New Federal Pay Equity Legislation to Take Effect August 31, 2021

Written by on August 17, 2021 in Employment Law Blog, Employment Law Issues
Pay Equity Courthouse

By Tejpreet (Tanya) Sambi

On August 31, 2021, federally regulated employers will be required to comply with the new rules under the Pay Equity Act.

The Act requires employers to ensure that male and female employees are provided with equal pay for doing work of equal value.

Under the Act, employers with 10 or more employees will have three years to develop and implement their proactive pay equity plans. The process for establishing a pay equity plan is outlined in the Act. If it is found that employees are underpaid, then the employer will be required to rectify this, within three years (by September 3, 2024). The employer will then be required to revise and update the pay equity plan every five years to ensure the continued equal pay for work of equal value.

Employers with 10 or more employees will need to post a notice informing their employees of the establishment of a pay equity plan.

Employers with 100 or more employees will also be required to establish a pay equity committee.

At this time, the Act will not apply to Indigenous governing bodies as employers, to ensure that the Act is best suited for workplaces operated by Indigenous governing bodies

There is also a Pay Equity Act in Ontario that applies to all provincially regulated employers.


Federally regulated employers who have 10 or more employees should immediately start to prepare for the implementation of the Pay Equity Act. Employers and employees should seek the assistance of an Employment Lawyer to help determine and ensure that the Pay Equity Act is being complied with.

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Please note that this article is for informational purposes only and does not constitute legal advice.

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