Canada’s Pay Equity Act is now law
By: Karen A. Jensen (Canada’s Federal Pay Equity Commissioner)
As Canada’s federal Pay Equity Commissioner I am very pleased to share that Canada’s Pay Equity Act officially became law on August 31, 2021. This proactive legislation marks a significant milestone in the history of women’s rights and human rights in Canada. It guarantees equal pay for work of equal value and is an important tool in promoting gender equality, closing the gender wage gap and contributing to greater equity and inclusion in Canada.
The law applies to Canada’s federally regulated public and private sector employers with an average of 10 or more employees. It will also apply to federal parliamentary workplaces through changes made to the Parliamentary Employment and Staff Relations Act.
With the law now in force, these employers are now required to take proactive measures to identify and close wage gaps between female dominated and male dominated jobs of equal value.
Five major milestones sum up the process for achieving pay equity. The milestones are:
1. Get started…:
The first milestone is to establish a foundation for pay equity. Employers must get started by notifying employees that the pay equity process is underway by November 1, 2021. They must also establish a pay equity committee if they are required, or choose to do so.
2. Year 1 to year 3:
The second milestone is to establish a pay equity plan. In years 1 through 3, workplaces must create a pay equity plan. Employers must post the final pay equity plan and notice of pay increases by September 3, 2024.
3. Year 3 to year 8:
The third milestone is to increase employee compensation. Increases in compensation must occur on September 4, 2024. If applicable, employers may phase in these increases between 3 to 5 years or between 2024 and 2029. The length of the phase in period depends on the size of the employer.
4. Year 4 and then yearly onwards:
The fourth milestone is to file an annual statement to the Pay Equity Commissioner on year four after becoming subject to the Act and then yearly onwards. Employers are required to file their first annual statement by June 30, 2025.
5. Yearly requirements:
The fifth milestone is to update the pay equity plan. In order to update a pay equity plan, employers must collect workplace information on the last day of each fiscal year. They are also required to post the updated pay equity plan by September 4, 2029.
Tools and resources that will help Canada’s federal employers comply with their new pay equity obligations are available on the Canadian Human Rights Commission’s website. As part of its mission to educate and promote pay equity, I invite you to take a few minutes to watch our video introducing pay equity and its implications in Canada.
Additional tools and resources, including helpful infographics can be found on our website.
Join us in celebrating the contribution of this law to the advancement of human rights in Canada. We are pleased to be able to contribute to EPIC’s efforts to build a more equal world!