January Pay Equity Deadline: HR’s Checklist for Canadian Organizations
January Pay Equity Deadline: HR’s Checklist for Canadian Organizations
By Cheryl Petruk
Some important changes about pay equity are coming for businesses starting January 1, 2026. Organizations should take action now to be prepared.
In a previous blog, we talked about
Ontario employment standards in 2025. Now, some of the upcoming changes to pay equity are coming into effect. Is your organization ready?
Canadian pay equity compliance is something all organizations must follow, or they could face fines and other repercussions. Our team has put together this guide to help you understand what is changing and the steps you need to take to ensure you’re compliant.
What we’ll cover:
- What’s changing? Upcoming changes to ESA rules that employers should prepare for
- Why are these pay equity changes happening?
- Pay equity checklist to ensure your organization is in compliance
- What are the consequences of non-compliance?
What’s changing? Upcoming changes to ESA rules that employers should prepare for
With the passage of Bill 149 (Working for Workers Four Act, 2024), Ontario is moving forward with a new pay transparency framework that will significantly change how organizations advertise job opportunities.
Beginning January 1, 2026, employers will be required to include specific compensation details and hiring disclosures in all public job postings. The goal is to improve transparency, reduce bias in recruitment, and support fair pay practices across the province.
Below is a summary of what employers need to know:
Key Requirements for Job Postings
- Rules apply to employers with 25 or more employees.
- Compensation or salary ranges must be posted in all public job ads.
- Employers cannot request “Canadian experience” in job postings.
- Ads must specify whether the role is a new position or a replacement.
- Employers must disclose any use of AI or automated tools in screening applicants.
- Employers must notify all interviewed candidates of the outcome within 45 days of their interview.
- Employers must retain copies of job postings, applications, and interview communications for three years.
Additional Pay Transparency Measures Introduced Under Bill 149
Salary range disclosure: Compensation is required to be included for every public job ad.
Ban on asking for pay history: Employers are no longer allowed to ask about pay history from applicants.
Protection for employees who discuss compensation: Employers cannot penalize staff for sharing pay information.
Reporting obligations for larger organizations: This will help reduce gender-based pay gaps.
Not sure where to start? Let us guide you through the new requirements. Reach out to our HR team today at (416) 593-7999 or getstarted@augmenthr.com.
What are these pay equity changes happening?
For some time, there has been a need to change the rules to make pay equity more transparent.
The goal of the changes is to help standardize pay practices across all industries and create greater transparency. In turn, this will help reduce gender and race-based wage gaps by removing salary negotiation imbalances. This will empower job seekers with upfront compensation information.
Pay equity checklist to ensure your organization is in compliance
Use the following steps to update your HR practices to ensure your company complies with the new pay equity rules:
1. Determine Eligibility
- Confirm whether your organization meets the threshold for compliance (e.g., 25+ employees).
2. Assign Ownership
- Appoint a project lead or compliance owner to manage implementation.
3. Review and Update Job Postings
- Audit all job posting templates for compliance.
- Add salary ranges or pay bands to each job ad.
- Disclose if AI or automated tools are used in the hiring process.
- Indicate whether the role is a new position or a replacement.
- Remove any requirements for “Canadian experience.”
4. Audit Pay Practices
- Review current compensation data for gaps or inconsistencies.
- Develop or update clear salary bands for all roles.
- Ensure salary bands align with internal equity and market competitiveness.
- Analyze whether public salary ranges will expose internal pay gaps and prepare an action plan.
5. Review Interview Processes
- Audit interview applications and screening questions for compliance and fairness.
- Update interview question lists to align with transparency and bias-reduction standards.
6. Establish Candidate Communication Standards
- Implement a process to notify all interviewed applicants of outcomes within required timelines.
- Standardize follow-up messaging to ensure consistency and documentation.
7. Train Internal Teams
- Train HR, recruiters, and hiring managers on new legal requirements.
- Ensure teams understand disclosure rules, follow-up obligations, AI transparency requirements and record retention rules
- Provide managers with talking points for employee questions about salary ranges and pay equity.
8. Strengthen Pay Equity Foundations
- Clarify your organization’s compensation philosophy and how pay decisions are made.
- Audit job architecture to ensure roles, titles, and levels are consistent and defensible.
- Conduct a formal pay equity assessment to identify disparities.
9. Develop a Communication & Change Strategy
- Build clear messaging explaining salary ranges, pay practices, and the organization’s commitment to equity.
- Align messaging with your employee value proposition.
- Prepare proactive internal communications before new rules take effect.
10. Engage Employees
- Create channels for employees to ask questions and provide feedback.
- Hold ongoing conversations about pay transparency and equity.
- Measure sentiment and adjust your strategy over time.
What are the consequences of non-compliance?
Organizations that fail to meet the new transparency rules may face legal, operational, and reputational risks as enforcement measures develop.
Potential consequences include:
- Reviews or investigations by the Ministry of Labour.
- Employee concerns or complaints about perceived pay inequities within the organization.
- Damage to the employer's reputation if posted salary information does not match actual internal compensation practices.
- Increased scrutiny of recruitment processes where inconsistencies or gaps are identified.
A final word about the new pay transparency rules
As Ontario moves toward greater pay transparency and equity, employers must be proactive in preparing for the January 1, 2026, changes. By taking steps now, businesses can avoid compliance risks and build a more transparent and trustworthy workplace. If your organization needs support navigating these updates, our team is ready to help.
Get pay-equity ready—book a consultation with our
HR experts today.
Cheryl Petruk has over 25 years of progressive experience in human resources and organizational leadership. Cheryl provides strategic guidance to clients across various industries, offering tailored solutions in HR policy development, recruitment and retention strategies, employee relations, organizational design, and leadership development.
