Historically, conversations about employee compensation have been shrouded in secrecy. Society has taught us not to discuss a person’s wage because it is considered impolite. After all, personal finances are just that: personal. However, the significantly large wage gaps persist because of this lack of transparency and conversation among employees.

Pay transparency is about equity in the workplace and the prevention of employees being underpaid more than their colleagues. This disparity is especially prevalent within marginalized groups like women of colour, disabled people, Indigenous people, etc.

Back in 1927, the Famous Five Suffragettes fought for “equal pay for equal work” because women made a third of a man’s salary. We’ve come a long way as a country since then. In 2023, Statistics Canada recorded that Canadian women are making 87 cents to a man’s dollar across the board.

Bringing in a Canadian HR Consulting firm, like Pivot HR, to audit your business’s wage disparity can be an invaluable resource, especially for large companies. Read on to learn about pay transparency and how it affects employers.

What is pay transparency?

Simply put, pay transparency is about ensuring equality in the workplace. In 2022, Statistics Canada reported that women are being underpaid by 17% compared to men across many workforces. This number jump-started the movement for workers to make equal wages. Pay disparity is especially egregious for women in disadvantaged and marginalized communities.

Pay transparency is a new wave of legislation being slowly implemented across Canada to close the gender pay gap. With the rise of inflation, increased cost of living and housing prices skyrocketing, workers are also getting fed up that their wages are staying the same.

The Pay Transparency Act passed in May 2023, and all employers in BC must follow these rules, except those covered by the federal Employment Equity Act. According to the British Colombia government, pay transparency is “if an employment opportunity is publicly advertised, then pay information must be included with the publicly available information.”

How does this affect employers?

As Gen Z enters the professional world on the heels of the Millenials, Gen Z has learned to be selective over which businesses they even choose to interview at. When scanning through Indeed or other job sites, the majority of people are more likely to interact with an ad disclosing the salary range.

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Bad employers use fear-mongering to intimidate employees out of disclosing their wages to fellow employees. In Canada, this is illegal. No Canadian law has been made to prevent employees from disclosing their wages.

Pay Transparency legislation has already been implemented in four provinces: Newfoundland and Labrador, Prince Edward Island, Ontario, and as of May 11, 2023, British Columbia. This legislation is yet to be implemented nationwide, but it is a promising start.

Conclusion

For existing Canadian companies with a large number of employees, doing the detective work to find out where the wage discrepancies lay can be an exhausting task. HR consulting firms exist for situations like this! Outsourcing an internal audit to a Canadian consulting firm like Pivot HR is a wise choice and worth the time and money spent.

Contact us today to learn more about the internal investigations Pivot HR provides!