Order Fixing January 1, 2021 as the Day on Which Division 3 of Part 4 of that Act Comes into Force: SI/2020-72
Canada Gazette, Part II, Volume 154, Number 24
SI/2020-72 November 25, 2020
BUDGET IMPLEMENTATION ACT, 2019, NO. 1
Order Fixing January 1, 2021 as the Day on Which Division 3 of Part 4 of that Act Comes into Force
P.C. 2020-842 October 30, 2020
Her Excellency the Governor General in Council, on the recommendation of the Minister of Labour, pursuant to section 128 of the Budget Implementation Act, 2019, No. 1, chapter 29 of the Statutes of Canada, 2019, fixes January 1, 2021 as the day on which Division 3 of Part 4 of that Act comes into force.
(This note is not part of the Order.)
Pursuant to section 128 of An Act to Implement Certain Provisions of the Budget Tabled in Parliament on March 19, 2019 and Other Measures, set January 1, 2021, as the day on which Division 3 of Part 4 of that Act comes into force.
To amend the Employment Equity Act (the Act) to support the implementation of pay transparency measures to reduce wage gaps in the federally regulated private sector.
According to Statistics Canada, in Canada, employed core-aged women (25 to 54 years old) earned 87 cents for every dollar compared to men in terms of their average hourly wage in 2018 (a wage gap of 13.3%), up from 81 cents in 1998. Data from the Employment Equity Act – Annual Report 2018 (the Annual Report) indicates 48.6% of women in permanent full-time positions were in the top employment equity salary range of $60,000 or more in 2017, while 63.8% of men were in the top salary range for the same period. The Annual Report demonstrates similar gender differences when salary is analyzed by designated groups:
- in 2017, Aboriginal women remained much less likely (41.5%) to earn $60,000 or more compared to Aboriginal men (63%);
- in 2017, women with disabilities remained much less likely (45.7%) to earn $60,000 or more compared to men with disabilities (61%); and
- in 2017, visible minority women remained much less likely (48.4%) to earn $60,000 or more compared to visible minority men (60.5%).
In Budget 2018, the Government of Canada announced $3 million over five years, starting in 2018-2019, to address the wage gap through the inclusion of new pay transparency requirements in the federally regulated private sector. Further to these commitments, An Act to Implement Certain Provisions of the Budget Tabled in Parliament on March 19, 2019 and Other Measures, which received royal assent on June 21, 2019, introduced an amendment to the Act to allow for the introduction of additional pay transparency reporting requirements.
The amendment to the Act brought into force with this Order allows for the introduction of amendments to the Employment Equity Regulations (the Regulations) to fulfill Budget 2018 and 2019 pay transparency commitments. In addition to pay information already provided by federally regulated private-sector employers pursuant to the Regulations (i.e. representation data, employee occupational groups, employee salary ranges, and the number of employees hired, promoted and terminated), amendments to the Regulations made in conjunction with this Order require reporting of additional information in relation to employee salaries by employers. This will in turn enable the determination of an hourly rate of pay as well as bonus pay, overtime pay and overtime hours that will be used by Employment and Social Development Canada’s Labour Program to publicly report on the wage, bonus and overtime pay gaps of federally regulated private-sector employers. Aggregated wage gap information will be included in the Employment Equity Act Annual Report, and the Labour Program will also make wage gap information publicly available through a data visualization application.
The additional pay information filed by federally regulated private-sector employers (i.e. percentage wage gaps, bonus and overtime gap data) will be publicly available, with specific attention paid to making wage gaps of the four designated groups more evident. Experience in other jurisdictions has shown pay transparency to be helpful in raising awareness about the gender wage gap. In Canada, the transparency will be extended beyond gender to the other designated groups. Therefore, the pay transparency measures are expected to raise awareness of wage gaps that affect women, Aboriginal peoples, persons with disabilities and members of visible minorities.
It is expected that pay transparency will prompt employers to take action to examine their practices and show leadership in reducing wage gaps, helping to shift business culture and expectations towards greater equality. The data will be published as aggregate statistics (i.e. average percentage differences) to protect individual privacy.
Consultations were undertaken during the development of the new legislative and regulatory provisions. In late January and early February 2019, in-person engagement sessions were held with federally regulated private-sector employer representatives as well as various stakeholder groups, including unions, special interest groups, industry associations and interested representatives from provincial and municipal orders of government. Further, an online questionnaire was provided to all stakeholders in March 2019. Submissions were also received from stakeholders during publication of the Regulations in the Canada Gazette, Part I, from August 10, 2019, to September 10, 2019. The feedback received from these stakeholder groups helped to inform the approach to the regulatory amendments. Further details can be found in the Regulatory Impact and Analysis Statement which accompanies the amendments to the Regulations.
Compliance, Operations and Program Development