More on 'Employer'

Not all situations are as straightforward as STC's. In some instances, corporate ownership, organizational structure and financial interrelationships make the employer more difficult to identify - for instance, with franchises. In these unclear situations, the Pay Equity Hearings Tribunal has outlined the following four tests in determining the employer:

1. Who has overall financial responsibility?
2. Who has responsibility for compensation practices?
3. What is the nature of the business, service or enterprise?
4. What is most consistent with achieving the purpose of the Pay Equity Act?

1. Who has overall financial responsibility?

• Who bears the financial burden of compensation practices and wage adjustments under the Pay Equity Act?
• Who is responsible for the financial administration of the budget?
• What is the investment or ownership of shareholders?
• Who bears the responsibility of picking up the deficit or benefiting from the surplus?
• What are the employees' perceptions of who is the employer?

2. Who has responsibility for compensation practices?

• Who sets the overall policy for compensation practices?
• Who attaches the value of a job to its skill, effort, responsibility and working conditions?
• What is the labour relations situation?
• Who negotiates the wages and benefits with the union or sets the job rate in a non-union setting?

3. What is the nature of the business, service or enterprise?

• What is the core activity of the business, service or enterprise?
• Is the work in dispute integral to the organization or is it severable or dispensable?
• Who decides what labour is to be undertaken and attaches that responsibility to a particular job?

4. What is most consistent with achieving the purpose of the Pay Equity Act?

• If there is more than one possible employer, refer to the purpose and objectives of the Pay Equity Act.