Pay Equity Act (S.C. 2018, c. 27, s. 416)

Marginal note:Criterion

42 The criterion to be applied in determining the value of the work performed is the composite of the skill required to perform the work, the effort required to perform the work, the responsibility required in the performance of the work and the conditions under which the work is performed.

Marginal note:Method

43 In addition, an employer — or, if a pay equity committee has been established, that committee — must, to determine the value of the work performed, use a method that

• (a) does not discriminate on the basis of gender; and

• (b) makes it possible to determine the relative value of the work performed in all of the predominantly female and predominantly male job classes determined under section 35.

Calculation of Compensation

Marginal note:Calculation

• 44 (1) An employer — or, if a pay equity committee has been established, that committee — must calculate the compensation, expressed in dollars per hour, associated with each job class for which it has determined, under section 41, the value of the work performed.

• Marginal note:Group of job classes

  (2) If an employer or pay equity committee, as the case may be, treats a group of job classes as a predominantly female job class in accordance with section 38, the compensation associated with that job class is considered to be the compensation associated with the individual predominantly female job class within the group that has the greatest number of employees.

• Marginal note:Salary

  (3) For the purpose of determining salary in the calculation of the compensation associated with a job class, the salary at the highest rate in the range of salary rates for positions in the job class is to be used.

Marginal note:Exclusions from compensation

45 An employer — or, if a pay equity committee has been established, that committee — may exclude from the calculation of compensation, with respect to each job class in respect of which compensation is required to be calculated, any form of compensation that is equally available, and provided without discrimination on the basis of gender, in respect of all of those job classes.

Marginal note:Differences in compensation excluded

46 An employer — or, if a pay equity committee has been established, that committee — must exclude from the calculation of compensation associated with a job class any differences in compensation that either increase or decrease compensation in any or all positions in that job class as compared with the compensation that would otherwise be associated with the position, if the differences are based on any one or more of the following factors and those factors have been designed and are applied so as not to discriminate on the basis of gender:

• (a) the existence of a system of compensation that is based on seniority or length of service;

• (b) the practice of temporarily maintaining an employee’s compensation following their reclassification or demotion to a position that has a lower rate of compensation until the rate of compensation for the position is equivalent to or greater than the rate of compensation payable to the employee immediately before the reclassification or demotion;

• (c) a shortage of skilled workers that causes an employer to temporarily increase compensation due to its difficulty in recruiting or retaining employees with the requisite skills for positions in a job class;

• (d) the geographic area in which an employee works;

• (e) the fact that an employee is in an employee development or training program and receives compensation at a rate different than that of an employee doing the same work in a position outside the program;

• (f) the non-receipt of compensation — in the form of benefits that have a monetary value — due to the temporary, casual or seasonal nature of a position;

• (g) the existence of a merit-based compensation plan that is based on a system of formal performance ratings and that has been brought to the attention of the employees; or

• (h) the provision of compensation for extra-duty services, including compensation for overtime, shift work, being on call, being called back to work and working or travelling on a day that is not a working day.

Comparison of Compensation

Marginal note:Comparison

47 An employer — or, if a pay equity committee has been established, that committee — that has calculated under section 44 the compensation associated with each job class must, using the compensation so calculated, compare, in accordance with sections 48 to 50, the compensation associated with the predominantly female job classes with the compensation associated with the predominantly male job classes, for the purpose of determining whether there is any difference in compensation between those job classes.

Marginal note:Compensation comparison methods

• 48 (1) The comparison of compensation must be made in accordance with the equal average method set out in section 49 or the equal line method set out in section 50.

• Marginal note:Other methods

  (2) Despite subsection (1),

  • (a) if an employer determines that neither of the methods referred to in that subsection can be used, the employer must

    • (i) apply to the Pay Equity Commissioner for authorization to use a method for the comparison of compensation that is prescribed by regulation or, if the regulations do not prescribe a method or the employer is of the opinion that the prescribed method cannot be used, a method that it proposes, and

    • (ii) use the method for the comparison of compensation that the Pay Equity Commissioner authorizes; and

  • (b) if a pay equity committee determines that neither of the methods referred to in that subsection can be used, the committee must use a method for the comparison of compensation that is prescribed by regulation or, if the regulations do not prescribe a method or the committee is of the opinion that the prescribed method cannot be used, a method that it considers appropriate.

Marginal note:Equal average method

• 49 (1) An employer or pay equity committee, as the case may be, that uses the equal average method of comparison of compensation must apply the following rules:

  • (a) the average compensation associated with the predominantly female job classes within a band — or, if there is only one such job class within a band, the compensation associated with that job class — is to be compared to

    • (i) if there is more than one predominantly male job class within the band, the average compensation associated with the predominantly male job classes within the band,

    • (ii) if there is only one predominantly male job class within the band, the compensation associated with that job class, or

    • (iii) if there are no predominantly male job classes within the band, the compensation calculated under paragraph (b);

  • (b) the compensation for the purpose of subparagraph (a)(iii) is the following:

    • (i) the amount determined by the formula

      (A × B)/C

      where

      A

      is the average compensation associated with the predominantly male job classes — or if there is only one such job class, the compensation associated with that job class — that are within the band that is closest to the band within which the predominantly female job class or classes are located,

      B

      is the average value of the work performed in the predominantly female job classes within the band or, if there is only one such job class, the value of the work performed in that job class, and

      C

      is the average value of the work performed in the predominantly male job classes within the band referred to in the description of A or, if there is only one such job class, the value of the work performed in that job class, or

    • (ii) despite subparagraph (i), if there is at least one predominantly male job class within each of two bands that are equidistant from the band within which the predominantly female job class or classes are located, and there is no other band containing at least one predominantly male job class that is closer to that band, the amount determined by the formula

      (A + B)/2

      where

      A

      is the average compensation associated with the predominantly male job classes within one of the two bands or, if there is only one such job class, the compensation associated with that job class, and

      B

      is the average compensation associated with the predominantly male job classes within the other band or, if there is only one such job class, the compensation associated with that job class;

  • (c) the compensation associated with a predominantly female job class within a band is to be increased only if

    • (i) that compensation is lower than the compensation or average compensation referred to subparagraph (a)(i), (ii) or (iii), as the case may be, and

    • (ii) the average compensation associated with the predominantly female job classes within the band — or, if there is only one such job class, the compensation associated with that job class — is lower than the compensation or average compensation referred to subparagraph (a)(i), (ii) or (iii), as the case may be;

  • (d) if the compensation associated with a predominantly female job class within a band is to be increased, the increase is to be determined by multiplying the factor calculated in accordance with the regulations by an amount equal to the difference between the compensation associated with the job class and the compensation or average compensation referred to subparagraph (a)(i), (ii) or (iii), as the case may be; and

  • (e) an increase in compensation associated with the predominantly female job class or classes within a band is to be made in such a way that, after the increase, the average compensation associated with the predominantly female job classes within the band — or, if there is only one such job class, the compensation associated with that job class — is equal to the compensation or average compensation referred to subparagraph (a)(i), (ii) or (iii), as the case may be.

• Marginal note:Definition of band

  (2) In this section, band means a range, as determined by an employer or pay equity committee, as the case may be, of values of work that the employer or committee considers comparable.

Marginal note:Equal line method

• 50 (1) An employer or pay equity committee, as the case may be, that uses the equal line method of comparison of compensation must apply the following rules:

  • (a) a female regression line must be established for the predominantly female job classes and a male regression line must be established for the predominantly male job classes;

  • (b) the compensation associated with a predominantly female job class is to be increased only if

    • (i) the female regression line is entirely below the male regression line, and

    • (ii) the predominantly female job class is located below the male regression line;

  • (c) if the compensation associated with a predominantly female job class is to be increased, the increase is to be determined by multiplying the factor calculated in accordance with the regulations by an amount equal to the difference between the compensation associated with the predominantly female job class and the compensation associated with a predominantly male job class, were such a job class located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job class; and

  • (d) an increase in compensation associated with the predominantly female job classes is to be made in such a way that, after the increase, the female regression line coincides with the male regression line.

• Marginal note:Crossed regression lines

  (2) Despite paragraphs (1)(b) to (d), if the female regression line crosses the male regression line, an employer or pay equity committee, as the case may be, must apply the rules for the comparison of compensation that are prescribed by regulation.

Contents and Posting

Marginal note:Contents of plan

51 A pay equity plan must

• (a) indicate the number of pay equity plans required to be established in respect of the employer’s employees or, if the employer is in a group of employers, in respect of the employees of the employers in the group;

• (b) indicate the number of employees that the employer — or, in the case of a group of employers, each employer in the group — was considered to have for the purpose of determining whether a pay equity committee was required to be established in respect of the pay equity plan;

• (c) indicate whether a pay equity committee has been established and, if so, whether it meets the requirements set out in subsection 19(1) or, if not, whether the employer or group of employers, as the case may be, obtained the authorization of the Pay Equity Commissioner to establish a pay equity committee with different requirements;

• (d) set out a list of the job classes that have been identified to be job classes of positions occupied or that may be occupied by employees to whom the pay equity plan relates;

• (e) indicate whether any job classes referred to in paragraph (d) were determined to be predominantly female job classes and, if so, set out a list of those job classes;

• (f) indicate whether any job classes referred to in paragraph (d) were determined to be predominantly male job classes and, if so, set out a list of those job classes;

• (g) indicate whether a group of job classes has been treated as a single predominantly female job class and, if so, set out a list of the job classes referred to in paragraph (d) that are included in the group of job classes and identify the individual predominantly female job class within the group that was used for the purpose of subsections 41(3) and 44(2);

• (h) if there was a determination of the value of work performed in certain job classes, then, for each of those job classes, describe the method of valuation that was used and set out the results of the valuation;

• (i) indicate any job classes in which differences in compensation have been excluded from the calculation of compensation under section 46 and give the reasons why;

• (j) if a comparison of compensation was made, indicate which of the methods referred to in subsection 48(1) was used to make the comparison — or, if neither was used, explain why not and describe the method that was used — and set out the results of the comparison;

• (k) identify each predominantly female job class that requires an increase in compensation under this Act and describe how the employer — or, in the case of a group of employers, each employer in the group — will increase the compensation in that job class and the amount, in dollars per hour, of the increase;

• (l) set out the date on which the increase in compensation, or the first increase, as the case may be, is payable under this Act; and

• (m) provide information on the dispute resolution procedures that are available under Part 8 to employees to whom the pay equity plan relates, including any timelines.