The Pay Transparency Act1 (the "Act") is now law in British Columbia. British Columbia employers should be aware of and take steps to comply with the key requirements that we highlight below.
This legislation was passed relatively quickly, having been proposed in early March 2023 and brought into force on May 11, 2023. No supporting regulations are currently in force.
According to the provincial government's June 2022 discussion paper on pay transparency legislation, this legislation is intended to help close the gender pay gap by addressing systemic discrimination in the workplace.2
On March 9, 2023, we summarized the proposed Act (you can read that blog post here). This summary remains applicable, as the Act was brought into force without any changes from the initial bill. We have set out a more detailed summary of the Act below.
Disclosure of Salary/Wage Information on Job Postings
As of November 1, 2023, B.C. employers will be required to specify the expected salary or wage, or the expected salary or wage range, on all publicly advertised job opportunities.
Prohibited Conduct
Employers are no longer able to seek pay history information about a job applicant "by any means," unless the pay history information is publicly accessible. This means not asking the applicant directly about this information, or seeking the information via a third party (for example, a background check service provider).
The Act also prohibits employers from retaliating against employees who do any of the following:
- make inquiries about their pay;
- disclose information about their pay to another employee of the employer, or to a job applicant;
- make inquiries about a pay transparency report or information contained in a pay transparency report;
- ask the employer to comply with the employer's obligations under the Act; or
- make a report to the director in relation to the employer's compliance with the employer's obligations under the Act.
Retaliation includes suspension, demotion, discipline, harassment, termination of employment, or otherwise disadvantaging an employee or threatening to do so.
Reporting Requirements
Employer reporting requirements are being introduced in a staged manner, starting with large employers. For 2023, a "reporting employer" includes the Government of British Columbia and six Crown Corporations (ICBC, BC Hydro, WorkSafeBC, BC Housing, BC Lottery Corporation and BC Transit).
Unless exempted by future regulations, the reporting requirements will apply to B.C. employers with the following number of employees on January 1 of the applicable year:
- 2024: 1,000 employees or more;
- 2025: 300 employees or more;
- 2026: 50 employees or more; and
- Years after 2026: more than the lesser of 49 and any prescribed number.
Reporting employers will be required to prepare an annual pay transparency report on or before November 1 of each year. The report will have to be distributed to all employees and published on a publicly accessible website, among other things.
The Act requires that reporting employers "make reasonable efforts" to collect the required information from each employee.3 Employers will be required to collect gender information from employees according to the new Gender and Sex Data Standard, which defines the difference between gender and sex and defines gender identities beyond boy/man and girl/woman. When collecting the information, reporting employers must inform the employee that their disclosure of personal information for the purpose of the pay transparency report is voluntary.
The pay transparency report will include information about the reporting employer, the composition of its workforce, the differences in pay in relation to employees' self-identified gender and other characteristics, and any other information set out in future regulations.
The provincial government has said that details about what will have to be included in the report are still being developed and that an online reporting tool will be available to assist employers with these reports.4 In its responses to FAQs about the Act5, the provincial government has stated that:
- reporting employers will be required to report the pay gap as the difference between hourly wages, overtime and/or bonuses received by men, women and non-binary people;
- reporting employers may also be asked to report the pay gap in quartiles (top 25% of earners, high 25%, mid 25% and lowest 25%); and
- real wage data such as dollar amounts will not be reported.
By June 1 of each calendar year, starting in 2024, the provincial government will publish an annual report that includes information about pay differences, trends, and reports of non-compliance, amongst other things.
Don't Forget Human Rights
The Act is focused on transparency and as such, unless addressed by a future regulation, it does not give employees new rights or direct avenues of recourse if they feel that they are not being paid fairly. However, employers are reminded that B.C. employees already have the ability to bring a complaint to the BC Human Rights Tribunal if they feel that they have been discriminated against on the basis of their sex and gender identity or expression, for example, which are protected grounds of discrimination under the B.C. Human Rights Code (the "Code"). In addition, section 12 of the Code specifically prohibits B.C. employers from employing an employee of one sex for work at a wage rate that is less than the wage rate at which an employee of the other sex is employed for similar or substantially similar work.
Other Canadian Jurisdictions
All B.C. employers must comply with these new requirements unless they are federally regulated. Federally regulated employers must comply with the federal Employment Equity Act.[6] Pay equity legislation exists in other provinces and the specific legislative requirements vary from province to province. Note that the Act is focused on pay transparency and not pay equity, although it could be a first step towards full pay equity legislation in British Columbia.
Using Personal Information Collected for Other Employment-Related Purposes
B.C. employers should be cautious about using personal information collected from their employees for the purpose of completing a pay transparency report for other employment or business purposes, such as other internal EDI initiatives or analytics. To ensure compliance with applicable privacy legislation, employers should consider whether they need to first obtain employees' consent or provide them with notice, as applicable. The applicable privacy legislation and requirements will depend on whether the employer is a public sector or private sector employer.
Summary
While most B.C. employers will not have to comply with the new reporting requirements this year, most of the Act is now in force. B.C. employers are advised to become familiar with the proposed reporting requirements and to consider how they will approach the collection and reporting of this information when the time comes. Recruitment and hiring practices may have to be updated prior to November to ensure compliance with the new job posting requirements. In addition, employment agreements may have to be updated to ensure compliance with the Act.
We will continue to monitor the Act and any regulations that are passed, which should provide much more detail on matters such as the content to be included in annual reports and any penalties for non-compliance.
Footnotes
3 Pay Transparency Act, section 6(1).
4 https://www2.gov.bc.ca/gov/content/gender-equity/pay-transparency-laws-in-bc
5 https://www2.gov.bc.ca/gov/content/gender-equity/pay-transparency-laws-in-bc
6 https://laws-lois.justice.gc.ca/eng/acts/e-5.401/
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
