British Columbia’s Ministry of Finance released its tool for employers to submit their pay transparency reports. Employers with 1,000 or more B.C. employees will need to submit reports by Nov. 1, 2024 as required by the Pay Transparency Act, which took effect May 11, 2023.

Applicable employers have had to comply with a salary history ban since the legislation passed, and provide salary ranges on job postings since Nov. 1, 2023. Organizations with 500 or more B.C. employees will have to submit pay transparency reports by Nov. 1, 2025. Beginning in 2026, those with 50 or more B.C. employees will have to report.

B.C.’s law goes beyond many of the recent state requirements in the U.S. by requiring annual reporting. Is your organization prepared to comply with the reporting requirements?

B.C. Pay Transparency Law Specifics

The impetus for B.C.’s pay transparency law was to address its 17% gender pay gap. Employers must annually report on differences between hourly wages, overtime, and bonus payments between men, women, and non-binary people.

Understand Your Reporting Requirements With Our Global Pay Data Reporting Calculator

Reporting is phased, based on employer size:

• From Nov. 1, 2023: B.C. government and the six largest Crown corporations: B.C. Hydro, B.C. Housing, B.C. Lottery Corp, B.C. Transit, ICBC, and Work Safe B.C. were required to report. A pay transparency report published by B.C. Public Service found that men earn 8.3% (median) more than women in government jobs.
• Nov. 1, 2024: employers with 1,000 or more employees.
• Nov. 1, 2025: 300 employees or more.
• Nov. 1, 2026: 50 employees or more.
• Nov. 1, 2027: 49 or fewer employees and any “prescribed number.”

A review on the Act’s effectiveness will take place after five years.

Employer Action Items

Employers with 1,000 or more employees must be prepared to submit the following pay data information in their reports:

• The number of employees as of Jan. 1, 2024.
• The gender category that is being compared with (for example, a comparison of men versus women or non-binary employees).
• The results of the pay gap calculations with the following details:
  • Salary (ordinary pay), excluding any bonus pay and overtime pay, received in the reporting period.
  • Number of hours worked that can be attributed to the salary.
  • Bonus pay received in the reporting period (either the organization’s financial year, or the previous calendar year).
  • Overtime pay received in the reporting period.
  • Number of overtime hours worked that can be attributed to the overtime pay.
  • The government has published a mock report, as well as links to each of the 2023 reporting employers.

The pay data reporting detail required falls well short of what is required under the EU Pay Transparency Directive. B.C. employers are not required to provide a remediation plan at the moment.

However, employees have the right to request information from employers on their individual pay level and average pay levels broken down by gender for categories of employees doing the same work or work of equal value. Organizations must make information on the objective and gender-neutral criteria used to define pay and career progression easily accessible.

The B.C. government has indicated that it may require reporting on intersecting identities, such as Indigenous women and racialized women. However, this requirement is not yet part of the Act or regulations.

The Pay Transparency Landscape

Pay transparency laws continue to be prevalent in the U.S., Canada and Europe. Vermont, Maryland, and Minnesota are the latest states to pass pay transparency laws. Hawaii’s pay transparency law took effect Jan. 1, and Illinois’ law takes effect Jan. 1, 2025.

Massachusetts is poised to become the next state to pass a pay transparency law, and Maine, Michigan, and New Jersey have pending bills. Washington D.C. ‘s law will go into effect on June 30. California, Colorado, Connecticut, Hawaii, Nevada, New York, Rhode Island, and Washington all have pay transparency legislation in effect.

In Canada, Ontario remains poised to pass a pay transparency law.

Additionally, pay transparency measures have also been proposed for federal employers by the Biden Administration.

This puts the onus on employers to prepare for a new landscape where pay transparency is both a requirement and an expectation.

Pay Equity at the Center

Pay transparency legislation remains prominent, and it’s feasible that nearly 50% of employees in the U.S. will be covered under pay transparency laws by 2026.

Employers that aren’t moving toward more transparency with their compensation are at risk of being at a competitive disadvantage. Pay transparency is an expectation for Millennial and Gen Z job candidates, with research indicating this group will avoid applying for jobs that don’t include a salary range on the job posting.

Additionally, absent a pay transparency strategy, you limit your available talent pool. With most organizations deploying some version of a dispersed workforce model, you are required to comply with salary range requirements in other states for jobs that can be performed remotely.

The goal of pay transparency laws is to promote practices that lead to a more equitable compensation environment. Similar to salary history ban laws, requiring pay ranges on job postings promotes fair pay practices and holds organizations accountable.

If implemented thoughtfully and strategically by an organization, pay transparency can promote a better work environment where employees believe they are paid fairly. Providing salary ranges on job postings can also positively narrow the applicant pool and improve the hiring experience.

Similarly, pay data reporting laws are designed to hold organizations accountable for their gender and racial pay inequities. However, if you are a multinational employer, navigating the intricacies of global pay data reporting can be daunting. There are diverse deadlines, thresholds, and regulations to manage, and more jurisdictions coming into play like B.C.