Pay Transparency Rules Start January 1, 2021

Summary#

This Order sets January 1, 2021 as the day Division 3 of Part 4 of the Budget Implementation Act, 2019, No. 1 comes into force. That change enables new pay‑transparency reporting rules under the Employment Equity Act so the government can publish information on wage, bonus and overtime gaps in the federally regulated private sector.

What it does#

• Fixes January 1, 2021 as the coming‑into‑force date for Division 3 of Part 4 of the Budget Implementation Act, 2019, No. 1.
• Allows amendments to the Employment Equity Regulations so federally regulated private‑sector employers must provide more detailed pay information.
• Requires reporting that will let officials calculate hourly pay rates and report on bonus pay, overtime pay and overtime hours.
• Directs Employment and Social Development Canada’s Labour Program to publish aggregate wage, bonus and overtime gap information, including in the Employment Equity Act – Annual Report and a public data‑visualization tool.
• Specifies that the published data will be aggregated to protect individual privacy.

Who's affected#

• Federally regulated private‑sector employers and their employees — that is, employers covered by federal employment law rather than provincial rules.
• Workers and groups whose pay gaps the reporting will highlight, including women, Aboriginal peoples, persons with disabilities and visible minorities.
• The general public and researchers who will use the published statistics.
• Employment and Social Development Canada (Labour Program), which will collect and publish the data.

Why it matters#

• The move is meant to increase pay transparency so wage differences are more visible. The government says this can encourage employers to examine and change pay practices.
• Background figures cited by the government show gaps: in 2018 employed core‑aged women earned about 87 cents for every dollar earned by men — a gap of 13.3%. Fewer women from designated groups were in top salary ranges (for example, fewer than 50% of some groups earned $60,000 or more in earlier data).
• The new reporting will make aggregated comparisons public (not individual payroll records). That can help workers, advocates and employers track progress and target efforts to reduce pay gaps.
• The government has committed $3 million over five years toward implementing these pay‑transparency measures.