The Pay Transparency Act (the “Act”) in British Columbia (BC) has come into effect as of May 11, 2023, bringing with it a host of new regulations and responsibilities for BC employers operating under provincial jurisdiction. This legislation imposes significant requirements on employers, with the goal of addressing the ongoing issue of the gender pay gap and fostering equitable compensation practices. To assist you, we have provided a summarized overview of these new provisions for your convenience.
- Job Postings
Starting from November 1, 2023, employers will be obligated to disclose the expected salary range or wage for all publicly advertised job openings. It’s important to note that this requirement does not apply to job opportunities that are not publicly posted or general recruitment campaigns (such as “help wanted” posters) that don’t specifically mention a particular job opening.
- Pay History Information
Employers are now prohibited from inquiring about an applicant’s pay history. However, it’s worth mentioning that the Act does not restrict employers from utilizing pay history information that is already in their possession or publicly accessible.
- Protection against retaliation
The Act expressly forbids employers from taking retaliatory actions such as dismissal, suspension, demotion, discipline, harassment, or any form of disadvantage against employees who:
- Seek information about their own pay;
- Disclose their pay to another employee or prospective employee;
- Raise queries to their employer about a pay transparency report or its contents;
- Request their employer’s compliance with the Act; or
- Report their employer’s compliance with the Act to the Director of Pay Transparency.
- Pay Transparency Report
To promote accountability and address pay disparities comprehensively, employers above a certain size will be obligated to complete and post annual pay transparency reports. This requirement will be implemented in stages over the next few years. Employers will be mandated to prepare the report by November 1st of each year.
- By November 1, 2023: the B.C. government and the six largest Crown corporations, which are BC Hydro, BC Housing, BC Lottery Corp., BC Transit, ICBC, and Work Safe BC will be required to begin posting annual pay transparency reports
- By November 1, 2024: all employers with 1,000 employees or more will be required to begin posting annual pay transparency reports
- By November 1, 2025: all employers with 300 employees or more will be required to begin posting annual pay transparency reports
- By November 1, 2026: all employers with 50 employees or more will be required to begin posting annual pay transparency reports
These reports will provide insights into pay gaps that exist among different groups, shedding light on any discrepancies that may arise due to gender, race, ethnicity, or other factors. An online reporting tool will be made available to assist employers in preparing these reports, ensuring a streamlined process and facilitating compliance. The exact details of what must be included in the reports are currently being developed through collaboration between the BC Public Service Agency, the six largest Crown corporations, and other stakeholders.
Gathering information for the report
Employers must gather the necessary gender and diversity information from each employee according to Gender and Sex Data Standard. In doing so, employers should also inform employees that disclosure is voluntary and offer them an opportunity to provide or update their information within the report at least once a year. Employees can decline to give their gender information to their employer for the purposes of preparing the pay transparency report.
Employers will be required to use this information to complete the Pay Transparency Report, with the assistance of a reporting tool that the Ministry will introduce under regulation. Employers must also adhere to BC’s private sector privacy legislation to ensure compliance. This includes obtaining proper consent (or falling within valid exceptions to consent) whenever employee personal information is used or disclosed, as well as implementing appropriate safeguards to securely protect any collected personal information.
Reporting pay gap
Employers will be required to report the pay gap in terms of differences in hourly wages, overtime, and/or bonuses between men, women, and non-binary individuals. The pay gap can be represented using quartiles (e.g., top 25% earners, high 25%, mid 25%, and lowest 25%), although employers are not obligated to disclose actual wage data (dollar amounts) of their employees.
Publishing reports on the website
Once the pay transparency report is prepared, employers must publish it on their publicly accessible website. In cases where the employer lacks a publicly accessible website, the report must be readily available to both employees and the public upon request.
Take proactive steps
Employers should be aware of these new regulations aimed at promoting pay transparency and ensure that their hiring practices and internal policies align with the requirements. Although most employers won’t be immediately required to produce a pay transparency report, it is advisable for all employers to take proactive steps to ensure they can fulfill their reporting obligations when they come into effect.
The above overview is provided for informational purposes only and should not be considered as legal advice. It is strongly advised to seek specific legal guidance before making any decisions based solely on this material. If you have any questions on the new legislation, reach out to an expert from HR Covered.