Division 14 introduces new, proactive pay equity legislation. It repeals the Public Sector Equitable Compensation Act and it amends both the Canadian Human Rights Act and the Parliamentary Employment and Staff Relations Act. The legislation and proposed amendments are intended to create a proactive pay equity regime that ensures equal compensation for work of equal value for employees in female-predominant jobs in federally regulated workplaces.
In terms of how the act applies, the pay equity act will apply to all federally regulated employers with 10 or more employees, including the federal private sector, the federal public service, and the Prime Minister and ministers' offices. In addition, the regime will apply to parliamentary workplaces through amendments to the Parliamentary Employment and Staff Relations Act. Individuals and workplaces with fewer than 10 employees would remain covered under the current regime of the Canadian Human Rights Act.
In terms of the key elements and the process, the pay equity act establishes requirements for all employers with 10 or more employees. However, the requirements are different for small employers—those with 10 to 99 employees—and large employers, which have 100 employees or more. Regardless of their size, all employers will be required to develop a single pay equity plan within three years from the coming into force of the legislation, or from becoming subject to the act.
That plan would set out a number of pieces of information, including job classes that have been identified in the workplace; gender predominance of job classes; value of work of job classes that have been assessed based on skill, responsibilities, effort and working conditions; compensation associated with each job class, using a total compensation approach; and results of comparison of the compensation of female- and male-predominant job classes of similar value, using an equal line or equal average model. It will identify those female-predominant job classes that require an increase in compensation, it will set out when those increases are due, and it will provide information on the dispute resolution procedures available to employees.
Plans are to be developed by joint committees for large employers, or those with unionized employees irrespective of their size. These joint committees would have both employer and employee representatives. Two-thirds would be employee representatives, and 50% of them would be women. For small employers or those with no unionized employees, the plan would be developed by an employer-led process. Regardless of the size or the way the plan is developed, all employees will be given an opportunity to comment on the plan before it's finalized.
Increases in compensation will be required to be made by employers within three to five years, depending on the size. Large employers would have up to three years to phase in increases, so long as the payments are at least 1% of their annual payroll. Small employers would have up to five years to phase in those payments, provided again that those payments are 1% of their annual payroll.
Employers would be required to review their plans at least every five years in order to identify and close any pay gaps that may have emerged. They would also be required to provide a short annual statement to the pay equity commissioner each year to ensure sufficient oversight. In terms of that oversight and enforcement and compliance with the pay equity act, a pay equity commissioner would be appointed by the Governor in Council to the Canadian Human Rights Commission.
The pay equity commissioner would administer and enforce the act through a range of compliance and enforcement tools that would include administrative monetary penalties. There would be an appeal mechanism for certain decisions or orders of the pay equity commissioner to the Canadian Human Rights Tribunal.
There would be a creation of a pay equity unit that would consist of officers and employees of the Canadian Human Rights Commission that would support the pay equity commissioner in fulfilling her or his duties under the act. There would also be the creation of a pay equity division within the CHRC, which the pay equity commissioner would preside over in order to address complaints of discriminatory practice related to pay equity in federally regulated workplaces with fewer than 10 employees.
Finally, there would a provision for three additional members with knowledge and expertise in pay equity matters to be appointed to the Canadian Human Rights Tribunal.
In terms of the amendments that would be made to the Parliamentary Employment and Staff Relations Act, there would be the creation of a new part of the PESRA that would provide that the pay equity act applies to all parliamentary employers and employees in a manner that's tailored to respect parliamentary privilege.
Oversight would also be by the pay equity commissioner, who would have the authority to conduct compliance audits and investigations of parliamentary employers and issue compliance orders and notices of contravention to deal with complaints. However, the pay equity commissioner would need to provide notice to the Speaker before entering any place under the authority of parliamentary employers.
Sanctions for non-compliance with decisions or orders of the pay equity commissioner would be tabled in Parliament by the Speaker, and appeal for decisions or orders of the pay equity commissioner would be made to the Federal Public Sector Labour Relations and Employment Board.
At this time, if you have any questions we would be happy to answer them.