Ah, I think this might happen, if the day to switch back from DST in your time zone differs from mine (2016-10-30). Please change $scope.mytime accordingly.
This is an interesting bug. We likely need to add a check in the increment method in the timepicker & special timezone handling - the decrement one seems to work properly.
Edit: fixing the increment probably will introduce a problem into decrement - this will be tricky.
On the fall day of DST the time picker can't go forward past 2 AM
http://plnkr.co/edit/f1kiq5J89eOhBLgtstRT?p=preview
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