Are you required to have a pay equity plan?

March 12, 2010 Yosie Saint-Cyr, LL.B. Managing Editor Human Resources, Human Rights, Payroll, Wages and Compensation

pay-equity One purpose of Pay Equity is to redress differences in compensation due to systemic gender discrimination suffered by persons who occupy positions in predominantly female job categories. Only the provinces of Quebec and Ontario have pay equity legislation that covers the private sector. The Pay Equity Act in each province requires employers with 10 or more employees to provide equal pay for work of equal value.

This is the law, so I was amazed to find out how challenging the state of non-compliance is.

In Quebec, in 2008, ten years after the Pay Equity Act was enacted, women still earn 11 percent less than men. Those were the findings of an economic analysis study conducted by Analysis Group, Economic, Financial and Strategy Consultants on behalf of the Ordre des CRHA et CRIA du Québec (ORHRI). According to the Quebec government, more than half of companies had not implemented the required pay equity plan and measures, and several had not maintained their pay equity plans as required by law.

As a result, the Quebec government modified its pay equity measures last May, and these changes have repercussions for all employers. The law was amended to address several issues, including that of non-complying companies.

Companies with 10 or more employees who still find themselves in non-compliance have until December 31, 2010, to rectify the matter and implement their pay equity plan. If your company has complied but not maintained your plan up to date, new maintenance rules have been introduced. Consequently, the formal evaluation of the maintenance must be done every five years, the first being due December 31, 2010.

Any company that is not yet subject to the law must calculate the annual average salary of its workers, retroactive to 2008.

The results of the maintenance must be posted in conspicuous places at the company (notice boards, intranet, etc.). Finally, the employer must complete a statement and send it to the Quebec Pay Equity Commission.

How about Ontario? According to the Equal Pay Coalition, women in Ontario, on average, still earn 29 percent less than men. Indicating that the law in Ontario is not faring any better than in Quebec. Employers are still not complying with the Pay Equity Act, 21 years after enactment (1988). However, the Ontario government has not taken any drastic measures to enforce the law.

It may be that employers find the law very complex and not easy to comply with. Nevertheless:

Employers who have not yet complied with the law should proceed to take measures to comply to avoid very costly adjustment plans.
Employers who have complied should look closely at their pay equity plans to ensure that they have complied with the maintenance requirements.
Employers are required to make annual adjustments until pay equity is achieved.

The provincial governments have various tools and resources to help you achieve pay equity.

In Ontario, the tools can be found in the Library of the Pay Equity Commission website at www.payequity.gov.on.ca/peo/english/pubs_tools.html.

In Quebec, the tools can be found under Publications on the Pay Equity Commission website at www.ces.gouv.qc.ca/asp/publications.asp

Note that Quebec’s and Ontario’s Pay Equity Acts do not apply to employees of the federal government, federal agencies or federally regulated companies. The pay equity sections of the Canadian Human Rights Act cover employees of these employers.

In other Canadian jurisdictions, human rights legislation includes equal pay provisions based on the prohibited ground of sex or gender. And in some jurisdictions, there are also equality of pay provisions under the employment standards laws, which are very different from pay equity legislation.

What challenges do you face when it comes to complying with pay equity legislation?

Yosie Saint-Cyr
Human Resources and Compliance Managing Editor

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Yosie Saint-Cyr, LL.B. Managing Editor

Managing Editor at First Reference Inc.

Yosie Saint-Cyr, LL.B., is a trained lawyer called to the Quebec bar in 1988 and is still a member in good standing. She practiced business, employment and labour law until 1999. For over 18 years, Yosie has been the Managing Editor of the following publications, Human Resources Advisor, Human Resources PolicyPro, HRinfodesk and Accessibility Standards PolicyPro from First Reference. Yosie is one of Canada’s best known and most respected HR authors, with an extensive background in employment and labour across the country. Read more