Unpaid overtime a growing legal liability

Mobile technology has helped employers squeeze more productivity out of their employees, but all those hours of work while technically off the clock leaves them open to lawsuits over unpaid overtime, experts warn.

Overtime pay is governed by different standards across Canada. In Ontario, for example, it must be paid for any work in excess of 44 hours per week. There are exceptions for managerial roles and those in professions like medicine, the law and accounting, but for the most part, employees are legally entitled to excess pay for excess work.

Legal experts say when an employer gives a smartphone to an employee and then allows them to perform work duties outside the office during regular hours, that's tantamount to asking for overtime to be performed.

"Employers are liable for this unpaid overtime and there's been increasing awareness among employees about how they are being exploited often in these circumstances," labour lawyer Douglas Elliot says.

Elliot is a senior partner with Roy, Elliot & O'Connor law firm in Toronto. He's heading up two huge class-action lawsuits on the issue in Canada. He's helping 5,000 Scotiabank employees claiming $350 million in unpaid overtime work from their employer. And he heads up a similar suit against CIBC on behalf of 31,000 workers suing for $600 million in unpaid work.

While mobile technology has made for some huge leaps in terms of worker productivity, not all of those effects have been universally positive. An online survey conducted in May by California-based software company Good Technology found that more than two thirds of respondents check their work email before 8 a.m., with the average first log-on coming at 7:09 in the morning.

'We haven't had a defined work week for several decades now' —Prof. Linda Duxbury

Even more admitted that they don't go to sleep without first checking their email.

"Those are some pretty good examples of how that access to data … is extending the work day," the company's senior vice-president John Herrema says. One of the key findings of the survey, he said, was that respondents were working on average about seven extra hours per week — almost a traditional full day of work, every week.

Those findings echo the results of another academic survey. Linda Duxbury is a professor in Carleton University's business school. For the last decade, the school has surveyed workers who are given access to smartphones and watch how it impacts their workloads and stress levels.

"We haven't had a defined work week for several decades now," Duxbury says. "These mobile phones [psychologically] take you to work even when you're physically not at work."

Plugged-in workers are certainly getting more done. But not always being paid more for it. And that leaves their employers liable if they should ever try to rectify that.

That's why some companies have already moved to address the issue.

Other global cases

In 2011, German carmaker Volkswagen decided to block emails from company-issued smartphones 30 minutes after their shift ends. The phones only become unblocked when the next shift begins.

In December, the government of Brazil passed a law stating that employees who answer work-related emails on their phones after hours are entitled to overtime, under the assumption that an email to a worker is equal to an order to work from a superior.

And in 2010, Chicago police officer Jeffrey Allen filed a class action suit on behalf of the city's police force after they were issued smartphones.

So far, there don't appear to be any Canadian overtime lawsuits that hinge specifically on smartphone use. But they're clearly a factor in one way, Elliot notes. They provide a ready-made electronic trail of evidence when it comes time to build a case about unpaid work. "It's indisputable," he says. "You can look at the electronic record and determine the truth."

The smartphone argument has yet to gain much traction in Canada, but Elliot has a simple piece of advice for any company looking to protect itself from future legal actions over unpaid overtime.

"They should pay people for their overtime," he says. "That's the way to protect yourself."