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Compliance Reminder – Ontario Pay Equity Commission is open for business

The Pay Equity Act of Ontario requires every provincially regulated employer with ten or more employees to ensure that pay equity exists in the workplace. This is not a one-off compliance requirement. Rather, employers must maintain pay equity on an ongoing basis. This means that both unionized and non-union employers need to re-visit their pay equity compliance when changes occur in the workplace such as the creation of new job classes, significant changes to job duties, elimination of a prior male comparator job class or a business acquisition or reorganization. Pay equity compliance is voluntary and self-directed. However, the Pay Equity Commission operates two programs that permit the Commission to reach out to employers even in the absence of a complaint in order to determine whether the employer is pay equity compliant. These two programs are described briefly below.

Monitoring Program

The Monitoring Program has been underway for a number of years. By September 30, 2010 (most recent date for which information is publicly available), the Monitoring Program had contacted over 3,000 Ontario employers. In the past, the Pay Equity Commission tended to focus on particular industry sectors (for example retail, food) or geographic areas (for example Greater Toronto Area and northern regions of the province). However, the Monitoring Program is currently focussed on contacting employers who were flagged as part of the Wage Gap Program or did not respond to a contact under the Wage Gap Program. Pursuant to the Monitoring Program, the Pay Equity Commission contacts employers to request three years of compensation data and information about jobs, locations and the employer’s pay equity process. The Review Officer can require up to seven years of data where concerns are raised. If the employer is not compliant with the Pay Equity Act, the Review Officer will require compliance pursuant to a set time line.

Wage Gap Program

The Wage Gap Program was launched in 2011. Its goal is to cover all Ontario workplaces to determine whether wage gaps persist. Using the Dunn & Bradstreet listing of employers, the Pay Equity Commission has completed its pilot project of canvassing employers with 500 or more employees. As it winds down phase two, covering employers of 250 to 499 employees, it is now turning its focus to employers with 100 to 249 employees. Employers are not required to produce employee data for the unionized work force. Currently the Wage Gap Program is not contacting employers which have been visited by the Pay Equity Commission within the last ten years. If an employer does not respond by the deadline or the wage data indicates possible pay inequities, the file is referred to a Review Officer.

Our advice

The Pay Equity Act is unusual in that it does not include a limitation period. Therefore, it is possible for the Pay Equity Hearings Tribunal to order an employer to comply retroactively to a date in the early 1990’s, depending on when the company began operations in Ontario and depending on the size of the work force. We strongly recommend that all employers become compliant with the pay equity requirements, generally by selecting a realistic retroactivity date for which the employer has sufficient data about pay, gender dominance and job duties. Be sure that all new positions are evaluated under your job evaluation system. Keep records so that you can show compliance at least to your selected retroactivity date. Build pay equity compliance into the H/R systems by ensuring that all jobs have up to date job descriptions, all positions are evaluated under your job evaluation system and all newly created positions are immediately evaluated and paid according to your job evaluation system.

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Compliance Reminder – Ontario Pay Equity Commission is open for business

Ontario’s Pay Equity Commission Publishes Interpretative Guide to Pay Equity Act

Ontario’s Pay Equity Commission recently published an interpretative guide designed to help employers understand their obligations under the Pay Equity Act. Introduced in 1987, the Pay Equity Act’s stated purpose is “…to redress systemic gender discrimination in compensation for work performed by employees in female job classes.” It applies to all private sector employers in Ontario that have ten or more employees and all public sector employers.

In addition to setting out the requirements for achieving and maintaining pay equity, the Guide also highlights the pay equity office’s pro-active monitoring program which it has undertaken in recent years to ensure that employers are complying with their statutory obligations.

To access the Guide online, please visit: http://www.payequity.gov.on.ca/en/resources/guide/ope/index.php

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Ontario’s Pay Equity Commission Publishes Interpretative Guide to Pay Equity Act

Faster Movement of Men up Pay Ladder not Remedied by Pay Equity Act

On May 31, 2012 the Ontario Divisional Court ruled that the Pay Equity Act does not require the harmonization of wage grids as long as female employees achieve the same level of pay as men at the top of the grid. The Canadian Union of Public Employees (CUPE) appealed decisions by the Pay Equity Tribunal with respect to two Ontario employers: Lakeridge Health Corporation and the York Region District School Board. At both of these employers, it was found that workers belonging to the male dominated job class moved more quickly (nearly three times as fast) through pay levels than the workers belonging to the female dominated job class. The comparison was between the mostly male service workers versus the female dominated clerical staff.

In coming to its decision, the Divisional Court found that although the union argued that the fundamental objective of the Act is to “eliminate” gender discrimination in compensation, it would be more accurate to say that the purpose of the Act is to “redress” systemic wage discrimination in accordance with the detailed provisions of the legislative scheme.

The Court went on to state that “within that legislative scheme, the Legislature has made a number of choices about how pay equity is to be achieved…with the result that the Act does not contemplate the elimination of all discrepancies between comparably-valued male and female job classes.” At least one discrepancy that the Act does not contemplate addressing, as found in this case, is the time it takes to reach the highest rate of pay for men and women in comparable jobs. It has yet to be known whether this case will be appealed by CUPE.

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Faster Movement of Men up Pay Ladder not Remedied by Pay Equity Act