Pay Equity Implementation Series:: Guideline # 14

The Pay Equity Implementation Series is designed to help employers, employees and bargaining agents to achieve pay equity and to understand their rights and obligations under the Pay Equity Act, R.S.O. 1990, c. P7, as amended (the Act). These guidelines do not restrict review officers of the Commission or the Pay Equity Hearings Tribunal in their interpretaion of the Act. The series is published in a sequence that generally reflects the steps for implementing pay equity. (Revised Summer 2002)

Significance

All public sector employers who existed in 1987 and all private sector employers who had 100 or more employees in 1987 were required to post pay equity plans. Pay equity plans provide employees with information about how pay equity was done and the results for their workplace. Pay equity plans were to be posted prominently where all affected employees could read them. Copies must be provided on request to bargaining agents and to non-union employees.

The posting dates, which ranged from January 1, 1990 for the public sector and large private sector employers to January 1, 1994, for small private sector firms who chose to post plans, are now past. Nevertheless, the requirement to post remains for public sector and large private sector employers, and any resulting adjustments become retroactive to the appropriate first adjustment dates.

In union workplaces, the bargaining agent and the employer negotiate the pay equity plan. In non-union settings, the employer is responsible for preparing the pay equity plan, but may choose to involve employees in the process.

Employers who had fewer than 100 employees in 1987 and who chose not to post a pay equity plan no longer have the option of doing so. (Part III of the Pay Equity Act was repealed Jan. 1, 1994)

Private sector employers who hired their tenth employee after January 1, 1988 are not required to post pay equity plans but must achieve pay equity immediately.

Explanation

In each establishment, there must be one pay equity plan for each bargaining unit and one for all non-union employees.

Section 13 of the Pay Equity Act, sets out a number of items that must be included in a pay equity plan. Keep in mind that the purpose of drafting a plan is to communicate the pay equity process and outcomes to employees. Employees should be able to identify and track through the plan the job class that includes their position.

Identify the establishment and the group of employees covered by the plan (i.e. non-union or bargaining unit employees).

List all female job classes covered by the plan and all male job classes that were evaluated as potential comparators. It also makes sense to list job classes that were gender neutral. If only female job classes exist in the establishment, no further information is needed. However, a plan that includes a statement about the lack of male job classes must still be posted.

Describe the gender neutral comparison system used to do the job comparisons. If a point-factor job comparison system was used, describe the subfactors that were used to evaluate job classes and explain how they were weighted. If a ranking system was used, describe the methodology. Include a definition of equal or comparable value, point banding, ranking, or any other method used to determine job classes of equal or comparable value.

List the results of pay equity comparisons, including:

The Act set out the following schedule for mandatory posting of pay equity plans based on the job-to-job comparison method:

Sector	Number of Employees	Mandatory Posting Date
Public Private Private Private Private	All sizes 500 + 100-499 50-99 * 10-49 *	January 1, 1990 January 1, 1990 January 1, 1991 January 1, 1992 January 1, 1993
* Employers who had fewer than 100 employees in 1987 could choose to post a pay equity plan and phase in pay equity adjustments or not post a pay equity plan and achieve pay equity by their mandatory posting date.

Part III of the Act, which covered small employers, was repealed on January 1, 1994. Employers with 10 to 99 employees no longer have the option of posting plans and phasing in adjustments.

The proportional value comparison method was added to the Act in 1993. Employers with female job classes that could not be compared to a male job class using job-to-job were required to apply the proportional value comparison method. Pay equity plans were to be replaced or amended to reflect proportional value comparisons and any resulting pay equity adjustments.

In addition to the information listed above, plans reflecting the proportional value method must include the following:

Proportional value pay equity plans should provide sufficient information that incumbents in female job classes understand the value of their jobs relative to the value of the job classes in the representative group of male job classes used.

Employers applying the proportional value comparison method because some female job classes could not be compared to a male job class using job-to-job were required to post amended or replacement pay equity plans by January 1, 1994. A sample pay equity plan incorporating the proportional value comparison method is included in the Appendix to this guideline.

(Please call, write or e-mail the Commission, or mail the "Notice of Inability to Achieve Pay Equity" form, which is included at the back of this guideline.)

Note: Nothing prevents a bargaining agent from notifying the Commission about these circumstances.

A deemed approved pay equity plan is binding on the parties it covers unless there has been a change in circumstances which makes that plan no longer appropriate. A plan can be amended and reposted because of changed circumstances if:

When a plan is amended because of changed circumstances, the amount of a pay equity adjustment for any female job class cannot be less than it was under the original plan.

Where an employer and bargaining agent are unable to agree on an amended plan, the employer must notify the Pay Equity Commission within 120 days of having received notice to bargain.

A plan that has been negotiated with a bargaining agent, which complies with the Act, is deemed to have been approved by the Commission when both parties sign it. The employer must then post a copy in the workplace.

A deemed approved pay equity plan is binding on both the employer and the bargaining agent and prevails over relevant sections of an existing collective agreement. The adjustments to rates of compensation are considered to be incorporated into the collective agreement.

Plans covering non-union employees must initially be posted for 90 days, during which time employees affected by the plan may comment on it to the employer. Employers then have seven days to prepare and post a notice stating whether the plan has been amended and, if so, to post copies of the amended plan with the changes clearly noted. From the date of the second posting, employees have 30 days in which to object to the plan to the Commission. If no objection is filed within the 30 days period, the plan is deemed approved, assuming that it complies with the Act.

There is no requirement in the Act about how long the pay equity plan must remain posted. However, the Commission recommends the plan remain posted until pay equity is achieved or until the plan is updated.

Relevant sections in the Act

Subsection 1(1)	Defines pay equity plan.
Section 2	Sets out circumstances where employers may combine establishments.
Section 10	Sets out the mandatory posting dates for job-to-job pay equity plans.
Section 13	Sets out the required contents of plans, dates and details about adjustments, that the plans are binding and prevail over collective agreements, and that adjustments are incorporated into collective agreements.
Section 13.1	Sets out the details of the obligations of a purchaser to implement the pay equity plan of the seller when the business is sold.
Section 14	Sets out procedures for the employer and bargaining agent negotiating a plan.
Section 14.1	Sets out procedures for amending a pay equity plan due to changed circumstances when a bargaining unit is involved.
Section 14.2	Sets out procedures for amending a pay equity plan due to changed circumstances when a bargaining unit is not involved.
Section 15	Sets out procedures for an employer preparing and posting a plan for non-union employees.
Section 16	Sets out procedures for objections to posted plans, for notices that bargaining agents and employers cannot agree, and for notices that pay equity cannot be achieved by doing job-to-job or proportional value comparisons.
Section 17	Sets out procedures at the Hearings Tribunal concerning objections arising from section 16.
Sections 19 and 20	Describes the option to post plans for employers with fewer than 100 employees.
Section 21.4	Requires plans to be amended or replaced to reflect the proportional value comparison method.
Section 21.5	States that amended or replacement plans are binding and prevail over collective agreements, and that adjustments are incorporated into collective agreements.
Section 21.6	Sets out the required contents of plans reflecting the proportional value comparison method.
Section 21.7	Requires pay equity plans reflecting the proportional value comparison method to be posted within six months of the effective date of the Pay Equity Amendment Act (1993).
Section 21.8	States that sections 14, 16 and 17 apply to plans reflecting proportional value comparisons involving bargaining units.
Section 21.9	States that non-union employees have rights to comment on and object to amended or replacement plans as described in section 15.
Section 21.10	Describes the procedures for adjustments arising from a plan reflecting the proportional value comparison method.
Section 24	Describes enforcement measures the Pay Equity Office may take if a plan is not being prepared or implemented.
Section 25	Sets out procedures at the Hearings Tribunal concerning objections arising from section 24.
Subsection 34(2)	States that review officers shall monitor the preparation and implementation of plans.

References

Pay Equity Implementation Series (Revised) -
Guideline # 4: Definition of Establishment

Pay Equity Implementation Series (Revised) -
Guideline # 7: Determining the Gender Predominance of Job Classes

Pay Equity Implementation Series (Revised) -
Guideline # 8: Disclosing Information

Pay Equity Implementation Series (Revised) -
Guideline # 9: Gender Neutral Job Comparison

Pay Equity Implementation Series (Revised) -
Guideline # 10: Which Job Classes to Compare

Pay Equity Implementation Series (Revised) -
Guideline # 11: Determining Job Rate

Pay Equity Implementation Series (Revised) -
Guideline # 12: Permissible Differences in Compensation

Pay Equity Implementation Series (Revised) -
Guideline # 13: Pay Equity Adjustments

Management Board Secretariat (1993), 4 P.E.R. 58

"How to Read Your Pay Equity Plan," Pay Equity Commission Newsletter, Vol. 3, No. 1, March 1991, p. 2?5.

For more information

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Guideline # 14
Pay Equity Plans