RBC facing $800M class-action lawsuit over alleged pay violations

The RBC logo is photographed in Toronto, on Wednesday, May 4, 2022. (THE CANADIAN PRESS/Christopher Katsarov)

A subsidiary of the Royal Bank of Canada is facing a lawsuit seeking $800 million in damages over an alleged failure to properly compensate commissioned employees for vacations and statutory holidays.

On Dec. 29, Ontario Superior Court Justice Edward P. Belobaba certified the lawsuit, allowing the case to continue through to the litigation process as a class proceeding.

A statement of claim filed with the Ontario Supreme Court in July 2020 alleges that the Royal Bank of Canada's Dominion Securities branch (RBCDS), a subsidiary that oversees RBC's wealth management and investment firms, violated provincial employment laws by failing to pay vacation and public holiday wages to commissioned employees.

It also alleges that the bank failed to disclose to employees that their vacation and holiday pay were not being properly calculated and paid out.

The allegations have not been proved in court.

The suit was brought forward by Leigh Cunningham, a Winnipeg resident and former RBC Dominion Securities investment (RBCDS) advisor, who earned income by commission.

“I am very pleased with this favourable decision [to certify the case],” Cunningham said in a release issued Tuesday, adding she was “eager to move [..] forward.”

“The decision is an important step in the proceeding and provides access to justice for the entire class of employees,” she said.

When reached for comment, Greg Skinner, RBC’s director of wealth management, told CTV News Toronto that RBC “believes that all advisors have received their statutory vacation and holiday pay.”

“RBC takes the allegations seriously and ensures that everyone who works at any RBC company is fairly compensated and we will be defending ourselves,” Skinner said.

RBC declined to comment further as the matter remains before the courts.

Lawyers David O’Connor, Daniel Lublin and Stephen Moreau, representing the plaintiffs, said many large employers in Canada are unaware of or do not comply with the requirement to pay commissioned employees for vacation and public holidays.

While the certification sets the stage for the allegations against RBC to be examined, the resolution of the case “will speak to an important issue of unpaid wages in Canada [and] whether workers are being paid the way that employment standards legislation requires them to be paid,” they said.

"These are all really important workplace questions that affect workers across the country — not just investment advisors, but all kinds of employees who may be receiving income other than by way of just base salary."

Those who believe they may be a class member in this lawsuit can find more information at https://vacationpayclassaction.ca.

Earlier in January, CIBC agreed to pay a total of $153 million to settle a class-action lawsuit filed more than a decade ago over the bank's overtime policies.