Pay equity on government radar

Provincial advocates rally around federal government’s lead on compensation
By Sheila Brawn
|Canadian Payroll Reporter|Last Updated: 04/16/2019
Ottawa
While the federal government takes steps to implement pay equity for federally regulated workplaces, advocates in other parts of the country continue to press their governments for pay equity legislation. Credit: Michel Loiselle (Shutterstock)

Pay equity is on the radar again in some Canadian jurisdictions.

While the federal government takes steps to implement pay equity for federally regulated workplaces, advocates in other parts of the country continue to press their governments for pay equity legislation.

In December, Parliament passed legislation that, once in force, will require federally regulated public- and private-sector employers with at least 10 employees to proactively address pay equity.

The government has not confirmed a date for implementing the new law, but has suggested it could come into force by year’s end.

Pay equity — also called equal pay for work of equal value — aims to ensure that jobs traditionally or predominately done by women are paid at least the same as comparable jobs traditionally or predominately done by men.

Pay equity is different from equal pay for equal work, which addresses situations in which men and women do the same or substantially similar work.

Under the new federal Pay Equity Act, employers will be required to create a pay equity plan by Dec. 13, 2021. The plan will have to indicate the number of employees, identify job classes in the workplace and which gender is predominate in each class, and evaluate the value of work each class does based on skill, effort, responsibility and working conditions.

If the plan shows differences in pay between comparable job classes, employers will have to increase the compensation paid to employees in the underpaid predominately female classes. Employers will also be required to post notices of their obligations and how they are fulfilling them.

Unionized workplaces and non-unionized employers with 100 or more employees will have to set up a pay equity committee to develop and update the plan, with a mandatory review at least every five years.

The act will also establish a pay equity commissioner who will be responsible for administration and enforcement.

The new process will advance beyond the current complaints-based system under the Canadian Human Rights Act, which requires employees to bring forward complaints about pay discrimination rather than requiring employers to examine their pay policies.

The federal government said it drew on pay equity laws in Ontario and Quebec when developing its act — the only two provinces with legislation that applies to public- and private-sector workers.

Four other provinces — Manitoba, New Brunswick, Nova Scotia, and Prince Edward Island — have pay equity laws, but they only apply to public-sector workplaces.

Advocates in New Brunswick are working to expand pay equity legislation to the private sector.

“Too often, female-dominated jobs are undervalued and underpaid compared to male-dominated jobs,” stated the New Brunswick Coalition for Pay Equity in a letter to politicians last fall. 

“Thanks to Pay Equity Act, 2009, public-sector employees in female-dominated jobs have received equal pay for work of equal pay. However, 65 to 70 per cent of employed women work in the private sector in New Brunswick. The government should pass pay equity legislation to protect their rights,” it said.

By the end of 2020, the coalition wants the government to implement recommendations from a recently released report calling for private-sector pay equity legislation.

The report was prepared by an advisory committee to the Economic and Social Inclusion Corporation, a government-created body made up of representatives from government, business, non-profit organizations, and individuals who have experienced poverty.

It called for pay equity legislation that would cover all employers in the province who have at least 10 employees. Like the province’s current pay equity law, the report suggested that any new legislation be proactive, with regular reviews, rather than complaint-based.

“Without legislation, pay equity is dependent on employers’ will, which is not always sufficient to ensure men and women are paid equitably,” said the report.

It also recommended that pay equity cover all types of employees (for example: full-time, part-time, seasonal, contract) and that pay equity assessments not be contingent on there being a minimum number of employees in a job class.

It suggested other features of the legislation could include a three-year phase-in, based on employer size, and the creation of a pay equity office to enforce the act and resolve disputes.

“Regardless of the model chosen, it will be important to legislate the fundamental right to pay equity and provide a clear legislative framework for its implementation,” it said.

So far, the government has not said whether it will adopt the report’s recommendations. Last fall, the government did not support a private member’s bill that would have mandated pay equity for private-sector employers with at least 10 workers.

Advocates in Newfoundland and Labrador are also waiting to see if their government will move on pay equity. Two years ago, members of all political parties in the legislature unanimously approved an NDP motion asking the government to develop pay equity legislation, but the government has yet to do so.

In Alberta, the province’s Human Rights Act requires employers to pay male and female employees the same rate when they do the same or substantially the same work, but it does not address equal pay for work of equal value.

“The Human Rights Act and certain federal regulations address wage equity, but without legislation at the provincial level you can’t really ensure wage equity is a reality,” said Bonnie Gostola, a vice-president with the Alberta Union of Provincial Employees.

A 2016 report on pay equity published by the Parkland Institute — a non-partisan research centre affiliated with the University of Alberta — also recommended a pay equity law for the province.

The report by Queen’s University professor Kathleen Lahey found that the income gap between men and women in Alberta was 41 per cent, compared to a national average of 33 per cent.

“Pay equity legislation is one of the first and most fundamental steps in reducing this gender income gap, and bringing women and men closer to income parity,” said the report.

It recommended compulsory pay equity legislation that would apply to both the public and private sectors. It also suggested that the government create a pay equity commission to oversee the legislation and conduct audits.

The Alberta government has not indicated whether it plans to table pay equity legislation.

Pay equity has also been on the radar in British Columbia. Last year, a private member’s bill was put forward that would require public companies to proactively take steps to address wage gaps based on gender for substantially similar work.

“While equal pay for equal work is enshrined in the Human Rights Code, discrimination can only be prosecuted retroactively once it is detected or brought forward,” said Liberal MLA Stephanie Cadieux at the time. “This legislation would require firms to proactively rectify wage gaps on their payroll.”

The bill did not advance beyond first reading. To date, the B.C. government has not announced plans to table its own pay equity law.

Pay equity is also before the provincial legislature in Quebec — but for a different reason. The government has had to rewrite sections of its Pay Equity Act after the Supreme Court of Canada ruled them unconstitutional.

Last May, the court said certain provisions related to employer pay equity audits were invalid because they violated equality rights under the Canadian Charter of Rights and Freedoms.

The Pay Equity Act requires employers to audit their pay equity progress every five years, with wage adjustments applying from the date they post the audit results.

“If the audits showed women were not being paid fairly, they could still only get pay equity every five years, with no backpay for unfair wages in between,” said the court’s summary of the case.

“This has the effect of making the employer’s pay equity obligation an episodic, partial obligation,” it said.

The proposed amendments that the province’s National Assembly is now studying aim to comply with the court’s ruling by among other changes requiring that pay adjustments that occur following an audit be payable as of the date of the event leading to the adjustment and not from the date the employer posts the audit results.

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