Ontario’s new pay-gap law clearly needs more work
When our children were young, I remember a lawyer friend of mine lamenting the 5 o’clock stink-eye her co-workers shot her way as she exited the office and headed home to, you know, live a life.
A flexible or even humane work existence was seen not in keeping with aspirations to make partner. The parenting penalty, paid more commonly by women, was especially borne out in compensation and work choices that better accommodated the demands of child rearing. You could swap the finance sector for law and get the same result: Men and women entering same- pay careers based on the achievement of high levels of education experience very different long-term financial outcomes. A quarter-century has passed and here we are, stuck with a wage gap that remains yawning and intractable. Serial celebrity revelations have helped keep the issue in the headlines.
Claire Foy, the British actress who elevated her performance as the young Queen Elizabeth in The Crown head and royal shoulders above her co-star Matt Smith, is reportedly in line for £200,000 in back pay to bring her compensation in line with the more narrowly talented, furrow-browed Smith. This comes more than two years after Jennifer Lawrence addressed the Sony hack revelations that disclosed the gaping disparity between her points payout on American Hustle and that of her male costars. “I failed as a negotiator because I gave up early,” Lawrence wrote. “If I’m honest with myself, I would be lying if I didn’t say there was an element of wanting to be liked that influenced my decision to close the deal without a real fight.” Women lawyers reflecting on last year’s bonus may nod in recognition here.
The parent penalty and the systemic if-you-don’t-ask-you-don’t-get ethos are just two elements in a game that’s rigged against women, a bald fact that has spurred governments to audit the pay gap. Compelled disclosure, most recently in the U.K., has resulted in an easy-access, searchable online database of more than 10,000 U.K. companies and counting.
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Any employer with more than 250 employees is required to report on the difference between the mean and median hourly rates of pay for male and female full-time employees as well as differentials in bonus pay.
The proportion of male and female employees who receive bonus pay is also documented.
As I have argued in previous columns, the U.K. initiative is commendable for bringing transparency to the issue. Companies must report annually, so next year women at, say, Telegraph Media Group will be able to see whether their employer has made any progress in fixing an out-of-whack compensation structure that pays them a median wage that’s 23.4 per cent less than their male counterparts.
Ontario took its first steps to achieve something similar when it tabled its Pay Transparency Act in March, a move I described as “inexplicably late in its tabling, vague in its constitution and painfully slow in its proposed enactment.”
That bill has now been enacted, with a couple of important amendments that are worth mentioning here and cause me to look somewhat more kindly upon the government of the day.
It’s still awfully late to be getting on board with this — Premier Kathleen Wynne’s mandate letter to Labour Minister Kevin Flynn, which included that he establish a closing-the-wage-gap strategy, dates back to September 2014.
And a stated enforcement date of Jan. 1 next year is cause for obvious concern with an election looming.
But the Liberals made an important move by erasing wishy-washy language that gave the Ministry of Labour the option to publish the reports or not.
The new language requires the government to make the reports public believing — correctly, I think — that such open reporting will help spur a cultural shift. If the government is wise, it will follow the U.K.’s comprehensive, easy access template.
The bill’s initial language targeted first the Ontario Public Service — well that’s a no- brainer — followed by companies with more than 500 employees. Those employers would have to file by the end of 2019. But small- and mediumsized enterprises with fewer than 500 employees account for roughly 90 per cent of the private sector workforce in Canada, leaving the act to cast a too-small and not all that useful net. The government’s intent was to broaden the category of compulsory filers to 250 “we think around 2020, ’21,” Flynn told me in an interview in March.
The government has taken the 500-employee target off the table, starting instead with 250 or more and, later, 100 or more. On the surface, this too is good news. But there’s a bit of fancy footwork involved. Instead of that initial 2019 deadline, the new wording pushes back submission of the first transparency reports to May 15, 2020. So the target numbers are right, but the timeline is sluggish. Employers with 100 or more employees won’t be required to file until the spring of 2021.
The fine print had better come quick. For example, companies must be compelled to include partner compensation in their overall stats.
Back in the U.K., the first deadline had barely passed before Prime Minister Theresa May directed cabinet ministers to come up with sectoral action plans to reduce the gap. So the audit is just step one. Ministers have been given six months to report back. Now that’s a government that has addressed the gap with the seriousness and urgency it deserves.
The target numbers are right, but the timeline is sluggish