Increasing pay transparency for federally regulated employers under Employment Equity Regulations
Brian G. Johnston, QC, Jennifer Thompson and Daniel Roth
The Government of Canada has announced the final Regulations Amending the Employment Equity Regulations (“Regulations”). The Regulations come into force on January 1, 2021 and will bring increased pay transparency to federally regulated workplaces. Federally regulated employers with 100 or more employees will be required to file annual employment equity reports with the Minister of Labour on or before June 1 each year, with the first report due by June 1, 2022 covering the 2021 reporting period. These reports will be used to compile aggregated wage gap information on women, Aboriginal people, persons with disabilities, and members of visible minorities.¹ This information will then be published for the first time in the Employment Equity Act: Annual Report 2022.
The existing version of the Regulations will continue to apply to employment equity reports for the 2020 reporting period. The amended Regulations in force as of January 1, 2021 will only apply to reports for the 2021 reporting period and onward.
The Regulations seek to simplify the definition and calculation of salary, no longer requiring employers to annualize salaries for the purposes of reporting. Rather, employers will be required to report more readily available information, including:
- salary, not including bonus pay or overtime pay;
- the period over which the salary was paid;
- the number of hours worked that can be attributed to the salary earned;
- the amount of any bonuses paid during the reporting period; and
- the amount of any overtime paid during the reporting period with the corresponding hours worked giving rise to that overtime pay.
The Regulations also provide definitions for overtime pay, overtime hours, and bonus pay, to help guide employers. Employers will be required to maintain and retain records to support their reporting. Employers must also retain information about each employee’s occupational unit group classifications and code under the North American Industrial Classification System.
The Regulations further prescribe that employers must use the definitions found in the Employment Equity Act (“Act”) for the purposes of self-identification in workplace questionnaires feeding into their reporting. The Act provides definitions of Aboriginal people, persons with disabilities, and members of visible minorities, who along with women, constitute the designated groups. Prior to the amended Regulations coming into force, employers were permitted to use their own definitions of designated groups insofar as they were “consistent” with the definitions in the Act. After the Regulations come into force, employers will all be required to use the prescribed definitions, seeking consistent comparison across the aggregated self-identification data.
Canada will be the first country in the world to make wage gap information with respect to women, Aboriginal people, persons with disabilities and members of visible minorities working in federally regulated workplaces available to the public. In addition to the above pay transparency measures, the related Pay Equity Act is also expected to come into force sometime in 2021 following the conclusion of the federal government’s public consultation on the proposed Pay Equity Regulations. The public consultation on the Pay Equity Regulations will remain open until January 13, 2021.
The federal government will be updating the forms associated with filing the annual reports, and the Workplace Equity Information Management System will be updated in advance of the June 1, 2022 reporting deadline.
All federally regulated employers with more than 100 employees who have employment equity obligations should review their policies and procedures in light of these changes to ensure compliance for the 2021 reporting period.
¹ Note that this is the terminology utilized by the Employment Equity Act itself.
This article is provided for general information only. If you have any questions about the above, please contact a member of our Labour and Employment group.
Click here to subscribe to Stewart McKelvey Thought Leadership articles and updates.
Archive
Jennifer Taylor Introduction Appeal courts in Ontario1 and Nova Scotia2 have now issued decisions about Trinity Western University’s proposed law school (“TWU”) in British Columbia, and at first glance they couldn’t be more different. The Court of Appeal for…
Read MoreJoe Thorne1 and Giles Ayers2 Limitation periods serve a critical function in the civil justice system. They promote the timely resolution of litigation on the basis of reliable evidence, and permit litigants to assess their legal exposure…
Read MoreOn July 14, 2016 the Supreme Court of Canada issued a significant decision affecting federally regulated employers across Canada. In Wilson v. Atomic Energy of Canada Limited the Court held that the purpose of the unjust dismissal…
Read MoreOn April 1, 2016 New Brunswick’s Mortgage Brokers Act came into force, requiring businesses acting as mortgage brokerages or as mortgage administrators in New Brunswick to be licensed. A mortgage brokerage is a business that on behalf…
Read MoreIn May 2016, the Federal Court of Canada confirmed that copyright does not protect facts, even where a book’s author is clearly inspired by the content of a film (Maltz v. Witterick, 2016 FC 524 (CanLII)).…
Read MoreBy Jennifer Taylor “…firms of notaries or lawyers…must not be turned into archives for the tax authorities”1 So says the Supreme Court of Canada in one of two highly anticipated decisions on solicitor-client privilege, offering lawyers…
Read MoreJoe Thorne1 and Clara Linegar2 As joint owners of a business, what do you do when the business relationship falls apart? And what if one owner undermines the business in the process? In Smith v Hillier,3 Justice Paquette…
Read MoreThe Supreme Court of Canada has dismissed the appeals in Bruce Brine v. Industrial Alliance Insurance and Financial Services Inc.1 (with costs) and Luciano Branco, et al. v. Zurich Life Insurance Company Limited, et al.(without costs). Both of…
Read MoreOn May 4, 2016, the Nova Scotia Pooled Registered Pension Plans Act (“PRPP Act”) was proclaimed in force, and finalized Pooled Registered Pension Plan Regulations were released. While there were no major changes from the previously released draft regulations, the proposed rules…
Read MoreBy Level Chan and Dante Manna Pooled Registered Pension Plans (“PRPPs”) are closer to becoming a reality for Nova Scotian employers. PRPPs were established by the Federal government in an effort to address the lack of retirement savings…
Read More