The following principles underlie the Pay Equity Office’s interpretation of the Act. The principles have emerged from an understanding of the law and cases that have been heard by the Tribunal and the courts. Employers should consider how these principles apply to their situation and ensure that what they do to implement and achieve pay equity, is consistent with the intent and structure of the Act.

1. Pay equity is both a fundamental human right and a regulatory labour standard. As such, it blends aspects of compensation practices, employment law, labour relations and human rights.
2. Pay equity in Ontario is a self-managed process. The Act imposes an obligation on every employer to take specific steps to ensure that pay equity exists in their workplace. Employers are responsible for implementing pay equity regardless of whether or not they believe that they have fair compensation or non-discriminatory practices and regardless of whether or not there has been a complaint made.
3. Pay equity is focused on gender neutrality. The main purpose of the Act is to require employers to compare work in a gender neutral way so that the work done in female-dominated job classes is made as visible as the work done in male-dominated job classes and is compensated accordingly.
4. Pay equity allows for considerable flexibility. Some of the requirements of the Act are specific and precisely defined and employers must comply strictly with these exact terms. Other requirements are not specifically or precisely defined which means that there is more than one way for employers to meet the requirement. Where the provisions of the Act are not precise, employers are compliant with the law as long as they make choices that are applied consistently and fall within a reasonable range of outcomes that meet the purpose of the Act.

The Tribunal has established the standard of review to be used in determining whether there has been a contravention of the Act. Following Tribunal rulings, Review Officers use correctness as the appropriate standard when determining whether the pay equity result contravenes a precise provision of the Act, and reasonableness as the appropriate standard when deciding whether the result contravenes a provision that is not capable of exact application, but implies a range of outcomes or an exercise of discretion Group of Employees v. Parry Sound District General Hospital, 1996 CanLII 8067 (ON PEHT), Ottawa Board of Education v. Ontario Secondary School Teachers’ Federation, 1996 CANLII 7947 (ON PEHT), and Group of Employees v. Parry Sound District General Hospital, 1995 CANLII 7205 (ON PEHT).

5. Pay equity and collective bargaining. Employers and unions are continuously involved in negotiations around compensation that may or may not have pay equity consequences. The Act prohibits employers or bargaining agents to bargain for, or agree to, compensation practices that, if adopted, would cause a contravention of the general requirement to provide for pay equity.