Thank you.
Thank you for inviting us to be here with you today to contribute to your review of pay equity in federally regulated sectors.
My name is Marina Mandal. I am the assistant general counsel at the Canadian Bankers Association. The CBA represents 59 domestic banks, foreign bank subsidiaries, and foreign bank branches operating in Canada.
The banking industry contributes significantly to job growth and to Canada's labour market. Banks and their subsidiaries employ over 280,000 Canadians. Banking is a knowledge-based industry that offers high-quality, well-paying jobs. Over 80% of jobs in the banking industry are full-time positions, and banks paid $24 billion in salaries and benefits to their employees in 2014.
The banks' human resources policies and practices are at the leading edge. Many banks enhance their employees' personal lives with comprehensive benefit programs and pension plans, generous leave policies, and alternative work arrangements, such as flexible work schedules, job-sharing, and telecommuting.
Canada's banks are leaders at fostering diverse workplaces. Many of our members have formal and informal diversity policies, practices, and programs in place aimed at promoting diversity, and a bank's diversity strategy is often overseen by a senior advisory council.
A workforce that is truly representative of the organization's external labour market and its customer base is something in which we strongly believe. Not only is building a diverse workforce the right thing to do, it also broadens a bank's ability to compete for top talent and respond to rapidly changing markets.
Regarding gender diversity specifically, as of 2014, women constituted 62% of the workforce at Canada's six largest banks, which is substantially more than any other federally regulated sector. The banking industry exceeds the government's benchmarks for representation of women at executive, professional, and middle management levels, with women making up 34.5% of all senior managers in banking, 50.4% of middle managers, and 50.5% of professionals.
Canada's banks have been committed to the principles of pay equity for more than 35 years. Banks have refined their job evaluation and compensation systems to ensure they are gender neutral and compliant with the Equal Wages Guidelines, which provide guidance on the application of the pay equity provisions in the Canadian Human Rights Act.
In order to ensure that compensation is gender neutral, banks have established internal pay equity plans and have implemented a number of policies and procedures to ensure equitable compensation for men and women. This includes undertaking regular audits to identify pay differences, requiring that compensation decisions be based on a set of gender-neutral factors, conducting spot checks to ensure there are no biases in the decisions regarding compensation, and conducting pay equity maintenance exercises to correct any salary gaps. Canada's banks strongly believe in equal pay for work of equal value and will continue our leadership in this area.
As the committee has already heard previously, there is a distinction between pay equity and the gender wage gap. In addition to their efforts on pay equity, banks are minimizing the wage gap by implementing human resource strategies to encourage an increasing number of women to enter into senior executive roles. For example, banks have implemented staffing protocols to promote increased representation of women in senior positions, provide access to training and leadership development programs, and support initiatives that promote the advancement of women in banking.
We understand the committee has been mandated to propose a plan for the federal government to implement a new pay equity regime, either through legislation or through other means. While the banking industry is supportive of pay equity, a more complex and prescriptive pay equity regime will not have the desired effect of closing the gender wage gap in Canada. As you consider options moving forward, we would encourage the committee to take into account the following overarching principles in drafting its recommendations to the government.
First, a new federal regime for pay equity must remain sufficiently flexible and take into account differences in the size of workforces among federally regulated employers, the types of businesses represented, corporate structure, and workforce composition. A one-size-fits-all approach is not appropriate for pay equity.
Second, it should take into account the degree to which pay equity has already been achieved by an individual employer and not impose onerous new rules and requirements where they are not needed. This will allow the government to focus on areas where outcomes need to be improved.
Third, a new pay equity regime should build on existing precedents and structures. It is appropriate that protection of the human right to be free from gender discrimination should remain with the Canadian Human Rights Commission.
Last, it should be clear about its objectives. The focus should be on eliminating systemic discriminatory practices in pay systems and on programs to increase development opportunities and promote the advancement of women broadly.
In closing, the banks are fully committed to the principles of pay equity. Having a flexible, efficient, and effective regulatory framework would support the objectives of pay equity.
Thank you again for the opportunity to present our views, and I look forward to your questions.
