The new pay equity agenda – 7 steps to compliance

By: Marisha Tardif

On August 31st, 2021, the Pay Equity Act and its Regulations will enter into force, creating new requirements for federally regulated employers with 10 or more employees. The new legislation  requires employers to be proactive in eliminating wage gaps between men and women in the workplace, ensuring equal pay for work of equal value across job classes.

To achieve this, employers need to meet a series of obligations that revolve around the creation of a pay equity plan.

Below are 7 steps to help you understand and comply with the new pay equity agenda.

STEP 1 – Post a notice in your workplace

By November 1st, 2021, employers must post a notice to their employees announcing the creation of a pay equity plan and  a pay equity committee – if a pay equity committee is required.

The Canadian Human Rights Commission has published a free template and guidance sheet to help employers develop a workplace notice. Click here to learn more.

STEP 2 – Create your pay equity committee

Once you have posted your notice, you will need to get to work on your pay equity plan. You may be required to set up a pay equity committee to create the plan.

Trucking HR Canada has developed a fact sheet to help you learn more about pay equity committees and whether you are required to create one.  Click here to download this resource.

STEP 3 – Develop your pay equity plan

To develop a pay equity plan, employers need to follow a specific process,  requiring you to gather data and perform calculations to evaluate compensation across job classes.

Creating a pay equity plan is a complex and time-consuming process. It is a good idea for employers to review requirements and start taking steps towards creating your pay equity plan as soon as possible. Again, we have you covered.  Click here to consult a list of the information you will require to create your plan, as detailed by the Canadian Human Rights Commission.

STEP 4 – Post the draft pay equity plan and receive feedback from your employees

Once your draft pay equity plan is complete, employers must post the plan with a notice informing employees that they have 60 days to provide comments. Once this feedback is collected, employers will be required to finalize their pay equity plan by August 31st, 2024.

STEP 5 – Communicate any increases in employee compensation and pay these out

Once the final pay equity plan has been posted in year 3, employers must also increase compensation within any job classes that are not receiving equal pay for work of equal value. Employees must be notified of any pay increases in advance of the company paying these out. Depending on the employer’s size and circumstances, these pay increases must either be paid out in full on the day after the final pay equity plan is posted, or within 3 to 5 years (provided the employer is eligible for a phased implementation approach).

STEP 6 – Submit your first annual statement

At the end of year 3, employers need to submit an annual statement to the Pay Equity Commissioner regarding their pay equity plan and the pay increases that have been identified within it.

STEP 7 – Monitor and update your pay equity plan

At least once every five years, employers will have to review and update their pay equity plans to account for any pay equity gaps that may have appeared since posting their initial plan.

Stay tuned for more information

Trucking HR Canada is here to support employers with labour-related compliance requirements, including those stemming from changes to the Canada Labour Code and from changes to help achieve wage fairness. We work in partnership with industry associations, government agencies and more in ensuring you have the practical resources and tools needed to support HR excellence.

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