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PAL Benefits Releases Pay Equity Survey

Posted by on Aug 9, 2010 in Compensation | 0 comments

The results of PAL Benefits Pay Equity Survey are set out below. Also, see the exclusive interview and podcastof Steven Osiel, PAL’s VP of Total Rewards.************************************Thank you to those who participated in our most recent Flash Survey which probed awareness of the issue of Pay Equity. As promised, we share aggregate results and their interpretation with you here.

Respondents

Most of our respondents have employees in Ontario. The location breakdown of survey respondents is as follows:

  • Ontario — 93.7%
  • Quebec — 41.6%
  • Alberta — 39.5%
  • British Columbia — 33.3%
  • Other provinces — 22.9%
  • Outside of Canada — 16.6%

 

Familiarity

  • Just under half of respondents (44%) indicated they are very familiar with Pay Equity concepts and requirements.
  • More than half (54%) indicated they are only a little familiar with Pay Equity details (48%) or not at all familiar (6%).

Commentary

It is not difficult to understand the general lack of familiarity with the subject.  Pay Equity was top of mind for many employers when legislated 20 years ago.  But today, there is a feeling we have moved past the establishment of pay equity and it is now established in the workplace.  As shall be revealed below, that is not necessarily the case. In reality, compliance with the Pay Equity Act is far from achieved.

Posting a Pay Equity plan for employees

 

All Ontario employers with over 10 employees (with the exception of federally regulated employers) are required to post a plan and achieve Pay Equity.

  • ·  However, more than half of respondents (68.7%) either never posted a Pay Equity plan or do not know if they did or not.  
  • 31.2% of our respondents have done so.

Commentary

How do we explain the large number of companies who have not posted such a plan?  This is likely due to the fact that heightened Pay Equity activity peaked in the period shortly after it became law — between 15 and 20 years ago.  Today, since many employers truly believe they provide equal pay for equal service, regardless of gender, they may (falsely) assume no further actions are required to comply with the Pay Equity Act.  Unfortunately, complying with the spirit of the act is not a substitute for complying with the very specific steps outlined by the provincial government in order to be Pay Equity compliant.

Reviewing Plan for Compliance

  • 14.5% of respondents reviewed their Pay Equity plan within the past 3 years.
  • 20.8% reviewed it between 3 and 10 years ago
  • The remaining 64.5% either never reviewed it or don’t know if they did or not.

Commentary

In Ontario, the Pay Equity Act does not mandate employers to undergo a Pay Equity plan review.  This is unlike Quebec, however, where rules introduced in 2009 mandate a review every 5 years.  Outside Quebec, it is advisable to consider the need to review your Pay Equity plan for compliance.

In Ontario, the Pay Equity Office actively audits organizations for compliance. An audit may be initiated under one of two circumstances:

  1. Random audit. Since 2008, the Pay Equity Office has been targeting the retail and hotel/motel sectors. However, audits are not limited to these sectors
  2. In the event of a Pay Equity complaint initiated by an employee or former employee.

For your information, 6.2% of our respondents indicated they were, indeed, subject to an audit for Pay Equity and 4.1% of them were actually subject to a Pay Equity complaint.

An organization would be wise to undergo an ad-hoc internal audit to reveal whether or not an official, in-depth, internal audit is warranted.  By doing so, a company will be better positioned to defend their compliance and/or document efforts to rectify non-compliance in the event of a random audit or complaint.

 

Passing an Audit

  • Most respondents (66.6%) thought they would pass an audit by the Pay Equity Commission.
  • However, 33.3% didn’t think they would pass or weren’t sure if they would pass.

Commentary

As mentioned earlier, while many companies assume they are Pay Equity compliant and certainly would choose to be so on principal, that doesn’t mean they have undertaken the real actions required to comply with Pay Equity legislation.  These requirements include some of the following:

  • Identify male/female jobs
  • Evaluate the relative worth of each job with a gender neutral and Ontario compliant evaluation tool for those jobs
  • Analyze the results for any gender based inequities
  • Write up a Pay Equity Plan and post it
  • Rectify inequities
  • Maintain pay equity across time and organizational changes

 

Quebec

Quebec has the most stringent Pay Equity maintenance policy.  Recent legislation sets out the criteria for Pay Equity practice.  These include:

  • Submitting a Pay Equity plan to the government for review, and
  • Undertaking a review every five years.

We direct you here for further information on Quebec’s requirements.

Please contact Steven Osiel at Pal for direction on how you can ensure your organization is compliant with the Pay Equity rules in your province.Thank you for taking the time to respond to our survey.
Pal Benefits Inc.

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