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Denny’s restaurants settles foreign workers’suit for $1.4 million




Sheryl Smolkin


Temporary workers from the Philippines who worked at Denny’s restaurants in B.C. have won a settlement worth $1.4million that is the first of its kind in Canada.

Newspaper title

The Toronto Star

Full text

Toronto Star

Denny¹s restaurants settles foreign workers¹suit for $1.4 million Temporary
workers from the Philippines who worked at Denny¹s restaurants in B.C. have
won a settlement worth $1.4million that is the first of its kind in Canada.
By: Sheryl Smolkin, Published on Tue Jul 16 2013

A group of temporary workers from the Philippines who worked as cooks and
servers at Denny¹s restaurants in B.C. have won a settlement worth
$1.425 million that is the first of its kind in Canada.

The BC Supreme Court approved the settlement because Denny¹s failed to
honour its contracts with the workers. This included offering them less than
a full week of work, not paying overtime pay and failing to reimburse them
for agency fees and airfare to Canada.

The judgement which was released May19, caps a two-year battle by the 77
workers to have the terms of their employment contracts honoured. It is the
first case in Canada where contract workers have launched such an action.
They are typically reluctant to take legal action for fear of reprisal by
their employers.

Denny¹s brought the workers to Canada under the Temporary Foreign Workers
Program (TFWP) beginning in 2006. The federal program lets employers hire
workers for up to 24 months to provide labour in areas where there are

In some cases, work permits can be renewed and workers may apply for
permanent resident status.

The case began when Alfredo Sales was fired in August 2010, a week after he
filed a claim with the British Columbia Employment Standards branch seeking
repayment from Denny¹s for his airfare.

It became apparent to Sales¹ Vancouver lawyer Charles Gordon that other
Denny¹s employees were in a similar situation. Gordon, a partner with Glavin
Gordon Clements, launched a class action on behalf of 77 workers in January
2011 suing Denny¹s western Canada parent Northland Properties.

³Many of these people were still working for Denny¹s so they never would
have gone to court on their own. That¹s why a class action made sense,²
Gordon says.
The first hurdle was certification of the class action. This involved
getting permission from the B.C. Supreme Court to have all the claims dealt
with at the same time.

If the class action had not been certified, each employee would have had to
bring a separate case. Certification also tends to benefit plaintiffs as it
brings pressure for the action to be settled before trial.

Madam Justice Shelley Fitzpatrick agreed to the certification in March, 2012

Documents filed with the Court revealed that the workers had contracts which
guaranteed either 37.5 or 40 hours a week of work, but they frequently did
not get that many hours. Also, when they worked overtime, they were not paid
at the overtime rate.

Nor were the workers reimbursed for their flights from the Philippines to
Canada as promised, a cost of about $1,000 per person. In addition, an
agency retained by Denny¹s charged applicants agency fees prohibited by the
province¹s Employment Standards Act of $5,000 to $6,000 per person.

A year after the certification, Denny¹s agreed to a settlement. Although
19 of the original 77 people dropped out before the case settled, the judge
decided to include them because of the way the company treated them.

About $850,000 of the settlement was earmarked for the wages and fees.
The rest was for arbitration, auditing and legal fees plus several court
ordered charitable donations to worker support groups.

To date, each class member has received about $7,000 representing the agency
fee plus airfare, even if they are no longer working or residing in Canada.
The rest will be paid when a court-appointed auditor reviews Denny¹s payroll
records to determine how much is owed to each plaintiff.

It is expected that these amounts will be paid to class members within the
next few months, says Gordon. He also says that the case sends a powerful
message to both employers and temporary foreign workers.
³If employers are not living up to the terms of their employment contract,
there is a way that workers can pursue them.²

File Attachments


Economic sectors

Labourers in food, beverage and associated products processing, Food and beverage servers, and Food counter attendants, kitchen helpers and related support occupations

Content types

Documented cases of abuse

Geographical focuses

British Columbia and Philippines

Spheres of activity