FAQ: Pay equity reform
Q1. What is the gender wage gap and how is it calculated?
The gender wage gap is the difference between wages earned by men and wages earned by women. The gap can be measured in various ways, but the most common methods typically look at the earnings of full-time, full year workers or the hourly wages of all workers, regardless of their employment type. Pay equity is typically concerned with hourly wages, since it measures the amount of pay received for a given amount of work (an hour).
There is a wide range of factors that contribute to the gender wage gap, such educational attainment, occupational choice, union status, job tenure, experience and family responsibilities.
Q2. What is pay equity?
Pay equity is compensation in an establishment that is set without discrimination based on gender, i.e. equal pay for work of equal value.
Q3. Will pay equity eliminate the gender wage gap?
Pay equity can help reduce the gender wage gap. However, pay equity does not address other factors which contribute to the gender wage gap, like occupational segregation, market segmentation, the "motherhood penalty" and the field of study.
Q4. What is the Government doing to support pay equity reform?
On February and in the House of Commons, the Government signaled its intention to develop a new direction for pay equity that deals with the issue in a balanced and responsible way.
On , in its response to the report of the Special Committee on Pay Equity, the Government announced its intention to introduce legislative reform for proactive pay equity in both the federal public service and the federally regulated private sector and move away from the current complaint-based system for pay equity.
The Government introduced the Pay Equity Act through Bill C-86, Budget Implementation Act, 2018, nº2 which was tabled in the House of Commons on , and received Royal Assent on . Once it is brought into force, the Pay Equity Act will replace the complaint-based system in the Canadian Human Rights Act, s. 11, with a proactive pay equity system for public and private-sector federally-regulated employers.
Q5. Why is the Government reforming pay equity?
The Government is committed to gender equality and strongly believes in the principle of equal pay for work of equal value and the fair treatment of all workers in the workplace. The Government wants to make meaningful progress on reducing the wage gap between men and women, and proactive pay equity is one part of the solution.
Q6. What are the next steps with respect to pay equity in the federal jurisdiction now that Parliament has passed the Pay Equity Act?
Enabling regulations are required to bring the new Pay Equity Act into force. Following the consultation period for the proposed Pay Equity Regulations (led by the Labour Program at Employment and Social Development Canada), the Government will look to a potential coming into force date for the Pay Equity Act and its enabling regulations later in 2021.
On , Canada’s first federal Pay Equity Commissioner was appointed. The Pay Equity Commissioner is responsible for the development of education materials and will provide an oversight and enforcement function.
Q7. Will the Public Sector Equitable Compensation Act be brought into force?
No. The Public Sector Equitable Compensation Act was enacted by Parliament in March 2009 as a separate equal pay for work of equal value regime for federal public sector employers, their employees, and bargaining agents.
On February and in the House of Commons and its response to the report of the Special Committee on Pay Equity, the Government signaled its intention not to bring the Public Sector Equitable Compensation Act into force.
Moreover, the Pay Equity Act introduced in the House of Commons as part of Bill C-86 on contains provisions that would repeal the Public Sector Equitable Compensation Act once all pay equity complaints filled by public service employees under the Canadian Human Rights Act have been resolved.
Establishing pay equity
Q8. Which legislation provides for pay equity in the federal government departments and agencies?
The Canadian Human Rights Act sets out that "it is a discriminatory practice for an employer to establish or maintain differences in wages between male and female employees employed in the same establishment who are performing work of equal value." It provides a complaint-based approach to ensure employees receive pay equity.
Employees or their bargaining agents may file complaints with the Canadian Human Rights Commission if they believe that their right to pay equity has been violated. The Commission refers public sector pay equity complaints to the Federal Public Sector Labour Relations and Employment Board for determination.
Gender wage gap and composition of the federal public service
Q9. What is the gender wage gap in the federal public service?
The gender wage gap in the federal public service is calculated as the difference between the average hourly wage of all men and the average hourly wage of all women regardless of the group and level.
The gender wage gap in the federal public service shrunk from 10.5% in 2009-2010 to 8.2% in 2019-2020. For men and women under 35, this gap narrows to 3.2%, due in part to the greater similarities in characteristics that impact wages for this younger population.
For more information, please consult the Fact Sheet: Compensation of Women and Men in the Public Service.
Q10. What is the proportion of women and men in the federal public service?
Between 1990 and 2020, there has been a change in the gender makeup of the federal public service: the percentage of female employees has increased from 45% in 1990 to 55% in 2020. The type of positions women are employed in has also evolved. More women are being hired into executive and professional positions that previously were typically held by men. Women make up approximately half of promotions within the federal public service—a trend that is expected to continue. Among other factors, this positive change is due to an increasing number of female graduates, the government's proactive employment equity practices and the implementation of policies that support women at work.
For more information, please consult the Fact Sheet: Compensation of Women and Men in the Federal Public Service.
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