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What is Pay Equity?


What Does "Pay Equity" Mean in Ontario?

Under Ontario's laws, "pay equity" is different from "equal pay for equal work".

Under the Employment Standards Act, 2000 (ESA), subject to certain exceptions, an employer cannot pay one employee at a rate of pay less than another employee on the basis of sex when they perform substantially the same kind of work in the same establishment, their work requires substantially the same skill, effort and responsibility and their work is performed under similar working conditions.

Under Ontario's Pay Equity Act, "pay equity" requires an assessment of all jobs in an organization and an unbiased comparison of the work done by women to the work done by men in order to determine whether the women are being compensated equitably. For example, the receptionist for a company may be as valuable to the organization as the warehouse shipper-receiver. The Pay Equity Act requires an employer to compensate work done by female job class(es) at least equally to work done by comparable male job class(es).

For more information to understand the difference between "pay equity" and "equal pay for equal work", please go to the "What's the Difference?" section.


Ontario's Pay Equity Act

The Pay Equity Act and its regulations can be found on the Province of Ontario's E-Laws website.


Important Note About the Act

In 1996, the Legislature repealed the proxy provisions of the Act (S.O. 1996, c.1, schedule J, s.1.). The Service Employees International Union challenged the repeal before the Ontario Divisional Court on the basis that it contravened sections 15 and 28 of the Charter of Rights and Freedoms. The Court agreed with the Union and ruled that the repeal was unconstitutional and of no force and effect. (SEIU, Local 201 v. Ontario (Attorney-General) (1997), 35 O.R. (3d) 508).

While the Court's ruling restored the proxy provisions to full effect, the Act has not been amended to reintroduce the repealed sections into the statute.  The missing provisions of the Pay Equity Act, which the Pay Equity Office (PEO) is required to enforce, are reproduced on the Pay Equity Hearings Tribunal (PEHT) website. The proxy provisions can be found here .

This reproduction is provided for your assistance and convenience only. Please refer to the Pay Equity Amendment Act, 1993 (S.O.1993, c.4) which remains the official version.