Closing federal pay gap still years away under new equity plan
OTTAWA -- The federal government has introduced its plan for establishing pay equity in federally regulated sectors, but it will be some time before the new policy comes into effect.
As part of newly tabled second budget implementation legislation, Bill C-86 -- which puts in place further and yet-unfulfilled aspects of the February 2018 federal budget -- the government has brought forward its long-awaited plan to see men and women paid equally for equal work.
The new legislation, the Pay Equity Act, requires federal employers to evaluate their current compensation practices and make sure they line up with the new regime. It will apply to all federally regulated sectors, such as banks, telecommunications and transport industries. It will also apply to the prime minister and ministers' offices, and parliamentary workplaces.
Employers will have three years from the time the bill comes into force to set up their regimes. Senior officials briefing reporters on background said they are anticipating having this new regime come into effect around a year after Bill C-86 receives royal assent, meaning it could be up to four years from now before these sectors are paying their employees equally.
In 2017, women made 88.5 cents for every $1 a man earned. This new approach will apply to nearly 1.2 million people in Canada.
Defending the time it will take before the reality of a federal equal pay regime is realized for workers across Canada, Employment, Workforce Development and Labour Minister Patty Hajdu told reporters she didn't want to "rush" the process.
"We are comfortable that allowing three years is a sufficient length of time" for the work that needs to be done to ensure each employer has a plan to pay its employees equally, she said.
Hajdu said this period of time will be needed to have each employer identify the predominate gender in each of their job categories, the current compensation levels within each, and determine from these and other factors, how many people need to be paid more.
"It really is meant to address the consistent undervaluing of work that is considered predominately female," Hajdu said. The federal government could not offer an estimate on what it will cost to see women paid equally to men, pointing instead to how the move will enhance the Canadian economy.
The new pay equity legislation lays out two sets of requirements, one for employers with between 10 and 99 employees, and one for workplaces with 100 or more employees. The new pay equity regime will not apply to federal employers with fewer than 10 people on staff.
The Act also establishes a new "Pay Equity Commissioner," who will be appointed, and will have staff that will assist in enforcing this new regime. The commissioner will have the power to conduct compliance audits, and impose fines should an employer be found to not be paying its employees equally.
Once the Act is in place, every five years federal employers will have to review their plans to make sure that pay gaps have not arisen since the plan first came into effect. If a pay gap has formed, the employer will be expected to retroactively pay the employees who were making less than they deserved.
Currently, pay equity is recognized as a right for federal employees, but is enforced on a complaints-based system, putting the onus on workers to challenge pay discrimination. This new regime puts the responsibility on the shoulders of the employer to make sure their compensation practices are balanced.
Establishing federal pay equity was announced as part of the 2018 budget and was to be part of the budget implementation bill. When it was not included in the first 560-page budget bill, C-74, which passed in June, critics questioned when the promise would be fulfilled.
Prior to this, a parliamentary committee recommended in June of 2016 that "it's time to act" and called on the government to table proactive pay legislation within 18 months.
Speaking to what she called the "long overdue" measure, Status of Women Minister Maryam Monsef said it is long but important work that needs to be done in collaboration with stakeholders.
"We're deeply thankful to women’s organizations who have relentlessly advocated for what is right and what is fair for decades. They, like us, agree that women have waited long enough. Our economy can’t afford to hold half of us back," Monsef said.
Relatedly, in the omnibus and wide-spanning 850-page Bill C-86, the government is creating a Gender Budgeting Act, to formalize this government’s policy of "promoting gender equality and inclusiveness by taking gender and diversity into consideration in the budget process," and establish reporting requirements for analyzing budgets through a gender lens. It also makes Status of Women a full department, now called the Department of Women and Gender Equality, or WAGE.
Monsef said formalizing this new department was, in part, about "ensuring that future governments cannot reduce its mandate without significant public debate."