Understanding your obligations under Canada’s Federal Pay Equity Act

Pay equity remains a critical concern among organizations around the world. Maintaining pay equity can be challenging, particularly when federal guidelines require action.  

Canadian employers subject to the Federal Pay Equity Act are required to ensure transparent and fair compensation practices. One key component of this process is the submission of an annual statement to the Office of the Pay Equity Commissioner. 

Who must submit?

The Pay Equity Act mandates that all federally regulated private and public sector employers with an average of 10 employees or more file an annual statement, as it is a crucial tool in assessing the impact and compliance with the act.

What to include

Essential information that must be included in a single employer’s annual statement:

Employer information

• Legal name
• Business number (if applicable) 
• Contact information for the senior person responsible for the pay equity plan
• Date the employer became subject to the act 
• Number of employees as of March 31 (public sector) or December 31 (private sector)

Plan details

• Date of the most recent pay equity plan posting  
• Whether the plan was posted within the prescribed timeframe or with authorization for a later date 
• Whether a pay equity committee was involved in the establishment or update of the plan 
• Use of predetermined values of work in the plan development 

Information on female job classes owed an increase 

Number of predominantly female job classes requiring an increase. For each job class, include: 

• Increase in compensation (dollars per hour and percentage) 
• Date when the increase is payable
• Total number of employees entitled to the increase 
• Number of women entitled to the increase

If increases are phased in, detail the amount and dates of each increment. If an extension for posting the pay equity plan was granted, include information on:

• Lump sums and interest paid
• The number of employees entitled to these

How to submit

An authorized individual can submit the annual statement through the Annual Statement Portal.

Deadline to submit

The Pay Equity Act specifies deadlines for submitting annual statements. These deadlines depend on when the employer became subject to the act: 

• Employers subject to the act as of Aug. 31, 2021, must submit by June 30, 2025. 
• Extensions granted for posting pay equity plans adjust the deadline to June 30 following the year of posting. 

Understanding and preparing your annual statement, along with conducting regular maintenance reviews, are vital steps towards ensuring compliance, bridging the gender wage gap and fostering transparency in compensation practices. 

Author

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Narinder Varaich

Director, Work & Rewards

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