Pay Equity Committee on May 3rd, 2016

[The Chair, Liberal, Anita Vandenbeld]

I call this meeting to order. Perhaps everybody would please take their seats because we don't want to lose time. We have three ministers here today.

Welcome.

I am very pleased we are able to have this meeting at this special time at which we're able to bring the three ministers and the departmental officials together all at once.

We will be allotting the time of seven minutes per minister, and then we will go into questions and answers. To remind the committee, Minister Hajdu will be here for the first hour, then she needs to leave but her departmental officials will stay. If you have particular questions for Status of Women, I would suggest you get those questions into the earlier rounds. The other ministers will remain.

We're very honoured to have with us today the Honourable Patty Hajdu, Minister for Status of Women, along with Meena Ballantyne, the head of agency for Status of Women.

We have also the Honourable MaryAnn Mihychuk, Minister of Employment, Workforce Development and Labour, along with her official from the Department of Employment and Social Development, Lori Sterling, deputy minister of labour.

We also have the Honourable Scott Brison, President of the Treasury Board, along with his officials, Manon Brassard, assistant deputy minister, compensation and labour relations, office of the chief human resources officer; and Renée Caron, senior director, equitable compensation, compensation and labour relations sector.

We will begin with seven-minute presentations from each minister, starting with Minister Hajdu.

[Patty Hajdu, Liberal, Minister of Status of Women]

Thank you very much.

Good afternoon, Madam Chair. I welcome the opportunity to appear here before the Special Committee on Pay Equity.

I'd like to begin by recognizing that we are meeting on the unceded traditional territory of the Algonquin nation.

I also want to take a moment to thank this committee for all of their hard work on the issue of pay equity. Since you will hear very shortly from my colleagues about pay equity at the federal level and within federally regulated workplaces, I will focus my comments on the issue of the gender wage gap, which is closely associated with pay equity.

While definitions may vary, the gender wage gap is generally recognized as the difference between the total of what women earn in our country compared with what men earn. As the committee knows, pay equity is defined as equal pay for work of equal value, where jobs are evaluated on their skill, their effort, their responsibility, and working conditions, and can be compared for their value in the workplace.

The two are linked because addressing pay equity allow us to acknowledge the undervaluing of work traditionally performed by women and consider ways to address it.

Pay equity, however, is only one part of the solution to the gender wage gap. It is a complicated issue with multiple causes, and it requires a multi-faceted response. No single action by an individual, organization or government will close this gap. It is going to take all Canadians working together.

The need for action on the gender wage gap is quite clear. According to Statistics Canada income data, a woman working full time makes 73.5¢ for every dollar that a man makes. Canada now ranks 80th out of 145 countries in the 2015 World Economic Forum's Global Gender Gap Index report for income equality between women and men.

Just as there are marked differences in the distribution of work between men and women, there are also clear differences between groups of women. Immigrant women's employment lags 7% behind that of Canadian-born women and 14% behind that of immigrant men. Aboriginal women's employment rates are 5% below those of aboriginal men and 11% below those of non-aboriginal women. This is unacceptable and we have to make progress.

Alarmingly, studies suggest that more than half of the gender wage gap is due to unexplained factors that either we have not yet learned how to measure or, quite frankly, are the result of patriarchy, the systemic bias and discriminatory practices that have resulted in women being paid less than their male counterparts.

Statistics show that, while more women are now making inroads into all industries and occupations, they are still concentrated in lower-paying sectors such as retail, health care, and social services. Women are also overrepresented in part-time work and are less likely to reach more senior positions. Of course, many women have a greater share of unpaid work, including roles as parents or caregivers. The so-called motherhood penalty reduces the earnings of women with children by at least 9% compared to women without children.

Conversely, Canada ranks first out of 145 countries in female educational attainment, according to the World Economic Forum. This makes it clear that we have a significant pool of talented women in Canada with the skills and capabilities needed for a range of economic opportunities.

Women now make up the majority of enrolments in college programs, and the proportion of women is even greater among graduates. Since the early 1990s, women have made up the majority of full-time students enrolled in undergraduate university programs. As a result, women already represent nearly half the workforce.

The sectors of our economy where women are under-represented are slowly becoming fewer. In the public and not-for-profit sectors, women hold many leadership positions, and women are slowly gaining ground as entrepreneurs, senior executives, CEOs, and board members across the country, but challenges remain. Women represent just 19.5% of FP 500 board members, and 40% of FP 500 companies have no women whatsoever on their boards.

How do we make progress in closing this gap? One critical ingredient is leadership. As the Minister of Status of Women, I'm very proud to be part of a government that has made gender equality a priority, an action that will have ripple effects throughout our society and economy. We plan on making meaningful progress on reducing the gender wage gap across the country. We are leading by example. The Prime Minister made history last November by appointing the first-ever federal cabinet with an equal number of women and men, and the federal government is now working to ensure that its senior appointments are merit-based and reflect Canada's diversity, with gender parity as a key goal.

Through Status of Women Canada, we're supporting projects in sectors of the economy where women have traditionally been under-represented, such as the science and technology sectors. We will continue to engage the public, the private, and the not-for-profit sectors to promote increased representation of women in leadership and decision-making positions. We know that, when there are more women in leadership positions and roles, there are better outcomes for women.

In March of this year, I announced a new call for proposals for projects to engage indigenous women and strengthen the role they play in their communities, as well as projects that empower women for political or community action. We expect those projects to be launched later this year. The review of our electoral system is also an opportunity to look for increased engagement of and for women.

Thank you very much.

[The Chair, Liberal, Anita Vandenbeld]

Thank you very much, Minister.

Our next speaker will be Minister Mihychuk, for seven or eight minutes.

[MaryAnn Mihychuk, Liberal, Minister of Employment]

Thank you very much for the invitation.

I'd like to acknowledge that we are on the traditional territory of the Algonquin people, and the Métis homeland.

As my colleague has indicated, our government believes it's high time we move forward on the pay equity issue.

As Minister of Employment, Workforce Development and Labour, part of my mandate is to foster safe, fair, and productive workplaces and to encourage co-operative labour relations in the federal jurisdiction. I also have the role of ensuring compliance with pay equity provisions in section 11 of the Canadian Human Rights Act. Section 11 makes it discriminatory for employers to pay men and women employed in the same establishment a different wage when they perform work of equal value.

In addition, the labour program offers educational support to federally regulated private sector employers and crown corporations to help them eliminate gender-based wage discrimination. The labour program can also refer suspected cases of gender-based wage discrimination to the Canadian Human Rights Commission.

Our government's goal is to stop this discrimination related to the undervaluation of work traditionally performed by women.

Many studies show that systemic discrimination related to the undervaluation of work traditionally performed by women is not new, or uniquely Canadian. Modern economies face this kind of discrimination to a greater or lesser degree. Figures from StatsCan's 2015 labour force survey show that women across Canada earn only 82¢ for every dollar earned by men. In the federal sector, a woman earns 87¢ for every dollar earned by men. Neither statistic is acceptable.

Equity and diversity are priorities in our mandate letters, and cabinet reflects their importance. We value fairness, transparency, and collaboration. We strongly believe in the principle of equal pay for work of equal value, and the fair treatment of all workers.

Some progress has been made in closing the gender wage gap; however, too many women still face unfair challenges in the workplace and much more needs to be done. Achieving pay equity is a contentious issue, and there are worries about employers and unions trying to hash it out at the bargaining table. In fact, not all federally regulated employees are union members, so that approach would not work.

We know we can do better. Gender bias in how women and men are paid is simply no longer acceptable. It is a question of fairness and equal access to opportunity—core values of our government and of Canadians. We need to build on what we already have. Sixteen years ago the government created a task force chaired by Dr. Beth Bilson to study pay equity and make recommendations. The Bilson report came forward in 2004 with 113 recommendations on pay equity.

One of its recommendations was that we move to a proactive pay equity model that requires employers to review their compensation systems, identify gender-based disparities, and take measures to address them. While the overall assessment of proactive legislation was very positive at the time, there was little consensus on how to implement those recommendations.

I'd be interested in your views on a proactive approach to pay equity in the federally regulated private sector. I am open to suggestions for free-standing pay equity legislation, but foremost I am committed to making every possible effort to achieve pay equity in the federal jurisdiction.

Pay equity is one means of doing so—a very important one—and we must do so. I therefore welcome the work of this committee and look forward to hearing your thoughts and recommendations on the most effective actions we can take to make pay equity a reality in this country.

Thank you.

[The Chair, Liberal, Anita Vandenbeld]

Thank you very much, Minister Mihychuk.

Our next speaker is Minister Brison.

You have between seven and eight minutes, Minister.

[Scott Brison, Liberal, President of the Treasury Board]

Thank you, Madam Chair. I'm delighted to be here with you and my colleagues at committee today.

I also want to say that the reason Minister Hajdu needs to leave after the first hour hasn't been announced, but she is in fact receiving an award as the mental health champion parliamentarian of the year from the Canadian Alliance on Mental Illness and Mental Health. I think it's important to recognize this.

[Some hon. members]

Hear, hear!

[Scott Brison, Liberal, Kings—Hants, NS]

I'm very pleased to be here. We appreciate all committee members having been flexible on the time to meet with us.

As you know, we supported the creation of this special committee and we are pleased to see that your work on this vital topic is well underway.

We don't see this as a partisan issue. As we move forward on important social and equity issues around equality and diversity, we ought to seek to move forward as a Parliament working together to build a fairer and better Canada.

A gender wage gap in this day and age is simply unacceptable. At Treasury Board, we have the fortunate opportunity to be part of the solution.

Let me begin by briefly explaining the two roles Treasury Board plays when it comes to pay equity.

Firstly, Treasury Board plays an important role vis-à-vis pay equity legislation in the public sector, and secondly, Treasury Board is the largest federally regulated employer. We employ just under 200,000 people in the core public administration, so we have an opportunity to set a standard and to lead by example in pay equity.

The Government of Canada of course believes in the principle of equal pay for work of equal value. This is a fundamental human right. That is unequivocal and is a basic principle that's enshrined in the Canadian Human Rights Act, framed by constitutional guarantees of equality.

The goal of pay equity policy and legislation is to ensure that pay is based on the value of the work, not on the gender of who is doing the work. In 1977 the Government of Canada became the first jurisdiction in Canada to enact pay equity legislation in the form of the Canadian Human Rights Act's section 11. This legislation allowed for pay equity complaints to be filed and was actually the vanguard of its time, but the landscape has changed. Now is the time for the Government of Canada to reassess the method of addressing the issue of pay equity.

My colleague, the Minister of Status of Women, has talked about the gender wage gap and the measures to reduce it. The gender wage gap in the public sector stands at about 9%. It is better than the average, which is about 14%, but we have no time to be complacent about or to derive comfort from these statistics. We have a lot of work to do.

The Prime Minister has delivered on the commitment of appointing a gender-balanced cabinet, which further underscores the importance of this. It sets a real example and is having an impact in corporate boardrooms. I've been told by corporate leaders that in fact it's having an impact on how they look at corporate boards going forward. It's going to actually raise the bar for corporate Canada as well.

It's notable that on International Women's Day the National Film Board of Canada announced that at least half of its production funding will be allocated to films directed by women. It's going to take all of us across government and across business to work together to make meaningful progress.

In terms of making meaningful progress on this front, we will have to ensure not only that women have equal access to good jobs at all levels but that we also make incremental and important progress in reducing the gender wage gap. The more we break down barriers and inspire young women and girls to pursue a wide range of careers, the stronger our country will be. It all depends on us, as representatives of the Canadian people, to set an example.

While noticeable progress has been made towards gender equality, there is still a lot of hard work to be done. Pay equity is an important part of that work.

It's my understanding that this committee has heard from a number of witnesses, and that much of the discussion has been focused on the pros and cons of the Canadian Human Rights Act, the Bilson report, and the Public Sector Equitable Compensation Act, PSECA. These systems attempt to address the pay equity issue by each implementing different solutions arising from various decision points. We need to understand the decisions that underlie these three systems, decisions like defining the scope of the model or outlining the dispute resolution process. Our government's answers to questions like these will be fundamental in crafting an approach to pay equity that gets it right. This becomes very important from an equity perspective, and also has very significant fiscal implications. As we focus on developing a more widely accepted approach, it's imperative that we learn from the mistakes of past attempts, and as we move forward, that we don't repeat those mistakes.

The committee has heard from multiple witnesses and stakeholder groups, putting in very good positions and input to advise the government. This committee's work is very important. It will inform our decisions as a government as we go forward.

The process by which pay equity is enacted must be revisited. That question is not up for debate. We know the imperativeness of this. We appreciate and support your work as a committee. Time is of the essence. This legislation requires a sound development process, and we commit to maintaining consultations with the stakeholders as we go through this process. We're committed to pay equity at every level, of course, including at the cabinet table.

In 2016, women expect to be full participants in the economic, social and democratic life of our country.

We're committed to resolving pay equity in a balanced and responsible way, which is why this government supported the motion from the beginning. We look forward to your guidance on this important issue, and to your input and co-operation as we move forward. This issue doesn't just affect women. It affects all of us, as Canadians, because equality and fairness is a Canadian value.

Congratulations on your work. We look forward to the conversation here tonight and your continued engagement.

[The Chair, Liberal, Anita Vandenbeld]

I want to thank all the ministers for joining us today and for their presentations.

We will begin the question period, so I give the floor to Mr. Sheehan.

You have seven minutes, Mr. Sheehan.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

Thank you very much to all three presenters. That was very informative.

I, too, would like to congratulate the Minister of Status of Women on receiving that award, as a colleague from northern Ontario. It's well deserved.

[Patty Hajdu, Liberal, Thunder Bay—Superior North, ON]

Thank you.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

My question is for the Minister of Status of Women.

We know that the government has been working very hard on promoting gender-based analysis throughout all government work in order to ensure that all members of society are taken into account when policies are being created.

How would greater uptake of GBA affect the wage gap, and can you provide some examples?

[Patty Hajdu, Liberal, Thunder Bay—Superior North, ON]

Thank you very much, MP Sheehan.

I am glad you brought up gender-based analysis. It's a core commitment in my mandate, actually, that we strengthen the use of GBA. As you know, GBA has been on the books for a long time and departments should be using gender-based analysis in the decisions they're making that will affect the Canadian population. We've seen a varying degree of use and success in terms of using those tools.

Gender-based analysis essentially supports departments to consider the gendered impacts of programs and policy initiatives. It can also be used to address historic inequities, and I would argue, even inequities in terms of income. It can also look at initiatives, for example, that will strengthen women's labour market attachment; that can help close the gap. For example, why are women under-represented in various sectors, or over-represented in various sectors for that matter?

The most widely known examples of this type in recent years have been the changes to employment insurance special benefits, the implementation of a special range of benefits—and I don't want to steal my colleague's thunder—in terms of EI changes that can actually provide income replacement for women while they're away from work. But also looking at opportunities to support men to have opportunities to take parental leave in a more fulsome way, which would allow women to re-engage in the workforce in a more rapid way, or stay engaged in the workforce.

Perhaps we should be looking at using GBA when we're developing apprenticeships or skills training opportunities, and then, of course, strong GBA as we move forward with an agenda of innovation, of science, of technology, making sure that we have policies, programs, and legislation in place that will allow women to fulsomely take advantage of those opportunities.

I'd also like to say, beyond GBA, that we talk about this as being a human rights issue. It of course is a human rights issue, but it also falls into the category that good social policy is good fiscal policy. Women have contributed more to global GDP growth than have either new technology or the new giants, China and India, a fact supported by OECD and International Monetary Fund studies. This isn't only about human rights, although clearly that is the foundation. This is about spurring our economic growth through the fulsome inclusion of women.

Thanks.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

Chair, I'd like to share my time with Ms. Dabrusin.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

Thank you.

My question is also for Minister Hajdu.

When you were talking you mentioned something about an unexplained wage gap. Could you please elaborate on what you mean by unexplained? Perhaps you could also provide some suggestions to the committee about what tools you would need, if any, to address that.

[Patty Hajdu, Liberal, Thunder Bay—Superior North, ON]

Thank you very much, that's an excellent question as well.

I'm glad we're having this conversation in terms of pay equity being one component of addressing the gender wage gap. It certainly is a component, but it is really only one component.

We know there are a range of factors that are influencing the gender wage gap. I've talked a little bit about some of them—overrepresentation in lower-paying fields, under-representation in higher-paying fields—also overrepresentation of women in part-time work, lack of representation in senior positions and on boards, as well as women's greater share of unpaid work. I think about my own experience raising children and all of the time that goes into actually raising children that prevents you from possibly pursuing further education or training opportunities that might allow you to advance in your career, or even doing the very valuable networking in certain sectors that is essential to moving up in the ranks.

This discrimination and bias against women, even though we talk about the progress we've made in terms of women's rights, we still see a strong discrimination in certain sectors. When I talk about the Prime Minister's role around leadership, it's really because he's exercising his power in a way that's sponsoring women into higher positions. This doesn't happen across sectors. Quite frequently what happens is that the senior leader says, “Hey, does anyone know of a great guy for this vice-president position?” and four names of men come forward, rather than any names of women. That's because the network is primarily composed of men who are sponsoring other men.

Therefore, there are a number of reasons for the gender wage gap, not the least of which is pay equity, but certainly there are a lot of systemic, cultural, and practical considerations.

If I have another minute, Madam Chair, Status of Women actually has a number of actions across the range of those issues, whether it's looking for ways to empower women to seize leadership opportunities, working with corporations and boards to grow the pipeline and make sure there are women leaders in the pipeline, or looking for ways that we can actually work with our ministerial colleagues to address some of the legislative barriers to women fully participating in the workforce.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

It's interesting that you talked about that. I practised law before, and you would see a huge dropping out of women as they moved through the practice. There was a big gap.

You mentioned women being educated and that we have a high number of women graduating from programs, but fewer continuing on to be board members or anything like that. Has any thought been given at Status of Women to reintroducing women into the workforce after being pulled out for a number of years?

[Patty Hajdu, Liberal, Thunder Bay—Superior North, ON]

Yes, we are looking at how we can support women to re-engage in the workforce, but also to become entrepreneurs and business owners. There has been a focus as well on supporting women in ways that meaningfully support their own direction.

I want to touch on what you talked about in terms of the gap between the women who are educated in certain fields and then their representation in those sectors.

I'm being told to wrap up, so we can have that discussion later.

[The Chair, Liberal, Anita Vandenbeld]

I'm sorry, Minister. You can come back to that in a further question.

We are now going to Mr. Albas.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Thank you, Madam Chair.

I want to thank all the ministers and your officials for coming and for the work you do for our country. It isn't an easy role, and I'm glad you're here to talk about this important issue.

I'd like to start with the President of the Treasury Board. Thank you for your opening comments. I'd like to delve a little bit deeper into the Public Sector Equitable Compensation Act. Right now the transitional rules are in place. Can you give me your view on this piece of legislation? It is obviously untested because it hasn't come into force. Where do you start, as someone six months into the role?

[Scott Brison, Liberal, Kings—Hants, NS]

Thank you, Mr. Albas.

I have to tell you that I have difficulty with PSECA from a couple of perspectives. The way it was introduced as part of a budget implementation act didn't start off the conversation well. Let me say that I'm not being partisan. I'm speaking as someone who has been a legislator and as somebody who is now representing a government. I believe an issue this important ought not to have been part of a budget implementation omnibus bill.

This is an important issue and there was little or no consultation with important partners and stakeholders who ought to have been consulted and ought to have been part of the process. This committee, and the mandate of this committee in this study, is a very important step and is only part of the consultation we have to do over the next period of time.

However, what is clear is that the emphasis in PSECA on market forces is a bit of an issue. It is a significant issue, in fact, because the pay equity issues, the gap in pay between men and women, is greater in the private sector than it is in government. There is a real challenge in that government ought to lead, but there is a risk that we might import some things that may not be working well in the private sector.

Bargaining agents have made clear their strong opposition to PSECA as it was brought forward in 2009. Two of the largest unions have launched a charter challenge against the act on the grounds that it violates equality rights, freedom of expression, freedom of association. We're concerned about that and we want to consider what other solutions may exist. Any new pay equity law needs to be based on evidence. It needs to be developed through important and meaningful consultation with partners and stakeholders, including bargaining agents. We as a government are averse to bringing PSECA into force.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

On that, Minister, I certainly can appreciate the market forces comment. It seems to me when I read the material, especially through the lens of the experience we have had at this committee, that it does give an opt-out clause, introducing forces outside of the public service. I can understand that. I would just suggest, however, that we carefully consider the legislation. To me, I think it's important to have a systematic way to do a workplace assessment every three to five years, where all employees know the pay equity challenges and then there is a process where both the union and the employer have to come together and work out a joint plan, and employees can step back at the end of that process and say, “Did our representatives do us right? Did the employer do right by us?”

There has also been some discussion at this committee with regard to having a more open process. Perhaps it doesn't have to be in legislation. Perhaps it could be done by a policy through Treasury Board. Perhaps there could be a conflict resolution process, an alternative to going through some of the longer provisions that are laid out. I know the union of financial professionals said they would have benefited from that. I think all of us here want to see these things get resolved early. Are you open to looking at alternative mechanisms?

[Scott Brison, Liberal, Kings—Hants, NS]

Yes, we are. Of course, it's clear that we have to move from a complaint-based to a more proactive approach on this. Again, I encourage the committee. This is one of the things that we are here, as ministers, to actually engage with and listen to your ideas on. We look forward to your report, and this may be one of the recommendations.

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Let me make a comment before I switch to the Minister of Employment, Workforce Development and Labour.

I attended the GBA+ analysis issued by the Auditor General, and I think Ms. Ballantyne was there for it. Treasury Board, obviously, has a challenge function, and there is a role for your staff to play and each individual department. One thing I think might be helpful is having some sort of mandatory training for ministers, so that they can better challenge in order to make sure that GBA+ is being incorporated.

Minister of Employment, thank you. I appreciate your comments. You said, “While the overall assessment of proactive legislation was very positive at the time, there was little consensus on how to implement the recommendations.” Those were your words from earlier.

Last night we had two groups, the Canadian Bankers Association and then a group that represents many of the large employers from the federally regulated workplace, representing two-thirds of employees, who had deep concerns about issuing a new proactive, independent framework because there would be a new bureaucracy in place, new rules, a new mandate. They think there's much more to be gained by speeding up the current processes, seeing more funding, perhaps making use of the pre-existing labour programs and harmonizing with them.

Are you set already on a particular model, or are you looking to see how you can improve the system? We had StatsCan come in last night, Minister, and we heard from them that they have a number of gaps that make it very difficult to assess why these wage gaps exist and why they persist. From what I saw and heard from them, there was not convincing evidence that proactive legislation is the silver bullet that we might utilize.

[The Chair, Liberal, Anita Vandenbeld]

Mr. Albas, I'm sorry, but the time is up. We'll encourage the minister to answer that in a forthcoming round.

We are going to move on to Ms. Benson, for seven minutes.