On March 7, 2023, the British Columbia government introduced Bill 13, the Pay Transparency Act (the “Act”), designed to help close the province’s gender pay gap by imposing new disclosure and reporting obligations on certain employers.
New Rules for All Employers
If passed, the Act would require all employers to disclose the expected salary or wage (or expected range) and any other prescribed information for job opportunities that are publicly advertised in any manner.
Further, the Act would prohibit employers from asking job applicants about their pay history or otherwise seeking such information from a third party (e.g., the candidate’s current/previous employer), unless the information is publicly available.
Employers will also be prohibited from dismissing, suspending, demoting, disciplining, harassing or otherwise disadvantaging an employee or threatening to do any of the foregoing because the employee:
- inquired about their pay;
- disclosed their pay information to a colleague or job applicant;
- inquired about the employer’s pay transparency report (discussed below);
- asked the employer to comply with its obligations under the Act; or
- reported the employer’s non-compliance with the Act.
Reporting on Pay Transparency
Additionally, Bill 13 proposes to require certain employers to prepare annual pay transparency reports with prescribed information. Such employers will be required to make reasonable efforts to collect the prescribed information and must inform employees that their disclosure of information is voluntary. Such employers will also be required to publicly post such reports on their website or otherwise make such reports available to their employees.
The government has not yet proposed details on what annual pay transparency reports must contain, but the Act would permit the government to create regulations prescribing information about the reporting employer, the composition of the reporting employer’s workforce, and differences in pay in the employer’s workforce in relation to employees’ self-identified gender and other characteristics. Indeed, in the government’s announcement, the stated goal of Bill 13 is to ensure addressing the pay gap “goes beyond the gender binary, making B.C. the first jurisdiction in Canada to take this approach”.
The Act sets out a phased approach to the reporting requirements, commencing immediately once passed into law with the government and crown corporations, who 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.
Finally, Bill 13 proposes to require the government to publish annual reports beginning in 2024 that contain consolidated information about differences in pay among prescribed groups of individuals, a description of trends in relation to such differences, the number of reports of non-compliance with the Act, and any other prescribed information.
Compliance & Administration
Bill 13 proposes to establish the new office of the “Director of Pay Transparency”. The Director would be responsible for supporting employers with compliance and receiving complaints of non-compliance.
However, employers should note that as currently drafted, and without details of any yet-to-be proposed regulations, the proposed legislation does not provide penalties for non-compliance. Acts or omissions contrary to the Act’s requirements will not be deemed to constitute “offences” under provincial law. We await details on the associated regulations to see whether the proposed legislation will have specific enforcement mechanisms.
Takeaways for Employers
All provisions of the Act are proposed to come into effect after receiving royal assent from the Lieutenant Governor, except for employers’ disclosure obligations respecting publicly advertised job opportunities, which would come into effect November 1, 2023.
If enacted, the Act would increase employer obligations relating to pay disclosure, and introduce new prohibitions designed to protect employees’ ability to discuss or share pay information. In particular, given the prohibition on reprisals or threatened reprisals against inquiries and disclosure of pay information, employers with existing prohibitions on the disclosure of pay information in employment agreements, confidentiality agreements, policies or handbooks may suddenly find themselves offside the prohibition on threatened reprisals and may wish to amend such documents to ensure compliance with the Act.
We will blog further updates on Bill 13 as they arise. We invite you to follow our Knowledge Hub to stay up-to-date with key changes in employment and labour law.