Canadian Pay Transparency Requirements

Pay transparency is not only a legal requirement in many Canadian jurisdictions, it is increasingly a strategic priority for employers. Recent research by Mercer revealed that while many companies still focus solely on the legal requirements for pay transparency, there is a growing movement toward using these legal requirements to propel change. Understanding the legal requirements – and how pay transparency is being approached across the country – is the starting point though.

Currently, 6 provinces have introduced or passed pay transparency legislation, some of which is in force and some of which is still pending. The legislation takes different forms but typically covers some or all of the following:

• Pay disclosure in job postings

• Prohibitions on asking for pay history information

• Reprisals

• Non-disclosure

• Reporting obligations

Pay Disclosure in Job Postings

In Force

In publicly advertised job postings in British Columbia, Ontario and Prince Edward Island, employers must disclose the expected salary or salary range for the posted job. In BC and PEI the requirement applies to all publicly advertised job postings – there are no stated exemptions. In Ontario, the requirement only applies if the employer has 25 or more employees at the time the job is posted.

The legislation in Ontario provides additional exemptions, and additional restrictions which also do not apply in BC and PEI. Where the compensation or high end of the compensation range is $200,000 or more per year, disclosure is not required. Alternatively, if posting a compensation range, the range cannot be greater than $50,000.

Pending

Newfoundland and Labrador and New Brunswick have introduced legislation that will require pay transparency in publicly advertised job postings, but they are not yet in force (the legislation is passed in Newfoundland and Labrador but not yet in force and in New Brunswick the legislation is still to be passed). In New Brunswick, the requirement will also apply to internal job postings. Like BC and PEI, there are no exemptions and no specific requirements regarding the permissible range of compensation.

*Note that the job posting requirements in New Brunswick will come into force as soon as the legislation is passed.

Pay History Information

In Force

Several provinces prohibit employers from seeking pay history information about an applicant. BC, Nova Scotia and PEI all prohibit employers from seeking pay history information about an applicant. There are slight differences in the rules in each jurisdiction though.

BC provides an exception for publicly available information, and proposed changes to the law in PEI will also allow an exception for publicly available information (note that this change is not yet in force in PEI).

Nova Scotia and PEI provide an exception where the applicant voluntarily discloses their pay history. In Nova Scotia, in addition to voluntarily disclosing their wage history, the applicant must also provide written authorization to obtain confirmation and must acknowledge in writing that it is beneficial to them (the prospective employee) to discuss their wage history.

Pending

Newfoundland and Labrador and New Brunswick have also introduced legislation to prohibit employers from seeking pay history (the legislation is passed in Newfoundland and Labrador but not yet in force and in New Brunswick the legislation is still to be passed).

The New Brunswick legislation provides an exception for publicly available information.

The Newfoundland and Labrador legislation provides an exception where the applicant voluntarily discloses their pay history, whereas New Brunswick specifically provides that even if pay history is voluntarily disclosed, the employer cannot rely on that information.

*Note that the pay history requirements in New Brunswick will come into force as soon as the legislation is passed.

Reprisals

In Force

Pay transparency legislation in BC provides that employers cannot dismiss, suspend, demote, discipline, harass, or otherwise disadvantage an employee (or threaten to do any of those things) because the employee:

• asked the employer about the employee’s pay;

• disclosed information about the employee’s pay to another employee of the employer or to an individual who has applied for employment with the employer;

• asked the employer about a pay transparency report or information contained in a pay transparency report;

• asked the employer to comply with the employer’s obligations under this Act; or

• made a report to the director in relation to the employer’s compliance with the employer’s obligations under this Act.

Pending

Proposed legislation in New Brunswick will also prevent reprisals. Under the proposed legislation, and employer cannot dismiss, suspend, demote, discipline, harass or otherwise disadvantage an employee (or threaten to do any of those) because the employee discussed compensation or exercised rights under the Act.

The proposed legislation in Newfoundland and Labrador contains similar anti-reprisal provisions.

Non-Disclosure

In Force

Pay transparency legislation deals with non-disclosure in a number of different ways. In Nova Scotia, employers cannot disclose an employee’s wages except in certain circumstances. Employers also cannot ban discussion or disclosure of wages by employees in the workplace – meaning they cannot prohibit employees from discussing their wages.

In BC, an employer cannot take reprisals against an employee if the employee disclosed information about their pay to another employee or applicant. The proposed legislation in Newfoundland and Labrador includes similar provisions.

Pending

The proposed legislation in New Brunswick will prohibit employers from entering into non-disclosure agreements with an employee that would restrict discussions regarding compensation. It will also prohibit employers from taking reprisals against an employee if the employee discussed compensation.

Reporting Obligations

In Force

British Columbia is the only province that currently requires pay transparency reports. The legislation provides that on or before November 1 of each year, “reporting employers” must prepare a pay transparency report. The scope of “reporting employers” has expanded each year. Private sector employers who have the following number of employees on January 1 of the applicable year are a “reporting employer”:

• for 2024, 1,000 or more;

• for 2025, 300 or more;

• for 2026, 50 or more;

• for a year after 2026, smaller employers (to be set out in the regulation).

The legislation provides specific requirements for collecting information, report requirements, timing requirements, and access to pay transparency reports.

Pending

New Brunswick’s proposed legislation will also require “reporting employers” to prepare pay transparency reports. For private sector employers the reporting obligations will begin in 2029 (for employers with 100+ employees). Smaller employers will have to report starting in 2030.

Similarly, Newfoundland and Labrador’s proposed legislation will also require employers to collect certain information for the purposes of preparing pay transparency reports. The scope of this requirement, including which employers will be required to report, is not yet clear. Additional details will be set out in future regulation.

*Note that Ontario also has enacted pay transparency reporting legislation, but it is not yet in force and it is unclear when, or if, it will ever come into force.

How Compliance Works Helps

We know how hard it is to understand the sometimes subtle differences between your obligations across provinces and to stay on top of ever-changing legal requirements. That is made even more difficult when governments take months (or years) to bring changes into force. Knowing what applies when is real challenge. With Compliance Works, answers are at your finger tips!