BC Tables New Pay Transparency Legislation

On March 7, 2022, one day before International Women’s Day, the NDP government tabled new legislation that will force employers posting jobs to mention pay ranges, allow employees to compare pay and eventually force medium and larger employers to post summaries of how they pay their employees by gender and level of compensation. The government believes this will help close the “pay gap” between average wages for men and women.

Under the Pay Transparency Act:

1. employers publishing a job ad must state the specified salary or wage or range, and may be required to add other unspecified data the government may later prescribe;
2. employers may not ask job applicants about pay at their current or former employers: this is thought to disadvantage women and minorities since it can perpetuate their lower pay;
3. employers may not discipline or ban employees from disclosing their pay to fellow employees or job applicants: again, this is thought to allow all employees to gather better information to formulate their pay demands.

Private sector employers in BC must publish a “Pay Transparency Report” (“PTR”) if they meet the following employee thresholds:

The PTR must be publicly available. The legislation contains no details about what information must be published but the government has stated that it will require employers to publish information about how women and men are paid, presumably including overall averages.

While the Act’s non-PTR requirements should help all employees and especially women to achieve more equitable pay, some provisions will prove awkward in some situations that have nothing to do with gender inequity. For example, when a company actively recruits someone else employed elsewhere, the new employer may legitimately want to know what the employee currently makes to ensure the new offer will meet or exceed that compensation. Under the Act, employers can no longer ask for that information; only the employee can decide to volunteer that information.

As for the PTR, one of the difficulties with pay reporting genders is making reasonable allowances for non-discriminatory pay differences. If a company compensates primarily based on seniority and most of the most senior employees are men while newcomers are mainly women, the pay gap if reported globally by gender may appear large but would not actually support a conclusion of discrimination in pay. Employers will be hoping the regulations stating the reporting requirements will allow reasonable flexibility to compare “apples to apples” comparisons of pay levels by gender.

The Act will likely pass by mid-year with the non-PTR requirements likely to be in force in late 2023. As noted above, private sector employers will face deadlines for publishing PTRs between November 1, 2024 and November 1, 2026 depending on their size.

Employers and recruiters should already be reviewing compensation data requested in application forms and interviews, including for employers, by their recruiters. Those employers who have been getting by with paying sub-market pay rates will find it more difficult to attract applicants since they now have to publish their pay scale for roles. This may lead some to review pay both for new hires and potentially their peers. The minority of employers who try to ban discussion of pay levels among employees will need to abolish those rules, which likely never were very effective in any event. Once the PTR regulations are published, employers will need to gather wage data by gender and report them in the still to be announced format prescribed under the Act.

Pay equity advocates continue to press the government for much more onerous “pay equity” legislation that requires employers to “value” jobs and then determine if job categories dominated by females are underpaid relative to the value of job categories dominated by men. The government is apparently still considering such legislation, despite evidence it has not made much of a difference in Ontario and Quebec.

If you want more information on this topic, you can contact us at:

Geoffrey Howard:            ghoward@howardlaw.ca

604 424-9686

Sebastian Chern:             schern@howardlaw.ca

604 424-9688