Most of the amendments to the Employment Standards Act, 2000 introduced by Bill 148, Fair Workplaces, Better Jobs Act, 2017 came into force on January 1, 2018 or earlier. However, a significant and controversial amendment dealing with “equal pay for equal work” come into force on April 1, 2018, and employers are nervous both about the implications of this amendment and how to deal with it.
For decades, the ESA has provided that men and women performing “equal work” had to receive “equal pay”. The Pay Equity Act was enacted to broaden this protection by, among other things, introducing the concept of “value” into the mix.
Bill 148 (and the ESA) will provide (effective April 1, 2018) that casual, part-time, temporary and seasonal employees the same wages as full-time employees when:
(a) they perform substantially the same kind of work in the same establishment;
(b) their performance requires substantially the same skill, effort and responsibility; and
(c) their work is performed under similar working conditions
This will not apply when the difference in the rate of pay is made on the basis of,
- a seniority system;
- a merit system;
- a system that measures earnings by quantity or quality of production; or
- any other factor other than sex or employment status.
As you can see, similar but not-identical positions may still trigger the requirement for equal pay under Bill 148.
The Ministry of Labour puts it this way:
It will be mandatory for employers to pay:
(a) casual, part-time, temporary and seasonal employees, who are doing substantially the same work as full-time/permanent employees, the same rate of pay as full-time/permanent employees
(b) temporary help agency employees (also known as assignment employees), who are doing substantially the same work as employees of the client, the same rate of pay as employees of the client
In terms of process, an employee who believes that their rate of pay does not comply with the ESA may request a review of their rate of pay from their employer , and the employer will,
- adjust the employee’s pay accordingly;
- if the employer disagrees with the employee’s belief, provide a written response to the employee setting out the reasons for the disagreement.
- not reduce the rate of pay of an employee in order to comply with this obligation.
The employer is required to respond to the employee who requests a review of their rate of pay in writing. There is no direction on what this response must entail, however, where the employer determines that a wage adjustment is not required, the response would, presumably, tie into the exceptions found in the ESA. If the employee is not satisfied with the employers’ response, a complaint would lie under the ESA. Employers should ensure that they are able to justify differences in pay between employees in various classifications, doing substantially the same work at the establishment, and be prepared to explain these differences, in writing, in accordance with the new ESA requirements.