Are you struggling with understanding the scope of Ontario’s upcoming pay transparency requirements, or questioning how to comply with the requirements? You are not alone. There are still many questions about how these new rules will apply.
In our earlier posts, New Job Posting Rules: What Employers Should Know and Ontario Job Postings – New Requirements Come into Force Jan. 1, 2026, we provided a breakdown of the key elements of these new laws and what they mean for employers, but there are still many questions about how these rules will work in practice. In this post we’ll:
- Provide a review of the upcoming pay transparency changes.
- Flag some of the issues that you need to be thinking about.
- Provide some tips on how to prepare.
Recap – Pay Transparency in Job Postings
Ontario included changes to job postings rules in Bill 149 and Bill 190. Both of these bills have now passed into law and the government has announced that the job posting changes will come into force on January 1, 2026. On November 29, 2024 the government filed Regulation 476/24 – Rules and Exemptions re Job Postings. This regulation provides more detail on the requirements and clarifies some of the questions that were raised by the initial amendments.
The Regulation creates some limits on the scope of the new job posting requirements.
First, it provides that the new requirements will only apply to employers with 25 or more employees on the day that the public job posting is posted.
Second, the new job posting requirements only apply to a “publicly advertised job posting”. The Regulation defines a “publicly advertised job posting” as an external job posting advertised to the general public in any manner, but not including:
- a general recruitment campaign that does not advertise a specific position,
- a general help wanted sign that does not advertise a specific position,
- a posting for a position that is restricted to existing employees of the employer, or
- a posting for a position for which work is to be performed outside Ontario, or performed outside Ontario and in Ontario and the work performed outside Ontario is not a continuation of work performed in Ontario.
One of the most notable aspects of the coming Ontario law is the requirement for employers to include expected compensation or a range of expected compensation in publicly advertised job postings – otherwise referred to as a pay transparency requirement. This move is designed to provide job seekers with a better understanding of what they can expect to earn, helping them make more informed decisions about applying for positions.
Penalties for failing to comply with these new requirements are set out in the Employment Standards Act, 2000 (ESA). The general enforcement provisions of the ESA apply to the job posting requirements in the same way that they apply to other contraventions or violations of the ESA. These include:
- Complaints. A person who alleges that the ESA was violated can file a complaint within 2 years of the alleged violation.
- Investigations. An employment standards officer can enter any workplace without a warrant to investigate a possible contravention of the ESA. An employment standards officer has broad powers to inspect documents, question anyone, and require the employer to complete a self-audit.
- Administrative penalties. A person who is deemed to have violated the ESA will be subject to penalties.
- Offences and Fines. A person who contravenes the ESA is liable, on conviction, for:
- if an individual, a fine of up to $100,000 and/or 12 months imprisonment;
- if a corporation, a fine of up up $100,000 for a first conviction, $250,000, for a second conviction and $500,000 for subsequent convictions.
- An officer, director or agent of the corporation who permits the contravention is also liable on conviction for a fine or imprisonment.
While any of these enforcement actions could be taken against an employer who does not comply with job posting requirements, the biggest risk (at least initially) is likely complaints. Repeated violations of the requirements though could lead to more serious enforcement action.
Pay Transparency Issues to Consider
The Regulation has provided more clarity on the pay transparency requirements, but there are still some questions. While the Regulation does not exclude specific industries or occupations, it provides that the pay transparency requirement does not apply if the expected compensation for the position is $200,000 per year or more, or if the high end of the compensation range is $200,000 per year or more. In those circumstances, the salary or salary range does not have to be included in a publicly advertised job posting.
The Regulation also imposes a limit on the range that can be included in a publicly advertised job posting. If a compensation range is used in a job posting, the range cannot be more than $50,000.
To understand these exemptions and requirements, you need to understand what is meant by “compensation”. For example, the exemption only applies if the expected compensation or high end of the compensation range is $200,000 or more. As is often the case with legislation, understanding a definition is often more complicated than it seems (but that’s a topic for another day).
“Compensation” is defined in the Regulation as “wages”. To understand what is meant by “wages”, you must look to the ESA. “Wages” is defined in the ESA as:
- monetary remuneration payable by an employer to an employee under the terms of an employment contract;
- any payment required to be made by an employer to an employee under the ESA (for example, vacation pay); and
- any allowances for room or board under an employment contract.
Wages specifically do not include:
- tips or other gratuities,
- any discretionary gifts or bonuses that are not related to hours, production or efficiency,
- expenses and travelling allowances, or
- generally, employer contributions to a benefit plan and payments to which an employee is entitled from a benefit plan.
These definitions are helpful, but they leave some questions:
- What is included in monetary remuneration payable under an employment contract? Many compensation plans are complex and include benefits and remuneration that may not clearly fit into the definition. You may need to have a lawyer review your employment agreements and provide advice – based on your specific agreements – on what will be considered compensation under the new requirements.
- How do employers deal with potential monetary remuneration under an employment contract where the amount payable can vary? Consider, for example, the hiring of a salesperson. Compensation may include commissions. Those are monetary remuneration payable under the terms of an employment agreement. But the amount that may be paid can vary significantly. There is no clear guidance on how to calculate or determine the compensation or compensation range to include in a job posting for a position that may have a range greater than $50,000 and that also may vary considerably from year to year.
- What happens when an employee has a choice in how some benefits are received? For example, where an employee can decide after hiring whether they want to be reimbursed for car expenses, whether they want to be paid a car allowance, or whether they want to be provided with a company car. The way that this benefit is received may impact whether it must be included in the compensation amount. Expenses are specifically excluded from wages so a pure reimbursement likely would not be included in compensation. But if someone chooses to be paid a monetary amount that may amount to more than a reimbursement, that may be treated differently. This same issue may apply to other types of payments as well.
This is not an exhaustive list of issues. But it does highlight the fact that there are still some gaps with these rules. Whether the government decides to address these gaps by amending the legislation remains to be seen – but we will be watching and will notify our subscribers as soon as any changes are introduced.
How to Prepare for Pay Transparency
Employers must begin to prepare for these changes. The new rule will require most employers to review and revise their job posting practices. To prepare for these changes, you should:
- Audit current job posting practices and templates.
- Review your employment agreements to ensure you understand the different compensation plans and compensation elements.
- Review current compensation bands and salary structures to ensure consistency.
- Do market research to set competitive but realistic compensation ranges.
- Consider your hiring strategy. Given these new rules, do you want to post more internal positions or use more networking to find candidates to avoid or minimize publicly advertised job postings?
- Review your roles and identify positions where it may be more difficult to determine the compensation amount. Obtain legal advice on these roles to understand what amounts need to be included in determining compensation.
- Manage expectations. Ensure that internal communication is clear about why some roles may pay more, especially for similar roles.
- Train HR and other hiring staff about these new rules.
- Put in place tracking and retention mechanisms for job postings, application forms, interview timelines.
- Also – be sure to include disclosure if using AI in hiring, and remove “Canadian experience” requirements.
Other Provinces’ Job Posting Rules
As a reminder, there are job posting requirements in other jurisdictions as well. British Columbia and Prince Edward Island require employers to include the expected pay or the range of expected pay for a position in a job posting. Prince Edward Island has just passed Bill 76 (not yet in force) which will exclude from this requirement recruitment campaigns, general help wanted signs, or job postings that are only advertised to the employer’s existing employees.
Newfoundland and Labrador has passed similar legislation, but it is not yet in force.
Employers hiring in Quebec must publish offers of employment, transfer or promotion in French. Where an employer publishes a position (as part of recruitment, hiring, transfer or promotion) in a language other than French, they must publish the position simultaneously in French. For more information on how Quebec’s French language laws impact hiring, see our earlier post: French Language Laws Triggered by 1 Quebec Employee.
Implications for Employers
These new regulations will require employers to adapt their hiring and recruitment processes to comply with new transparency requirements. This might involve updating job posting templates and policies, training HR staff on the new requirements, and ensuring that AI tools used in hiring are disclosed appropriately.
These changes may inspire similar reforms in other provinces. Employers should watch for more changes and further details on Ontario’s upcoming job posting regime.
For more information on hiring, including human rights protections, see our earlier post: Hiring in Canada? 4 Things to Know
How Compliance Works Helps HR Teams
Governments are continually responding to changes in the Canadian workplace by amending employment laws. This includes evolving employer transparency requirements. Compliance Works makes it easy to track and understand these changes. Subscribers are notified of upcoming changes in real time – allowing them to stay ahead of the changes and respond proactively.
