Pay Equity

Ontario Pay Equity Commissioner and CEO Kadie Philp joins First30 CEO Amy Davies in this episode of Coffee ’n’ Law for an insightful discussion on pay equity, workplace compliance, and the importance of proactive HR practices.

Amy and Kadie explore how the Pay Equity Office identifies high-risk sectors, what can trigger investigations or complaints, and why maintaining strong documentation and compensation records is essential for organizations of all sizes. Kadie also explains how employers can proactively assess pay equity risks, what happens when gaps are identified, and why transparency around compensation is becoming increasingly important.

Connect with Kadie Philp:

On LinkedIn: https://www.linkedin.com/in/kadiewardphilp/
Visit the Pay Equity Office: www.payequity.gov.on.ca

Resources from the Ontario Pay Equity Office:

·        Learn more about the Pay Equity Act: Pay Equity and You

·        Read Ontario’s Pay Equity Act with Selected Case References, 2022

·        Learn how to do Pay Equity in 7 Steps

·        Access the Pay Equity Solution for Small Business Do-It-Yourself Toolkit

·        Listen to the PEO’s podcast “Level the Paying Field” 

·        I Work in Ontario: answers to some commonly asked questions 

·        I Hire in Ontario: answers to some commonly asked questions

·        Contact the Pay Equity Office and file a complaint

Reports from the Ontario Pay Equity Office:

·        Theory of Change for Achieving Equal Pay for Work of Equal Value report 

·        Understanding the Gender Pension Gap in Canada report 

Ontario Pay Equity Office Social Media Accounts:

·        LinkedIn: Ontario Pay Equity Office

·        English X: @OntPayEquity

·        French X: @OntPayEquityFR

·        YouTube: Ontario Pay Equity Office

·        Email: AskPayEquity@ontario.ca

Connect with Amy Davies:

On LinkedIn: linkedin.com/in/daviesamy
Email: amy@first30ready.com
Visit First30's website: www.first30ready.com

HR Law Canada

Stay up to date with employment law news by subscribing to HR Law Canada: www.hrlawcanada.com

This podcast is produced by Storyphora, www.storyphora.com, info@storyphora.com

#amydavies #coffeenlaw #employmentlaw #HRleaders #payequity #workplacelaw #genderpaygap

Transcript

SPEAKER_02 0:00

But at the foundation of that is having the data and the information. And so you need to keep track of your job descriptions of how they change over time. If you had a job that existed five, 10 years ago, but you renamed it something or you changed it when you rehired, like all this needs to be tracked because fundamental to the process is creating job classes, which is actually grouping similar jobs. Um, and in order to do that, you have to have job descriptions.

Amy Davies 0:32

Workplace law is complex and constantly changing. It can be hard to keep up, and the risk of getting it wrong can be costly for businesses. The Coffee and Law Podcast is here to help HR professionals and employers stay informed. We'll cover what's changing and how to navigate real workplace situations and everyday people decisions. So grab your favorite warm drink and join us for engaging practical and educational conversations with top experts in workplace and employment law.

Brent Jensen 1:06

This podcast provides high-level general information. The perspectives shared by our guests are for educational purposes and do not constitute legal advice. If you have a specific question or concern, please consult a qualified lawyer.

Amy Davies 1:21

Hi everyone, it's Amy Davies, founder and CEO of First30, and also your Coffee and Law podcast host here, to remind you that First30 offers career transition and outplacement services. So if you have terminations and layoffs coming up, this is a really good way to mitigate risk to your business and help your exiting employees recover from the job loss and get back to work. You can find out more information at www.first30ready.com forward slash outplacement, or you can reach out to me, Amy AMY, at first30ready.com. All of our programs include live coaching and a year of access. And in a tough job market, that can be very important. Now, back to our show. Hello everyone. Thanks so much for joining the Coffee and Law Podcast. The podcast has been doing so well. We are in the top 50% of business podcasts globally. Um, and that's with your help. So thank you for that. If you can subscribe, if you can like, if you're listening, if you could give us a five-star rating, we would be so grateful for that. And I want to give a shout out to our partners, HR Law Canada. So if you are looking for more news and information on HR Law for sure, or employment law or workplace law, check them out. They have amazing reports and articles. Um, and of course, we thank our podcast producers, Story4. People ask me all the time who our podcast producers are at Story4, and they are amazing. Um, so I am very excited to have Katie Philp here today. Katie is the commissioner and CAO of the Pay Equity Office. So we're going right to the source, Katie. I'm really happy to have you. And if you think you're seeing double, Katie is the one with the flags behind her. And Amy is here. We we've been accused of being doppelgangers in the past. People have definitely mistaken us for each other, especially when we're both wearing glasses or we're both not wearing glasses. Um, you've worked uh in 30 countries, over a hundred cities. Um, and it's so great to have you here. So thank you. And why don't you tell us in your own words a little bit more about what you do?

SPEAKER_02 3:48

Sure. Well, the Pay Equity Commission is a regulatory body of the Ministry of Labor Training Skills Development in Ontario. So it's quasi-judicial. We have two parts. We have my office, which is a regulatory body, which is also an education outreach body. And we also have a tribunal. So we make decisions here in the office, um, which I lead on pay equity. We respond to complaints. We also do active monitoring of files of companies who are provincially regulated in Ontario. And if companies um or individuals where we make a decision, they don't like what we've said, uh, they can go to the tribunal and they can actually appeal our decision or appeal whatever action we've we've asked them to take. So it's a it's a it's a fairly substantial organization in terms of making sure that the law of pay equity, which exists in Ontario, it has existed since 1989, is put into force and then also has a sort of checks and balance for the people who we regulate to um respond to the way that we are enforcing the law.

Amy Davies 4:53

And what launches a sort of investigation by the pay equity office, or what what should companies and organizations be aware of when it comes to being one of those? It's like I feel like it's like being audited by the CRA or something. You want to make sure you're doing the right thing. So you do things like hire an accountant and you make sure your books are in order. And that way you don't get red flagged. So if I'm an HR listener right now, I'm thinking, how do I make sure my company is not flagged and looked at in a more detailed way?

SPEAKER_02 5:32

Well, pay your employees equitably, number one. Um so we do do active um monitoring campaigns. And these are something that are we choose companies or we choose first we choose sectors basically, and then we kind of do subsectors, we go uh deeper into the data. We use uh North American occupational codes and North American industry codes. And what we're looking for is sectors where um if the gender wage gap is higher than the average in that sector, it's going that sector, first of all, is going to be red flag for us. And then we'll dive into to try to understand what's happening in that sector and what's happening within the jobs within that sector. So let me give you an example. STEM, we know that the STEM sector very broadly has a gender wage gap of 14%. Uh, the provincial average is 11%. It's a little bit higher, not like outrageous, but still really like what's going on. So we dive deeper and then we see, okay, in STEM, engineering wage gap is only 7%, which is interesting. And we would go deeper into figure out why is their gap smaller? How does that change by um different discipline within engineering? So we do a lot of a really deep dive in the data to understand where is the gap the biggest in what sector, in what job classifications, and then we construct a monitoring campaign about that. So I would say to your listeners, all of this information is available for free on Stats Canada. It's all free. Uh, you can go in and you can look at you probably know, or it's easy to learn uh and navigate what your sector is, what the sector codes are, what the job codes are. And if you discover that your sector is higher than average than the Canadian or provincial gender wage gap, that's something we look at. So you could potentially your sector could be red flagged. Then after we do that, we kind of distill it down to a workable list of companies that we can go out and actively monitor.

Amy Davies 7:28

Right. And I want to uh also make clear that I'm Katie was kind enough in her office, was kind enough to share some really great links for everyone to learn more. And those are going to be added to the show notes. It's a long list, but it's a list worth keeping intact. So I'll put it all of it on there. Okay, so say I am an HR practitioner, I've done my due diligence, yes, and I've realized, oh my goodness, we do have a large gap. Um, and this is something we need to fix. Now, here's the thing: it can be expensive to go down that path and to try to fix things. Now, I am in HR. How do I broach this with our leadership and our CFO? What is the case that I make to them?

SPEAKER_02 8:18

Well, first of all, to comply with the act, like, first of all, it's the law. So I find, you know, companies generally respond to risk, not reward. We recently did a monitoring campaign. And uh, you know, I read all these books about like the modern regulator and how to be like a cool hip modern regulator, um, which said was like, just be nice. Um, so we we did A B testing on letters to our companies, and letter A was just kind of a nice, like, hey, you need to comply with the act, you need to like, here's the business case, here's the thing. It was a very soft letter, uh, which is the new modern uh process. Letter B was the regulatory hammer. It was from our lawyer saying, you have to do this or else. And guess which got the biggest response? I was very disappointed to say that it was the regulatory hammer because I really like to be a nice person and leader. So I think number one to managers is risk. Like this is really a risk. We could knock on your door, we could ask to see your information. Um, and it's better if you proactively do it from our perspective, but also we could respond to a complaint. If you have an employee that has made a complaint to our office, um the process could be twice as long for you. So it's it's better if you just proactively do it and find the risk.

Amy Davies 9:34

Katie, I have a question. I'm sorry, I want to interrupt because I do have a question about uh employees making a complaint. How easy or difficult is it for employees to make a complaint to your office?

SPEAKER_02 9:45

It's very easy. Um, you know, our office operates, I would say, like we are a thou shalt. We are proactive and reactive. So that means proactive in that we go out and monitor that's the thou shalt, but we are reactive in that we allow or have employees or bargaining agents file complaints. They can do that through our website. There's an intake form, and part of the intake form actually helps us determine whether or not we have jurisdiction because sometimes we get complaints and it's not actually a pay equity complaint. It might be a human rights complaint or it might be um a completely different issue, an employment standard act issue that we don't deal with. So it's um pretty straightforward for an employee or a bargaining agent to put in a complaint for us.

Amy Davies 10:25

And you you can say, I can't say this, but I am curious, what is the frequency of complaints that you might see in a year?

SPEAKER_02 10:35

It really varies. It's interesting. It varies what's happening like in the news, it varies what's like what's happening in the economy, it varies with the bargaining cycles of different and the inquiries are not always complaints. So they, you know, um that it's like it's really hard for us to actually, it's a great question because we're constantly monitoring that to try to predict to make sure we have the capacity to respond. Um, but yes, it varies with all kinds of things happening in the labor market.

Amy Davies 11:01

And I want to say that right now, so first 30, as you know, uh we're we work in onboarding, but we also work in career transition and outplacement. And it's from that work, I know this is a very, very difficult time in the job market. And that is probably a time where you have people who may be out of work who have, you know, reflect on their situation or they're worried about their job. And you may be seeing a rise in these types of complaints. So this is a very good time to take a look at what's happening in your company.

SPEAKER_02 11:32

It is a good, good point you're making here, Amy, because we we do see a number of complaints when people, after people are dismissed or after people lose their jobs or they're unemployed, or even they retire, they're like, oh, wait a minute, I don't think I was actually making what I should have made. Um, so that is more challenging, obviously, for the employer to go through those records if the individual no longer works there, depending on how their records management is, which is one thing I will say to your listeners, if you're an HR, you need to keep good records. If I could leave you with one good message, you know, work with a software, work with something or someone who keeps those records in check, because in order to do a pay equity analysis, you have to do a gender-neutral job comparator system. That is essentially the foundation of the pay equity um requirement. And our act does outline two ways to um a couple of ways to actually do it, but we do give freedom or flexibility to the employer to say, this is actually the best job evaluation system for us. We're gonna use our own job evaluation tool as long as they can show us that it's gender neutral and we outline in the act what makes it gender neutral. But at the foundation of that is having the data and the information. And so you need to keep track of your job descriptions of how they change over time. If you had a job that existed five, 10 years ago, but you renamed it something or you changed it when you rehired, like all this needs to be tracked because fundamental to the process is creating job classes, which is actually grouping similar jobs. Um, and in order to do that, you have to have job descriptions and you have to understand how jobs have changed over time in your organization. This is probably the number one challenge we run into, and what creates a lot of delay and problems when we're doing the pay equity analysis is companies have not kept good records of their job descriptions, how they classify jobs, um, and how they uh have changed over time.

Amy Davies 13:35

And is there actually rules around how companies need to keep those records? Or is it one of those things that just it will make your your life easier if you've done it, but there's no obligation for you to do it until you are asked to um represent your business to the pay equity commission?

SPEAKER_02 13:57

Yeah, the the pay equity act does not outline a specific way to document and save the files, nor a specific timeline. Um, you know, like CRA will require a company to keep information, which compensation information is financial data, you know, arguably seven plus years. So that could be a good marker for companies to use. But in theory, the act can go all the way back, uh, depending how long the employer's been around, all the way back to when it was put into force in 1989.

Amy Davies 14:27

So what happens? So say I make a complaint that I haven't been paid equitably and I've been working for the organization for 20 years. Is it reasonable to think that the company would have to go back 20 years and make up the difference to me?

SPEAKER_02 14:43

So that's what the act does say. We have to go back to when either the company came into um existence or when they passed 10 employees. Often we will use like our review officers have a lot of discretion. They have a lot of authority under the act when they're doing the job evaluation or sorry, when they're doing the um investigation. So they will kind of look at a reasonable measure because often the reality is like we don't, uh it is a big challenge. Companies, we moved from completely analog to completely digital, and a lot of these documents, you know, are no longer in existence. So this is something that the review services officer has um a level of determination to say like what's actually reasonable because we're gonna spend and lose a significant amount of time. That's also not reasonable in terms of finding a solution or closing the file because the data's we can't go back 20 years. So there's some discretion in the way that that's actually applied uh when we do investigations.

Amy Davies 15:42

So if I'm an HR professional listening today, I want to be proactive and I proactively find that Amy has not been paid uh equitably for the last five years. Is my action to bring Amy up to the uh to the pay band that is appropriate? Or is or is it that to pay Amy what she should have been paid or or to eat to make it uh equal for the last five years that she's worked with?

SPEAKER_02 16:15

So generally what we do is like we will start and then we will move kind of backwards to figure out where did the pay gap actually arrive, so arise. So we're not going to assume that Amy's been paid inequitably for 20 years, the whole time she's been there. We're gonna assume that at some point a gap arose that's related to gender-based discrimination. So we would kind of start moving backwards. Like where did the where did the gap start? One year, two years, five years, we would go until we found where the gap, oh, the gap emerged in this year at this moment in time. That's when it has to, it has to be corrected back. So there is back payment expectation and then moving up to the pay band where the value is determined to be.

Amy Davies 16:55

And do you find a lot of situations where organizations move a male counterpart down? It's illegal. You can't do that. Yeah, it's important for us to know that.

SPEAKER_02 17:04

It's important for you to know. You cannot say you achieved pay equity by reducing the pay of a male job. So what's interesting about the pay gap, too, and I'll say about our act, is we look at the job class of the act, not the gender of the person doing the job. So, and that's based on the fact that, you know, in the 80s, uh, 70s and 80s, when this act was written, and even still largely today, the labor market is fairly sex segregated. We still have, you know, jobs that are primarily male dominated and jobs that are primarily female dominated. What the act does is set says, okay, anybody working in a female job class, that, and that could be any gender, we have had pay equity complaints from men in female job classes. If the job is gendered female, um, that's what we're looking at, not the gender of the person, just the historical and stereotype of the job. So you can't take a male job class and say, we're gonna pay this job class less in order to not have to pay this female job class more. And so what you do is you sort of like you look at the jobs, you you you classify them, and then you we have a process of sort of like assigning a gender to them based on the his the history of who's actually occupied the job, the stereotype of the job, and um the incumbency. So who's actually in the job now? But that's an important point to note is that we are not regulating or correcting for like women in in jobs, we're correcting for job classes that have been undervalued because they're historically, you know, categorizes women's work, and we've historically undervalued women's work. And you can't achieve that by bringing down male job class pay.

Amy Davies 18:40

Okay, that's a that is a really good point. It's a great question. Yeah, yeah. Outplacement and career transition support make a real difference for employees experiencing terminations or layoffs. Offering these services also reduces legal and reputational risk for employers. All of First30's outplacement programs include access to a live coach along with one year of access to our career transition portal, job search resources, and much more. Programs start at $985 per participant. You can find information about our programs and pricing at first30ready.com forward slash outplacement. Or reach out to us anytime at info at first30ready.com. I think you've made clear what you would do if you're going in and looking at what a company has been paying and trying to make things right. Um, but if I'm, if it's the HR person who's trying to make things right, you're not involved. Let's imagine you're, you know, you're not involved in this one. Do I still have to take all of my female employees who are working in, you know, roles that have been labeled as sort of male roles over the course of history and up their pay for the years where there has been the discrepancy? Or should I tell my leaders that we will just have to start paying the women in these roles at a different rate today? Because I think that's a different conversation with your leadership, right?

SPEAKER_02 20:15

Yeah, to be compliant with the Pay Equity Act, you so the conversation with the leaders is you have to do a gender-neutral job evaluation of some kind. We have tools. And I think once you see what that looks like for you, like the value, proportional value, that's the conversation you're gonna have to have with leadership to say, here's the gap, but you do have to show when it emerged and correct it to be 100% compliant with the act is actually correct, like discovering when it emerged and correcting it. But I do want to give some good news because I know this can be very terrifying. The prospect, right? Um when we go in and we do like random monitoring campaigns, we find depending on the sector, it's something like 76 to 83 percent. They have not like the we're monitoring companies that haven't done it yet. They didn't have a pay equity plan to begin with, but after they went through the process, like 76 to 83% of them are actually compliant. Like they did not, we didn't find pay gaps. And I think that that's an important message for managers to hear is that you're more likely to have already achieved it if you have like a sound compensation system uh that's you know competitive with the market, you're you're more likely than not to actually be in compliance. So to try to take away the fear of like this could cost us millions, like maybe not. Like most of you are already actually providing um equitable pay. But if you do find it, you do have to go back to like keep analyzing until you find where did the inequity emerge and correct it.

Amy Davies 21:51

And do you find that working with your team or doing this becomes someone's full time job for a certain amount of time? Because it sounds like a lot of work. Work to go through and go back.

SPEAKER_02 22:02

It is. The job evaluation, depending on the size of the company, the job evaluation process, as you know, you're an HR, job evaluation processes in general, uh, and coming up with compensation strategies and compensation bans is a lot of work in general. And then having to go through it with this lens, we totally appreciate the challenges. That's why we've created, we have a DIY toolkit. Um, we have like a PDF fillable form. It's good, I would say, for companies up to like 50, so like small. We're launching very soon a new one that's like fully digital, which which is like any size company can use it. And um, so it's sort of a fillable web form that you go and it takes you through the process. So we try to make that as easy as possible by giving the resources and tools and videos. And our review services team will go through um company. You know, they'll they'll show and guide. Um, also, there's you know, consultants out there that will do this work, depending on the capacity and size of the company. But if you're a mid-size and you don't have a robust HDR team, nor do you have the budget for a big legal team, uh, you can find resources on our site.

Amy Davies 23:12

Okay. And now um there's I will say that previously we did a podcast on the our very first was on the changes that HR should be aware of, the employment law changes for 2026. One of them was these changes was that you have to post the um salary range within it. Can't be a hundred to a hundred or two hundred, it has to be within a $50,000 range. Do you think that's going to help um companies remain compliant?

SPEAKER_02 23:45

I think it's gonna, that's a really good question. We know we've done all kinds of research around the world, like where are pay gaps closing and what kind of policies and legislation do they have in place? Um, and we do know that where countries or like provinces or US states, even who have had pay transparency for a number of years, we do know that gender wage gaps are closing faster. So I I do I do believe that it's going to have an impact on the gender wage gap rich writ large closing. So that does like it's also new. It does lead me to think that, like, yes, this is going to help companies when you're more transparent with pay, um, you're gonna all like it kind of leads to equity, right? Or equality. So I do think it's gonna help in terms of how pay is understood and accessed and how, you know, we know that if it's a case where somebody didn't negotiate as strong for themselves or they're not represented by a union, like the pay transparency kind of takes those differentials away, right? And it allows for more equitable compensation writ large. So I do think we're gonna have a positive impact on actually achieving pay equity in the workplace because of it.

Amy Davies 24:58

Well, with people like you at the helm, I'm sure. If if there's nothing else, Katie, you are a person of action. And I we're very fortunate to have you. Now, we have two takeaways, like we have three takeaways, I would say. One is bookkeeping, keep your books, keep your records. The second is be proactive. And I think those two go hand in hand. The third is make sure you review the resources that we Katie has team has shared with us. Is there anything else before we get on to our fun spill the tea segment that you want our audience to know or you think they should know?

SPEAKER_02 25:37

I think they should know that, you know, we respond to risk, right? We don't want to be in a situation where we're faced with something that we're not prepared for. So I want to echo your point on being proactive, keeping the data, organizing it, and and don't be afraid to look behind the curtain. It's probably better than you think.

Amy Davies 25:54

Oh, that's good. That's good news. All right, so now we get on to our fun segment of the show Spill the Tea, where we talk about a surprising story, a shocking story, a funny story. Maybe it's a serious story, but you know, on the coffee and law, we we love coffee, so we're not afraid to spill the tea. So, Katie, do you have a spill the tea story that you can share with us?

SPEAKER_02 26:17

I do. Um, and it it does involve the law because it involved a potential lawsuit. But my first job 25 years ago, and I think it also says a little bit about how workplaces have progressed. So 25 years ago, I was my first kind of real corporate professional job, and I was being introduced to the company's board of directors, which is a big deal for a young woman out of university. This is like, oh my God, I'm going into the boardroom. This is like sacred ground. And my boss introduces me like this. I'm gonna have this one's knee zone shut so I don't have to pay her maternity leave.

Amy Davies 26:53

Oh my goodness.

SPEAKER_02 26:54

And obviously, I was well, first of all, I was a Matt Lee replacement. Um so yeah. And obviously I was shocked. I was devastated, wondering if, you know, everyone around the table was like like picturing me lying with my legs open or my knees shut. Like it was obviously very nauseating. It was sort of a definitive moment in my career because I clapped back very strong and shut him down because I realized I can't let him talk like that to me in this place. But I think for me, when I think back to that, bit of a Pollyanna view was like this guy was, you know, your typical three-piece suit, older gentleman at the time. He was probably already in his 60s. Like he was a nationally known, respected individual. But he also personified what that generation believed in terms of how they could talk to women at work. And I do think a lot has changed for women in the workplace. I do think a lot has changed about Matle. Um, yes, about the way the laws that protect women, because also like I was a Mat Leave replacement, uh, the way like you can't talk like that to women in the workplace now. Or if you did, there'd be way more repercussions. So yeah, I ended up kind of swiping back very strong to him. And we, you know, I worked there maybe three years. Um and he was a great mentor in some ways, but it was constantly a battle of dealing with these underhanded conversations, which nobody around the boardroom table called out, which is also unfortunate. I think we have a culture today now where people may call it out or at least have a conversation on the side.

Amy Davies 28:29

Yeah. And you know, I've been in a situ I've been in situations similar to you where it hasn't been called out. I, if you don't mind. Now you made me think of a story, Katie, if you don't mind my sharing. So I was working in an I won't say which organization, but it was um, I had business partners. It was a very large team. I was in research at the time, so I did mark marketing research and employee research, and I was presenting some findings. It was my last presentation before I went on leave. I actually had a very good relationship with our VP, who was quite a character, and not everyone had a good relationship. So I was very grateful for that. At the end of my presentation, he said, I want to thank Amy very much for all of her hard work and to let all of you know that I'm 99% sure that the baby she's carrying isn't mine. Oh my God. Yes. Uh so 99, thank you. Yes, 99. So I said, I would like to share with everyone that as your research representative, I am 100% sure that he is not the father of my child. Um, but HR was in the room, they were laughing, you know, and it's one of those things where for us, we are the type of people who will clap back, as you said. Yeah. Uh and and I guess there's a certain level of, yeah, I can handle this, but that was such a bad example in both of their parts on how to treat professional women in the workplace. And I can say that years later, something similar happened to me, and some another leader, another woman actually called it out to the entire leadership team, which was incredible and something I very much appreciated. But uh wow, I'm so grateful how the world has changed. We still run into these situations, but um hopefully women like you and I have kind of carved a bit of a path, and you you more so than me in the work you're doing, which um I'm personally very grateful for. And I'm very happy that you were on the show. Katie, thank you so much for joining us, and thank you everyone for listening.