Unequal wage grids don’t violate pay equity

As long as top pay rate is the same in comparable job classes, pay equity is achieved: Ontario court
By Amanda Silliker
|Canadian HR Reporter|Last Updated: 07/17/2012

As long as the top pay rate for men and women in comparable job classes is the same, the difference in the wage grid — the amount of steps and length of time it takes for employees to reach the top pay level — does not constitute a violation of the Pay Equity Act, an Ontario court has ruled.

In a recent case, the Canadian Union of Public Employees (CUPE) argued two employers — Lakeridge Health in
Oshawa, Ont., and the York Region District School Board in Aurora, Ont. — were violating the Pay Equity Act by having male job classes with fewer steps on the wage grid to reach the top salary than their comparable female job classes.

At Lakeridge Health, the male-dominated service workers could progress to the top of the pay scale after nine months of service, while the comparable female-dominated clerical employees could not reach the maximum pay level until after 24 months. This would result in a health records clerk (a female job class) earning nearly $4,000 less than a storekeeper helper (male job class) in the first 24 months of employment, CUPE said.

“Why do women have to wait longer to get to the established rate of pay for the job, which is the top rate?” said Paul Moist, president of CUPE in Ottawa, which has 620,000 members, two-thirds of whom are women. “We want to know, ‘Why is women’s work valued less?’ And we consider it to be less valued if it takes five or six years to get to the top rate of pay.”

At the York Region District School Board, mostly female clerical employees had a wage grid comprised of four steps that would take employees three years to reach the maximum job rate. The comparable, mostly male custodial employees had a wage grid with three steps and could reach the highest pay at the end of one year.

A few years ago, CUPE submitted an application to the Pay Equity Hearings Tribunal to harmonize the wage grids for male and female comparator jobs. It was dismissed so CUPE appealed to the Ontario Divisional Court but the appeal was rejected in a decision released May 31.

“It was kind of justice denied for us,” said Moist. “We’re not happy with the decision but it’s just one more step along the journey to pay equity.”

The Ontario Divisional Court upheld the Pay Equity Hearings Tribunal’s decision because the Pay Equity Act does not require the harmonization of wage grids, it said. The act refers to the achievement of pay equity in terms of the adjustment of job rates — the highest level of pay — despite the fact it also acknowledges job classes may have more than one rate of compensation attached to them, said the court.

“The Pay Equity Act should operate to close that gap and order the employer to make those pay steps the same so that they are, in fact, paid comparably,” said Mary Cornish, a labour and human rights lawyer at Cavalluzzo Hayes Shilton Mcintyre & Cornish in Toronto, who represented the CUPE locals in the case. “The tribunal ruled that the Pay Equity Act did not require that as a result of what we thought was quite a narrow construction of the act.”

Cornish relied on a number of reports in making the case for discrimination, including a federal Pay Equity Task Force report and a report from the International Labour Organization. Both reports found unequal wage grids where the female jobs take longer to get to the maximum rate are “some of the kind of classic features of the systemic discrimination women face,” said Cornish.

But the conclusion cannot be drawn that it’s gender discrimination simply because incumbents in a male job class have fewer steps in their wage grid than female job classes, said Carolyn Kay, partner at Hicks Morley in Toronto, who acted on behalf of Lakeridge Health before the Pay Equity Hearings Tribunal. Because the wage grids are negotiated in collective bargaining, they are “very much dependent on the priorities of the different bargaining agents,” she said.

“One union might negotiate for quicker progression through the grid and they may do that in exchange for something else at the bargaining table. The other bargaining unit might not be concerned about the grid and they may negotiate something different, so there’s a whole host of variables that can be at play and influence the structure of the wage grid,” said Kay.

The Pay Equity Act is not intended to preclude parties from negotiating different compensation structures, she said.

However, the ruling hinted the Pay Equity Act may be vulnerable to a challenge under the Charter of Rights and Freedoms, citing CUPE’s argument it does not do enough to eliminate gender-based wage discrimination.

“(The Ontario government), in enacting the Pay Equity Act, made a number of policy decisions about the way in which to achieve pay equity, enacting legislation that does not eliminate all systematic wage discrimination. As a result, the (act) may be vulnerable to a challenge under section 15 of the charter because of that under-inclusiveness,” said the court.

CUPE is reviewing the decision and “wouldn’t close the door” to a possible charter challenge, said Moist.

“(The decision) could mean two things: They’re wrong and maybe we’ll appeal to a higher court — we haven’t made that decision yet — or there are shortcomings in the act and politicians need to fix that. We’re just assessing this right now,” he said.

The decision has set workplace parties “off on a journey to various places to get the remedy for these women,” said Cornish.

“These particular unions asked in collective bargaining to close these particular pay gaps a number of different times and were refused, so voluntarily requesting it doesn’t work. And so now what it means is employers are going to be faced with litigation to force them to do it. It’s not going to be under the Pay Equity Act, but human rights laws,” she said.

If an employer does not have a pay equity plan developed, it should do so immediately, said Kay. Since this decision came out, she has received a number of phone calls around pay equity and the more people hear about this case, the more employees will be questioning pay equity at their own organizations, she said.

“I have no doubt that this thing will go further,” said Kay. “We haven’t heard the last word on this issue.”

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