Pay discrimination for part-time, temporary workers focus of amendments
As of April 1, 2018, the next tranche of Bill 148 amendments, which focus on enhancing the “equal pay for equal work” protections for employees in Ontario, are in force.
These amendments to the province’s Employment Standards Act, 2000 (ESA), which focus on pay discrimination, will most significantly impact employers who rely on part-time, temporary, casual or seasonal workers, and temporary help agencies, which typically pay their “assignment employees” (defined in the ESA as an employee employed by a temporary help agency for the purpose of being assigned to perform work on a temporary basis for clients of the agency) less than their “clients” (defined as a person or entity that enters into an arrangement with the agency to assign one or more of the agency's assignment employees to perform work for the person or entity on a temporary basis) pay their full-time employees for doing similar work.
Key amendments and ministry guidance
While every province already has legislation prohibiting pay discrimination based on sex, Ontario will be the first to prohibit pay discrimination based on a “difference in one’s employment status,” which the amendments define as:
• a difference in the number of hours regularly worked; or
• a difference in the term of their employment, including a difference in permanent, temporary, seasonal or casual status.
For employers, this means that all employees, with some exceptions, must be paid the same rate of pay if:
• They perform “substantially the same”(defined by the amendments as the same but not necessarily identical) kind of work in the same establishment
• Their performance requires substantially the same skill, effort and responsibility
• Their work is performed under similar working conditions.
Employers can still pay employees a different rate of pay if the difference is not connected in any way to sex or employment status, such as a difference based on seniority, merit or quantity or quality of production.
Employers in unionized environments with collective agreements in effect on April 1, 2018, have until the earlier of the expiration of their collective agreement or Jan. 1, 2020 to comply.
For employees who suspect their pay is less due to their employment status, while they can file a complaint directly with the Ministry of Labour, the amendments allow them to request a review from their employer.
Employers must respond by either:
• Providing a written a response with reasons, if they disagree with the employee; or
• Adjusting the employee’s pay accordingly.
Employers are prohibited from reducing the rate of pay of other employees to comply.
When the employee requesting the review is an assignment employee, the ministry’s guide to the ESA published on its website suggests explaining:
• The positions or jobs that they are comparing their work to
• Why they think the work is equal
• Why they think their rate of pay is unequal.
While the amendments do not expressly require clients of temporary help agencies to share their wage information, the ministry encourages them to ask client businesses for a salary or wage rate grid outlining the minimum and maximum rates of pay for each job.
The amendments prohibit employers, including temporary help agencies, from retaliation against employees who request such a review or collaborate with other employees in seeking to determine whether their employer is in compliance.
For employees who file complaints with the ministry — whether or not they request a review from their employer — an employment standards officer would be assigned to investigate the situation, as with any potential violation of the ESA.
If a contravention is found, the officer can define the amount owing to the employee and deem it to be unpaid wages.
Reasons for the amendments
The Bill 148 amendments were inspired by The Changing Workplaces Review, a 420-page report commissioned by the provincial government to identify and address deficiencies in workplace legislation in Ontario, which has failed to keep pace with the modernized workplace.
In respect of the equal-pay-for-equal-work amendments, these were motivated by a need to increase protections for “vulnerable workers in precarious jobs,” which the report estimated to be at least 30 per cent of the workforce.
In the report, “vulnerable workers” referred to groups defined by their social location (such as ethnicity, race, sex, ability, age, or immigration status) and it defined “precarious employment” as work for remuneration characterized by uncertainty, low income, and limited social benefits and statutory entitlements.
Of this group, the report found assignment employees as “being among the most vulnerable and precariously employed of all workers,” which is due in large part due to the triangular relationship of their arrangement.
Upon review of the widespread practice of companies paying part-time workers less than full-time employees doing similar work, the report labelled any distinction in pay on this basis as “arbitrary and discriminatory,” akin to differential treatment based on the protected grounds in the Ontario Human Rights Code.
Other provinces
While Ontario is the first to introduce such sweeping equal work for equal pay protections, it would not be surprising if other provinces were to follow suit in the near future.
In British Columbia, a “mandate letter” from the Premier to the Minister of Labour upon his appointment in 2017 stated that one of his deliverables is to “update employment standards to reflect the changing nature of workplaces and ensure they are applied evenly and enforced.” This could be viewed as addressing similar pay discrimination issues. In Newfoundland and Labrador, a 2018 report by that province's Federation of Labour called for attention to wage discrimination against temporary workers and identified precarious work as a significant issue in the province.
However, at this time, it appears that other provinces have focused their attention on enhancing their leave provisions, which were part of Ontario's earlier Bill 148 amendments already in force.
David J. Master is an associate lawyer working at Littler LLP and advises employers on the full spectrum of employment and labour law issues. He can be reached at (647) 256-4536 or [email protected].
