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In its flurry of pre-election legislation, the Ontario government has now passed the Pay Transparency Act, 2018 into law. As of January 1, 2019, employers will have new obligations and restrictions when hiring new employees.

All employers will be:

  • prohibited from asking a job applicant about their previous compensation history
  • required to include information about the expected range of compensation in job postings
  • prohibited from intimidating, dismissing or other penalizing employees from asking questions about compensation, talking about their own compensation or seeking the employer’s compliance with the legislation.

Some employers will also be required to file reports with the Ministry of Labour detailing their workforce composition and levels of compensation by gender. This obligation will apply first to the Ontario public service, and then will be gradually applied to employers, starting with the largest (over 250 employees) first.

The stated goal of the legislation is to even the playing field between men and women. Statistically, women are less likely to vigorously advocate for higher wages, which is believed to be part of the reason for gender gap in pay, which is approximately 30% at this point. Additional information provided to employees is expected to create pressure (one hopes from both women and men) to reduce discrepancies based solely on gender.

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