Ontario`s Pay Equity Act was first enacted in 1987. This statute requires employers with more than 10 employees to eliminate gender-based wage differences and it applies to both public and private sector employers, as well as full-time and part-time employees.

Pay equity is considered a fundamental human right in the workplace. It integrates many aspects of employment law, including compensation, human rights and employment law standards.

Employer’s Basic Obligations

The Act imposes an obligation on every employer to take affirmative action to ensure that pay equity is a workplace tenet. An employer is obligated to take a proactive approach to ensuring pay equity among each of its employees. This is not something to be done as a response to an employee complaint.

Employers have an obligation to:

• Determine job classes, including the gender and job rate of job classes.
• Determine the value of job classes based on factors of skill, effort, responsibility and working conditions.
• Conduct an audit comparing all female employees and workers using job–to–job, proportional value or proxy method (proxy is for public sector only and of limited application).
• Adjust the wages of underpaid female employees or workers as necessary so that they are paid at least as much as an equal to male counterparts in a comparable job class or classes.

Every employer may be subject to a random audit conducted by a Pay Review Officer to ensure compliance with these obligations.

The Issues on a Complaint

The first step in assessing the merits of a complaint with respect to pay equity is to assess the relevant job descriptions. The positions being contrasted need not be mirror images, but they should be comparable to one another. The factors to be examined include skill, effort, responsibility and working conditions. The ultimate goal is to allow for equal pay for equal work with the same employer.

One example may be a comparison of job responsibilities of managers of different departments within the same company. Comparative factors may include the number of direct reports and the substance of the work done in each department. The key comparator is the value of the job function to the company.

Filing the Complaint

Any person may file a complaint with the Pay Equity Commission. It will be the task of legal counsel to determine the merits of each individual case. The employer may argue reasons for the wage disparity, which could be based on seniority, the merits of the work being done, or the varying qualifications of the comparative positions.

Currently, the Pay Equity Commission is backlogged with cases. The time period from filing to the date of a hearing is now roughly two years.

The Pay Transparency Act

The prior Liberal Government introduced this statute which was intended to prevent an employer from asking potential candidates about their previous wages. It was intended to assist in the elimination of wage discrepancies based on gender. However, the current provincial administration has not proceeded with this new legislation.

Take Away to Both Sides

Pay equity is a fundamental human right. Affirmative action is required from all employers to eliminate wage disparity based on gender. The issues are complicated and complex, but an experienced employment lawyer can help to guide both employers and employees through any concerns or disputes regarding pay equity in the workplace.

Get Advice and Know Your Rights

Whether you are the employer or the employee, sound legal advice will help to make you aware of your rights and obligations around pay equity, and navigating the complaints process if necessary. To discuss this issue with a skilled lawyer, contact the offices of Toronto employment lawyers Grosman Gale Fletcher Hopkins LLP. We regularly advise parties on both sides of a wide range of legal workplace issues. Contact us online or by phone at 416-364-9599 to schedule a consultation.