by Paula Määttä

III. Canada

B. Scope of the concepts on equal pay

1. The definition of "pay"

The Canadian pay equity statutes include definitions of "wages", "pay" and "compensation" that go beyond basic salaries. In Manitoba, Ontario and Prince Edward Island the definition includes pay and benefits provided. Wages do not refer only to cash salaries. For example, in the Pay Equity Act of Prince Edward Island "wages mean all forms of pay and benefits paid or provided, directly or indirectly, by or on behalf of an employer to or for the benefit of an employee and includes the relevant salary scales". Indirect compensation would include, e.g., vacation time, health plans and allowances. Benefits for employees include pension funds, disability plans, and health insurance. (Canadian Human Rights Commission 1992, pp. 12-13.)

In Nova Scotia the Act gives guidance on what should be contained in the total wage for the purposes of pay equity. The provision explicitly excludes gratuities, payments in lieu of overtime, and living, car and clothing allowances. The other statutes are unclear about what should be included when calculating wages. (McDermott 1993, pp. 45-46.)

2. The definition of "equal work"

The Canadian equal pay jurisdictions are based on three different approaches by which the persistent gender-based wage gap has been reduced. The legislation initially proceeded from started with the "equal pay for equal work" approach. Subsequently, the approach based on the principle "equal pay for work of equal or comparable value" was followed. The latest approach is based on the "pay equity" principle. Because the pay equity approach has such a significant potential for reducing the gender-based wage gap, this chapter focuses on this approach.

Proactive pay equity legislation has been enacted in Manitoba, Ontario, Prince Edward Island, New Brunswick and Nova Scotia. "Pay equity" denotes a compensation practice that is based primarily on the relative value of the work performed, irrespective of the gender of employees, and it includes the requirement that the employer not establish or maintain a difference between the pay of male andfemale employees who are performing work of equal or comparable value. The concept of "pay equity" is based on the assumption that wage discrimination against women is common in the society and demands an ample remedy. This type of equal pay legislation bypasses a complaint system of enforcement in favour of a regulatory model. It does not clearly forbid wage discrimination but sets positive obligations on employers to inspect their pay practices and insure that these practices comply with legislation. (CCH Canadian Limited 1995, pp. 416-417.)

For example, in Nova Scotia pay equity is achieved in a female-dominated class in different ways. First of all, the pay rate for a class may be made equal to the pay rate of the only male-dominated class of the same employer performing work of equal or comparable value. Secondly, the pay rate for a class may be made equal to at least the lowest pay rate of two or more male-dominated classes of the same employer performing work of equal or comparable value. Thirdly, the pay rate for a class may be made equal to the higher pay rate of the only male-dominated class performing work of lower value where no male-dominated class performs work of equal or comparable value. Finally, equality in pay may be achieved when the pay rate for a class is equal to the highest pay rate of two or more male-dominated classes performing work of lower value and there are no male-dominated classes performing work of equal or comparable value. (CCH Canadian Limited 1995, p. 428.)

The "Equal pay for work of equal value" approach does not compare work, but the value of work. Comparisons may be made between dissimilar jobs. The principle of "equal pay for equal work" requires that male and female employees be paid the same wage for doing similar work or substantially similar work. This approach applies to situations where male and female employees may have different job titles, but perform substantially the same work. The provisions provide that the concepts of skill, effort, and responsibility are to be used to determine what is similar or substantially similar work. The value of work and similarities among different types of work may be determined by using job evaluation. This principle exists in the legislation of every province. (CCH Canadian Limited 1995, pp. 415-416.)

3. Scope of the equal pay provisions

In general, equal pay provisions cover the public sector and, in some states, the private sector in Canada. The Pay Equity Act of Manitoba, Ontario, Prince Edward Island, Nova Scotia and New Brunswick pertain to the public sector, but the private sector is covered by the provisions of "equal pay for equal work". The Ontario Pay Equity Act applies also to all private sector employers with 10 or more employees, but it does not cover enterprises with fewer than 10 employees. In Nova Scotia, the Pay Equity Act applies to (a) employees in the Civil Service, corrections employees, highway workers and employees of the Victoria General Hospital and the Nova Scotia Hospital who are not in the Civil Service; (b) employees of Crown corporations, hospitals and school boards; (c) university employees, municipalities and municipal enterprises and their employees; and (d) public sector corporations or bodies added by regulation.

All pay equity statutes include both full-time and permanent part-time employees. In Ontario, however, students employed over the vacation period are not defined as an employees. The Pay Equity Act of Prince Edward Island excludes persons employed to make a temporary investigation on behalf of the Legislative Assembly or the Government. The Act does not include any person who is paid fee or is hired on a special contractual basis or as an independent contractor. It also excludes students temporarily employed during summer vacations.

The coverage of pay equity legislation in Canada requires at least one comparable male job class in the employer's establishment in order to establish a discriminatory pay practice. The principle of equal pay has been limited to the jobs which are performed by the female job class. Under this provision, attention has been directed to low-paid female-dominated jobs, but the legislation has less relevance for female employees working at other occupations.