clause contained in the contract, the motion judge looked to the relationship between Ms. Huras and Primerica and the nature of their dispute. He found two distinct relationships: first, while Ms. Huras was a trainee; and second, when she became a licensed sales representative of Primerica. This relationship was created when the parties entered into a contract in August 1996.
He further found that the contract could not properly be construed as to apply retrospectively to the earlier period of training. The motion judge held that the provisions of the contract related to Ms. Huras’ relationship as a licensed sales representative of Primerica and not when she was as a trainee. The motion to stay was dismissed.
The Court of Appeal found no reason to interfere with the motion judge’s interpretation of the arbitration clause. The dispute raised in Ms. Huras’ claim did not arise from her relationship with Primerica as a licensed sales representative. The appeal by Primerica was dismissed.
For more information:
• Huras v. Primerica Financial Services Ltd., Ontario Court of Appeal, Docket No. CA C34178, Aug. 17/01.
