Treasury Board promises retroactive payments with pay equity plans

After delays, the Treasury Board of Canada Secretariat (TBS) is promising employees who may be entitled to an increase in compensation under final pay equity plans will receive that increase, as well as interest on that sum, backdated to the original deadline of Sept. 4, 2024.

“The government is dedicated to supporting the Pay Equity Act (2018) and the Pay Equity Regulations that came into force in 2021,” said the TBS in a press release.

Canada’s federal Pay Equity Act received Royal Assent on Dec. 13, 2018. The purpose of the act is to create a proactive pay equity regime within the federal public and private sectors to ensure that federally regulated workplaces provide equal pay to men and women for work of equal value. 

The act and the supporting Pay Equity Regulations (regulations) came into force on Aug. 31, 2021.

The act’s pay equity regime applies to federally regulated workplaces with 10 or more employees, explained Barry Kuretzky, partner, and Rhonda  Levy, knowledge management counsel, both at Littler, in a previous HRD article.

Extensions granted by Pay Equity Commissioner

However, on May 31 this year, TBS applied to the Pay Equity Commissioner for extensions to its deadline to complete the plans. 

On Aug. 19, the Pay Equity Commissioner granted the Treasury Board of Canada Secretariat (TBS) an extension of 3 years to develop a pay equity plan for CPA employees. Also, on July 5, the commissioner also granted TBS an extension of 18 months to develop a pay equity plan for Royal Canadian Mounted Police (RCMP) members.

The extensions would allow the pay equity committees to complete their important work under, TBS said.

“Creating pay equity plans in such diverse organizations is a complex undertaking requiring deep collaboration between the employer and employee representatives, all of whom must reach consensus on each step of the process,” said TBS.

“As the country’s largest employer and service provider, implementing pay equity for over 270,000 public servants in the CPA, including 21,000 members of the RCMP, is a historic and unique effort to address the pay gap.”

Cause of delays by TBS

In July, the Professional Institute of the Public Service of Canada (PIPSC) noted that even if the need for an extension is unavoidable, it is the sole responsibility borne by the employer.

“It is important to point out that interest will start to accrue beginning Sept. 4th, and members in female job classes where an adjustment is needed will not lose anything by delaying the posting of the final plan,” said the union in a press release.

The group noted that it started to raise the subject of forming the Pay Equiy Committee as early as 2021, “warning the employer that any delays could create a backlog that would be impossible to fill”. 

“The TBS decided instead to go through its request for multiple plans, refusing to start the work before the Commissioner denied the request. It is PIPSC's belief that we would not be in this position had TBS been diligent and started the work three years ago, as the Act is written.”

Earlier this year, Ottawa launched a new pay transparency website in an effort to highlight the barriers to equity experienced by women, Indigenous peoples, persons with disabilities, and members of visible minorities in federally regulated private sector industries.