Amazon faces combined appeal in a class action at the Federal Court despite arbitration agreement

The Ontario Court of Appeal has permitted the appeals of certification and stay decisions to be combined despite an existing arbitration agreement.

In Davis v. Amazon Canada Fulfillment Services, ULC, 2023 ONCA 634, approximately 73,000 delivery drivers retained as independent contractors or employed by third-party companies filed a class action lawsuit against Amazon. The delivery drivers claimed that they were, in fact and law, employees of Amazon. Consequently, they are entitled to overtime, holiday pay, and other entitlements under provincial employment standards legislation.

The class action judge dismissed the plaintiff's motion to certify the action as a class proceeding and granted Amazon's motion to stay according to the Arbitration Act. The judge found that the claims of some members of the proposed class were parties to agreements that contained arbitration provisions. The plaintiff sought to appeal the stay decision to the Ontario Court of Appeal because it was a final order of a Superior Court judge from which an appeal lies to the Court of Appeal. The plaintiff sought an extension of time to appeal the stay decision and requested the appeal transfer from the certification decision, which is currently pending in the Divisional Court, to the Court of Appeal.

The plaintiff brought a motion seeking an extension of time to deliver his notice of appeal from the stay decision and an order transferring to the Court of Appeal the appeal certification decision that was pending in the Divisional Court and combining it with the appeal from the stay decision.

Amazon consented to the extension of time for the appeal of the stay decision but opposed the transfer of the certification decision appeal to the Court of Appeal.

The court noted that the fact that one appeal lies to the Court of Appeal and another to the Divisional Court and that both were in the same proceeding were necessary but insufficient conditions to make an order for transfer. Such an order is discretionary, and the court may refuse to grant it even if the parties consented. The court emphasized that the overriding consideration was whether separate appeals in different courts or combining them in the Court of Appeal better comports with the administration of justice.

The court further explained that relevant factors to whether a joinder is appropriate include the risk of inconsistent results, the extent of overlap in the matters to be addressed in the two appeals, and whether the different issues in the two appeals contraindicate the joinder.

In this case, the judge highlighted the intertwined nature of the issues, as the motion to stay was part of Amazon's resistance to the certification motion. The court observed that Amazon moved to have the proposed class action stay in favour of arbitration for those with arbitration provisions in their work contracts.

The court also considered that it was only because certification of a class proceeding was under consideration that the court could even entertain whether claims of delivery drivers who had arbitration agreements should be stayed in favour of arbitration. The court found these considerations relevant to the administration of justice. It militated strongly in favour of the appeals being combined in the same court so that they can be managed, sequenced, considered, and decided, taking into account and specifying the effect a decision may have on the other.

As a result, the time to deliver a notice of appeal from the stay decision was extended. Additionally, the appeal from the certification decision, pending in the Divisional Court, is transferred to the Court of Appeal and combined with the appeal from the stay decision.