Supreme Court of Canada 2020 Decision in Uber Case
In 2020, the Supreme Court of Canada issued a ruling relating to a proposed class action against Uber.
In that case, an Uber driver sought to commence a class proceeding against Uber for violations of the Ontario Employment Standards Act (“ESA”). However, Uber brought a motion to stay the class proceeding in favour of arbitration in the Netherlands, relying on the arbitration clause in its services agreement with the driver.
Ultimately, the Supreme Court of Canada ruled that the arbitration clause contained in the standard Uber contract was unconscionable and therefore invalid.
Class Members Seek Certification of Class Action in Ontario
Following, the Supreme Court of Canada’s decision, the driver went back to court seeking certification of the proposed class action. At the core of the class action, the driver and the proposed putative class members argued that Uber had breached its employment contracts with the class members and contravened ESA. They also submitted that Uber was liable for unjust enrichment and negligence.
The class members include those who provided at least one ride or delivery using the Uber app and total an estimated 366,359 people.
More specifically, the class members claim that they have been misclassified as independent contractors, rather than employees, which means that they are not afforded the employment protections under the ESA and related federal statutes.
Thus, in what the court called an“extraordinary case”, the core issue to be decided by the class action centred on the relationship between Uber and the class members and whether that relationship was that of service provider and customer, employer and employee, or employer and independent contractor.
Requirements for the Certification of a Class Action
Under s. 5 of the Class Proceedings Act, 1992, a court has no discretion and is required to certify a class action when the legislation’s five-part test is met. The test requires that the proposed class action meet the following criteria :
1) The pleadings disclose a cause of action;
2) There is an identifiable class of two or more persons that would be represented by the representative plaintiff;
3) The claims of the class members raise common issues;
4) A class proceeding would be the preferable procedure for the resolution of the common issues; and
5) There is a representative plaintiff 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.
The court further explained:
“For an action to be certified as a class proceeding, there must be a cause of action shared by an identifiable class from which common issues arise that can be resolved in a fair, efficient, and manageable way that will advance the proceeding and achieve access to justice, judicial economy, and the modification of behaviour of wrongdoers. On a certification motion, the question is not whether the plaintiff’s claims are likely to succeed on the merits, but whether the claims can appropriately be prosecuted as a class proceeding. The test for certification is to be applied in a purposive and generous manner, to give effect to the goals of class actions; namely: (a) to provide access to justice for litigants; (b) to encourage behaviour modification; and (c) to promote the efficient use of judicial resources.”
Court Certifies Class Action Against Uber
Ultimately, the court certified the class action.
It first found the cause of action criterion had been met for the claims of breach of contract and breach of the ESA. However, the court refused to certify the claims for unjust enrichment and negligence.
It further found that the identifiable class criterion had been met.
Third, the court held that there were certifiable common issues for the breach of contract and breach of ESA causes of action. However, it refused to certify the claims of aggregated damages and punitive damages.
The court also held the preferable procedure criterion had been met, stating:
“[T]here are viable common issues and a class action in the immediate case is a meaningful route to access to justice for both the Class Members and for Uber. In so far as the preferable procedure criterion is concerned, the immediate class action would be manageable and the common issues trial would provide considerable momentum for individual issues trials if the common issues favoured the Class Members.”
Finally, the court held that the representative plaintiff criterion had been satisfied.
In the result, the court therefore certified the class action and it will proceed accordingly.
The important distinction between independent contractors and employees makes a significant difference in compensation, during employment and if a wrongful dismissal case arises. Some employers do not properly structure agreements with workers to define them as independent contractors, as they intend to. Workers may be under the impression that they are independent contractors when they have actually been full-time employees the entire time. You may have been dismissed from your job not realizing that you should have been receiving benefits, vacation pay, holiday pay, sick pay and overtime pay while you were employed. You may be entitled to recoup these losses and to sue your former employer for damages caused by the discrepancy. Contact me at Peter A. McSherry Employment Lawyers in Guelph to obtain a full evaluation of your particular case. If you suspect you may have been entitled to the benefits of an employee rather than an independent contractor, I may be able to help you pursue the compensation you deserve.
As a Guelph lawyer with in-depth knowledge of employee classification issues, I can help provide your case with the tools, resources and skill to pursue your best possible resolution. Your informed decisions will drive your case, and I can advocate for your best interests in any legal realm. Contact me today by phone at 519-821-5465 or by e-mail to schedule a consultation.