Court poised to certify BMO holiday pay class action

A proposed class action against Bank of Montreal seeking holiday and vacation pay for certain employees paid largely on commission is on the verge of being certified in the Supreme Court of British Columbia.

In the case, Paul Cheetham, who worked as a “private wealth consultant” at the bank, brought a proposed class action on behalf of non-unionized employees who were paid variable compensation (commissions and bonuses on top of a base salary) — specifically other private wealth consultants and mortgage specialists. The class action claimed damages for breach of contract and breach of duty of good faith stemming from unpaid statutory vacation and holiday pay.

The bank opposed certification of the suit, arguing among other things that the employees’ variable compensation included their required vacation and holiday pay.

The court largely sided with the proposed plaintiff, ruling that the case meets the tests for certifying a case as a class action.

Among other things, the court said there’s a potentially viable claim for breach of contract, that a class action is the “preferable procedure” for these claims, and that Cheetham is a suitable representative plaintiff for the case.

However, the court said that before the case can be certified as a class action, the claim needs to be amended so that certain other proposed issues meet the requirements of class action legislation.

Without those revisions, the plaintiff’s pleadings are “insufficient to support a claim for breach of the duty of good faith,” the court said in its decision.

“However, the plaintiff has articulated a manner in which the claim can be framed to disclose a proper cause of action for a breach of the duty of good faith,” it said.

“In the circumstances, I find that it is appropriate to permit the plaintiff an opportunity to amend his pleadings to plead breach of the duty of good faith.”

The court dismissed some of the proposed grounds for the action, finding they aren’t viable.

Once the claim is revised in line with the court’s direction, the claim will be in a position to be certified as a class action.

“The parties are to arrange for a further hearing to discuss the timing of the submissions and the next steps in this litigation that arise from these reasons,” the court said.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.