Equity in pay May 2011

Equity in pay by Toronto Training and HR May 2011

Contents 3-4 Introduction to Toronto Training and HR 5-10 Definitions 11-12 Drill A 13-17 Equity theory, intrinsic and extrinsic considerations 18-20 Pay equity law in Quebec 21-23 Steps of a typical pay equity exercise 24-26 Gender pay gap 27-28 What is a job class? 29-32 Male or female job classes 33-36 Is your employer at risk of a pay equity claim? 37-38 Drill B 39-48 Case studies 49-50 Conclusion and questions Page 2

Introduction to Toronto Training and HR Toronto Training and HRis a specialist training and human resources consultancy headed by Timothy Holden 10 years in banking 10 years in training and human resources Freelance practitioner since 2006 The core services provided by Toronto Training and HR are: ,[object Object]

Training course delivery- Reducing costs ,[object Object]

Improving employee engagement & morale

Services for job seekers,[object Object]

Definitions 1 of 5 What is PAY EQUITY?

Definitions 2 of 5 Skill Effort Responsibility Working conditions

Definitions 3 of 5 FACTS Pay Equity does not anticipate or guarantee an increase in pay for all job classes. Male jobs in a Bargaining Unit will not receive an increase as a result of Pay Equity. Pay Equity does not provide for internal equity. When a male comparator is identified, it does not mean that the male job is the “same” as the female job, but rather that the value of the jobs is relatively the same.

Definitions 4 of 5 FACTS Under Pay Equity, the rate of compensation for the female job class must be equal or greater than that of the identified male comparator. Male comparators and compensation practices within one organization may not be the same as those in another organization. Pay Equity does not take into consideration how well an individual performs their duties. It is in no way attached to performance or internal equity. Pay Equity recognizes only the Employer’s expectations and the requirements of the job as described in the job data.

Definitions 5 of 5 FACTS Where a female job class is currently paid higher than the identified male comparator, there will be no adjustment in pay. Pay Equity is not an exact science. The Pay Equity Commission has concluded that Bargaining Unit members of each joint committee, and the Employer representatives, are required only to be reasonable in the collection and evaluation of job content. They do not need to meet an exact standard. The Pay Equity Commission recognizes that a range of outcomes is possible.

Equity theory, intrinsic and extrinsic considerations

INTRINSIC OUTCOMES Enjoyment Challenging work Responsibility Meaningful work A sense of accomplishment A feeling of personal worth Job is useful to society Work-life balance Personal growth Trust Equity theory, intrinsic and extrinsic considerations 1 of 4

EXTRINSIC OUTCOMES Pay Health care benefits Retirement benefits Good work relationships Friendships Skills development Career guidance Mentoring opportunity Equity theory, intrinsic and extrinsic considerations 2 of 4

INTRINSIC INPUTS Commitment Dependability Work ethic Creativity Motivated Ability to mentor Cooperation Values Equity theory, intrinsic and extrinsic considerations 3 of 4

EXTRINSIC INPUTS Education Credentials Training Time Professional connections Seniority Equity theory, intrinsic and extrinsic considerations 4 of 4

Pay equity law in Quebec

Pay equity law in Quebec 1 of 2 Bill 25 Filing requirements and onus of proof Organizations employing 10 to 49 Organizations employing 50 to 99 Organizations employing 100 plus Reference period Definition of an enterprise for purposes of pay equity Counting employees

Pay equity law in Quebec 2 of 2 Pay equity plan Study to establish salary adjustments Deadlines Classes of employees Value of dissimilar jobs Salary adjustment payments Maintenance of pay equity Non-compliance

Steps of a typical pay equity exercise

Steps of a typical pay equity exercise 1 of 2 Determine the number of employees Determine if more than one equity plan is required (applies only if 50+ employees) If a pay equity committee is required, determine its composition (applies only if 100+ employees) Identify the predominantly female and predominantly male job classes Choose the method and tools to evaluate the job classes

Steps of a typical pay equity exercise 2 of 2 1st posting in respect of job classes and evaluation process (applies only if 50+ employees) Evaluate the job classes Determine the value of differences in compensation Define the terms and conditions of payment of compensation adjustments Post the results Pay adjustments in compensation Maintain pay equity

Gender pay gap 1 of 2 MAIN FACTORS INFLUENCING Human capital differences Part-time working Travel patterns Occupational segregation Workplace segregation

Gender pay gap 2 of 2 Is it narrowing in Canada?

What is a job class? ALL the following criteria must be met: The positions must have similar functions or responsibilities; The positions must require similar qualifications; and, The positions must have equal remuneration, or be based on the same salary scale.

Male or female job classes

Male or female job classes 1 of 3 Is the job class traditionally associated to males or females due to occupational stereotypes? For example, even if your receptionist is male, it would still be considered a predominantly female job class. Are 60% of the employees in this job class male or female?

Male or female job classes 2 of 3 Is the representation of men or women in a job class significant compared to the rest of the company? For example, in a company mainly composed of women, the job class “assembler” includes 30 employees of which 55% are male and 45% are female. Since a large proportion of the males in the company are included in this job class, it could be considered as predominantly male even if they aren’t represented at 60%.

Male or female job classes 3 of 3 Was a certain job class historically held by men or women? If, for example, a job class that is currently predominantly male has always been held by females, it could be considered as being predominantly female even if this is not indicative of the current situation.

Is your employer at risk of a pay equity claim?

Is your employer at risk of a pay equity claim? 1 of 3 Is pay equity between genders a consideration in your organization’s HR policy? Does your HR department understand the implications of current and future equal pay legislation? Is equality of pay embedded in the recruitment, retention and engagement policies of your organization, including the monitoring of starting salaries by gender?

Is your employer at risk of a pay equity claim? 2 of 3 Does your executive leadership team understand and support the concept of pay equity? Do your managers understand the concept and implications of equal pay? Does your organization provide guidelines to help managers in performance management discussions and in the allocation of pay rises and bonuses? Does your organization have a job evaluation scheme?

Is your employer at risk of a pay equity claim? 3 of 3 If challenged, could your organization justify gaps in base pay and annual bonus between a male employee and a female employee who have the same duties? Does your organization believe that its job evaluation scheme can manage the issue of equal pay? Does your organization have a process to deal with an equal pay claim?

Equity in pay May 2011

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Equity in pay May 2011