The Government of Ontario recently passed the Pay Transparency Act, 2018, which will go into effect on January 1, 2019. This piece of legislation is part of Then Now Next: Ontario’s Strategy for Women’s Economic Empowerment, designed to improve gender equity over the course of three years. So, what does the Pay Transparency Act, 2018 mean for your business? There are four important points that Ontario employers should know as we move towards implementation.
All Job Postings Must Include Compensation Ranges
Beginning January 1, 2019, any publicly advertised job posting must include the salary range or expected compensation information for the position. This measure is designed to prevent arbitrary salary assignments that could be rooted in conscious or unconscious bias. Applicants will know up front what the employer expects to pay, and they will also know whether the salary they are ultimately offered falls into the high or low end of the spectrum.
Compensation History Questions Are Prohibited
Under the Act, employers are expressly prohibited from asking for compensation history information. This includes personal inquiries directly to the candidate or inquiries made through a third-party agent, such as a recruiter. The idea behind this provision is that women who are paid less than their male counterparts will continue to earn less if they are asked about salary history. However, applicants may choose to disclose their compensation history voluntarily.
Businesses Must Prepare Pay Transparency Reports
To remain in compliance with the Act, companies that employ more than 100 people will be required to provide pay transparency reports to the Ministry of Labour. The Ministry will then make that data public. The reports will include information about the employer’s workforce composition and compensation differences with respect to gender and other characteristics. Employers will also be required to post those reports online or in the workplace in a location accessible to all employees.
The act prohibits employers from penalizing, intimidating or dismissing an employee who:
- Inquires about compensation.
- Discloses compensation information to employees.
- Inquires about the employer’s pay transparency report.
- Notifies the Ministry of Labour about an employer’s compliance or non-compliance with the provisions of the Act.
- Asks their employer to comply with the provisions of the Act.
Employers have the rest of this calendar year to prepare themselves for compliance in 2019. Larger employers have at least two years to prepare for pay transparency reports, as the first are not due until 2020.
Preparing for compliance requires changes in approach, philosophy and process. Partnering with an expert staffing firm can ensure you adhere to the Act as you recruit new talent. Recruiters with expertise in gender equity issues can ensure you remain on the right side of the government, and you connect with top talent in the region. Contact Employment Professionals Canada today to learn how a trusted and experienced employment partner can positively impact your business.