The British Columbia government has released long-awaited details on pay transparency reporting. This article supplements our initial post describing the Pay Transparency Act (the “Act”). Further, employers are reminded that the obligation to post expected salaries and wages for publicly advertised job postings comes into effect on November 1, 2023.
Salary posting requirement comes into effect
Starting November 1, 2023, employers will be required to disclose the expected salary or wage, or a range, on publicly advertised job postings. Since our initial blog, the British Columbia government has released additional guidance on the salary disclosure requirement.
The expected salary/wage disclosed on a job posting does not need to include bonus, overtime, tips, or benefits. If using a range, the range cannot have an unspecified upper or lower limit. For example, the posting cannot say “$20 per hour and up” or “up to $30 per hour.”
The salary disclosure requirement applies to jobs posted on third party websites (e.g., LinkedIn, Indeed or Monster). The guidance also suggests that the disclosure requirement applies to jobs advertised in other jurisdictions if the position is open to British Columbia residents and may ever be filled by someone living in British Columbia, either in-person or remotely.
This requirement does not apply to jobs that are not publicly posted (e.g., internal postings) or general “help wanted” advertisements.
Reporting on Pay Transparency
The government has released the Pay Transparency Regulation (the “Regulation”) to supplement the Act’s pay transparency reporting requirements.
A “reporting employer” will be required to make reasonable efforts to collect information on each of its employee’s “gender category” and must inform employees that their disclosure of this information is voluntary. The gender categories listed in the Regulation include Man, Woman, Non-binary, and “Unknown”, for those who do not identify as being in the previous categories or for whom the reporting employer does not have that information.
A pay transparency report must, at the option of the reporting employer, cover either the most recently completed financial year or the calendar year immediately preceding the year in which the report is prepared. This is important to note for private sector employers, as reporting deadlines will be in November of every calendar year, and it may be prudent for certain employers to start collecting applicable data.
As discussed in our prior blog, the Act sets out a phased approach to the reporting requirements. Government and crown corporations will be required to prepare their first pay transparency report by November 1, 2023. Employers with 1,000 or more employees as of January 1, 2024 will be required to prepare their first report by November 1, 2024, employers with 300 or more employees as of January 1, 2025 will be required to prepare their first report by November 1, 2025, and employers with 50 or more employees as of January 1, 2026 and subsequent years will be required to prepare annual reports by November 1 of the applicable year.
The Regulation specifies what will be included in the pay transparency reports. Among other requirements, the reports will disclose:
- the number of employees as of January 1 of the report year;
- the dates on which the reporting period began and ended;
- the reporting employer’s North American Industry Classification System code;
- the percentage of employees in each gender category who received overtime pay during the reporting period;
- the percentage of employees in each gender category who received bonus pay during the reporting period. “Bonus pay” is defined by the Regulation as including securities and commissions, in addition to holiday bonus pay, year-end bonus, and money relating to profit-sharing;
- the differences between the mean and median hourly rates of pay of employees in the reference category and that of employees in each of the other gender categories;
- the differences between the mean and median amounts of overtime pay and number of overtime hours of employees in the reference category and that of employees in each of the other gender categories; and
- the differences between the mean and median amounts of bonus pay of employees in the reference category and that of employees in each of the other gender categories.
The Regulation prescribes specific methods for calculating the above-listed data points. The “reference category” for calculating the differences in data points will be the “Man” gender category, if there are 10 or more employees in that category. The reference category will be “Unknown” if there are fewer than 10 employees in the “Man” category and 10 or more in the “Unknown” category. The reference category will be the “Non-binary” category if there are 10 or more employees in that category and fewer than 10 in both the Man and Unknown categories. Typically, for most large employers, the “Man” category will be the reference category, and the data will demonstrate the differences in pay, overtime, and bonus between men and other gender categories.
Certain data points cannot be reported for a gender category with fewer than 10 employees, nor for where there is only one category with 10 or more employees.
Additionally, the Regulation requires reporting employers to report on their workforce in quartiles. The report must rank employees from lowest to highest hourly rate of pay and divide them into four equal segments. For each segment, the reporting employer must specify the percentage of employees who are in each of the gender categories (unless a given gender category in that segment has fewer than 10 employees). This will demonstrate the share each gender category has in each quartile of earnings.
Much needed clarification
The Regulation provides much needed clarification on the pay transparency reporting requirements. Given impending reporting requirements for certain employers commencing November 2024, such employers would be well advised to start collecting required data for their reports now.
We will blog further updates on the Act and the Regulation as they arise. We invite you to follow our Knowledge Hub to stay up-to-date with key changes in employment and labour law.
Gary Clarke is a partner and Co-Head of the Employment & Labour Group nationally and Head of the Employment & Labour Group in Western Canada. Gary’s practice focuses on employment, labour relations, human rights and privacy law. He assists employers in both union and non-union environments with various human resources and labour relations issues including: drafting employment agreements, compensation schemes, workplace policies, restrictive covenants and non-disclosure agreements, recruiting, retention and termination practices and procedures, discipline and grievances, human rights issues and investigations, disability management, employment standards compliance, occupational health and safety issues, privacy issues and complaints, labour relations issues and advice and litigation arising from terminations and departing employees. He regularly advises on drug and alcohol testing policies and practices, including in the emerging area of law surrounding the legalization and use of cannabis. Gary also has extensive experience advising employers in the context of corporate transactions, restructurings and insolvencies.
Gary works creatively with employers in Alberta, British Columbia and in the Federal jurisdiction to develop strategies to avoid problems in the workplace, aiming to minimize the risks of litigation or disruption to the employer’s business. Mediation and other alternative dispute resolution approaches are often used to achieve these aims. In situations where litigation is necessary or cannot be avoided, he has experience before the various administrative tribunals and courts.
David Price is an associate in the Employment and Labour Group. His practice focuses on employment, labour relations, human rights and privacy law. He represents union and non-union employers on issues relating to labour and employment standards compliance, employment agreements, workplace policies, discipline and grievances, termination practices and procedures, restrictive covenants, human rights matters, collective bargaining, and litigation arising from employee terminations. He regularly advises on drug and alcohol testing policies and practices, as well as the rapidly evolving area of law surrounding COVID-19 pandemic testing and vaccination policies. David also provides advice to clients on employment and labour matters in the context of corporate transactions.
He has appeared before the Provincial Court of Alberta, the Court of King's Bench of Alberta, the Alberta Labour Relations Board, the Supreme Court of British Columbia, the British Columbia Labour Relations Board, and the Social Security Tribunal of Canada. He has also appeared before private labour arbitrators and an international arbitral tribunal under the rules of the International Chamber of Commerce.
Cameron Penn is an associate in the Advocacy Group. His practice focuses on labour and employment law, and commercial litigation.
Cameron is an active volunteer, providing pro bono services to self-represented litigants at the Alberta Court of Justice and Court of King’s Bench. He also serves as a Director for a major political party in Alberta.
Prior to law school, Cameron held various positions in labour relations in both the private sector and federal government.