Court finds core employment factors can be decided collectively across all Pizza Nova drivers
On March 24, 2026, Ontario's Divisional Court issued a split ruling in a class action in which the plaintiff claimed $150 million in general damages and $5 million in punitive, aggravated and exemplary damages, alleging that approximately 1,800 or more Pizza Nova delivery drivers were misclassified as independent contractors.
In Cervantes v. Pizza Nova Take Out Ltd., Justice Matheson, writing for a three-judge panel, dismissed the plaintiff's appeal while granting the franchisees' appeal in part, striking the conspiracy claim. What survived: a class action alleging those drivers were employees, not independent contractors, denied entitlements under Ontario's Employment Standards Act, 2000. At the centre of it all were a mandatory Operations Manual, the pizza delivery system, a template driver contract, and two forms of franchise agreements — documents the court identified as central to the question of who controlled how drivers were classified and engaged.
The documents that made it to court
Pizza Nova grew from a single Toronto restaurant into a franchisor with approximately 140 franchisees across Ontario. Lead plaintiff Juan Jose Lira Cervantes drove for four Pizza Nova locations in Toronto, was paid as an independent contractor, and received none of the statutory benefits he claimed were owed, including minimum wage, vacation pay, and employer contributions to EI and CPP.
These documents sat at the heart of the case as the court examined who actually controlled how drivers were classified and engaged. The amended statement of claim alleged that "the Franchisor, not the Franchisees, retained extensive control over the terms and conditions of the agreements with the drivers."
That allegation placed those documents at the heart of the employer liability question.
When "independent contractor" is not enough
The court upheld the certification of employment status as a common issue. The motion judge, whose reasoning the Divisional Court upheld, found that core factors of the employment relationship could be assessed collectively across all drivers, and that individual differences "existed at the margins of the working relationship, not at its core."
The certified non-conspiracy claims were limited to the Franchisor and the four Cervantes Franchisees the plaintiff had made deliveries for. The plaintiff was granted leave to propose additional plaintiffs to expand that certification but had not yet done so at the time of the ruling.
On negligence, the court declined to strike the claim, citing the motion judge's reasoning that "a delivery driver searching for low paid shift work may not have the same ability to regulate their affairs in a contract such that a negligence claim would be precluded."
What the ruling leaves on the table
The Divisional Court upheld certified claims for breach of the ESA, breach of contract and the duty to act in good faith, unjust enrichment, and in the alternative, negligence, against the Franchisor and the four Cervantes Franchisees. The plaintiff had claimed $150 million in general damages and $5 million in punitive, aggravated and exemplary damages, as well as other remedies.
The conspiracy claim was struck. The court found that the franchisees had merely acquiesced to the franchisor's standard-form requirements, and that acquiescence alone did not amount to a coordinated unlawful act among franchisees.
The parties were directed to submit a draft order specifying the amendment to the certification order within two weeks. The motion judge had expressly made "no finding that a negligence claim would succeed at trial."
