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Ontario’s Pay Equity Act

with Selected Case References, 2022

Disclaimer: This Guide gives an overview of the minimum requirements of the Pay Equity Act as interpreted by the Pay Equity Office. The interpretations are drawn from our own experiences and by applying the key rulings of the Pay Equity Hearings Tribunal and the courts and is current to the date ​of publication.

Interpretation, posting and miscellaneous Definitions

In this section

    1. (1) In this Act,

    “bargaining agent” means a trade union as defined in the Labour Relations Act that has the status of exclusive bargaining agent under that Act in respect of any bargaining unit or units in an establishment and includes an organization representing employees to whom this Act applies where such organization has exclusive bargaining rights under any other Act in respect of such employees; (“agent négociateur”)

    “collective agreement” means an agreement in writing between an employer and a bargaining agent covering terms and conditions of employment; (“convention collective”).

    “Commission” means the Pay Equity Commission of Ontario established by this Act; (“Commission”)

    “compensation” means all payments and benefits paid or provided to or for the benefit of a person who performs functions that entitle the person to be paid a fixed or ascertainable amount; (“rétribution”)

Wentworth County Board of Education v. Wentworth Women Teachers’ Association, 1990 CanLII 3993 (ON PEHT) 1990-01-22 — Employees of a single employer with multiple branches attempted to negotiate for multiple bargaining units using one collective bargaining agent. The Tribunal allowed it and determined that there is nothing in the definition of “bargaining agent” in the Act that prevents organizations, acting jointly, from together being the bargaining agent for pay equity purposes.

“collective agreement” means an agreement in writing between an employer and a bargaining agent covering terms and conditions of employment; (“convention collective”).

“Commission” means the Pay Equity Commission of Ontario established by this Act; (“Commission”)

“compensation” means all payments and benefits paid or provided to or for the benefit of a person who performs functions that entitle the person to be paid a fixed or ascertainable amount; (“rétribution”)

Group of Employees v. Windsor Casino Limited, 2007 CanLII 62083 (ON PEHT) 2007-11-14 — The pay equity plan negotiated by an employer and the union included tips in the calculation of compensation for the purposes of determining job rate. The Tribunal held that where tips are ascertainable and the inclusion of tip amounts do not artificially manipulate the compensation and job rate of a job class, tips are to be included in compensation.

Regional Municipality of Peel v. Canadian Union of Public Employees, Local 966, 1992 CanLII 4698 (ON PEHT) 1992-10-15 — Shift premiums were payable to different job classes of employees subject to differing preconditions. The tribunal held that the value shift premiums should be included in the calculation of compensation, so long as the availability of the shift premium is not largely illusory in that availability is dependent on pre-conditions that cannot be met by members of the job class.

Ontario Nurses’ Association v. Lady Dunn General Hospital, 1991 CanLII 44518 (ON PEHT) 1991-06-28 — Female employees sought to equalize compensation between the male and female job classes by way of an increase in vacation benefit rather than cash value. The Tribunal held that to achieve pay equity, the sum of all salaries or wages, and benefits, if any, received by a female job class must be equal to the sum of all salaries or wages, and benefits, if any, provided to its male comparator job class. Where the compensation paid to a female job class must be adjusted to achieve pay equity, that adjustment may be made to wages or salaries, to benefits, or to a combination of the two.

“effective date” means the 1st day of January, 1988; (“date d’entrée en vigueur”)

“employee” does not include a student employed for his or her vacation period; (“employé”)

Note: There is no definition of Employer nor Employee in the Act. The Tribunal developed the definitions and interpretation tests it thought appropriate.

Ontario Nurses Association v. Haldimand-Norfolk (Regional Municipality) (No.3), 1989 CanLII 1454 (ON PEHT) 1989-06-30 — The parties disputed the identity of the employer and so asked the Tribunal to make a determination. At para. 49, the Tribunal outlined the criteria to be used when considering who the employer is. The 4 factors discussed are the overall financial responsibility; responsibility for compensation; nature of business, service or enterprise; and what is most consistent with the purpose of the Act.

Thomson Newspapers Corporation v. Southern Ontario Newspaper Guild, 1993 CanLII 5427 (ON PEHT) 1993-07-28 — Thomson Newspapers objected to the finding that it was the employer for pay equity purposes. The Tribunal applied the control test and held that Thomson Newspapers was the employer because it had overriding financial control and ultimate authority regarding compensation.

Salvation Army on behalf of Group of Employers v. Group of Employees (Anonymous), 1997 CanLII 12216 (ON PEHT) 1997-12-01 — The Tribunal was asked to identify the employer for each of the 155 Salvation Army centres, where the applicants sought a finding that each centre was a separate employer. At para. 7, the Tribunal lists thirteen questions to consider under the legal relationship test in order to determine who the employer is.

Wellington (County) v. Butler, 1999 CanLII 14830 (ON PEHT) 1999-10-25 — The Tribunal looked at whether women who provided day care in their homes as part of a program operated by the Corporation of the County of Wellington were employees of Wellington for pay equity purposes. The Tribunal considered the different common law tests used to determine employment relationship and concluded that the appropriate approach was the total relationship test. Based on the totality of the relationship, the day care providers were deemed employees.

Wellington (County) v. Butler, 2001 CanLII 38739 (ON SC) 2001-10-31 — The court reviewed and quashed the Tribunal’s decision. The court did not take issue with the total relationship test applied by the Tribunal; they agree that the Tribunal is given considerable latitude to define the employment relationship using a number of legal tests absent a definition. That said, the court found flaws in the Tribunal’s analysis of the application under the test they chose to adopt.

Clow v. Peterborough (City), 1995 CanLII 7217 (ON PEHT) 1995-06-09 — A part-time employee was terminated for pay equity activity, and the Tribunal was asked to determine if she was an employee and thus under the jurisdiction of the Pay Equity Office. The Tribunal determined that part-time seasonal employees are employees for pay equity purposes. They also determined that due to the “residual employment relationship”, the complaint was valid even though the employee had been terminated when it was made.

“establishment” means all of the employees of an employer employed in a geographic division or in such geographic divisions as are agreed upon under section 14 or decided upon under section 15; (“établissement”)

Ontario Nurses Association v. Haldimand-Norfolk (Regional Municipality) (No.3), 1989 CanLII 1454 (ON PEHT) 1989-06-30 — The question was whether the Municipality was the employer of the Regional Police Force such that the police are part of the Municipality’s establishment and may be used as a comparative male job class for the nurses. The Tribunal held that the police were part of the establishment of the Municipality and based on the plain meaning interpretation of the definition of “establishment”, the Municipality was the employer of the Regional Police Force for the purposes of the Act.

Helen Henderson Care Centre v. Service Employees’ International Union, Local 183, 2001 CanLII 28094 (ON PEHT) 2001-12-17— The Tribunal was asked to determine the nature of an employment relationship. At para. 90, the Tribunal held that it is the characterization of the employer itself and not the nature of its activities that determine the extent of its obligations under the Act.

“female job class” means, except where there has been a decision that a job class is a male job class as described in clause (b) of the definition of “male job class”,

(a) a job class in which 60 per cent or more of the members are female,

(b) a job class that a review officer or the Hearings Tribunal decides is a female job class or a job class that the employer, with the agreement of the bargaining agent, if any, for the employees of the employer, decides is a female job class; (“catégorie d’emplois à prédominance féminine”)

“geographic division” means a geographic area prescribed under the Territorial Division Act, 2002; (“zone géographique”)

“Hearings Tribunal” means the Pay Equity Hearings Tribunal established by this Act; (“Tribunal”)

“job class” means those positions in an establishment that have similar duties and responsibilities and require similar qualifications, are filled by similar recruiting procedures and have the same compensation schedule, salary grade or range of salary rates; (“catégorie d’emplois”)

Gloucester (No. 2) (1991), 2 P.E.R. 208 — The Tribunal was asked to decide on a dispute in how to adjust the rates of compensation for incumbents in the female job classes. Given that “position” and “incumbent” are distinguished in several places in the Act, different meanings must be given to each term. The Tribunal established that the definition for “position” must be inferred from the definition of a job class. That is, a position is a subset of a job class and cannot straddle more than one class. “Position” is the work performed, not the person who performs the work; there may be more than one incumbent occupying one position.

Wentworth County Board of Education v. Wentworth Women Teachers’ Association, 1990 CanLII 3993 (ON PEHT) 1990-01-22 — Two school boards argued that all elementary teachers constitute one job class on the basis that they all occupy one position. At para. 90, The tribunal discusses the grouping of positions into job classes in the context of meeting all four criteria under the definition of job class. The Tribunal found that compensation schedules for teachers were set based on different educational qualifications, despite the similarities evident in actual teaching duties. Therefore, it was determined that there were seven distinct job classes, not just one.

Peterborough (City) v. Professional Fire Fighters Association, Local 519, 1997 CanLII 12087 (ON PEHT) 1997-06-11 — One of the issues put to the Tribunal was to identify the appropriate job class for an order which required Peterborough and the Peterborough Professional Fire Fighters Association to implement a pay equity plan. At para. 21, The Tribunal states that the term “job class” is not an exact requirement and subject to what is reasonable, parties have a range in which to negotiate what will meet the requirements in the Act.

Windsor Star v. Communications, Energy and Paperworkers Union, Local 517-G, 2009 CanLII 56704 (ON PEHT) 2009-10-19 — The issue was whether certain positions constituted one or more “job classes”, given that compensation for some individuals was pursuant to a collective agreement and other individuals were paid based on the terms of a Letter of Understanding based on a previous position. The Tribunal held that a single position cannot include positions which do not have the same compensation schedule, even if work is identical.

Hospital for Sick Children v. Ciordas, 1995 CanLII 7026 (ON PEHT) 1995-02- 09 — The Hospital sought a finding that the Registered Nurses all formed one job class in spite of original evaluations of the positions which separated the positions into three grade levels. The Tribunal considered the duties and responsibilities different enough to separate Registered nurses into 33 different job classes.

Canadian Union of Public Employees, Local 87 v. Thunder Bay (City), 2004 CanLII 60158 (ON PEHT) 2004-07-30 — The dispute centred on whether the parties had, in good faith, considered part-time positions and decided on their job classes when they negotiated and agreed to a Pay Equity Plan. The Tribunal held that they did not. Subsection 1(1) exhaustively defines the term job class. There is no provision in the Act, expressed or implied, that allows the employer and the bargaining agent to modify the constituent parts of the definition of job class to classify positions. These standards must be applied correctly. To determine a job class, the employer and the bargaining agent actively must look at the positions in the establishment and determine whether all four elements are present. Determining a job class and deciding or agreeing whether a job class is male or female are two distinct processes.

“job rate” means the highest rate of compensation for a job class; (“taux de catégorie”)

Ontario Northland Transportation Commission v. Transportation Communications International Union, 1992 CanLII 4696 (ON PEHT) 1992-09- 30 — The Tribunal was asked to identify the job rates for a job class of Clerks. They identified three principles to be used when determining job rate under the heading of ‘Job Rate – Calculation’. The principles are (1) calculations are to be as accurate as possible; (2) the job rate is to be calculated in a manner least disruptive to the collective agreement and compensation practices of the parties; and (3) the calculations must conform to the purpose and scheme of the Act.

Welland County General Hospital (1994) 5 P.E.R. 12 — A union sought and obtained a collective agreement through arbitration which had the effect of increasing the job rate of a male job class. The Tribunal deemed that pay equity negotiation and collective bargaining were separate and distinct processes. The also held that where an incumbent in a male job class receives a wage rate that is in excess of the rate set out in the collective agreement, this actual rate, and not the collective agreement rate, is the job rate.

York Region Board of Education v. York Region Women Teachers’ Association, 1995 CanLII 7030 (ON PEHT) 1995-01-18 — Teachers were paid based on annual salary and not by an hourly wage. The question was whether the hours worked by incumbents were relevant to the determination of job rate. The Tribunal held that the hours actually worked as compared to potential male comparators were irrelevant to job rate because both were measured as annual salaries and not hourly wages. Job rates must be expressed in common terms for comparison purposes.

Group of Employees v. Windsor Casino Limited, 2007 CanLII 62083 (ON PEHT) 2007-11-14 — The pay equity plan negotiated by an employer and the union included tips in the calculation of compensation for the purposes of determining job rate. The Tribunal held that where tips are ascertainable and the inclusion of tip amounts do not artificially manipulate the compensation and job rate of a job class, tips are to be included in compensation. The determination of tips for calculating compensation must be as accurate as possible. Here, the Tribunal determined that the method used to ascertain tips was flawed.

Group of Employees v. Windsor Casino Limited, 2009 CanLII 56707 (ON PEHT) 2009-10-19 — This decision was in response to the Tribunal’s direction that the Employer and Union track the tips of employees in order to ascertain the proper tip rate for the relevant job classes. The determination of tips as a component of the job rate can be based on the collection and evaluation of data.

Regional Municipality of Peel v. Canadian Union of Public Employees, Local 966, 1992 CanLII 4698 (ON PEHT) 1992-10-15 — Shift premiums were payable to different job classes of employees subject to differing preconditions The Tribunal found that both the monetary value of a benefit and the availability of a benefit to incumbents in a job class must be considered when determining the value of a benefit in the context of job rate calculations.

Canadian Union of Public Employees, Local 2974.1 v. Essex (County), 1996 CanLII 8065 (ON PEHT) 1996-11-15 — The Tribunal was asked to determine if there was a pay equity plan between the parties, whether it was an approved plan, and whether it was reviewable and under what circumstances. The Tribunal held that the pay equity plan was deficient as it did not include benefits in the calculation of the job rate. That is, a job rate must include a wage and benefits component.

Hamilton-Wentworth District School Board v. Ontario Secondary School Teachers’ Federation, 2009 CanLII 60545 (ON PEHT) 2009-10-30 — The issue in dispute was how to calculate the job rate for the male comparator job class. At para. 8 and 9, the Tribunal confirmed that the achievement of pay equity does not involve compensating all positions in female job classes at the job rate of the male comparator without regard to compensation scales, ranges or schedules which may exist in the establishment. At para. 11, the Tribunal concluded that the value of vacation benefits must be included in calculation of job rate, taking into account the years of service.

Ontario Nurses’ Association v. Lady Dunn General Hospital, 1991 CanLII 4451 (ON PEHT) 1991-06-28 — Female employees sought to equalize compensation between the male and female job classes by way of an increase in vacation rather than cash value. The Tribunal ruled that vacation entitlement had to be included in the calculation of job rate and adjustments, as required, can be made to wages/salaries, or benefits or to a combination of the two.

“job-to-job method of comparison” means the method of determining whether pay equity exists that is set out in section 6; (“méthode de comparaison d’un emploi à l’autre”)

“male job class” means, except where there has been a decision that a job class is a female job class as described in clause (b) of the definition of “female job class”,

(a) a job class in which 70 per cent or more of the members are male, or

(b) a job class that a review officer or the Hearings Tribunal decides is a male job class or a job class that the employer, with the agreement of the bargaining agent, if any, for the employees of the employer, decides is a male job class; (“catégorie d’emplois à prédominance masculine”)

“Minister” means the Minister of Labour; (“ministre”) “pay equity plan” means,

(a) a document as described in section 13, for a plan being prepared under Part II, or

(b) a document as described in section 6, for a plan being prepared or revised under Part III.1; (“programme d’équité salariale”)

(c) a document as described in section 18, for a plan being prepared under Part III.2. (“programme d’équité salariale”)

“private sector” means all of the employers who are not in the public sector; (“secteur privé”)

“proportional value method of comparison” means the method of determining whether pay equity exists that is described in Part III.1; (“méthode de comparaison de la valeur proportionnelle”)

“proxy method of comparison” the method of determining whether pay equity exists that is described in Part III.2. (“méthode de comparaison avec des organisations de l’extérieur”)

“public sector” means all of the employers who are referred to in the Schedule; (“secteur public”)

“regulations” means the regulations made under this Act; (“règlements”) “review officer” means a person designated as a review officer under subsection

34 (1). (“agent de révision”) R.S.O. 1990, c. P.7, s. 1 (1); 1993, c. 4, s. 1; 1996,

  1. 1, Sched. J, s. 1; 1997, c. 26, Sched.; 2000, c. 5, s. 19; 2002, c. 17, Sched. C,
  2. 20 (1).

Posting

(2) Where this Act requires that a document be posted in the workplace, the employer shall post a copy of the document in prominent places in each workplace for the establishment to which the document relates in such a manner that it may be read by all of the employees in the workplace. R.S.O. 1990, c. P.7, s. 1 (2).

Idem

(3) The employer shall provide a copy of every document posted in the workplace under this Act,

(a) to the bargaining agent, if any, that represents the employees who are affected by the document;

(b) to any employee who requests a copy of the document, if the employee is not represented by a bargaining agent and the employee is affected by the document. R.S.O. 1990, c. P.7, s. 1 (3).

Calculation of number of employees

(4) If Part II or III applies to an employer, a reference in this Act to the number of employees of the employer shall be deemed to be a reference to the average number of employees employed in Ontario by the employer during the twelve-month period preceding the effective date or during the period from the day the first employee commenced employment in Ontario with the employer until the effective date, whichever period is shorter. R.S.O. 1990, c. P.7, s. 1 (4).

Decisions re job classes

(5) In deciding or agreeing whether a job class is a female job class or a male job class, regard shall be had to the historical incumbency of the job class, gender stereotypes of fields of work and such other criteria as may be prescribed by the regulations. R.S.O. 1990, c. P.7, s. 1 (5).

Oakwood Retirement Communities Inc. v. S.E.I.U. Local 1 Canada, 2010 CanLII 76245 (ON PEHT) 2010-12-15 — A union sought to challenge a pay equity process undertaken by the employer under an agreement with the predecessor union. At para. 69, The tribunal discusses the fact that the employers were subject to Part I of the Act and were not required to negotiate pay equity with a bargaining agent in the same manner that it would if it was governed by Part II. However, employers must seek agreement from the bargaining agent on decisions concerning gender predominance in the context of a consideration of historical incumbency and gender stereotypes.

Canadian Union of Public Employees, Local 2974.1 v. Essex (County), 1996 CanLII 8065 (ON PEHT) 1996-11-15 — The Tribunal was asked to determine if there was a pay equity plan between the parties, whether it was an approved plan, and whether it was reviewable and under what circumstances. The Tribunal held that the pay equity plan was deficient. At para. 36, the Tribunal found that the pay equity plan agreed to by parties contravened the Act, in part, because parties simply adopted job classes in the collective agreement without reference to the actual definition of job class in the Act.

Parry Sound District Hospital (No.2) (1995), 7 P.E.R. 72 — Housekeeping and dietary employees challenged a pay equity plan on the basis that the gender characterization of job classes was inappropriate. The Tribunal held that they had jurisdiction to hear the matter and the standard of review for gender predominance is reasonableness. At para. 70, the Tribunal noted that it may not contravene the Act for a job class to be identified as gender neutral following an examination of the current incumbency. The Tribunal stated that while the outcome might be different if historical incumbency and gender stereotyping are considered, an outcome based on a consideration of current incumbency is not unreasonable.

Pay Equity Office v. GL&V Process Equipment Group Inc., 1999 CanLII 14828 (ON PEHT) 1999-12-16 — Gender predominence of a “Buyer” job class was in dispute, where the pay equity plan identified it as female, but the employer characterized it as male. At para. 23, the Tribunal states that the Act dictates a two-step process with respect to determination of gender predominance – (1) examine current incumbency at the time the employer’s pay equity obligation began, and (2) consider historical gender incumbency and gender stereotyping. At para. 27, the Tribunal discusses that the fairest way to determine historical incumbency in light of turnover is to compare the total incumbent years of each gender. Here, both current and historical incumbency indicated a male job class.

Hatts Off Specialized Services Inc. v. Employees of the Employer, 2005 CanLII 60098 (ON PEHT) 2005-03-23 — An Order declared that the job classes of Bookkeeper, Child and Youth Worker and Supervisor were female job classes. The Applicant disagreed and asserted that Bookkeeper was a male job class and that the Child and Youth Worker and Supervisor were gender neutral. At para. 22, the Tribunal said that “[w]hile it is important to consider gender stereotyping in fields of work, the Act’s overall structure contemplates developing pay equity in each establishment of an employer, thus placing a particular focus on the reality of each workplace.” The Applicant was correct about the neutral job classes, but gender stereotyping needed to be considered more for the Bookkeeper class.

Dufferin-Peel Roman Catholic Separate School Board v. Several Employees, 1997 CanLII 12227 (ON PEHT) 1997-11-12 — The employer challenged an Order deemed that the Planner 1 job class was gender neutral. The Tribunal decided not to look at the gender composition of the entire department when assessing gender predominance because although they were asked to, such was outside their jurisdiction as the only class appealed was Planner 1. Looking at gender incumbency and stereotypes, the Tribunal deemed the class gender neutral.

Association of Professional Student Services Personnel v. Toronto Catholic District School Board, 2006 CanLII 61262 (ON PEHT) 2006-03-23 — The Applicant sought a determination that the Community Relations Officer job class was a female job class within the meaning of the Act. At para. 8 & 9, the Tribunal upheld the two-step analysis for gender predominance in Pay Equity Office v. GL&V Process Equipment Group Inc., above. Although the current and historical incumbency indicated a gender-neutral job class, the Applicant argued that gender stereotypes were not considered. The Tribunal held that employers are not required to demonstrate they considered gender stereotype after the deemed approved plan is implemented and the is onus on the challenging to demonstrate that Part I was contravened. The Applicant did not meet this onus.

Flemingdon Neighbourhood Services v. Lemire, 2009 CanL(ON PEHT) 2009- 10-23 — The employers challenged an Order that the Executive Director job class was gender neutral, and argued it was female dominated. There was only one incumbent who was male. At para. 4 & 5, The Tribunal notes that where job class has a single incumbent, historical incumbency may not be as relevant a factor to consider. It may be more relevant to consider gender stereotypes in the entire sector itself when determining the gender predominance of a single incumbent job class. The Tribunal held that the sector stereotypes indicated the class was female dominated.

One-member job classes

(6) A job class may consist of only one position if it is unique in the establishment because its duties, responsibilities, qualifications, recruiting procedures or compensation schedule, salary grade or range of salary rates are not similar to those of any other position in the establishment. R.S.O. 1990, c. P.7, s. 1

Wentworth County Board of Education v. Wentworth Women Teachers’ Association, 1990 CanLII 3993 (ON PEHT) 1990-01-22 — Two schoolboards argued that all elementary classroom teachers constituted one job class on the basis that they all occupy one position. The Tribunal found that compensation schedules were set based on different qualifications, despite similarities in actual duties and thus there were seven distinct job classes, not just one. At para. 95, The Tribunal said that if positions were different with respect to any one of the four criteria listed under the definition of job class, then it may form a separate job class, even if the job class only consists of one position. All four criteria under the definition of job class must be considered.

Windsor Star v. Communications, Energy and Paperworkers Union, Local 517-G, 2009 CanLII 56704 (ON PEHT) 2009-10-19 — The issue was whether certain positions constituted one or more “job classes”, given that compensation for some individuals was pursuant to a collective agreement and other individuals were paid based on the terms of a Letter of Understanding. The Tribunal held that there were different job classes. Even if the work performed is identical, an incumbent is in a different job class if the compensation schedule is different.

Disabled, etc., not to be classed separately

(7) A position shall not be assigned to a job class different than that of other positions in the same establishment that have similar duties and responsibilities, require similar qualifications, are filled by similar recruiting procedures and have the same compensation schedule, salary grade or range of salary rates only because the needs of the occupant of the position have been accommodated for the purpose of complying with the Human Rights Code. R.S.O. 1990, c. P.7, s. 1 (7).

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