The push toward pay equity: Pay transparency laws & compliance

November 20, 2025

Sara Maginn Pacella

In recent years, Canada has moved to create safeguards and pay transparency laws both nationally and locally through provincial legislation to ensure better pay equity practices.
Pay transparency is achieved when an organization openly shares salary and benefits information with both current employees and applicants as part of its hiring process. This article provides information on current best practices in Canadian pay transparency.

*Note: This information is provided for informational purposes only. Please refer to your local legislation and consult with your compliance and legal advisors to ensure your pay transparency practices meet current local and national standards.

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Why does pay transparency matter?

Global organizational consulting firm Korn Ferry reminds employers that, “Pay transparency isn’t just a legal necessity – it’s a strategic advantage. Done well, it enables open conversations, improves employee experience and builds cultures of fairness and performance.”

Online employer review platforms enable employees, past and present, to anonymously share information about compensation to gauge industry standards and compare salaries. This means that if employers don’t work toward pay transparency, employees will do it for them, potentially affecting the impressions of new and existing talent.

A recent Mercer report found that 40 per cent of potential employees are unlikely to apply to job postings that don’t include compensation information. That’s why many job posting sites have begun to prompt employers to input salary ranges whenever they post an employment advertisement online.

More than ever, pay transparency extends beyond meeting legal and compliance requirements and has become a strategic priority for many top-tier organizations.

The benefits of pay transparency include:

Increasing employee trust and brand loyalty;
Improving employee retention;
Attracting new talent;
Increasing internal talent referrals;
Boosting morale;
Streamlining recruitment and hiring processes (not wasting time on applicants who will not accept the pay band for a position);
Promoting pay equity and fairness;
Preventing secrecy and stigma around pay-related decisions;
Improving transparency and reducing the perception of discrimination and unfairness in pay decisions;
Enabling employers to identify and resolve pay disparities within an organization;
Improving a company’s brand and workplace culture;
Boosting productivity because employees feel valued; and
Helping employees identify career development goals by understanding how their pay relates to others.

” Effective pay transparency in the workplace won’t happen overnight. It takes time, thought and planning to implement such programs in a way that aligns with company culture and meets local requirements. ”

A national overview of pay transparency standards

While Canadian pay transparency mandates differ, they are all moving toward achieving pay equity through accurate disclosure. In a 2024 press release, Minister of Labour and Seniors, Seamus O’Regan Jr., said, “If we’re going to close pay gaps and representation gaps, we have to know where those gaps are. There’s no equity without transparency.” Beginning on January 1, 2021, all federally regulated private-sector employers (with more than 100 employees) were required to report salary data that communicates any wage gap-related information.

Some Canadian jurisdictions impose fines on organizations who fail to comply with local pay transparency requirements.

Provincial and territorial measures vary, but some highlights include the below.

Since 2023, British Columbia has been progressively implementing pay transparency requirements. As of November 2025, employers with more than 300 employees are required to both report and display their employee pay transparency reports. By November 1, 2026, employers with 50 or more employees must report and display employee pay transparency reports.
In June 2022, Prince Edward Island set forth employment standards legislation that requires employers to disclose pay rates and salary ranges in all public job postings.
On January 1, 2026, Ontario employers with 25 or more employees must post an expected compensation pay range not to exceed $50,000 to any job postings with a total compensation of less than $200,000, are prohibited from requiring “Canadian experience” on job postings or application forms, must disclose if a publicly posted job is for an existing vacancy and must disclose if artificial intelligence (AI) is used as a part of their hiring practices.
Quebec’s Pay Equity Gap Act requires that employers of 10 or more employees have general pay equity obligations. Employers of 50 or more employees must develop, prepare, post and update a pay equity plan and remedy any pay inequities within four years of becoming subject to this act.

What barriers do organizations face as pay transparency legislation is passed?

For some organizations, pay transparency legislation may conflict with existing company practices or company culture, in addition to other factors.

Common barriers to implementing new pay transparency practices can include:

Disruption of existing pay structures, causing employees to perceive unfairness in the organization’s pay practices;
Time and resources required to craft consistent communication surrounding pay-related policies and practices and the impacts of payroll legislation;
Talent poaching from competitors by offering salaries above the current market range;
Legal challenges surrounding perceived pay disparities based on factors including ethnicity, age or gender;
Privacy concerns;
Finding an effective method and resources to reduce systemic biases that become exposed within an organization;
Reduction in the employer’s negotiating power; and
Properly educating senior management and human capital management (HCM) employees on the nuances related to the emotional side of salary negotiation.

What are some initial steps an organization should take when implementing pay transparency initiatives?

Effective pay transparency in the workplace won’t happen overnight. It takes time, thought and planning to implement such programs in a way that aligns with company culture and meets local requirements.

Getting started can include the below.

Reviewing local and national pay transparency standards to identify any existing gaps to begin an action plan and create compliance checklists.
Conducting regular pay equity audits to identify and rectify any pay disparities and ensure the accuracy of pay-related data.
Creating a fair, transparent pay policy and audit system for setting and reviewing salaries.
Developing and implementing a clear pay transparency communication strategy (both internally to current employees and externally to prospective employees).
Providing staff training on current and emerging fair pay practices and discussion surrounding pay equity.
Creating meaningful and open dialogue with employees about pay transparency.

Conclusion

Will your company lead the charge when it comes to meeting pay transparency requirements? Getting educated on current and upcoming pay transparency requirements will set you on the right path toward an equitable workplace.

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