1: Executive Summary

2: Introduction

Ontario’s Pay Equity Act (the Act) requires private sector employers with 10 or more employees and all public sector employers to identify and correct the gender discrimination that may be present in their pay practices. This may require adjusting the wages of employees in female job classes so that they are at least equal to the wages of employees in male job classes found to be comparable in value based on skill, effort, responsibility and working conditions. According to the Act, all employees – both men and women – in undervalued female job classes may receive pay equity wage adjustments.

As part of its mandate to enforce the Act, the Pay Equity Office (PEO or the Office) conducts proactive monitoring programs to educate employers about pay equity requirements and to help them ensure their compensation practices provide for pay equity. Monitoring programs target areas where female job classes may be undervalued and underpaid compared to male job classes.

In September 2014, the PEO launched the Public Sector Monitoring Program (P-Monitoring). The P-Monitoring program concentrated on ensuring that pay equity was implemented and maintained for employees who are not considered employees of the Crown (the provincial government). The program objective was to ensure that classified agencies, as government bodies, have compensation practices that provide for pay equity.

This report summarizes and outlines findings from P-Monitoring. It will describe both the process and results of the program.

3: Process

A classified agency:

• Is established by government but is not part of a ministry;
• Is accountable to the government;
• Has a majority of board appointees made by government; and,
• Has been delegated or assigned authority or responsibility for a particular area of government business, public service or service delivery.

The list of classified agencies selected to be monitored was developed using filters to include:

• All classified agencies that are not adjudicative, advisory or trust;                
• All public bodies that are not Commission Public Bodies under Regulation 146/10;
• All public bodies where the Crown is not the employer per Regulation 387/07; and,
• All public bodies that have not had a case file with PEO in last 10 years.   

In total, 22 employers met the criteria (please see Appendix). They were contacted and files were opened. One employer required two different files, for a total of 23 files. Review Officers were assigned the files and employers were asked to provide information on the following:

• The year the company was established;
• The total number of employees they employ in Ontario;
• The number of female employees;
• The number of male employees;
• Job titles;
• The current job rate or range of job rates;
• If any employees are represented by a Union; and,
• The number of male/female employees in a particular job title.

Additionally, as part of the program, Review Officers analyzed items such as payroll records, salary grids, job descriptions and job evaluation systems as they deemed appropriate, and ensured that employers made the necessary pay equity comparisons.

4: Results

The results reported here are current as of September 4, 2018. It should be noted that the sample size is small and is not considered representative of all classified agencies. Care should be taken in drawing conclusions or generalizing the findings to the entire sector.

4.1 File Disposition

Files opened under the P-Monitoring Program had a case disposition assigned by a Review Officer when a file was closed. Please note that Review Officers issued three Notices of Decision which found the Act was not applicable to the employer (13% of files)^[1]. Case dispositions, for the purposes of this report, are described as follows:

Compliance without an order

• These files were closed by a Review Officer after further investigation. Many employers undertook pay equity comparisons with the assistance of a Review Officer without an Order being required. The employers were deemed to have compensation practices that provide for pay equity because they did a pay equity analysis and made any necessary pay equity adjustments.
• Review Officers issued 17 Notices of Decision which found no contravention of the Act (74% of files).

Ordered

• These files relate to employers found to be in contravention of the Act who were not willing to voluntarily comply, necessitating that an Order be issued.
• A total of three Orders were issued under the P-Monitoring Program (13% of files). Two Orders were issued to the employer with two files, meaning only two employers received Orders.
  

4.2 Adjustments

Over 35 female job classes received $1,082,952.97 in pay equity adjustments, benefitting over 125 employees as a result of the P-Monitoring program. Work is still ongoing to calculate the adjustments for one Ordered file, meaning the amount of adjustments and number of employees benefitting from the adjustments may grow. This ongoing work highlights the need for classified agencies to be vigilant about providing for pay equity and maintaining pay equity.

Of the calculated adjustments, employers who were brought into compliance with the Act without an order accounted for $610,768.03, or 56%, of total adjustments. The employer who had two files received two orders and accounted for the remaining $472,184.94, or 44% of total adjustments.^[2] It is important to note that even where compliance with the Act was achieved as a result of the program, adjustments were not necessarily owed.

4.3 Experience

Review Officers found that approximately 50% of employers had taken steps to implement pay equity prior to their engagement in the P-Monitoring Program. Interestingly, the employers that did not implement pay equity prior to the monitoring program were those that began operations between 2002 and 2008, suggesting new employers may be less aware of their obligations under the Act. When a new classified agency is created, government should ensure that its mandate includes compliance with applicable legislation.

Only five employers (23% of employers) reported using materials that are made publicly available by the PEO. Ten employers (45% of employers) engaged consultants to assist in the pay equity process.^[3] This suggests the free, public resources available on the PEO website are underused and may require updates or a review. The further development of pay equity tools for employers may make providing for pay equity more efficient and less costly.

Over half of the files were closed within the first year of the monitoring program. A further 26% were closed in under two years. Files may take longer to close because they are complex. Working with employers to ensure pay equity analysis is undertaken correctly is a top priority.

5: Conclusions

This report provided an overview of the P-Monitoring Program. The program experience suggests that wider outreach regarding the Act and the resources that the PEO provides to support compliance with the Act may be necessary. This is especially the case for new classified agencies, who were notably less aware of their obligations under the Act. Additionally, the use of consultants by 45% of employers suggests a willingness to make additional expenses to provide for pay equity. There may be utility in developing more user-friendly self-managed intuitive tools (or applications) for employers so they do not feel it necessary to make additional expenses to engage in pay equity analysis.

The file dispositions demonstrate that the majority of employers engage with the PEO and come into compliance with the Act willingly (74% of files). The $1,082,952.97 in pay equity adjustments that benefitted over 125 Ontarians suggest the P-Monitoring program was effective in working with classified agencies of the Ontario Government to implement and maintain pay equity. The adjustments also serve as a reminder that pay equity, and proactive programs, are necessary to redress systemic gender discrimination in compensation practices.

6: Appendix