'Timid' pay transparency legislation misses the mark, critics say

Advocates want all employers to track and report wage gap data.

Thestar.com
March 6, 2018
By Sara Mojtehedzadeh

Ontario's proposed new transparency legislation aimed at eliminating the gender pay gap is too weak and fails to address fundamental issues surrounding wage discrimination, according to the province's Equal Pay Coalition.

Hailed by Premier Kathleen Wynne as a "first-of-its-kind strategy," the bill introduced Tuesday would require all publicly advertised job postings to include a salary rate or range, bar employers from asking about past compensation and prohibit reprisal against employees who do discuss or disclose compensation. The bill would also make large employers track and disclose compensation gaps to government.

Fay Faraday, co-chair of the Equal Pay Coalition formed in 1976, welcomed the first three measures but said the reporting requirements fall short of other jurisdictions - and don't even match legal obligations already imposed on Ontario employers.

"Pay transparency is tremendously important but if the government is going to do it, they have to do it right to make sure its effective," Faraday said.

The reporting requirements contained in the proposed reforms will be applied to specific sectors. First, they will be rolled out for the Ontario Public Service. They will subsequently be introduced for private sector workplaces with more than 500 employees, and then those with more than 250.

Small businesses represent 95 per cent of all employers in Ontario, and employ 28 per cent of Ontario's workers, according to the Ministry of Labour.

"One hundred per cent of employers have an obligation to provide equal pay," said Faraday. "The human rights code doesn't carve out anybody. So there is no principle justification for restricting pay transparency."

Civil service workers' pay structures are already transparent because they are unionized employees with publicly available collective agreements that lay out pay rates, she added. Employees who make over $100,000 are also named on the Sunshine List.

Janet Deline, a spokesperson for the Ministry of Labour, said the new proposals would require the public service to provide additional data on workforce composition and aggregate pay gaps.

"The intent of the new legislation is to increase disclosure in hiring processes, around workforce composition and aggregate pay gaps by gender and other diversity characteristics," she said, adding the ministry would "encourage smaller employers" to release the same data.

Faraday said pay transparency is about "shifting the onus" of responsibility away from individual employees, who must currently file complaints about wage discrimination to get action, and onto employers to prove they are complying with the law.

"Every single employer should have this information at their finger tips," Faraday told the Star. "What they're proposing has some good elements but it doesn't actually address that fundamental issue."

The gender pay gap in Ontario is 30 per cent, according to the Equal Pay Coalition's calculation — a gap that narrowed by just 6 per cent since the late 1980s. To put the figure in perspective: if a man were to retire today at 65, a woman would have to keep working until she was 79 to quit with the same earnings.

The gap sharpens considerably based on race and origin. The pay gap for Indigenous women is 57 per cent, for immigrant women it is 39 per cent, and for racialized women it is 32 per cent. Women also make up the majority of minimum-wage earners and part-time workers.

The government's pay transparency legislation is part of a broader, $50 million three-year plan for women's economic empowerment. Provincial Pay Equity Commissioner Emanuela Heyninck told the Star the strategy as a whole "will have a significant impact for working women," as it "addresses many of the barriers to women's full participation in the workforce."

"The goal of any transparency legislation is to remove opportunities for pay inequalities, help shift expectations around salary and put women in a better position to negotiate a fairer wage. It will also enable employers to show leadership as accountable, equitable employers," she said.

While recently-passed Bill 148 introduced reforms for those in precarious jobs such as a $2.60 minimum wage bump, Jan Borowy - a lawyer with labour law firm Cavalluzzo and who co-chairs the Equal Pay Coalition with Faraday - called the government's latest wage discrimination proposals "timid."

"I think they may be concerned frankly about backlash from the business community after the minimum wage backlash. They are doing a disservice to women and their fundamental human rights."

The United Kingdom recently imposed similar pay transparency reporting requirements, which - like Ontario - apply only to workplaces with more than 250 employees. So far, 74 per cent of companies who have submitted their data pay men more than women, according to the Guardian newspaper.

Last year, the coalition drafted a model pay transparency law and urged the province to adopt it. Among other measures, it set out employees right' to know their workplace's pay structure and required all employers to file transparency reports to the Ministry of Labour and their shareholders ever year.

"We did the work for them already," Faraday said, adding that the coalition had no prior knowledge of the legislation tabled Tuesday. "This came out of the blue for us."

Borowy said pay transparency requirements should also apply to provincial government procurement processes. Last week, the federal government took steps in that direction, noting in its 2018 budget that its own proposed pay transparency legislation would specifically apply to federal contractors with contracts worth more than $1 million.

In a 2016 brief to the federal government prepared on the topic by the provincial Pay Equity Commission, the office noted its wage gap pilot program found 54 per cent of respondents "appeared to have a gender wage gap in their organizations." It also noted that 81 per cent of employers contacted voluntarily provided their compensation data to the commission.

That, Borowy said, could indicate that employers are willing to participate in more rigorous pay transparency schemes. But, she added, ensuring compliance required resourcing enforcement efforts. The Pay Equity Office currently has 14 review officers, but Ministry of Labour spokesperson Deline said the new economic empowerment strategy would increase the office's budget by 25 per cent, "allowing them to increase enforcement efforts."

"The concern that we've raised since the outset is that these initiatives are being promised now but it's a matter of weeks before the writ drops so there's no real action that's going to happen on this," said Faraday, referring to the imminent provincial election.

"This is really serious work that needs to be done, that needs to be taken seriously."