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Class Action Employment Lawsuit Filed Against Canadian Hockey League

Hot on the heels of the announcement of the recent MOL enforcement blitz, a freshly filed statement of claim in a class action lawsuit appears to combine two of the ongoing trends in employment litigation: the crackdown on unpaid positions which traditionally have not been subject to employment law and class actions (see our previous blog posts on the recent MOL internship blitz here and the recent settlement of another employment class action here.)

The Toronto Star reports that a class action lawsuit for $180 million was filed against the Canadian Hockey League (the “CHL”) on behalf of former and current players.  The CHL is the governing body for the three leagues that constitute Major Junior hockey, the most elite tier of junior hockey in Canada.

The lawsuit claims that the CHL’s current players receive between $50 and $120 per week for hours of practices, games, traveling and training.  The suit claims that the players are employees, and are therefore subject to the minimum wage requirements – which the stipends allegedly do not meet.  The suit suggests that players are required to “work” up to 65 hours of per week with no provisions for vacation pay, overtime or other statutory entitlements.

The lawsuit brings up numerous interesting employment law points.  For one, the initial hurdle is whether or not these players are employees for the purposes of employment legislation.  Unfortunately, the Ontario Employment Standards Act, 2000, does not define “employee” in any helpful way.

We will be discussing the rise in employment law class actions, among other current hot topics in labour and employment law, at our 28th Annual Employers’ Conference.  Attendees receive 6 CPD Credit Hours toward HRPA Recertification and this may apply toward 6 substantive CPD hours with LSUC. To review our complete agenda, or to register, click here.

Given that teams, even below the Major Junior level, charge fans for admission, there is an inherent logic to the argument that at some point before a youth earns a place in the NHL his status could shift from ‘participant’ to ‘employee’.  But there is no clear demarcation in legislation or caselaw.

To make matters more complex, CHL teams are scattered across all Canadian provinces except for Newfoundland.  Each province is subject to its own employment standards legislation, which can vary in important ways.  In fact, eight teams play out of the United States but are subject to the CHL’s rules and conditions.  This heterogeneity of claims could make it difficult to secure permission from the court (called “certification”) to proceed as a class action (instead of by individual claims).

Finally, the suit brings up interesting corollary questions:

  1. If the players were ruled ‘employees’ for the purposes of employment standards legislation, might this entitle them to worker’s compensation benefits after an injury?
  2. Would a player cut by his junior team be entitled to employment insurance?
  3. Would off-season training, with some players age 16 or younger, be a tax-deductible business expense?
  4. Could junior players unionize? The National Labour Relations Board in the US found that student-athletes on Northwestern University’s football team could do just that.
  5. What impact would the added costs and structural limitations have on player recruitment and development?

Suffice it to say that the outcome of this suit could have an impact on these other regimes in unanticipated, yet significant ways.

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