The Road Less Travelled: Pay Transparency in BC

Employers across BC are walking down a new path this Fall with the implementation of the Pay Transparency Act. If you haven’t heard, on May 11, 2023, the BC government passed the Pay Transparency Act which in a nutshell means the employers are required to start, or stop, doing the following:

1. Effective on May 11, 2023, employers can no longer ask job applicants what they have been paid in previous positions.
2. Effective on May 11, 2023, employers can not dismiss, suspend, demote, discipline, or harass an employee who asks their employer about their pay or about the employer’s pay transparency report, reveals their pay to another employee or a job applicant, or gives information to the Director of Pay Transparency about their employer.
3. Beginning November 1, 2023, employers must include the expected pay or pay range on any postings about a specific job vacancy.
4. In phases between November 1, 2023 and November 1, 2026, depending on company employee numbers, employers will have to post a Pay Transparency Report. Reporting specifics are still being designed.

More information about these specific requirements can be found on the  Pay Transparency Laws in BC site.

There is no doubt that these legal requirements are going to have far reaching implications on organizations of all sizes. If you have a culture where discussing pay is a taboo topic, this has the potential to bring up new and different conversations that you may not be prepared for. Job applicants are going to come with a new set of expectations around salary negotiations not to mention the retention challenges that will arise if you are not transparent with pay internally but post pay externally.

We suggest that you take a proactive approach to implementing pay transparency measures in your organization with these high-level steps. You will see a number of blogs from us over the next few months that address each of these in detail!

To ensure that pay transparency has a positive impact on your organization we suggest the following:

1. Develop a clear and transparent pay structure: Create a pay structure that is fair and transparent, and clearly outlines how pay is determined based on factors such as job responsibilities, qualifications, and experience. This can help to ensure that employees are paid fairly for their work and reduce the risk of pay disparities based on gender, race, or other protected characteristics.

• Establish clear guidelines for performance evaluations: Develop clear guidelines and criteria for performance evaluations to ensure that they are fair and consistent across the organization. Performance evaluations should be based on objective criteria such as job responsibilities and measurable outcomes, rather than subjective factors such as personal relationships or differences in manager style.

• Conduct regular pay audits: To identify any disparities in pay based on gender, race, or other protected characteristics, conduct regular pay audits. Pay audits can help to ensure that employees are being paid fairly for their work and identify areas where improvements can be made to promote pay equity.

• Provide clear information about pay and benefits: Employees trust that they are paid fairly when they understand how pay is determined. The employer can build this understanding by ensuring that pay information is readily available, easily understood, and consistently applied across the organization. Providing clear information about employee pay and benefits, including salary ranges, benefits packages, and opportunities for bonuses or incentives goes a long way to building trust.

• Foster a culture of open communication: Encourage open communication between employees and management regarding pay-related issues. This can include creating channels for employees to provide feedback on their pay and opportunities for employees to negotiate their salaries.

• Train managers and HR staff: Provide training for managers and HR personnel on how to promote pay transparency and ensure that pay-related decisions are fair and consistent across the organization. Having a consistent approach being applied equitably across the organization will also increase the trust factor.

Your Engaged Assignment: Does the idea of discussing salary openly in your organization send fear through your management team? Then let’s talk. We can support you with implementation of these steps and more as you build pay transparency best practices into your organizational culture!