Canada: How Will Ontario's Pay Transparency Act Affect Your Organization?

The Ontario government recently introduced Bill 203, the Pay Transparency Act, 2018 (Act) in the legislative assembly, in part to close the wage gap between men and women by ensuring that compensation is based on a job's requirements and the candidate's qualifications. More broadly, this legislation is part of a wider strategy aimed at increasing transparency in both hiring and payment practices in the province.

RECRUITMENT

If passed, the Act would prevent employers from seeking compensation history information about an applicant. Applicants, however, could still voluntarily disclose this information without being prompted, and these restrictions would not apply to publicly available compensation history information.

To ensure compensation transparency for applicants, the Act would require employers to include the expected compensation or the range of expected compensation in publicly advertised job postings.

TRANSPARENCY REPORTS

Pursuant to the Act, employers would have increased reporting requirements relating to compensation. In particular, prescribed employers would be required to publish pay transparency reports. It is expected that these reporting requirements would first be applied to the Ontario Public Service, followed by employers with over 500 employees, and then employers with more than 250 employees.

Pay transparency reports would be required to include prescribed information relating to the employer, its workforce composition, and differences in compensation in the workforce with respect to gender and other prescribed characteristics, to be determined through consultation.

In addition to having to submit these reports to the province, pay transparency reports would have to be posted online or in a conspicuous place in every workplace of the employer that is likely to come to the attention of employees in that workplace.

NO REPRISAL AND COMPLIANCE

The Act prohibits employers from intimidating, dismissing or otherwise penalizing employees for, among other things, inquiring about their compensation or a pay transparency report, or giving information about the employer's compliance or non-compliance with the requirements of the Act to the government.

Compliance officers may be appointed to enforce the Act by, for example, conducting compliance audits without a warrant and issuing a notice of contravention in the event that the officer is of the view that an employer has contravened the Act. Penalties for contraventions of the Act will be determined in accordance with the regulations.

DISCUSSION

If Bill 203 is passed, the Act will come into force on January 1, 2019. The Act may have a significant impact on employers, both as it relates to their hiring practices and reporting requirements.

There is no formal timetable with respect to when Bill 203 may be passed, and we will continue to monitor any developments as the Bill progresses through the legislative process.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.