Employment & Labour

Wright retained to argue appeal for proposed Uber driver class action

By Jennifer Pritchett, Associate Editor

The Uber driver who launched a proposed $400-million class action against the global ride-sharing app is appealing an Ontario judge’s decision to stay the lawsuit, says Toronto lawyer Michael Wright.

Wright, of Wright Henry LLP, has been retained to handle the appeal.

The plaintiff is a driver who delivers food from restaurants to consumers through the application, UberEats. The man brought a proposed class action on behalf of other drivers alleging they are Uber employees and entitled to the benefits of the province's Employment Standards Act, says the Ontario Superior Court of Justice decision.

In a motion filed with the court, Uber moved to have the proposed class action stayed in favour of arbitration in the Netherlands, arguing this is outlined in an agreement between Uber and the driver.

The court stayed the man’s action in favour of arbitration, says the ruling.

The factum for the plaintiff’s appeal of that decision alleges the court “erred by staying the action in favour of an arbitration provision that requires putative class members like [the plaintiff] to arbitrate disputes with Uber in the Netherlands.”

The focus of the appeal, it says, is whether, under Ontario law, an arbitration provision that requires [the plaintiff] to pay up to US$14,500 (almost $19,000 CDN) in filing and administrative fees, plus the cost of a mediator and an arbitrator, legal fees, and travel to mandatory mediation and arbitration in the Netherlands, "can preclude him from seeking adjudication of an alleged breach of minimum employment standards under the Employment Standards Act in Ontario on his and the Class’s behalf.”

While arbitration clauses are routinely enforced in Canada, they aren’t relied upon when an agreement undermines certain minimum rights for employees or any “vulnerable population,” says the factum.

“Likewise, courts will not enforce highly unfair bargains between parties that have vastly unequal bargaining power, especially when the weaker party seeks to enforce a fundamental right, such as the right to work.”

The appeal argues that the motion judge’s determination that the action should be stayed “ignored these principles and was grounded in several errors.”

The first of those alleged errors, outlined in the factum, is that the judge “wrongly determined [the appellant's] claims were commercial, not employment-related, and fell within the scope of the arbitration provision and the International Commercial Arbitration Act.

The second involved the judge allegedly ignoring the Employment Standards Act’s remedial purpose, and “wrongly concluded that the arbitration provision precluded [the appellant] from seeking to enforce his rights under the Act in an Ontario court, despite the arbitration provision’s requirement that disputes be resolved under the law of the Netherlands.”

The third error, says the court file, is that the judge allegedly “wrongly determined that the unfairness of the arbitration provision was insufficient to render it unconscionable — relying on the wrong legal test for unconscionability, requiring proof of Uber’s intent to take advantage of [the appellant] to establish an impermissibly high degree of unfairness.”

And the fourth, it says, alleges the court’s “consideration of the parties’ relative bargaining power and the nature of their relationship was grounded in two palpable and overriding errors of fact: (1) that Uber’s internal complaint process allows for the resolution of most disputes in Ontario such that only “substantial” disputes would require arbitration in the Netherlands; and (2) that drivers collect their fees from riders, rather than Uber remitting payment to the drivers. Neither of these findings are supported by the record.”

It also alleges that “Uber’s control over the means of resolving disputes and collecting and remitting payment to drivers further establishes its disproportionate power over [the appellant] and the putative Class Members and the unfairness of this arrangement.”

The man argues that his appeal be allowed and that the merits of his proposed class action be heard.

“Under the circumstances, the arbitration clause is unconscionable. The action should not be stayed,” alleges the appellant’s factum.

The appeal is scheduled for Nov. 27.

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