Ontario’s Pay Transparency Act: Update

May 29, 2018 | Paula Pettit

On April 26, 2018, Ontario passed Bill 3, An Act respecting transparency of pay in employment.  The Pay Transparency Act, 2018 (the “PTA”) received Royal Assent on May 7, 2018.

As previously reported, the PTA, which comes into force on January 1, 2019, is intended to increase transparency in hiring processes and to give women access to information when negotiating compensation. Ontario is the first province in Canada to enact pay transparency legislation.

As of January 1, 2019, all employers will be:

  • required to include a salary rate or range on all publicly advertised job postings;
  • barred from asking a job candidate about their past compensation; and
  • prohibited from reprising against employees who discuss or disclose compensation.

The PTA also will require larger employers to track and report compensation gaps based on gender and other diversity characteristics, which will be determined through consultationand prescribed. These reports must be posted online or in at least one conspicuous place in every workplace.  In addition, the Ministry will publish or otherwise make available to the public the pay transparency reports.

The final version of Bill 3 was amended to broaden the scope of the reporting requirement from employers with 250 or more employees to employers with 100 or more employees.  Implementation of the reporting requirements is on a staggered basis, as follows:

  • Employers with 100 or more employees (and every prescribed employer) must collect prescribed information for the purposes of preparing a pay transparency report no later than May 15 each year;
  • Employers with 250 or more employees must submit the first pay transparency report no later than May 15, 2020; and
  • Employers with 100 to 249 employees must submit the first pay transparency report no later than May 15, 2021.

Reporting requirements and content will be prescribed.  No regulations are currently enabled by the statute.

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