Legislation coming to the Federally Regulated Employment Sector (and possibly provincially-regulated employers enrolled in the Federal Contractors Program)

The Canadian pay equity model requires employers to assess the value of female-dominated jobs and male-dominated jobs within an organization by evaluating the value of the jobs on the basis of skill, effort, responsibility and working conditions. Female-dominated jobs which are paid less than male-dominated jobs of the same or comparable value need to be paid the same.  This type of job evaluation permits jobs with entirely dissimilar job functions to be valued. The Equal Wages Guidelines, 1986 under the Canadian Human Rights Act was arguably the first piece of pay equity legislation in the country.  This was followed by private sector pay equity laws in Ontario and Quebec.  However, the provincial laws do not simply rely on employee or union complaints and, instead, set out a proactive compliance regime with various milestones and deadlines.  The Equal Wages Guidelines, 1986, on the other hand, are complaint-based and have a history of spawning notoriously lengthy litigation.

The Special Committee on Pay Equity tabled its First Report to Parliament on June 10, 2016. Among its 31 recommendations, the Special Committee recommends that the Government of Canada draft proactive gender pay equity legislation within 18 months of the tabling of the Report to apply to the federal public service, Crown corporations,  federally regulated companies with 15 or more employees, and companies participating in the Federal Contractors Program.  Federally regulated employers in Ontario and Quebec which can provide evidence of compliance with the provincial legislation would be exempt from the federal pay equity plan, monitoring and reporting requirements.

The Report recommends the creation of a pay equity commission and a pay equity tribunal. The legislation would require both unions and employers to be responsible for modeling, implementing, monitoring and maintaining pay equity plans and would prohibit unions and employers from negotiating collective agreements that would contravene the pay equity legislation.  In fact, it was recommended that the legislation should stipulate that any pay equity agreement would supersede a collective bargaining agreement.  A female-dominated job class would be one with at least 60% female incumbents for job classifications with 100 or more employees, or at least 70% female for job classifications with fewer than 100 employees.

The federal government announced in October 2016 that it first plans to consult with stakeholders and experts and then table proactive pay equity legislation by 2018. The legislation will cover 874,000 employees and 10,800 employers in the federal jurisdiction.  There has been no comment from the Government on the Report’s recommendation to extend the requirements to provincially-regulated private sector employers participating in the Federal Contractors Program.   The government has faced criticism from unions and from the NDP for delaying pay equity to 2018.

We will keep you posted.

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