Pay equity is a fundamental human right. Pay equity is essential because it addresses the undervaluation of women’s work, which contributes to Canada’s significant gender wage gap. Canada’s Pay Equity Act came into effect on August 31, 2021. We compiled this Frequently Asked Questions (FAQ) as a reference to help members of joint pay equity committees during their mandate.

When does the federal Pay Equity Act take effect?

The legislation took effect August 31, 2021.

To whom does the Act apply?

The Act applies to the core federal public service, separate agencies and Crown Corporations such as the Public Health Agency of Canada or the National Capital Commission, businesses created to perform work on behalf of the Government of Canada, the RCMP, Parliamentary institutions such as the Parliamentary Protective Service and federally regulated private sector employers (e.g. airports, ports, couriers etc.).  

What does the legislation intend to accomplish?

The purpose of the Act is to identify and eliminate gender-based pay discrimination rooted in an employer’s compensation system, which results in jobs held by women being paid less than jobs held by men when these jobs are of equivalent value to the employer. 

What role does PSAC play in achieving pay equity under the Act?

In unionized workplaces where there are over 10 employees, employers must make all reasonable efforts to establish a pay equity committee to develop the workplace pay equity plan.  

When a committee is established, PSAC has the right to participate in the development of the workplace pay equity plan. Its role is to select representatives to sit on pay equity committees, to monitor and oversee the activities of these pay equity committees, and to provide direction to its representatives.  

Bargaining agents also have recourses under the Act. If PSAC believes that there has been a violation of the Act in any workplace, or if it needs the assistance of the Office of the Pay Equity Commissioner to resolve an issue in a committee, it has the right to file complaints, disputes, and requests under the law. 

What is the composition of pay equity committees?

The Act requires that pay equity committees meet the following requirements:

• they must be composed of at least three members; 
• at least 2/3 of the committee membership must be composed of employee representatives; 
• at least 50% of the committee must be composed of women;
• the committee must include at least one employer representative.

Do employees get paid for the work they perform on the committee?

Yes, at their regular rate of pay. The Act requires that employers pay employees selected to participate on pay equity committees for the time spent in job evaluation and pay equity training and for the time spent participating in the committee’s activities. The law also requires that employers make their premises and equipment available to employees for work on this file, and that they allow employees to take time from work to select their representatives on the committee.

Who is responsible for providing the committee with the information necessary for it to perform its work?

The employer is responsible for providing the committee with the information necessary for it to complete its mandate. This may include job descriptions, information on the gender identification of position incumbents, information on total compensation, organizational charts, and more.   

Bargaining agents or employees may also have to provide information to pay equity committees, if they have information  necessary for the establishment of a pay equity plan. 

Some of the information provided to committees may be highly sensitive or confidential. All confidential information must be kept that way by those entitled to receive it.  

What is a "job class"?

A job class is a group of jobs sharing similar duties and responsibilities, requiring similar qualifications, and falling within the same range of salary rates or paid the same hourly rate. For example, an accounting clerk, an accounts receivable clerk and an accounts payable clerk, all paid the same hourly rate, would most likely be considered a single job class. The creation of job classes is an important part of the pay equity committee’s mandate and the decision as to the extent to which duties and qualifications are indeed similar rests with the committee. 

In the core public administration, a job class is defined as positions that are in the same group and level.

What is a predominantly female job class?

A job class which is currently composed of at least 60% women, or which has historically been composed of at least 60 % women, or which is stereotypically viewed as performing work associated with women (e.g., a nurse).

What is a predominantly male job class?

A job class which is currently composed of at least 60% men, or which has historically been composed of at least 60% men, or which is stereotypically viewed as performing work associated with men (e.g., crane operator).

A job class that does not meet any of these criteria may be considered gender neutral.

How is the relative value of male and female jobs determined? 

The Act requires that the relative value of a job be determined based on the following criteria:

• the skills required to perform the work;
• the effort required to perform the work;
• the responsibility associated with the work;
• the working conditions to which the person performing the work is exposed.

Skills, effort, responsibility and working conditions are referred to as “factors,” which form the basis of the job evaluation plans that will be used to determine the relative value of male and female-dominated job classes within the pay equity plan. 

How is the compensation paid to individual job classes determined?

In determining compensation, committees must consider several factors including hourly rates of pay and the value of employee benefits. The calculation of the compensation associated with a job class is discussed in detail in sections 44, 45 and 46 of the Act.. 

How does a pay equity committee make decisions?

Generally, decisions will be made by consensus; however, a vote on a given issue may also help to move the process forward. The employer and the employee side of the committee each get one vote. If the employee side is unable to achieve unanimity (100% agreement) on a given question put to a vote, the Act allows the employer to make the final decision. In case of an impasse or tied vote, the matter may be referred to the Office of the Pay Equity Commissioner for resolution. 

What happens on completion of the plan?

Once the committee or the employer has completed a pay equity plan, the results must be posted in a location or through a method accessible to all employees to which the plan applies. This initial posting must include all relevant information pertaining to the plan including, but not limited to:

• the number of pay equity plans established in respect of the employer’s employees;
• the number of employees affected by the plan;
• an indication of whether the plan was developed by the employer or by a pay equity committee;
• the list of job classes forming part of the plan, including their gender dominance;
• the method used to measure the relative value of job classes and the results of the evaluations;
• a description of the method used to calculate pay gaps;
• the list of female job classes for which pay equity adjustments are payable;
• the amount payable for each female job class deemed under-paid.

Can I provide feedback or ask questions about the plan before it is finalized? 

The Act gives employees to whom the plan applies the right to ask questions or provide comments on the draft pay equity plan. Employees have 60 days from the date of posting to submit comments and questions to either the employer or to the pay equity committee. The employer or the committee is required to consider any comments received when preparing the final version of the plan. Most employers must post the final version of the plan by September 3, 2024.  

What is the Pay Equity Commission?

The Pay Equity Commission is an administrative body that is part of the Canadian Human Rights Commission. It is headed by the Pay Equity Commissioner whose mandate is to:

• ensure the administration and enforcement of the Pay Equity Act;
• assist employees, employers and others in understanding their rights and obligations under the Act;
• facilitate the resolution of disputes relating to pay equity.  

When are increases in employee compensation due?

Increases in employee compensation are due the day after the pay equity plan is posted (currently scheduled for September 4, 2024). Compensation increases will be implemented moving forward and will not be retroactive. If employers receive permission to extend the posting deadline, or implement compensation increases in phases (up to 5 years), lump sums plus interest will be owed to affected employees.