Canada Gazette, Part I, Volume 159, Number 8: Regulations Amending Certain Regulations Made Under the Canada Labour Code (Equal Treatment and Temporary Help Agencies)

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February 22, 2025

Statutory authority
Canada Labour Code

Sponsoring department
Department of Employment and Social Development

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

General Comment

Issues

The Budget Implementation Act, 2018, No. 2 (BIA 2018) introduced new provisions to the Canada Labour Code (the Code) that are intended to ensure equal treatment for employees performing the same work, regardless of their employment status, and provide protection from unfair practices to temporary help agency employees (provisions pertaining to equal treatment and temporary help agencies). Amendments to the Canada Labour Standards Regulations (CLSR) and the Administrative Monetary Penalties (Canada Labour Code) Regulations (AMPs Regulations) are needed to support the implementation of the provisions pertaining to equal treatment and temporary help agencies to ensure they can be enforced.

Background

Application of the Canada Labour Code

The Code sets out the rights and responsibilities of employers and employees in federally regulated workplaces and is divided into four parts: Part I (Industrial Relations); Part II (Occupational Health and Safety); Part III (Labour Standards); and Part IV (Administrative Monetary Penalties).

Part III of the Code establishes basic labour standards (e.g. payment of wages, protected leaves) for persons employed in federal Crown corporations and federally regulated private-sector industries, such as

Part III of the Code does not apply to the federal public service. All other workplaces, which make up over 90% of the Canadian workforce, are under provincial or territorial labour jurisdiction.

New amendments to the Code and regulatory authority

The Budget Implementation Act, 2018, No. 2 (BIA 2018) amended the Code to include new provisions that prohibit an employer from paying an employee a lower rate of wages than another because of a difference in their employment status when they perform substantially the same kind of work under similar working conditions. This prohibition does not apply when the difference in the rate of wages is due to specific reasons such as seniority, merit, or the quantity or quality of each employee’s production or any other criteria prescribed by regulation. In addition, employers are not allowed to reduce an employee’s rate of wages to comply with this new requirement.

A new Division VI.1 of the Code entitled “Temporary Help Agencies” was created to complement the goal of achieving equal treatment in the federally regulated private sector. Under this new Division, employers that are temporary help agencies are prohibited from paying an employee who works for one of their clients a lower rate of wages than the client pays to their employee when they perform substantially the same kind of work under similar working conditions. This prohibition does not apply when the difference in the rate of wages is based on criteria listed in the legislation, namely an employer’s already established system of seniority, merit, the quantity or quality of each employee’s production or any other criteria prescribed by regulation.

In addition, the amendments to the Code also prohibit temporary help agencies from

The amendments introduce a new review mechanism under the provisions pertaining to equal treatment and temporary help agencies. If an employee believes that their rate of wages does not comply with the Code, they may request that the employer review the rate. The employer must, within 90 days after receiving the request, conduct the review and provide the employee with a written response that includes either a statement that they have increased their rate of wages to comply with the Code, or a statement, including reasons, that the employee’s current rate of wages complies with the provisions.

The legislative amendments also provide authority for the Governor in Council to make regulations that define terms for the purposes of the new provisions; modify the list of conditions under which rates of wages must be equal; modify the list of criteria that justify differences between the rates of wages of employees that meet these conditions; and modify the provisions or provide an exemption from the provisions for any class of employee.

While at present there are few federally regulated temporary help agencies, and thus few temporary help agencies that are subject to Part III of the Code, there is still a rationale to move forward with these changes to the Code. Based on evolving jurisprudence and changes in the economy, additional federally regulated temporary help agencies may appear in the future; therefore, it is best to have clear rules in place if that occurs. Having federal rules also provides a model to emulate for other jurisdictions with less stringent provisions.

While the term “industrial establishment” is defined in section 166 of the Code, the existing definition is too broad for the purposes of the new legislative provisions pertaining to equal treatment and temporary help agencies. It is predominantly used in the context of provisions relating to group terminations and is based on an index (see Schedule 1 of the CLSR); therefore, it is not useful in the context of the new provisions. It is necessary to define the term “industrial establishment” specifically for the purpose of comparing two employees under the new provisions pertaining to equal treatment and temporary help agencies. This is because only employees who work in the same industrial establishment can be compared. This new definition would only be applicable to Division III of the Code, which pertains to equal treatment.

The term “employment status” is not defined for the purposes of the equal treatment provisions in the Code. The term only applies to differences in terms of employment (i.e. whether the employment is temporary or permanent), and does not always include differences between part-time and full-time work. For example, paragraph 190(f) of Division IV, “Annual Vacations,” refers to seasonal or temporary employees, while paragraph 227(a) of Division IX, “Group Termination of Employment,” refers to employees employed on a seasonal or irregular basis. The Regulations Amending Certain Regulations Made Under the Canada Labour Code (Equal Treatment and Temporary Help Agencies [the proposed Regulations] would define the terms “part-time” and “full-time” in the context of employees, to ensure that it is clear who is comparable for the purpose of the provisions pertaining to equal treatment and temporary help agencies.

There are other differences in pay that are legitimate and justifiable but are not included as exceptions in the provisions pertaining to equal treatment and temporary help agencies of the Code, such as the practice of “red-circling,” which refers to the maintenance of an employee’s previous rate of wages following a reclassification or demotion to a lower-paying position. Other exceptions include differences in rates of wages that are aimed at addressing hiring difficulties during a labour shortage, accommodating for geographical differences (e.g. northern bonuses), compensating employees who are on travel status and supporting employee training and development programs in the workplace. The proposed amendments to the CLSR would provide for these additional exceptions.

Before the legislative amendments can come into force, corresponding amendments are needed to the CLSR and the AMPs Regulations to align them with the Code. The coming-into-force date of the legislative amendments will be set by an order of the Governor in Council.

Proposed amendments to the Canada Labour Standards Regulations

The CLSR specify how the labour standards set out in Part III of the Code are to be met and observed. To support the implementation of the new provisions of the Code pertaining to equal treatment and temporary help agencies, new sections will be added to the CLSR to define the terms “industrial establishment,” “employment status,” “full-time,” “part-time,” “permanent” and “temporary.” New provisions in the proposed Regulations are needed to outline how to interpret an employee’s employment status in cases where an averaging agreement or a modified work schedule is in place. The CLSR will outline how to determine to which industrial establishment an employee is attached, as well as provide additional instances where differences in pay are justified and legitimate. A clarifying provision will be added to ensure an “apples-to-apples” comparison of the wages and working conditions of comparable employees, providing that employees can only be compared if they are paid the same type of rate of wages. Minor amendments to record-keeping provisions will also be required.

Definition of “industrial establishment”

A new definition of the term “industrial establishment” is required to clarify whether two locations of the same employer are part of the same industrial establishment, to account for the realities of remote work, and to provide a means of determining to which industrial establishment each employee is attached. This new definition would also provide clarity for atypical workers in the transportation industries such as road transportation, maritime industries, rail transportation and aviation, as well as for employees regulated by Part III of the Code who have telework agreements. Accordingly, a new definition of the term “industrial establishment” that applies only for the purposes of the provisions of the CLSR pertaining to equal treatment and temporary help agencies would be added to the CLSR. This definition would be more precise and accompanied by objective criteria to make those determinations.

To ensure equal treatment provisions of the Code are applied effectively and efficiently, every federally regulated employee must be considered to work in one — and only one — industrial establishment. As there is not one common term used to describe the location of work for all types of employees in the transportation sector in legislation or collective agreements applicable to federally regulated industries, determining attachment to an establishment that acts as a reporting office would be useful to establish an attachment to a location of work.

Employers would benefit from this more specific definition, as it would provide clarity concerning which employees are working in the same industrial establishment. Employees would also benefit from this definition, as it would allow those working in irregular or multiple work sites, or with flexible work arrangements, to benefit from an equal pay rate regardless of their employment status.

Definition of “employment status”

The term “employment status” would be defined in the CLSR to include differences between full and part-time workers, as well as between temporary (e.g. fixed-term, casual, seasonal or on-call) and permanent employees. Without specifying this through regulations, the lack of certainty around the term may impede the implementation of the provisions pertaining to equal treatment and temporary help agencies in the Code.

Employers and employees will benefit from the inclusion of a definition of “employment status” in the CLSR. This definition specifies that differences in the hours worked per week and terms of employment are both considered part of employment status. Employees’ hours worked per week and terms of employment are therefore protected by the equal treatment provisions of the Code. Recognizing that employment contracts or collective agreements may define the relevant terminology between parties, the following baseline definitions would be provided.

Definition of “full-time” and “part-time”

The terms “full-time” and “part-time,” in relation to an employee, are not defined in the Code or the CLSR. Accordingly, definitions of these terms would be added to the CLSR. These definitions would be mutually exclusive to eliminate any confusion about how many hours per week are considered full-time employment, as per the Statistics Canada classification of how many hours equate to full-time employment.

Additional factor — Calculation using the same type of rate of wages

Employers and employees would benefit from a clarification of what it means to compare the rates of wages for the purpose of the provisions relating to equal treatment.

The CLSR would set out an additional condition that must be met for the prohibitions on differences in wage rates set out at subsections 182.1(1) and 203.2(1) of the Code to apply, namely that the employees’ wages for the performance of a job function are calculated using the same type of rate of wages.

In other words, for the purpose of determining whether two employees are paid the same or a different rate of wages, only identical types of compensation would be comparable (e.g. hourly wage, mileage rate, piece rate, pay per load or commission rate).

The rates of compensation for extra-duty services provided to employees, such as wages related to overtime, shift work, being on call, being called back to work and working or travelling on a day that is not a working day, could also be compared. The “rate of wages” would be understood to be the established rate at which — and conditions under which — an employee earns any applicable type of compensation.

The intent is to address policies or practices that disadvantage employees of one employment status from qualifying to earn the same rates of wages as employees with a different employment status.

Additional criteria justifying difference in rate of wages (exceptions)

The new “Equal Treatment” and “Temporary Help Agencies” divisions of the Code will allow for differences in rates of wages if these differences are due to a system based on seniority, merit, the quantity or quality of each employee’s production, or any other criterion that may be prescribed by regulation.

The proposed Regulations would add exceptions to equal treatment provision to include exceptional circumstances that permit employers to pay employees differently when warranted. These exceptions include “red-circling,” a practice where an employee is reassigned to a lower classification but retains their previous higher salary; increasing rates of wages due to difficulty in recruiting or maintaining employees during a labour shortage; northern bonuses related to geographical regions and locations of hardship; travel status pay for employees on travel status as opposed to those who do not travel (including to regions and locations of hardship); and employees’ pay when in a development or training program. To ensure that employers are provided sufficient flexibility, while still maintaining the intent of the legislation, these will be added to the lists of exceptions set out in the Code through the CLSR.

New sections — Temporary Help Agencies

New sections under the heading “Temporary Help Agencies” would be added to the CLSR to provide the same clarifications and exceptions for employees working for a federally regulated temporary help agency.

Additional record-keeping requirements

Under the record-keeping provisions of the CLSR, employers are currently required to keep information on the details of rates of wages, number of hours worked, actual earnings, and payments for each employee for 36 months after the date of termination of employment.

Additional record-keeping requirements would be added to the CLSR to enable the Labour Program to investigate complaints when they are received and to ensure that employees and employers are in compliance with the new provisions pertaining to equal treatment and temporary help agencies.

Schedule II of the CLSR

The CLSR requires employers to post certain notices. Schedule II specifies particular content for one of these notices, which includes a list of the minimum labour standards that Part III of the Code covers, a link to a website with further information and a statement that inquiries will be treated confidentially. This schedule would require an update to reflect the coming into force of the provisions pertaining to equal treatment and temporary help agencies and other recent changes to the Code.

Administrative monetary penalties

On January 1, 2021, Part IV (“Administrative Monetary Penalties”) of the Code was brought into force to promote compliance with requirements under Part II (“Occupational Health and Safety”) and Part III of the Code. The AMPs Regulations designate and classify violations of provisions under the Code and its regulations, making them subject to an administrative monetary penalty (AMP) in cases of non-compliance. Only designated violations can be subject to an AMP.

When amendments are made to Part III of the Code and its associated regulations, Schedule 2 of the AMPs Regulations must be updated to reflect any new requirement that could be violated. For the new provisions pertaining to equal treatment and temporary help agencies in the Code to be subject to AMPs, they must be designated and classified in Schedule 2.

The AMPs Regulations specify the method used to determine the amount of an AMP in each situation when issuing the notice of violation. The baseline penalty amount applicable to a violation varies depending on the type of person or department believed to have committed a violation and the classification of the violation. For violations under Part III of the Code, each designated violation is classified as either type A, B, C, or D, in order of increasing severity, according to the level of risk and/or the impact and significance of the violation as outlined in Table 1.

Table 1: Classification method for violations under Part III of the Code
Type  Description 
A Related to administrative provisions.
B Related to the calculation and payment of wages.
C Related to leave or other requirements, which could have an impact on the financial security, or health and safety, of an individual or group of individuals.
D Related to the employment and protection of employees who are under the age of 18.

Objective

The objective of the proposed Regulations is to support the implementation and enforcement of the new provisions pertaining to equal treatment and temporary help agencies by providing additional clarity to terms used in the legislation, further defining criteria for justified pay differences, providing clarification on the comparison of wages, setting out record-keeping requirements for employers, and ensuring that the AMPs regime can be used to promote compliance and be used in enforcement of the provisions.

Description

The proposed Regulations would clarify the legislative and regulatory provisions by defining terms, adding exceptions, setting out new requirements, designating the new legislative and regulatory obligations as violations under Schedule II of the AMPs Regulations, and address miscellaneous technical amendments resulting from the new amendments pertaining to equal treatment and temporary help agencies to the Code.

Definition of “industrial establishment”

For the purposes of the provisions pertaining to equal treatment and temporary help agencies, “industrial establishment” would constitute the physical or general location where work is being carried out. Two or more work sites of the same employer would be considered part of the same industrial establishment if they are in the same Employment Insurance (EI) region, as defined in Schedule I of the Employment Insurance Regulations.

Under paragraph 27(a) of the CLSR, EI regions are already used for the purpose of determining what constitutes an industrial establishment for the application of group termination requirements, which helps account for the different economic realities of each region. Using EI regions in the context of equal treatment provisions will provide a clear and objective way for employers and Labour Program officers to determine which employees work in the same industrial establishment when the employer has more than one work site.

If an employer has two or more industrial establishments, the proposed Regulations set out clear and objective criteria to determine to which one an employee is attached. They provide a general rule applicable to most employees, with more specific rules for transportation employees and remote workers.

The general rule is that an employee would be considered to work in the industrial establishment of the employer where the employee most often reports to work in person.

An employee whose main duty of employment is the transportation of goods or passengers by motor vehicle, train, aircraft, or ship would be considered to work in the industrial establishment where their home terminal, base, station, or port is located.

With respect to employees who perform all their work hours remotely, they would be considered to work in the industrial establishment in which they most often reported for work before their remote work agreement took effect, unless the nature of their duties, or those carried out in that industrial establishment, have since changed. If this primary indicator does not apply or is insufficient to determine the industrial establishment to which an employee is attached, the proposed Regulations specify the indicators that, considered together, must be used to determine where the employee is deemed to work. These indicators are the establishment in which

Definition of “employment status”

For the purposes of the provisions of the Code pertaining to equal treatment and temporary help agencies, employment status would be defined in the CLSR to include differences in the number of hours normally worked (such as full-time and part-time) as well as differences in the term of employment (such as being permanent or temporary, which would include having a fixed term contract, or employment on a seasonal, casual or irregular basis).

Additional criteria justifying differences in rates of wages (exceptions)

The proposed Regulations would add to the exceptions provided under the Code’s provisions pertaining to equal treatment and temporary help agencies that allow differences in rates of wages in specified circumstances. Mirroring similar exceptions that apply with respect to requirements of the Pay Equity Act, these would allow differences in pay due to a system based on one of the following criteria:

Comparing rates of wages

The proposed Regulations clarify that for the purpose of determining whether two employees are paid the same or a different rate of wages, only the same types of wages can be compared (e.g. hourly wage, mileage rate, piece rate, commission rate, overtime rate, or a rate applicable to other types of wages). This would allow the Labour Program to ensure that provisions pertaining to equal treatment and temporary help agencies are applied equitably through like-for-like comparisons.

Record keeping

The proposed Regulations introduce new record-keeping requirements to the CLSR that require all employers to keep the following records related to each review of rates of wages for the purpose of the new provisions pertaining to equal treatment and temporary help agencies:

An employer who is a temporary help agency would also be required to keep

Notices to be posted and other amendments

The CLSR requires employers to post, in their establishment, a list of the labour standards for federally regulated employers and employees (Schedule II). The new provisions pertaining to equal treatment and temporary help agencies would be added to the list of labour standards, as well as an updated link to a website containing additional information. One miscellaneous amendment would also be made to replace the term “Sick leave” with “Medical leave.”

Designation and classification of new Code provisions

The proposed Regulations would amend Schedule 2 of the AMPs Regulations to designate the following violations. These are classified as type C, since they could have an impact on the financial security of an individual or group of individuals:

The following violations would be designated as type B in Schedule 2 of the AMPs Regulations, as they address the calculation and payment of wages:

The following violations would be designated as type A in Schedule 2 of the AMPs Regulations, as they address the new record-keeping regulatory provisions and are administrative in nature:

Regulatory development

Consultation

The Labour Program held two consultations with stakeholders on the proposed regulatory package.

Modern employment standards consultation — 2019

In June 2019, the Labour Program held consultations on modern labour standards. A discussion paper pertaining to several amendments to Part III of the Code, including equal treatment and temporary help agencies, was shared with over 600 federally regulated stakeholders from the employer and employee communities, including Labour Standards Advisory Committee members, as well as with Indigenous partners, community organizations, and think tanks. Written submissions were received from 68 stakeholder groups but only a small number of comments were provided on the topic of equal treatment and temporary help agencies.

All stakeholders agreed that certain terms in the provisions pertaining to equal treatment and temporary help agencies need to be clearly defined. Some stakeholders cautioned that the language used in defining terms should not circumvent the intent of the new Code provisions. For example, employer representatives recommended that the term “merit” be defined to give the employer the ability to justify differences in wage rates, noting that merit and performance are critical to business operations and should remain as an exception to the prohibitions on wage discrepancies. Employee representatives and stakeholders within the non-profit sector advocated that the term “merit” be evaluated based on skills to do the job and not how well someone does the job; and that the term “seniority” should be defined as “date since hire or length of service” and not be based on the numbers of hours worked. Adding a definition to “wage” that would take into consideration different forms of income, such as bonuses, was also suggested.

Feedback also showed some confusion about how the equal treatment provisions would apply to employees working in different geographical locations. Employers requested that it be permissible to pay employees differently based on the physical location of their work: for example, employees living in the north may be given a retention bonus or additional pay to accommodate the increased cost of living.

Online consultation — 2022

Between December 21, 2021, and February 21, 2022, the Labour Program held additional online consultations to obtain further stakeholder input on the proposed Regulations. Stakeholders were asked to provide feedback on a discussion paper entitled Discussion paper: Fall 2021 Labour Program external consultations - Regulatory initiatives under the Canada Labour Code.footnote 1 Nine written submissions related to the proposed Regulations were received from employer associations from various federally regulated industries, employee associations, unions, and community organizations.

Employer representatives advocated that the list of exceptions to the prohibition on discrepancies in rates of wages in the legislation be expanded in the proposed Regulations to justify different rates of wages. For example, small businesses’ ability to negotiate individually with their non-unionized employees could be impacted by the equal treatment legislative provisions. Accordingly, the employer representatives suggested that a regulatory exception be introduced to allow for different rates of wages based on employee preferences (e.g. flexibility over higher pay). They also suggested that regulations allow for different rates of wages based on employee reclassification and labour shortages to mirror the Pay Equity Act.

Employers also suggested exceptions be added to accommodate classes of employees or to allow unionized workplaces with pre-existing collective bargaining agreements to be exempted from the Code’s requirements. Some employers noted a long history of collective bargaining within their sector (e.g. longshoring) and that the term “seniority” is a collective bargaining concept that is in the domain and function of the unions. It was also recommended that differences between employees’ rates of wages be allowed where employees’ remuneration is based on a system that relies on existing, predetermined salary ranges. Employers also suggested that an exception be added to allow for different rates of wages for summer students and students employed through a post-secondary co-op or internship program, since their positions are primarily designed for educational purposes.

Submissions from unions, employee associations, and community organizations disagreed with the proposals to add further exceptions, suggesting that doing so would create additional opportunities for employers to justify pay differences based on what could be construed as subjective assessments. They were not supportive of exemptions that could create further inequality if remuneration becomes an issue.

Feedback from employee representatives focused primarily on the definitions of terms used in the proposed regulatory provisions. For example, the “same industrial establishment” was considered as too restrictive and might allow large employers with multiple workplaces to discriminate based on the workplace an employee is assigned to. Employee representatives suggested the definition should be broadened to encompass the same geographical regions. They suggested that terms in the legislative provisions, such as “substantially the same kind of work” and “seniority,” be further defined in the proposed Regulations.

Unions and labour groups also provided feedback relating to temporary help agencies. Employee representatives were particularly supportive that regulations address the phenomenon of “perma-temp” employees. Perma-temp employment refers to employees working for the same temporary help agency for a long, possibly indefinite amount of time. Perma-temp employees often work the same schedules and hours as client employees and are often required to take client training and attend client meetings. However, employee representatives expressed that they considered the seniority exception to be problematic, as most temporary help agency workers will have lower seniority relative to client employees. This is due to the nature of the work undertaken by temporary help agency employees, which is usually over periods of short duration. Therefore, existing disparities could be reinforced. Employee representatives were also of the view that allowing for differences in rates of wages based on geographic location would be problematic, as it might incentivize employers to outsource work to temporary agencies located in lower-cost jurisdictions.

The proposed Regulations are based on stakeholder feedback from the consultations. While initially a definition of the term “seniority” was included in the proposed Regulations, following stakeholder consultations, it was removed. The concept refers to a set of very specific provisions set out in collective agreements that define how seniority is earned and retained, as well as its value. These provisions vary by collective agreement.

The original definition of the term “industrial establishment” was also expanded. The proposed Regulations would now provide clear and objective criteria (via Employment Insurance Regulations geographic regions) to determine whether two or more locations by the same employer can be considered as the same industrial establishment. The proposed definition provides additional clarity for employment sectors where jobs usually require travel or include multiple work sites, by clearly defining what is considered the location of work for road, rail, air and marine transportation sectors. In addition, the proposed definition accommodates modern realities of employment, such as telework, and ensures that employers may not skirt the provisions for remote workers by considering that they work in a different industrial establishment should their civic address be considered as the location where their work is carried out.

Additional exceptions to the prohibition on wage discrepancies were also added to the proposed Regulations to not only respond to stakeholder concerns that there are other legitimate reasons why employers may pay an employee more than another, but also ensure consistency with other federal legislation and regulations, such as the Pay Equity Act.

Modern treaty obligations and Indigenous engagement and consultation

In accordance with the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, a modern treaty implications assessment was conducted. There have been no impacts on modern treaties identified in relation to these proposed Regulations.

In August 2022, national Indigenous organizations were provided with a discussion paper outlining the regulatory changes being contemplated and requesting their feedback. The Labour Program received two submissions from Indigenous non-governmental organizations. Both submissions objected to seniority being a criterion to justify differences in rates of pay and employee ranking, noting that merit and quality of work were preferable. In addition, one submission noted that equal pay should also apply to provincial, territorial, and non-profit employees getting the same rate of pay as federal employees. Given that the criterion of seniority is set out in the legislation, and that Part III of the Code only applies to federal Crown corporations and federally regulated private sector industries, no changes could be made to the proposed Regulations in response to these submissions.

Instrument choice

The proposed Regulations are required to support the implementation and enforcement of the new provisions pertaining to equal treatment and temporary help agencies in workplaces that are subject to Part III of the Code. The objective cannot be accomplished through other instruments, as the proposed Regulations are necessary to clarify the application of the legislative provisions and to ensure they can be enforced.

Regulatory analysis

The monetized costs of the proposed Regulations include the costs to employers of increased wages to employees who would be granted equal treatment under the provisions, costs to employers of record-keeping requirements, and costs to the Labour Program / federal government for evaluating equal treatment reviews. The total present value (PV) cost is estimated to be $6,115,860.

The monetized benefits of the proposed Regulations are increased wages to employees who would be granted equal treatment under the provisions. The total monetized PV of benefits is estimated to be $1,428,172. Several benefits could not be monetized due to limitations on data, and methodological challenges. These include increased employee efficiency and motivation, which will reduce turnover, and prevention of wage discrimination.

This results in a net monetized cost of $4,687,688 in present value. While the measured monetary costs outweigh the monetized benefits, this does not imply the proposed Regulations represent a net social cost, since the broader positive outcomes related to workforce inclusivity, reduced workplace discrimination, and enhanced social equity counterbalance these monetized costs. The qualitative impacts of the proposed Regulations, including improved productivity by increasing efficiency and motivation, which leads to reduced employee turnover, and the prevention of wage discrimination, are inherently challenging to quantify in monetary terms, and consequently, a portion of the proposal’s benefits are not captured in the monetary valuation. The proposed Regulations may lead to a net societal gain considering these qualitative aspects of the benefits, in addition to those benefits that were monetized.

Analytical framework

Benefits and costs are assessed by comparing the baseline scenario against the regulatory scenario. The baseline scenario depicts what is likely to happen in the future if the Government of Canada does not implement the proposed Regulations. The regulatory scenario provides information on the intended outcomes of the regulatory proposal. Where possible, impacts are quantified and monetized. Monetized costs and benefits for the 10-year analytical period are discounted to the year of 2026 at a discount rate of 7%, and expressed in 2023 Canadian dollars. Only direct costs and benefits for stakeholders are considered in the cost-benefit analysis.

Baseline scenario

In the baseline scenario, the provisions of the BIA 2018 and the requirements of the proposed Regulations are not in force. In the baseline scenario, employees cannot submit requests for review to their employer to ask that their hourly wage be reviewed and adjusted to the same level as another employee who works in the same industrial establishment and performs substantially the same kind of work (requiring substantially the same skill, effort, and responsibility and under similar working conditions).

It is important to note that the provisions do not apply to differences in hourly wages across different industrial establishments.

Regulatory scenario

In the regulatory scenario, the provisions of the BIA 2018 and the requirements of the proposed Regulations are in force.

If an employee works in the same industrial establishment and performs substantially the same kind of work, requiring substantially the same skill, effort, and responsibility and under similar working conditions, as another employee in their organization but is being paid less than that employee, they have the right to request a salary review for equal treatment directly to their employer.

With the introduction of the new review mechanisms in the legislation, employers would need to keep records when an employee requests a salary review and concerning the result of that salary review, including a copy of the statements produced to justify the decision of the employer. This ensures that the request is either addressed by the employer or should the employee file a complaint with the Labour Program, the Labour Program officer can review the statements of compliance issued by the employer.

Data and assumptions

The analysis used data from the 2015 Federal Jurisdiction Workplace Survey (FJWS) to group non-permanent and part-time employees according to the weekly scheduled hours data provided per industry for all federally regulated private sector (FRPS) industries. The analysis estimated the number of part-time and non-permanent employees of the federal jurisdiction, including those employed in small businesses.

Similarly, the analysis used the 2015 FJWS to estimate the number of employers per industry for all FRPS industries and the number of small businesses impacted.

The analysis applied an assumed employee count growth rate of 0.92% and an assumed employer count growth rate of 0.84% for the 10-year analytical period.

To obtain the proportion of employees expected to submit requests for review for equal treatment, the Labour Program consulted internally with the Labour Standards operations team. The team indicated that fewer than 0.3% of employees are expected to submit requests for equal treatment reviews.

The Labour Program consulted the Commission des normes, de l’équité, de la santé et de la sécurité du travail (CNESST). The CNESST’s mission is to promote awareness about and ensure the respect of the mutual labour rights and obligations of workers and employers in Quebec. Data provided by the CNESST showed that requests for equal treatment review were higher in the first year of launch compared to subsequent years. In addition, CNESST provided information on the number of pay equity reviews and their success rate (15%). The analysis applied the same rate in the estimates for federally regulated sectors.

Based on the internal and external consultations, the analysis assumes that 0.2% of all employees affected by the equal treatment provisions would submit requests for equal treatment review in the first year of implementation, and 0.1% in the subsequent years of the 10-year analytical period, with an assumed approval rate of 15%.

To determine the number of employees submitting requests for review, the analysis applied the 0.2% request rate for the first year of implementation and the 0.1% request rate for subsequent years to the number of employees affected by the equal treatment provisions.

To determine the number of employees benefitting from a wage adjustment following submission of a request for review related to the equal treatment provisions, the analysis assumed that 15% of the requests would result in a wage adjustment. Table 2 presents the calculation results.

Table 2: Estimated number of employees affected
  Number of affected employees Number of employees submitting requests for review Number of employees benefitting from a wage adjustment
First year of implementation (2026) 187 549 375 56
Subsequent years (2027–2035) 196 392 196 29
Treatment of temporary agencies

Temporary agencies are in the scope of the proposed Regulations; however, the number of federally regulated temporary help agencies and their employees could not be determined. The Labour Program consulted the Association of Canadian Search, Employment and Staffing Services (ACSESS). The ACSESS, which represents 85% of temporary help agencies in Canada, indicated that none of their members appear to be federally regulated. As a result, the costs and benefits of provisions related to temporary agencies are not estimated.

Benefits and costs

Benefits
Benefit to employers

Productivity — Increasing employee efficiency and motivation with reduced turnover (qualitative)

Equal pay for temporary and part-time workers significantly boosts employee motivation and efficiency, leading to reduced staff turnover and absenteeism. This, in turn, enhances job performance, customer service, and work ethic. By fostering higher wages, labour regulations can help spur innovations that drive overall improvement in labour productivity. Research results published in the journal titled Canadian Public Administration footnote 2 indicate that increased hourly wages and the resulting economic security can improve career satisfaction, motivation, and overall productivity. In addition, the reduction in turnover rates and training costs may offset the expenses associated with higher salaries. Since many part-time and temporary workers earn wages below the poverty line, this measure could also help reduce poverty and reliance on government support.footnote 3

Benefit to employees

Benefits of increased wages to employees who would be granted equal treatment (monetized)

The regulatory proposal is expected to result in benefits to those employees who would be granted equal treatment. The present value of the total benefits associated with increased salary for those employees who would be granted equal treatment is estimated to be $1,428,172.

Prevention of wage discrimination (qualitative)

Many workers in non-standard employment are highly vulnerable due to the precarious nature of their employment status and their intersectionality (ethnicity, race, gender, ability, age, or immigration status). Precarious employment conditions, such as seasonal, temporary, and casual contracts, often come with lower hourly wage rates compared to those of full-time workers. These positions are usually filled by individuals much younger or much older than the Canadian average.footnote 2 A 2010 study found that immigrants often occupy lower- and middle-level jobs and are underrepresented in the knowledge sector, despite having skills and education comparable to those of Canadian-born workers.footnote 4 Multiple studies have demonstrated that women, single parents, racialized workers, and recent immigrants are disproportionately likely to be working for minimum wage and in precarious forms of work.footnote 4 Similarly, a 2012 study in Canada using the Survey of Labour and Income Dynamics showed that gender, visible minority status, age, and length of stay in Canada are all strong predictors of economic exclusion.footnote 5 In addition, young workers are more likely to occupy temporary labour market positions, highlighting generational inequalities between permanent and temporary workers in the public sector. Therefore, equal treatment and pay for precarious and non-standard employment would benefit disadvantaged and vulnerable groups of people with multiple intersectionality indicators.footnote 6

Monetized benefits

The monetized benefits are summarized in the following table.

Table 3: Monetized benefits summary for the equal treatment provisions
Benefit type Stakeholders affected Present value benefit
Increased wages to employees who would be granted equal treatment. Employees $1,428,172
Costs

In summary, the total present value costs for the 10-year analytical period are estimated to be $6,115,860.

The costs of the proposal can be divided into three broad categories:

  1. Costs to employers of increased wages for employees who would be granted equal treatment.
  2. Costs to employers of record-keeping requirements.
  3. Costs to the federal government for implementing the regulations, for monitoring compliance with them, and for enforcing the regulations.
Cost No. 1: Costs to employers of increased wages to employees who would be granted equal treatment

These costs include the time spent by human resource (HR) managers to assess the requests for review submitted by employees and to produce statements with a view to determining and justifying if wage adjustments are granted or if the employees’ current wage rates comply with the provisions. Cost No. 1 also includes the costs to employers associated with modifying employees’ pay rates in the pay system for employees who would have wage increases due to the proposed Regulations, as well as the costs employers will incur to pay higher wages to workers who receive an upward wage adjustment.

It is assumed that the costs of the time spent by HR managers to assess the requests for review submitted by employees and to produce statements with a view to determining and justifying if wage adjustments are granted or if the employees’ current wage rates comply with the provisions apply to an estimated 0.2% part-time and non-permanent employees in the first year, and to 0.1% in subsequent years. Each review is expected to require one hour of the HR manager’s time, at a wage of $57.36/hour (2023 Can$).footnote 7

To estimate the costs to employers regarding modifying employee pay rates in the pay system for employees who would have wage increases due to the proposed Regulations, it is assumed that a wage increase would be approved for 15% of the employees who submit requests for review. It is also assumed that the HR manager, at a wage of $57.36/hour (2023 Can$), would dedicate 30 minutes per employee to modify pay rates to indicate the increase in the employer pay system.

To estimate the costs to employers regarding higher wage payments for employees who submitted requests for review and whose wage increases were approved, the higher wage payments were calculated using the midpoint of hours worked per week, assumed to be 15 hours, multiplied by the weeks worked per year, assumed to be 48, multiplied by the wage differentials per industry.

To estimate wage differentials for each industry, annual wage data from 2019 to 2023, available from Statistics Canada, were used.footnote 8 The data were indexed to 2023 Canadian dollars and mapped using FJWS industry classifications and the North American Industry Classification System (NAICS). This product was used to estimate the annual difference in the average hourly wage rate for full-time and part-time employees.

Table 4: Calculated wage differential per Federal Jurisdiction Workplace Survey industry (indexed to 2023 Can$)
FJWS industry Wage differential
Transportation (air, rail, road, and maritime) $5.84
Banks $12.79
Feed, flour, seed, and grain $4.32
Telecommunications and broadcasting $16.03
Other (includes postal and pipelines, fisheries and oceans, nuclear industry and mines, and oil and gas extraction) $9.74

Similarly, to estimate the wage differentials for permanent/non-permanent employees, the analysis used the average usual hours and wages dataset from Statistics Canada,footnote 9 which displayed average hourly wages in current dollars for permanent and non-permanent employees from December 2020, 2021, 2022 and 2023. The analysis indexed these wage rates to 2023 Canadian dollars and used the difference between the average hourly wage rate for permanent employees and the average hourly wage rate for non-permanent employees was used to determine the non-permanent wage differential of $7.35.

Cost No. 2: Costs to employers of record-keeping requirements

These costs include the time spent by employers to keep records of the requests for salary reviews and the results of those salary reviews, including a copy of the statement produced to justify the decisionfootnote 10 of the employer. It also includes the cost to employers for keeping records of notices of employment opportunities that they used to inform employees about employment and promotion opportunities.

To estimate the cost of the time spent by employers to keep records of the requests for salary reviews and the results of those salary reviews, including a copy of the statements produced to justify the decision of the employer, the analysis used the assumptions that 0.2% of estimated part-time and non-permanent employees in the first year, and 0.1% in subsequent years, would request equal treatment reviews, and a record of these reviews would be kept by their HR administrator, who would dedicate 30 minutes to each record-keeping task, with an assumed wage of $33.97/hour (2023 Can$).footnote 11

To estimate the cost of the time spent by employers to keep records of the industrial establishment, position title, job description, employment status, and work conditions of each employee, as well as any criteria used to justify a difference in employees’ rates of wage, the analysis used the assumption that for all employees, the HR administrator would dedicate 5 minutes to record the information outlined above, per employee, with an assumed wage of $33.97/hour (2023 Can$).

Finally, to estimate the costs of keeping records of notices of employment opportunities for employers carrying out a practice of informing employees of employment or promotion opportunities in writing, the analysis assumed that for all employers, the HR administrator would dedicate 5 minutes to record the information outlined above, per employer, with an assumed wage of $33.97/hour (2023 Can$).

Cost No. 3: Costs to the federal government for implementing, monitoring compliance, and enforcing the proposed Regulations

The Labour Program consulted internally to determine the costs to the federal government for implementing the proposed Regulations, and the labour costs and time required for the Labour Program officers to review and assess the equal treatment requests.

It is assumed that the Labour Program will publish interpretation and guidance materials for employees and employers on their new rights and responsibilities. This will include taking the necessary time to understand the compliance components required to conduct inspections and/or investigations in response to complaints before the proposed Regulations come into force. The interpretation and guidance materials will be developed within one year, prior to the proposed Regulations coming into force.

Furthermore, costs to the Labour program for reviewing and assessing the equal treatment requests by Labour Program officers assume that the population of employees affected are the 0.2% of non-permanent and part-time employees requesting equal treatment reviews in the first year, and 0.1% for subsequent years. It is further assumed that the approval rate of these requests is 15%. The Labour Program officer’s wage is assumed to be $42.79/hour, and it was determined that these officers would dedicate 5 hours to review each equal treatment request.

Costs of the equal treatment provisions
Table 5: PV compliance costs for the equal treatment provisions
Compliance cost Present value total cost
Time spent by HR managers to assess employee requests for review and producing statements to determine and justify if a wage adjustment is granted or if the employees’ current rate of wages complies with the provisions. $93,201
Modifying employees’ pay rates in the compensation system for employees who have wage increases. $6,990
Paying higher wages for workers that received confirmation of a wage adjustment. $1,428,172
Total PV compliance costs $1,528,363
Table 6: PV record-keeping costs for the equal treatment provisions
Record-keeping cost Present value total cost
Time spent by employers to record requests for reviews and the statements produced to determine the decision of the employer. $27,598
Time spent by employers to keep records of the industrial establishment, position title, job description, employment status, and work conditions of each employee, as well as any criteria used to justify a difference in employees’ rates of wage. $4,087,073
Keeping records of notices of employment opportunities for employers carrying out a practice of informing employees of employment or promotion opportunities in writing. $420,680
Total PV record-keeping costs $4,535,351
Table 7: PV costs to the federal government for the equal treatment provisions
Cost to federal government Present value total cost
Review and assessment of equal treatment requests by Labour Program officers. $52,145

The total present value costs of the equal treatment provisions are found in the table below.

Table 8: Total PV compliance, record keeping, and costs to the federal government
Compliance costs Record-keeping costs Costs to the federal government Total PV costs
$1,528,363 $4,535,351 $52,145 $6,115,860

Figures may not add up to totals due to rounding.

Cost-benefit statement
Table 9: Monetized benefits (PV)
Affected stakeholder Description of benefit 2026 2027–2034 2035 Total Annualized value
Employees Increased salary $308,100 $1,022,700 $97,400 $1,428,200 $203,300
All stakeholders Total benefit $308,100 $1,022,700 $97,400 $1,428,200 $203,300
Table 10: Monetized costs (PV)
Affected stakeholder Description of cost 2026 2027–2034 2035 Total Annualized value
Employers Costs complying with equal treatment provisions $329,700 $1,094,400 $104,200 $1,528,300 $217,600
Costs of the
record-keeping requirements		 $551,200 $3,637,900 $346,200 $4,535,300 $645,700
Government Costs to Labour Program for reviewing and assessing complaints $11,300 $37,300 $3,600 $52,200 $7,400
All stakeholders Total costs $892,200 $4,769,600 $4,540 $6,115,800 $870,800
Figures may not add up to totals due to rounding.
Table 11: Summary of monetized benefits and costs (PV)
Impact 2026 2027–2034 2035 Total Annualized value
Total benefits $308,100 $1,022,700 $97,400 $1,428,200 $203,300
Total costs $892,200 $4,769,700 $454,000 $6,115,800 $870,800
Net impact −$584,100 −$3,747,000 −$356,600 −$4,687,600 −$667,400
Quantified (non-monetized) and qualitative impacts

Small business lens

The analysis used the same assumptions as outlined previously in the benefits and costs section focusing on small businesses, which employ 1 to 99 employees. This includes small businesses from all FRPS industries employing non-permanent and part-time employees in the federal jurisdiction.

There are several requirements relating to the retention of documents, which is often considered to be an administrative cost under the definition in the Policy on Limiting Regulatory Burden on Business. However, keeping records of the industrial establishment, position title, job description, employment status and work conditions of each employee, and of any criteria used to justify a difference in employees’ rates of wage is considered to be a compliance cost as this information is essential for employers to make the comparisons necessary to comply with the equal treatment provisions in the Code. Other document retention activities set out in the proposal are intended to demonstrate compliance and have thus been recorded as falling within the policy definition of administrative burden.

The PV of the compliance and administrative costs for small businesses in all industries for the 10-year analytical period are summarized below.

Small business lens summary
Table 12: Benefits
Type of activity Description of benefit Present value Annualized value
Compliance Increased salary to employees $181,351 $25,820
Total Total benefits $181,351 $25,820
Table 13: Costs
Type of activity Description of cost Present value Annualized value
Administrative Costs to employers to keep record of requests for review and the statements produced $3,480 $495
Costs to employers of keeping records of notices of employment opportunities $402,580 $57,318
Compliance Costs to employers to keep records of the industrial establishment, position title, employment status, and work conditions of each employee, as well as any criteria used to justify a difference in employees’ rates of wage $515,293 $73,366
Costs to employers associated with the time assessing, reviewing, and producing statements for the equal treatment requests $11,751 $1,673
Costs to employers associated with modifying employees’ pay rates in the pay system $881 $125
Costs to employers in terms of higher wage payments $181,351 $25,820
Total Total costs $1,115,336 $158,799
Table 14: Net impacts
Amount Present value Annualized value
Net impact on all impacted small businesses −$933,985 −$132,978
Average net impact on each impacted small business −$48.52 −$6.91

One-for-one rule

Element A of the one-for-one rule would be triggered as there would be monetized increases in administrative costs to employers.

Element B of the one-for-one rule would not be triggered as the proposal would not introduce a new regulatory title.

The record-keeping provisions of the proposed amendments would increase the administrative burden under the one-for-one rule. The costs to keep records of the requests for review and the statements produced to determine the decision of the employer would be considered burden “in” under the one-for-one rule. The costs to keep records of notices of employment opportunities would also be considered burden “in.”

As noted in the “Small business lens” section, the costs of keeping records of the industrial establishment, position title, job description, employment status and work conditions of each employee, and of any criteria used to justify a difference in employees’ rates of wage would not be considered an administrative burden because employers would need to collect this information to comply with the equal treatment provisions in the Code.

Assumptions used to estimate the costs to keep records of the request for review and the statements produced to determine the decision of the employer are such that employers would dedicate 30 minutes per affected employee to keep record of equal treatment request for review and to produce statements for the affected number of employees, following the assumptions of the request for review proportions, for the 10-year analytical period, performed by their Human Representative (HR) Administrative Assistant with an assumed wage of $32.89/hour (2012 Can$, including overhead).

Furthermore, assumptions used to estimate the costs of keeping records of notice of employment opportunities are such that all employers would dedicate 5 minutes performing this task for the 10-year analytical period, performed by their HR Administrative Assistant with an assumed wage of $32.89/hour (2012 Can$, including overhead).

Finally, it was determined, using the Regulatory Cost Calculator, that the annualized average administrative costs would be $20,608 or $1.06 per business (2012 Can$, 2012 discount base year).

Regulatory cooperation and alignment

The proposed Regulations are not related to a work plan or commitment under a formal regulatory cooperation forum.

Equal treatment legislation and regulations

The impetus for the creation of the federal equal treatment provisions stems in part because two provinces, Ontario and Quebec, had similar legislation in force in 2018, and there was a desire to bring the Canada Labour Code into alignment with provincial counterparts. The new equal treatment provisions in section 182.1 of the Canada Labour Code (not yet in force) are based on section 42.1 of the Ontario Employment Standards Act (ESA),footnote 12 which was in force between April 1, and December 31, 2018. This section of the ESA was introduced to ensure that employees working in the same establishment and doing substantially the same work were not paid a lower wage due to their employment status. This section of the act was repealed on January 1, 2019.

At present, Quebec is the only province with equal treatment legislation. Section 41.1 of the Act respecting labour standards footnote 13 prohibits an employer from paying an employee a lower rate of wage than another employee performing the same tasks in the same establishment solely because of the employee’s employment status. There are no supporting regulations for these provisions.

A cross-jurisdictional analysis was undertaken to assess protections for temporary and part-time employees, which included all members of the Organization for Economic Co-operation and Development as well as Commonwealth countries that have legislation in force protecting employees with non-standard employment status. This included statutory regimes found in the United Kingdom, Germany, Australia, and New Zealand. The Code’s new equal treatment provisions align with equal treatment measures taken by other countries in the OECD, such as the UK, New Zealand, Japan, Germany, South Korea and Australia. These countries have legislation that addresses equal treatment of employees based on employment status.

Recently, Australia has taken steps to improve the rights of casual workers. On September 4, 2023, the Australian federal government tabled the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023.footnote 14 The Bill will significantly amend the Fair Work Act 2009,footnote 15 Australia’s core labour legislation. While the legislation does not introduce equal treatment provisions, it seeks, in part, to improve the rights of casual employees and improve their access to small claims through an expanded definition of what is considered a casual employee.

Temporary help agencies legislation and regulations

The provisions in the new Division VI.1 of the Canada Labour Code are designed to ensure the equal treatment of temporary help agency employees under federal jurisdiction, and to bring federal legislation in line with existing provincial standards.

In the Labour Program’s estimation, most temporary help agencies in Canada are subject to provincial, rather than federal, jurisdiction. However, there is very little jurisprudence on this question. Accordingly, as case law on the matter evolves, more temporary help agencies may be found to fall under federal jurisdiction.

It is also possible that new federally regulated temporary help agencies will be established in the future, or that an existing agency will become subject to federal jurisdiction following significant changes to its structure or activities. Should that be the case, the Code’s temporary help agency provisions would apply to these federally regulated agencies.

Following the repeal of section 42.2footnote 12 of Ontario’s ESA in January 2019, Quebec is currently the only province in Canada that has equal treatment provisions prohibiting temporary help agencies from paying their employees less than their clients’ employees. Section 41.2 of Quebec’s Act respecting labour standards footnote 13 prohibits a personnel placement agency from paying an employee a lower rate of wage than that granted to employees of the client who perform the same tasks, in the same establishment, solely because of the employee’s employment status, and in particular because the employee is remunerated by such an agency or usually works fewer hours each week.

Quebec also has regulations respecting personnel placement agencies and recruitment agencies for temporary foreign workers. However, these are related to Division VIII.2, “Personnel Placement and Temporary Foreign workers”,footnote 13 of the Act respecting labour standards, which concerns the licensing of personnel placement and temporary foreign workers, rather than equal treatment for temporary help agency employees.

Many Canadian provinces have provisions pertaining to temporary help agencies in their respective labour standards legislation. However, many of these legislative provisions do not concern equal wages, but rather temporary help agencies charging fees to their employees. For example, section 12 of Alberta’s Employment Agency Business Licensing Regulation footnote 16 prohibits an employment agency business operator from directly or indirectly demanding or collecting a fee, reward or other compensation from individuals seeking employment. While Alberta’s regulations prohibit employment agencies from charging certain fees, such prohibitions are already included in the legislative amendments to the Canada Labour Code, and, therefore, do not need to be specified in regulations.

Section 15.1 of Manitoba’s Worker Recruitment and Protection Regulation footnote 17 specifies when a temporary help agency may charge fees. Such regulations at the federal level are not necessary, as the proposed amendment at subsection 203.1(1) of the Canada Labour Code will prohibit employers from charging fees once it is in force. The British Columbia Employment Standards Regulation footnote 18 has a provision that requires temporary help agencies to be licensed. This is different from what is contemplated in the proposed Regulations as it is not a requirement under the Canada Labour Code’s provisions pertaining to temporary help agencies. British Columbia does not have regulations related to prohibited fees or equal wages.

The Australian government’s Bill to reform the Fair Work Act 2009 will also amend labour hire arrangementsfootnote 19 to ensure that employers who supply employees to perform work for another employer pay these employees at the same rate of wages as employees of the host employer if they perform the same kind of work. The Bill will also empower the Fair Work Commission to pursue businesses who attempt to avoid the new changes to labour hire arrangements.

Effects on the environment

In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.

Gender-based analysis plus

Temporary employees (i.e. those employed on a fixed-term contract or on a seasonal, casual or irregular basis) and part-time workers are more likely to receive lower wages and have greater difficulty in gaining access to the labour market, and therefore depend on non-standard work arrangements.footnote 20 Data from the 2022 Survey of Employees under Federal Jurisdiction indicates that employees under federal jurisdiction occupying part-time positions tend to be women (12.4% compared to 9.5% for men).footnote 21 Although women represent a marginally higher proportion of part-time workers, they only represent 35% of employees in the federally regulated private sector compared to 65% who are men.

As for employees with temporary workplace arrangements, the 2022 Survey demonstrates that men constitute 55% of those under such arrangements compared to 45% of women. As above, it is important to note that men represent a larger portion of employees under federal jurisdiction. According to Statistics Canada, women tend to undertake part-time work due to caring for children (27% of women in part-time work arrangements compared to 10% for men).footnote 22 Women are also more likely to work multiple jobs.footnote 23 Younger people tend to occupy part-time positions more than employees in older cohorts, often due to being in school or pursuing post-secondary education (34% of those between 15 and 24 years old).

Although the data for the federal jurisdiction is sparse, research has shown that immigrants in Canada were significantly more likely to be precariously employed (e.g. working on a part-time and/or temporary basis) to Canadian-born workers.footnote 24 This is due, in part, to language barriers, visible minority status, underutilization of immigrant skills, and a lack of access to professional networks.footnote 25 These factors give rise to immigrant populations occupying precarious employment positions.

Therefore, the proposed Regulations will benefit women, immigrants, and young people by supporting the legislative provisions. This will be achieved by defining terms used in the legislation to ensure a uniform application throughout the federally regulated private sector. The definition of “employment status,” for instance, considers the difference in the number of hours worked by an employee (part-time versus full-time) and the differences in the term of an individual’s employment contract (permanent versus temporary employee). The definition of “industrial establishment” ensures that the unique nature and work locations of industries under federal jurisdiction (rail, air, maritime, and trucking) are clearly established so that comparisons with other employees are easier.

This ensures that those employed in more precarious work are not paid less than those occupying permanent and/or full-time positions. Employees in these positions, such as women and immigrants, will be able to benefit from a higher salary than before if they perform substantially the same kind of work. Since women tend to more frequently hold multiple jobs, the increase in salary may reduce this need. It will also ensure that new employees will not be paid a lower rate of wages if they work part-time or on a temporary basis.

Implementation, compliance and enforcement, and service standards

Implementation

The proposed Regulations would come into force on the day in which the amendments to the provisions pertaining to equal treatment and temporary help agencies in the Code come into force. It is anticipated that the amendments to the Code will come into force by Order in Council in late 2025 or early 2026, depending on the feedback received and time required to make any future changes to the proposed Regulations.

The Labour Program will publish interpretations, policies and guidelines (IPGs) for employees and employers on their new rights and responsibilities. These IPGs will be made available on the Canada.ca website prior to the coming into force of the legislative and regulatory measures.

Regarding the provisions addressing equal treatment, these materials will include guidance pertaining to

The guidance pertaining to temporary help agencies will address

Furthermore, Labour Program officers and inspectors will receive training on the new provisions prior to their coming into force to carry out their compliance and enforcement duties.

The draft IPGs pertaining to the equal treatment and temporary help agency provisions have been developed in conjunction with the regulations, to allow for stakeholder review during the comment period. For a copy of the draft guidance documents, please write to the Labour Program at EDSCDMTConsultationNTModernesConsultationModernLSWDESDC@labour-travail.gc.ca.

Guidance materials for the inspectorate and information for stakeholders will be finalized when the legislation and accompanying regulations come into force. However, work on these materials and information will remain iterative to allow any necessary guidance adjustments to be made as implementation issues are identified and operational guidance requests are received.

Compliance and enforcement

Labour Affairs officers will determine non-compliance with requirements under Part III of the Code by conducting inspections, or by conducting investigations in response to complaints. Compliance will be achieved using a variety of approaches along a compliance continuum. This may include educating and counselling employers on the regulatory changes including their record keeping obligations, seeking an assurance of voluntary compliance from the employer, or issuing a compliance order to cease the contravention and take steps to prevent its reoccurrence. To address more serious or repeated contraventions, an administrative monetary penalty under Part IV of the Code may be issued.

To learn more about how administrative monetary penalties may be issued, please consult the interpretations, policies and guidelines (IPGs) document entitled Administrative Monetary Penalties - Canada Labour Code, Part IV - IPG-106.

Contact

Interested persons may make representations concerning the proposed Regulations within 30 days after the date of publication of this notice. It is strongly recommended to use the online commenting feature that is available on the Canada Gazette website, but, if email is preferred, the representations should cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to

Annic Plouffe
Executive Director
Labour Standards and Wage Earner Protection Program
Labour Program
Employment and Social Development Canada
Email: EDSCDMTConsultationNTModernesConsultationModernLSWDESDC@labour-travail.gc.ca

PROPOSED REGULATORY TEXT

Notice is given that the Governor in Council proposes to make the annexed Regulations Amending Certain Regulations Made Under the Canada Labour Code (Equal Treatment and Temporary Help Agencies) under paragraphs 182.4(a)footnote a, (b)footnote a and (c)footnote a and 203.5(b)footnote b and (c)footnote b and subsections 264(1)footnote c and 270(1)footnote d of the Canada Labour Code footnote e.

Interested persons may make representations concerning the proposed Regulations within 30 days after the date of publication of this notice. They are strongly encouraged to use the online commenting feature that is available on the Canada Gazette website but if they use email, mail or any other means, the representations should cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to Annic Plouffe, Executive Director, Labour Standards and Wage Earner Protection Program, Department of Employment and Social Development, 165 De l’Hôtel-de-Ville Street, Place du Portage, Phase II, 10th Floor, Gatineau, Quebec J8X 3X2 (email: EDSCDMTConsultationNTModernesConsultationModernLSWDESDC@labour-travail.gc.ca).

Ottawa, February 13, 2025

Wendy Nixon
Assistant Clerk of the Privy Council

Regulations Amending Certain Regulations Made Under the Canada Labour Code (Equal Treatment and Temporary Help Agencies)

Canada Labour Standards Regulations

1 The Canada Labour Standards Regulations footnote 26 are amended by adding the following after section 11.1:

Equal Treatment

11.2 (1) The following definitions apply in this section.

full-time,
in respect of an employee, means that the employee is considered to be full-time under the terms of the collective agreement that applies to them or of their contract of employment or, if the collective agreement or contract of employment does not address the issue,
  • (a) that the employee is considered to be full-time under a policy of their employer that has been communicated to them; or
  • (b) if paragraph (a) does not apply, that the employee
    • (i) is scheduled to work an average of 30 or more hours per week, if they are subject to an averaging plan under subsection 169(2) or 171(2) of the Act or a modified work schedule under section 170 or 172 of the Act, or
    • (ii) usually works 30 or more hours per week, if they are not subject to such a plan or schedule. (à temps plein)
part-time,
in respect of an employee, means that they are not full-time. (à temps partiel)
permanent,
in respect of an employee, means that their contract of employment provides that they are employed for an indeterminate period. (permanent)
temporary,
in respect of an employee, means that their contract of employment provides that they are employed for a fixed term or on a seasonal, casual or irregular basis. (temporaire)

(2) For the purpose of subparagraph (b)(i) of the definition full-time, the average number of hours of work per week is the total number of hours scheduled under the averaging plan or modified work schedule, as the case may be, divided by the number of weeks in the plan or schedule.

(3) For the purposes of Division III of the Act, employment status means an employee’s status as a full-time, part-time, permanent or temporary employee.

11.3 For the purposes of Division III of the Act, all branches, sections and other divisions of federal works, undertakings and businesses that are located in a region established under paragraph 54(w) of the Employment Insurance Act are designated as industrial establishments.

11.4 For the purpose of paragraph 182.1(1)(a) of the Act, if an employer has more than one industrial establishment, an employee is considered to work

11.5 For the purpose of paragraph 182.1(1)(e) of the Act, it is a factor that the employees’ wages for the performance of a job function are calculated using the same type of rate of wages, such as

11.6 For the purpose of paragraph 182.1(2)(d) of the Act, the criteria are

2 The Regulations are amended by adding the following after section 16:

Temporary Help Agencies

16.1 For the purposes of Division VI.1 of the Act, all branches, sections and other divisions of federal works, undertakings and businesses that are located in a region established under paragraph 54(w) of the Employment Insurance Act are designated as industrial establishments.

16.2 For the purpose of paragraph 203.2(1)(a) of the Act, if a client has more than one industrial establishment, an employee is considered to work

16.3 For the purpose of paragraph 203.2(1)(e) of the Act, it is a factor that the employees’ wages for the performance of a job function are calculated using the same type of rate of wages, such as

16.4 For the purpose of paragraph 203.2(2)(d) of the Act, the criteria are

3 Subsection 24(2) of the Regulations is amended by adding the following after paragraph (f):

4 Schedule II to the Regulations is amended by replacing “Equal wages” with “Equal treatment”.

5 Schedule II to the Regulations is amended by adding the following after “Multi-employer employment”:

Temporary help agencies

6 Schedule II to the Regulations is amended by replacing “Sick leave” with “Medical leave”.

7 Schedule II to the Regulations is amended by replacing “https://www.canada.ca/en/employment-social-development/programs/employment-standards/federal-standards.html” with “https://www.canada.ca/en/services/jobs/workplace/federal-labour-standards.html”.

Administrative Monetary Penalties (Canada Labour Code) Regulations

8 Part 1 of Schedule 2 to the Administrative Monetary Penalties (Canada Labour Code) Regulations footnote 27 is amended by adding the following after item 28:
Item

Column 1

Provision

Column 2

Violation Type
28.1 182.1(1) C
28.2 182.1(3) C
28.3 182.2(1) B
28.4 182.2(2) B
28.5 182.2(3) C
28.6 182.3 C
9 Part 1 of Schedule 2 to the Regulations is amended by adding the following after item 42:
Item

Column 1

Provision

Column 2

Violation Type
42.1 203.1(1)(a) B
42.11 203.1(1)(b) B
42.12 203.1(1)(c) B
42.13 203.1(1)(d) B
42.14 203.1(1)(e) B
42.15 203.1(1)(f) C
42.16 203.1(2) B
42.17 203.2(1) C
42.18 203.2(3) C
42.19 203.3(1) B
42.2 203.3(2) B
42.21 203.3(3) C
10 Division 1 of Part 2 of Schedule 2 to the Regulations is amended by adding the following after item 31:
Item

Column 1

Provision

Column 2

Violation Type
31.1 24(2)(f.1) A
31.2 24(2)(f.2) A
31.3 24(2)(f.3) A

Coming into Force

11 These Regulations come into force on the day on which section 451 of the Budget Implementation Act, 2018, No. 2, chapter 27 of the Statutes of Canada, 2018, comes into force, but if they are registered after that day, they come into force on the day on which they are registered.

Terms of use and Privacy notice

Terms of use

It is your responsibility to ensure that the comments you provide do not:

  • contain personal information
  • contain protected or classified information of the Government of Canada
  • express or incite discrimination on the basis of race, sex, religion, sexual orientation or against any other group protected under the Canadian Human Rights Act or the Canadian Charter of Rights and Freedoms
  • contain hateful, defamatory, or obscene language
  • contain threatening, violent, intimidating or harassing language
  • contain language contrary to any federal, provincial or territorial laws of Canada
  • constitute impersonation, advertising or spam
  • encourage or incite any criminal activity
  • contain external links
  • contain a language other than English or French
  • otherwise violate this notice

The federal institution managing the proposed regulatory change retains the right to review and remove personal information, hate speech, or other information deemed inappropriate for public posting as listed above.

Confidential Business Information should only be posted in the specific Confidential Business Information text box. In general, Confidential Business Information includes information that (i) is not publicly available, (ii) is treated in a confidential manner by the person to whose business the information relates, and (iii) has actual or potential economic value to the person or their competitors because it is not publicly available and whose disclosure would result in financial loss to the person or a material gain to their competitors. Comments that you provide in the Confidential Business Information section that satisfy this description will not be made publicly available. The federal institution managing the proposed regulatory change retains the right to post the comment publicly if it is not deemed to be Confidential Business Information.

Your comments will be posted on the Canada Gazette website for public review. However, you have the right to submit your comments anonymously. If you choose to remain anonymous, your comments will be made public and attributed to an anonymous individual. No other information about you will be made publicly available.

Comments will remain posted on the Canada Gazette website for at least 10 years.

Please note that communication by email is not secure, if the attachment you wish to send contains sensitive information, please contact the departmental email to discuss ways in which you can transmit sensitive information.

Privacy notice

The information you provide is collected under the authority of the Financial Administration Act, the Department of Public Works and Government Services Act, the Canada–United States–Mexico Agreement Implementation Act,and applicable regulators’ enabling statutes for the purpose of collecting comments related to the proposed regulatory changes. Your comments and documents are collected for the purpose of increasing transparency in the regulatory process and making Government more accessible to Canadians.

Personal information submitted is collected, used, disclosed, retained, and protected from unauthorized persons and/or agencies pursuant to the provisions of the Privacy Act and the Privacy Regulations. Individual names that are submitted will not be posted online but will be kept for contact if needed. The names of organizations that submit comments will be posted online.

Submitted information, including personal information, will be accessible to Public Services and Procurement Canada, who is responsible for the Canada Gazette webpage, and the federal institution managing the proposed regulatory change.

You have the right of access to and correction of your personal information. To seek access or correction of your personal information, contact the Access to Information and Privacy (ATIP) Office of the federal institution managing the proposed regulatory change.

You have the right to file a complaint to the Privacy Commission of Canada regarding any federal institution’s handling of your personal information.

The personal information provided is included in Personal Information Bank PSU 938 Outreach Activities. Individuals requesting access to their personal information under the Privacy Act should submit their request to the appropriate regulator with sufficient information for that federal institution to retrieve their personal information. For individuals who choose to submit comments anonymously, requests for their information may not be reasonably retrievable by the government institution.