In Quebec, employers with 10 or more employees must do a pay equity exercise. This means that they must investigate whether employees in jobs traditionally or mostly done by women are paid less than employees in comparable jobs traditionally or mostly done by men. If this is the case, the employer must adjust salaries.
Pay equity exercises must be rigorous and documented. Employers must post the results for their employees to see and share them with the Commission des normes, de l’équité, de la santé et de la sécurité du travail (CNESST or labour standards, pay equity and workplace health and safety board).
Employers who don’t do a pay equity exercise, or don’t do it properly, can be fined between $1,000 and $45,000 for a first offence.
Important! This article only covers Quebec law.
Some employers must follow the federal government’s Pay Equity Program even though they are located in Quebec. This includes banks, telecommunications companies, rail companies, marine shipping companies and airlines.
1. Find out if pay equity rules apply to your company
Pay equity rules apply to companies with an average of 10 or more employees during a given year. Some employees don’t count toward this number, for example: interns, students and senior management. To learn more, visit the CNESST’s website (French only).
If you have 10 or more employees, you must:
- Compare the salaries of employees doing comparable jobs. You have at least four years to do this.The comparison must be done before December 31 of the fourth year after the year you reach 10 or more employees.
- Fill out a report on pay equity and submit it to the CNESST. (The report on pay equity is officially called the DEMES, which stands for Déclaration de l’employeur en matière d’équité salariale.) You must do this even if you haven’t finished your initial salary comparison.
You will get a letter from the CNESST reminding you to submit your report if you have declared 11 or more employees in your Annual Updating Declaration with the Registre des entreprises du Québec (REQ or Quebec enterprise register). In general, the CNESST sends this letter in the same envelop as the invitation letter for your annual update.
2. Do the initial pay equity exercise
The first step is to find out if there is a wage gap between employees doing comparable work. You must document this process and follow specific legal rules.
Important! The rules are different depending on how many employees you have. To know which rules apply to you, see the CNESST’s website (French only).
You must keep your documents for at least 6 years.
The CNESST can conduct a review of your pay equity exercise, especially if one of your employees makes a complaint.
Analyze job categories and salaries
To analyze job categories and salaries, follow these steps:
- Identify the different job categories in your company and determine whether each category is traditionally or mostly done by women, or by men.
- Compare the categories using a scoring system that gives points for the different aspects of each job. Jobs get points for employee qualifications, responsibilities, required effort and working conditions.
- See if there is a wage gap between job categories traditionally or mostly done by women and jobs traditionally or mostly done by men, if those categories have a similar number of points.
You can download a free tool from the CNESST’s website to help you with this. It is called the Progiciel pour réaliser l’équité salariale et en évaluer le maintien (software for creating and evaluating pay equity, French only).
You have no employees in job categories traditionally or mostly done by men? Contact the CNESST to find out what rules to follow (French only).
You might discover that employees in jobs traditionally or mostly done by women are paid less than employees in comparable jobs that are traditionally or mostly done by men.
If this is the case, you will have to fix the wage gap by raising salaries.
You can’t fix the wag gap by lowering salaries or by making an agreement with an employee or group of employees.
You can pay out salary adjustments over the course of four years, up to five instalments. But you must pay the first instalment by the deadline for completing your first pay equity exercise. This date is December 31 four years after the year you reach an average of 10 or more employees.
To learn about the different ways you can pay out salary adjustments, and the interest rates for late payments, see the CNESST’s website (French only).
3. Posting the results
To complete your pay equity exercise, you must:
- Post the results of the exercise for 60 days in a visible location that is easily accessible to your employees.
- During this time, you must allow your employees to make comments, ask for more information or file a complaint.
- When the 60 days are up, you have 30 more days to make necessary changes.
- Post the updated results, or a notice that says no changes were made, for another 60 days. The notice should list the ways employees can contest the results. The pay equity exercise ends the day you post the final results. That date becomes your company’s pay equity ‘anniversary’. It will be a reference date for future audits.
Important! If you have 50 employees or more, you must also post results once you’ve determined which job categories are comparable to others (which categories have a similar amount of points).
Sample notices are available on the CNESST’s website (French only). If you use the CNESST’s software to do the pay equity exercise, it will automatically generate notices.
4. Submit your annual report on pay equity (DEMES)
Each year, you must submit a report on pay equity (DEMES) to the CNESST.
You usually file this report when you do your annual updating declaration with the Registre des entreprises du Québec (REQ or Quebec enterprise register).
5. Do a pay equity audit every five years
You must re-evaluate pay equity every five years by doing what is called a pay equity audit. This helps you see whether new events have created wage gaps in your company.
You must keep track of event dates and report on them. If you must make salary adjustments, they will be retroactive to the date the event occurred.
The CNESST recommends that employers use an event log (French only) to document changes to the company over the five-year period.
The pay audit must be done on your company’s pay equity ‘anniversary’. The re-evaluation must focus on the jobs and salaries existing on that date.
To do a pay equity audit, you basically follow the same steps as the initial pay equity exercise.
You must keep the information used for the audit for a 6-year period after posting the results.
To learn more about the pay equity audit, visit the CNESST’s website (French only).
Who can make a complaint?
An employee or an employee representative, like a union, can make a complaint. Complaints can be made to the pay equity committee, the employer or the CNESST (French only).
Here are examples of possible complaints:
- The employer didn’t do a pay equity exercise or pay equity audit.
- The employer didn’t do the pay equity exercise or pay equity audit properly. For example, the employer didn’t do them on time, failed to post the results or failed to pay salary adjustments.
- The employer behaved illegally, for example, by punishing employees who commented on the pay equity plan or who made a complaint. It is also against the law for employers to discriminate against employees, make threats or act in bad faith.
Generally, complaints must be submitted using the CNESST complaint form (French only). There are different deadlines for submitting complaints (French only). If the employer never did a pay equity exercise or audit, employees can submit a complaint at any time.
Important! If the employer completed the pay equity exercise or audit with the help of a pay equity committee, employees generally can’t complain that the process didn’t follow legal rules.
- Information phone line (French only)
- Guide: pay equity exercises and pay equity audits (PDF) (French only)
- Employer responsibilities
- Free software to do the calculations (French only)
- Report on pay equity (DEMES)
- Free online training (French only)
- Samples of notices posting results of the pay equity process (French only)
- Company event log (French only)
You can hire a consultant or outside company to do your pay equity plan and audit.
This article explains in a general way the law that applies in Quebec. This article is not a legal opinion or legal advice. To find out the specific rules for your situation, consult a lawyer or notary.