Ontario Court of Appeal Finds Pay Equity Tribunal Unreasonable

  • June 13, 2021
  • Ed Montigny


2021 ONCA 148 (March 2021)


ON APPEAL FROM JUDGEMENT OF DIVISIONAL COURT                                              

(Justices Morawetz, Gordon and Backhouse)


PARTICPATING NURSING HOMES (PNH) – groups of employers that operate 143 for-profit nursing homes

ONTARIO NURSING ASSOCIATION (ONA) - bargaining power for approximately 2,100 registered nurses and allied health care professionals working at nursing homes


Added:  Attorney General’s Office (AGO) and Equal Pay Coalition.


What is the proper method to maintain pay equity

This case dealt with the Pay Equity Act (Act), which was intended to redress systemic gender discrimination in compensation experienced by those in female job classes.

The Act requires employers who are subject to the Act to establish and maintain compensation practices that provide pay equity in every establishment of the employer

The issue in dispute was the proper method of comparison to be used to maintain pay equity.

Three methods exist to achieve pay equity

  1. Job to job;
  2.  proportional value methods involve comparing the value/compensation relationship of female job classes to the value compensation relationship to male job classes within the employers establishment; and
  3. Proxy Method: In places without any male job classes the proxy method is used. This method involves comparing female job class in the seeking establishment (PHN) to a female job class at a proxy employer establishment (in this case, Municipal Homes for Aged) The proxy female job class is used, since it has already been comparted to a male job class within the proxy employer establishment - so it is the “deemed” male comparator.

Within the Nursing Homes Sector PHN took steps to establish pay equity compliant compensation in 1994 using the proxy method. This process was not finalized until 2005.

Unions now argue that PHN have failed to maintain pay equity compensation practices since 2005. They noted that scope of work increased and pay gaps re-emerged between PHN employees and those at Municipal Homes for the Aged doing comparable work.

While there was agreement that the proxy method was necessary to establish pay equity, the parties dispute whether the proxy method is to be used in ensuring that pay equity is maintained. The ONA argued that Municipal Homes for the Aged have increased pay because they have constant access to male comparators.

ONA argued that since PNH established pay equity via the proxy method they must use same process to maintain levels since otherwise pay disparities would emerge. The ONA also submitted that if the Act does not require use of the proxy method then the Act contravenes s. 15 of Charter.

The Participating Nursing Homes and AGO submitted that the proxy method is only used to establish pay equity – not to maintain it.

The dispute was brought before the Pay Equity Tribunal.