What is the Pay Transparency Act?

The Pay Transparency Act was quietly passed by the Ontario Government last week. What does that mean for you?

It means more headaches!  Unless you are a compensation analyst or Pay Equity expert then you could be in for a lot of head scratching and long hours getting your workplace compliant.

The Pay Transparency Act, 2018 establishes requirements for all workplaces relating to the disclosure of information about the compensation of employees and prospective employees.

Beginning January 1, 2019:

Employers are prohibited from seeking compensation history information about an applicant for a position. This means you cannot ask a candidate or their former employer how much the candidate earned.

Employers are now required to include in any publicly advertised job posting information about the expected compensation or range of compensation for the position.  Employers are no longer allowed to just say “pay is dependent on experience”.  You must state clearly what the pay rate is and stick with that rate.  This does not apply to internal (i.e. only seen in the workplace) postings or direct hires (there is no publicly posted ad for a vacancy).

“Prescribed employers” are required to prepare pay transparency reports that include information about the employer, the employer’s workforce composition (meaning how many males and females work there); differences in compensation in the employer’s workforce with respect to gender and other characteristics.  We are still waiting to get clarification on what “prescribed employer” means, at this time it appears to be workplaces with more than 250 employees.

An anti-reprisal provision has been included that prohibits employers, or persons acting on their behalf (i.e. recruiters or staffing agencies) from intimidating, dismissing or otherwise penalizing employees for, among other things, making inquiries about the employee’s compensation, disclosing their compensation or asking the employer to comply with the Act or the regulations. Complaints by employees that an employer has contravened the anti-reprisal provision may be dealt with by arbitration (if there is a collective agreement) or by filing a complaint with the Ontario Labour Relations Board.

Compliance officers may inspect workplaces without a warrant and conduct compliance audits, and if an officer believes that a person has contravened a provision of this Act or the regulations, the officer may issue a notice of contravention to the person under section 12.

The world of HR compliance is getting more complicated every day!

Call us today for help!