The proxy employer provides a ‘seeking’ employer with “pay equity job rates” for female job classes that are similar to the key female job classes of the seeking employer. The “pay equity job rate” is the rate that the proxy employer’s job classes would have been paid had the job class achieved pay equity on January 1, 1994 [21.11 (1)]. The proxy employer’s pay equity job rates are used to determine the pay equity gaps that exist for the seeking employer’s female job classes. Adjustments are paid to existing job classes until the pay equity target job rate is achieved, in addition to any job rate increases that may have been paid in the interim [21.11 (3), 21.22 (3)].

Only pay equity adjustments that were clearly identified as pay equity adjustments and distributed according to the rules of the Act to underpaid female job classes are considered for achieving the pay equity job rate. In other words, if the employer gives general wage increases (for example, cost-of-living increases), those general wage increases do not count towards any pay equity adjustment still owed under the plan, i.e. the general wage increase must be treated as an increase to the target rate.  For further clarity, a general wage increase does not do the double duty of also counting towards the pay equity adjustment still owed. The general wage increase should be noted on a separate line from the pay equity adjustment on any pay stubs [21.11 (3), 21.22 (3)].