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Pay Equity Regulations (SOR/2021-161)

Regulations are current to 2022-09-22 and last amended on 2021-08-31. Previous Versions

Pay Equity Regulations

SOR/2021-161

PAY EQUITY ACT

Registration 2021-06-24

Pay Equity Regulations

P.C. 2021-637 2021-06-24

His Excellency the Administrator of the Government of Canada in Council, on the recommendation of the Minister of Labour, pursuant to subsection 181(1) of the Pay Equity ActFootnote a, makes the annexed Pay Equity Regulations.

Interpretation

Marginal note:Definitions

 The following definitions apply in these Regulations.

Act

Act means the Pay Equity Act. (Loi)

band

band has the same meaning as in subsection 49(2) of the Act. (bande)

frozen

frozen, in respect of compensation associated with a job class, means that the compensation includes

  • (a) salary at a rate that is continued in force under section 107 of the Federal Public Sector Labour Relations Act;

  • (b) salary at a rate set out in a collective agreement applicable to a bargaining unit for which a strike may be declared or authorized without contravening subsection 194(1) of that Act or for which the conditions in paragraphs 89(1)(a) to (d) of the Canada Labour Code are met; or

  • (c) salary at a rate that

    • (i) under section 56 of the Federal Public Sector Labour Relations Act, cannot be altered except under a collective agreement or with the consent of the Federal Public Sector Labour Relations and Employment Board,

    • (ii) under subsection 24(4) of the Canada Labour Code, cannot be altered except pursuant to a collective agreement or with the consent of the Canada Industrial Relations Board, or

    • (iii) under paragraph 50(b) of the Canada Labour Code, cannot be altered without the consent of the bargaining agent. (gelée)

Marginal note:References to employers

 If a group of employers is recognized by the Pay Equity Commissioner as a single employer under section 106 of the Act, every reference in sections 10, 14 and 15, subsection 16(1), sections 18 to 20 and 22, subsections 23(1) to (6), and sections 24 to 26, 28 to 31, 39 and 41 to 46 to an employer is, in respect of the group of employers, to be read as a reference to that group of employers, unless the context otherwise requires.

Postings — General Rules

Marginal note:Format and place

 A document that is required under the Act to be posted must be posted in printed or electronic form and in such a way as to be readily available to all employees to whom the document relates. A document in printed format must be posted in a conspicuous place.

Marginal note:Accessibility

 If an employee to whom a document that is required to be posted under the Act relates has a disability as defined in section 2 of the Accessible Canada Act, that document must be posted in a form that is accessible to that employee.

Marginal note:Information to be provided

 An employer that posts in electronic form a document that it is required to post under the Act must provide the employees to whom the document relates with any information necessary to enable them to access the document.

Marginal note:Date of posting

 An employer that makes any posting under the Act must indicate in the posting the date on which the posting is made.

Pay Equity Plan

Marginal note:Notice — employer’s obligation

  •  (1) An employer that is required to post a notice under subsection 14(1) or (2) of the Act must do so within 60 days after the day on which it becomes subject to the Act.

  • Marginal note:Duration of posting

    (2) The employer must keep the notice posted until it posts the final version of the pay equity plan in accordance with subsection 55(1) or paragraph 57(2)(b) or 94(1)(b) of the Act, until it posts a notice under subsection 15(1) or (2) of the Act or until it becomes required under subsection 30(6) of the Act to establish more than one pay equity plan.

Marginal note:Notice — group of employers’ obligation

  •  (1) An employer that is in a group of employers and that is required to post a notice under subsection 15(1) or (2) of the Act must do so within 60 days after the day on which the group of employers becomes subject to the Act for the purposes of subsection 55(1) and paragraphs 61(1)(b) and 89(2)(b) of the Act.

  • Marginal note:Duration of posting

    (2) The employer must keep the notice posted until each employer in the group of employers posts the final version of the pay equity plan in accordance with subsection 55(1) or paragraph 57(2)(b) of the Act, until the employer posts a notice under subsection 14(1) or (2) of the Act or until the group of employers becomes required under subsection 30(6) of the Act to establish more than one pay equity plan.

Marginal note:Notice — establishment of plan without committee

  •  (1) An employer that is required, under section 25, 26, 28 or 29 of the Act, to post a notice of the establishment of a pay equity plan without a pay equity committee must do so within 60 days after the day on which the Pay Equity Commissioner approves the establishment of the plan without a committee.

  • Marginal note:Duration of posting

    (2) The employer must keep the notice posted until it posts the final version of the pay equity plan in accordance with subsection 55(1) or paragraph 57(2)(b) or 94(1)(b) of the Act.

Process for Establishment of Pay Equity Plan

Frozen Compensation

Marginal note:Prohibited comparison — frozen compensation

 In carrying out the comparison of compensation under sections 47 to 50 of the Act, an employer — or, if a pay equity committee has been established, that committee — must ensure that no comparison is made between frozen compensation associated with a predominantly female or predominantly male job class and compensation that is not frozen and that is associated with a predominantly female or predominantly male job class in which unionized employees occupy positions, unless the salary rate that is used to determine salary in the calculation of the frozen compensation associated with a job class is

  • (a) the salary rate obtained by adding, to the highest salary rate in the range of salary rates for positions in the job class, the product obtained by multiplying

    • (i) the salary at the highest rate in the range of salary rates for positions in the job class

    by

    • (ii) the average percentage by which, since the compensation associated with the job class became frozen, the salary for positions in job classes that contain positions occupied by unionized employees in respect of whom the pay equity plan applies and who are governed by a collective agreement that is not expired has increased; or

  • (b) if a pay equity committee has been established, the salary rate determined using a method other than the one set out in paragraph (a) that minimizes, to the extent possible, the differences in compensation that result only from the compensation associated with a job class being frozen.

Factors

Marginal note:Calculation — equal average method

  •  (1) The factor referred to in paragraph 49(1)(d) of the Act and the factor referred to in paragraph 28(d) are determined by the formula

    ((A × B) − C) ÷ D

    where

    A
    is the number of predominantly female job classes within the band;
    B
    is,
    • (a) if there is more than one predominantly male job class within the band, the average compensation associated with the predominantly male job classes within the band,

    • (b) if there is only one predominantly male job class within the band, the compensation associated with that job class, or

    • (c) if there are no predominantly male job classes within the band, the compensation calculated under paragraph 49(1)(b) of the Act or paragraph 28(b), as the case may be;

    C
    is the sum of the compensation associated with the predominantly female job classes within the band; and
    D
    is the sum of the differences, for each predominantly female job class within the band whose compensation is less than the value determined for B, between the value of B and the compensation associated with the job class.
  • Marginal note:Clarification

    (2) In the calculation of the factor referred to in paragraph 28(d), references in subsection (1) to a predominantly male job class are to be read as references to a predominantly male job class chosen or created, as the case may be, under subsection 19(1).

Marginal note:Calculation — equal line method

  •  (1) With respect to a predominantly female job class, the factor referred to in paragraph 50(1)(c) of the Act and the factor referred to in paragraph 29(1)(c) are determined by the formula

    ((A × B) ÷ C) + (D – (E × B))

    where

    A
    is determined by the formula

    F ÷ G

    where

    F
    is the absolute value of the difference between the compensation associated with the predominantly female job class and the compensation associated with a predominantly male job class, were such a job class located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job class, and
    G
    is the compensation associated with such a predominantly male job class;
    B
    is determined by the formula

    ((H − I) − (J × K)) ÷ (L − (M × K))

    where

    H
    is the sum of the products obtained by multiplying, for each predominantly female job class, the value of work performed in the job class by the compensation associated with a predominantly male job class, were such a job class located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job class,
    I
    is the sum of the products obtained by multiplying, for each predominantly female job class, the value of work performed in the job class by the compensation associated with that job class,
    J
    is determined by the formula

    (P – Q) ÷ R

    where

    P
    is the sum of the compensation associated with predominantly male job classes, were such job classes located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job classes,
    Q
    is the sum of the compensation associated with the predominantly female job classes, and
    R
    is the sum of the absolute values of the differences, for each predominantly female job class that is located below the male regression line, between the compensation associated with the job class and the compensation associated with a predominantly male job class, were such a job class located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job class;
    K
    is the sum of the products obtained by multiplying, for each predominantly female job class that is located below the male regression line, the value of the work performed in the job class by the absolute value of the difference between the compensation associated with the job class and the compensation associated with a predominantly male job class, were such a job class located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job class,
    L
    is the sum of the products obtained by multiplying, for each predominantly female job class that is located below the male regression line, the value of the work performed in that job class by the quotient calculated for the job class using the formula set out in A in this subsection,
    M
    is determined by the formula

    (N ÷ O)

    where

    N
    is the sum of the quotients calculated using the formula set out in A in this subsection, for each predominantly female job class that is located below the male regression line, and
    O
    is the sum of the absolute values of the differences between the compensation associated with each predominantly female job class that is located below the male regression line and the compensation associated with a predominantly male job class, were such a job class located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job class;
    C
    is an amount equal to the difference referred to in paragraph 50(1)(c) of the Act or paragraph 29(1)(c), as the case may be;
    D
    is the value determined for J in this subsection; and
    E
    is the value determined for M in this subsection.
  • Marginal note:Job class chosen or created

    (2) In the calculation of the factor referred to in paragraph 29(1)(c), a reference in subsection (1) to a predominantly male job class is to be read as a reference to a predominantly male job class chosen or created, as the case may be, under subsection 19(1).

Marginal note:Clarification

 The factors referred to in sections 11 and 12 must be calculated without regard either to the number of employees or to the number of positions in a job class.

Rules if Regression Lines Cross

Marginal note:Choice of method

 For the purposes of subsection 50(2) of the Act, the following rules apply:

  • (a) an employer — or, if a pay equity committee has been established, that committee — must apply the rules set out in paragraphs 50(1)(b) to (d) of the Act, without taking into account subparagraph 50(1)(b)(i); and

  • (b) if the application of the rules in paragraph (a) does not cause the regression lines to coincide without reducing the compensation associated with any job class, the employer or pay equity committee, as the case may be, must instead compare the compensation using

    • (i) the equal average method set out in section 49 of the Act,

    • (ii) the segmented line method set out in section 15, or

    • (iii) the sum of differences method set out in section 16.

Marginal note:Segmented line method

 An employer or pay equity committee, as the case may be, that uses the segmented line method must apply the following rules:

  • (a) the employer or pay equity committee must divide the predominantly female job classes and the predominantly male job classes into the following two segments:

    • (i) one segment that includes the job classes in which the value of work performed is less than the value at which the regression lines established under paragraph 50(1)(a) of the Act intersect, and

    • (ii) one segment that includes the job classes in which the value of work performed is equal to or greater than the value at which the regression lines established under that paragraph intersect;

  • (b) for each segment, the employer or pay equity committee must establish a female regression line for the predominantly female job classes in the segment and a male regression line for the predominantly male job classes in the segment;

  • (c) in a segment in which the female regression line is entirely below the male regression line, the employer or pay equity committee must apply the rules set out in paragraphs 50(1)(b) to (d) of the Act, and if the application of those rules does not cause the male and female regression lines to coincide without reducing the compensation associated with any job class, the employer or committee must use the equal average method set out in section 49 of the Act or the sum of differences method set out in section 16 to compare the compensation associated with all predominantly female job classes and predominantly male job classes; and

  • (d) in a segment in which the female regression line crosses the male regression line, the employer or committee must apply the rules set out in paragraphs 50(1)(b) to (d) of the Act, without taking into account subparagraph 50(1)(b)(i), and if the application of those rules does not cause the male and female regression lines to coincide without reducing the compensation associated with any job class, the employer or committee must use the equal average method set out in section 49 of the Act or the sum of differences method set out in section 16 to compare the compensation associated with all predominantly female job classes and predominantly male job classes.

Marginal note:Sum of differences method

  •  (1) The employer or pay equity committee, as the case may be, that uses the sum of differences method must multiply, for each predominantly female job class that is located below the male regression line established under paragraph 50(1)(a) of the Act, the factor calculated in accordance with subsection (2) by the absolute value of the difference between the compensation associated with the predominantly female job class and the compensation associated with a predominantly male job class, were such a job class located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job class.

  • Marginal note:Factor

    (2) For the purposes of subsection (1), the factor is the result of the formula

    (A − B) ÷ C

    where

    A
    is the sum of the compensation associated with predominantly male job classes, were such job classes located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job classes;
    B
    is the sum of the compensation associated with the predominantly female job classes or the value determined for A, whichever is less; and
    C
    is the sum of the absolute values of the differences, for each predominantly female job class that is located below the male regression line, between the compensation associated with the job class and the compensation associated with a predominantly male job class, were such a job class located on the male regression line, in which the value of the work performed is equal to that of the predominantly female job class.
  • Marginal note:Increase in compensation

    (3) The increase in compensation associated with a predominantly female job class located below the male regression line is the product calculated in accordance with subsection (1) in respect of that job class.

 
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