The Quebec Pay Equity Act: A Barrier To Accessing Pay Equity?

On May 10, the Supreme Court of Canada (the "SCC") upheld the decisions of the Quebec Court of Appeal and the Quebec Superior Court declaring ss. 76.3, 76.5 and s. 103.1 para. 2 of the Pay Equity Act (the "Act") invalid on the ground that these provisions are discriminatory and thus contrary to s. 15(1) of the Canadian Charter of Rights and Freedoms (the "Charter").1 According to the SCC, rather than ending systemic wage discrimination the impugned provisions "place barriers along the path to equal pay for women".

How did the SCC arrive at this conclusion and what will be the impact of this decision on employers with a business in Quebec?

Background

In 1996, the Quebec government adopted the Pay Equity Act to address systemic wage discrimination against women. The Act imposed ongoing obligations on employers to measure and correct pay inequities in predominantly female jobs.

More specifically, under ss. 40 to 43 of the Act, now repealed, employers had a continuous obligation to maintain pay equity and adjust compensation accordingly.

In 2009, faced with the widespread non-compliance of employers with the Act, the Quebec government amended employer obligations under the Act. Among these amendments, the government (i) abolished the continuous obligation to maintain pay equity, (ii) required pay equity audits every five years, and (iii) prevented retroactive remedies for the period between audits.

Following these changes, a group of unions challenged the new ss. 76.3, 76.5 and s. 103.1 para. 2 of the Act.

Under s. 76.3 of the Act, the employer audit posting is not required to include the date on which any pay inequity emerged.

Under s. 76.5 of the Act, adjustments in compensation apply from the date the audit results are posted. Incidentally, the Commission des normes, de l'équité, de la santé et de la sécurité du travail cannot assess compensation adjustments prior to the posting date (s. 103.1 para. 2). Redress can be applied prior to the posting only where there is evidence that the employer acted in bad faith or in a discriminatory or arbitrary manner.

In 2014, the Quebec Superior Court concluded that ss. 76.5 and 76.3 of the Act were discriminatory and violated s. 15(1) of the Charter. The declaration of invalidity was suspended for a one-year period.

In 2016, the Quebec Court of Appeal upheld the Superior Court's decision invalidating ss. 76.3 and 76.5 of the Act. Further, the Court of Appeal found that s. 103.1 para. 2 also violated s...