Federally regulated agricultural employers need to take action now to meet their pay equity obligations, if they haven’t already started.
The aim of pay equity is to ensure that an employer gives equal pay for work of equal value, regardless of gender. This means that jobs predominantly held by women are paid the same as jobs predominantly held by men, when the value of their work is the same.
It is not necessary for the jobs to be identical or even similar; it is sufficient that they have the same value in terms of their skills, effort, responsibility and working conditions.
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The Pay Equity Act came into force Aug. 31, 2021. It applies to all federally regulated employers with 10 or more employees.
Under the act, employers must develop a pay equity plan and publish the final version by Sept. 3, 2024. If wage increases are necessary, they must be paid shortly thereafter.
After the first plan has been developed, it must be updated every five years. Employers will also have to file annual statements with the pay equity commissioner, starting in 2025.
Many rules govern how to develop a pay equity plan. For companies with unionized employees, or with 100 or more employees, a pay equity committee must be set up to develop the plan.
The committee must comprise at least two-thirds employee representatives and meet other legislative requirements. It will make all major decisions concerning the pay equity plan. If the committee cannot resolve an issue, it can be referred to the pay equity commissioner for a binding decision.
The steps involved in developing a pay equity plan include:
- Identify job categories in the workplace (grouping positions with similar duties and compensation).
- Identify which job categories are female-dominated or male-dominated.
- Evaluate the work performed in each of the gender-predominant job categories.
- Calculate total compensation in dollars per hour for those job categories.
- Determine if there are gender-based compensation differences between male and female job categories performing work of equal value.
Employers must guard against the risks of non-compliance. Later this year, it is anticipated that the federal government will publish final regulations outlining the administrative monetary penalties that can be imposed for violations of the law. These penalties can be as high as $30,000 for employers with 10 to 99 employees and $50,000 for larger employers.
Implementing pay equity will give employers and employees the assurance that pay is fair, without gender discrimination. This can have significant reputational benefits for employers and can also contribute to the recruitment and retention of workers.
Implementing pay equity will also help reduce the wage gap between men and women in Canada. In 2020, a woman in Canada earned 89 cents for every dollar earned by a man.
Developing a pay equity plan can be a daunting task for those who have never done it before. Resources are available from the Office of the Pay Equity Commissioner. Employers who need help can also contact a pay equity specialist, who will guide them through the process.
Renée Caron runs Renée Caron Consulting and is the interim equal pay commissioner for the Northwest Territories.
