What is the Pay Equity Act?
The Pay Equity Act applies to all companies with 10 or more employees. It creates several obligations for employers, including the obligation to carry out an initial pay equity exercise when a company hires its tenth employee, and a maintenance assessment exercise every 5 years after the initial exercise. Since companies are bound to evolve over time, the aim of retention assessment is to ensure that people in typically female jobs still receive equal pay to those in typically male jobs of equivalent value within a company.
Are you aware of the changes?
In 2019, the Pay Equity Act was amended on several points. Here are the main changes:
- The pay equity evaluation must no longer consider only jobs and their remuneration on the evaluation date, but also all jobs and their remuneration in the five years preceding the evaluation date.
- When a wage discrepancy is discovered, the lump-sum payment made to employees affected by the discrepancy is calculated from the date of the event that created the discrepancy, plus interest.
- The employer is no longer required to provide a notice of posting. However, it is still obliged to display the results, and must now detail the events that generated pay differentials.
- A complaint form has been created for employees who believe their rights have been infringed.
- Employers must now keep all documentation used to analyze pay equity maintenance for six years (instead of five), or until the file is closed if an employee files a complaint.
Watch out for penalties!
Fines for breaches of the Pay Equity Act range from $1,000 to $45,000.
Our experts can help you carry out your initial pay equity exercise or maintenance assessment. Don’t hesitate to contact us!
