Action sought damages for misclassification, breach of contract for drivers in several provinces
The Alberta Court of King’s Bench has certified a class action lawsuit against ridesharing company Uber, but only for Alberta drivers and not the multijurisdictional class proposed in the lawsuit.
Shaneef Virani is an Uber driver in Alberta who uses the Uber app to provide rideshare services to people. The Uber app allows customers to contact him for rides and pay him for his services.
Uber updated many features on the app as well as licensing agreements and community guidelines that allow some drivers to negotiate fares, subcontract their services, and potentially lose access for excessive cancelling of trips.
Virani filed a class-action lawsuit against Uber with the Alberta Court of Queen’s Bench, claiming breach of employment standards legislation due to misclassification of the employment status of drivers, breach of contract, unjust enrichment stemming from Uber avoiding making employer contributions to government pension and employment insurance schemes, and illegality of contract related to a clause requiring Uber drivers to forego legal action in favour of arbitration and waiving any class actions. He proposed to represent anyone who used the Uber app to transport passengers and provide delivery services in all Canadian provinces other than Prince Edward Island an Ontario – the latter having already had a class-action suit certified by the Ontario Superior Court of Justice in August 2021.
Class action against Uber is the first of its kind in Ontario related to the gig economy, says an employment lawyer.
Individual circumstances varied: Uber
Uber contested the class-action lawsuit, arguing that the relationship between Uber and those using the app varied by driver according to time and location, and each relationship was case dependent. It also argued that there was no common issue in the class, as some drivers wanted to be an employee, some an independent contractor, and some a dependent contractor. In addition, many drivers want to continue under the status quo, said the company.
Uber noted that in British Columbia, the Director of Employment Standards had exclusive jurisdiction over employment standards disputes, and in Quebec, there were alternative dispute resolution methods. In addition, drivers were also free to use arbitration remedies under Uber’s services agreement.
The court referred to the class action certified in Ontario – Heller v. Uber Technologies Inc., 2021 ONSC 5518 – which found that there were certifiable common issues for breach of contract and breach of Ontario’s Employment Standards Act, 2000, but not for unjust enrichment.
Similar to the Ontario court, the court found that there was “some basis in fact” that the Uber business model and relationship with drivers would lead to a finding that they were employed by Uber. Uber’s service agreements allowed the company to impose basic requirements on driver activity, basic standards of behaviour, quality control mechanisms, and incentives. This was sufficient to constitute a common issue across all class members, said the court.
An Ontario court certified a class action for unpaid vacation and holiday pay against an employer.
Certain issues not common
As for the breach of contract claim related to Uber’s arbitration clause and class action waiver, the court found that it could be found to be unenforceable due to being contrary to legislative standards. This is a common issue that could be assessed for the class, said the court.
The court found that the unjust enrichment claim could not proceed, as there was no evidence Uber drivers being deprived of money from alleged under-contribution of employment insurance and Canada Pension Plan amounts.
The court also found that there was no basis to certify the assessment of aggravated, exemplary, or punitive damages on a class basis. Aggravated damages compensate for emotional suffering that exceeds what would normally be expected, while punitive damages are awarded in exceptional cases for conduct that is “harsh, vindictive, reprehensible and malicious.” Such circumstances would not be uniform for all drivers in the class and should not be addressed in a class action, said the court.
The court noted that “the preferability of a single class action over a multitude of individual actions is clear” where common issues of law and fact could be determined based on a single claim. However, there was a concern for a multijurisdictional claim such as this that the result would be consistent across jurisdictions, said the court.
Class actions against employers have largely been related to unpaid overtime, although the scope of claims is expanding, say experts.
Differences across jurisdictions
The court found that there were several variable factors that could influence a finding of whether drivers were employed by Uber, such as changes in policies regarding tips, cancellations, and subcontracting. In addition, it was unlikely that the views of drivers, riders, and courts in different jurisdictions would have a similar view in all the provinces involved, said the court.
The court determined that Virani’s class action was suitable for certification in Alberta, but not elsewhere, which would increase the chance of a fair and just process. Drivers in most other provinces had the option to pursue class actions in their own jurisdictions, but Virani’s class should be limited to Uber drivers in Alberta, the court said.
The motion for certification was granted for Alberta only, for the common issues of misclassification and breach of contract. See Virani v. Uber Portier Canada Inc, 2023 ABKB 240.
