New Ontario government postpones implementation of Pay Transparency Act
The Ontario government has delayed the implementation of the Pay Transparency Act, 2018 (the Act), which would have required provincially regulated employers in Ontario to begin disclosing compensation information in public job postings and prohibited inquiries into an applicant’s compensation history.
The Act was originally scheduled to come into force on January 1, 2019. However, following the 2018 Ontario election, the newly elected provincial government amended the Act so as to come into force “on a day to be named by proclamation of the Lieutenant Governor.” The government has indicated that it would postpone the implementation of the Act in order to conduct consultations, which the government says its predecessor failed to do prior to adopting the Act. No timeline has been given for further consultations.
Under the Act, Ontario employers would be prohibited from seeking compensation history from applicants who are not current employees of the employer. However, job applicants would be permitted to disclose their compensation history to prospective employers voluntarily. Additionally, the Act would require Ontario employers to include either the expected compensation or a range of expected compensation for the advertised position in publicly advertised job postings. The previous government argued that the Act would promote gender equality in the workplace.
Provincially regulated employers of 100 or more employees, and certain other prescribed employers, would be required to collect certain information on employee compensation and produce an annual pay transparency report. The report would have to contain information on the composition of the employer’s workforce and on differences in compensation with respect to gender and other designated characteristics. The report would be made publicly available.
If the Act is eventually implemented, either in its current or in revised form, it will impose significant changes to the hiring process in Ontario and require additional reporting to the Ministry of Labour. We will advise you of any further developments in this area.