Highlights
- Ontario's new labor laws, part of the Working for Workers Four Act, 2023, mandate disclosing pay ranges in job postings, among other things.
- Nationally, British Columbia's March 2023 proposal for salary transparency laws aligns with regional variations, highlighting a dynamic landscape in Canadian provinces' approaches to fostering openness in job markets.
- Early backing for Bill 194 suggests industry support, with almost half of surveyed organizations already disclosing pay ranges, showcasing a positive trend toward increased transparency in hiring.
- Pay transparency emerges as a strategic advantage, building trust, attracting top and streamlining recruitment for enhanced employee retention and organizational efficiency.
On November 6th, 2023, the Ontario government announced that it is bringing in a new set of labour laws which include making it mandatory to disclose the expected pay ranges in job postings.
These set of laws are a part of the bigger Bill 194, Working for Workers Four Act, 2023 which also includes forcing employers to disclose if artificial intelligence (AI) is used during the hiring process and banning unpaid trial shifts for restaurant and hospitality workers. All of these, if passed, would be added to the ESA.
This is not the first time an attempt has been made by the Ontario government to include pay transparency legislation in the ESA. In 2018, the Pay Transparency Act was proposed but never brought into force. It dealt with similar issues of pay range disclosure but also proposed prohibiting employers from asking applicants about their pay history and banning retaliation from employers if an employee disclosed their pay information to other employees in the organization.
Pay Transparency Laws in Other Provinces
In March of 2023, British Columbia proposed a similar law that would require BC employers to specify the “expected salary or wage” in all publicly advertised job postings and to prepare annual pay transparency reports in a phased approach, among other things.
Quebec currently has no provincial pay transparency laws.
The Future of Bill 149
These labour laws are still in their early stages of being enacted province-wide, being carried at the First Reading on November 14th and then a Second Reading on the same date. But its proposal has gotten many of us thinking about the ramifications if it is indeed passed.
According to a 2023 report by Payscale, nearly half (45%) of all respondents from organizations in Canada, the United States, and abroad, stated that they already include the pay range in their job postings, but 18% of those specified that they only do so because it’s required of them under their state or province law. Many stated that they disclose this pay range after they have already met with the candidate, either during the interview process (27%) or with the job offer (10%).
The general consensus among those who have already been including salary ranges in their job postings is that they come with many positive impacts for the organization, recruiters, and of course, candidates. In fact, in a study conducted by Leger Marketing, and Talent.com, over half of respondents (55%) supported the law “a great deal”, and 29% supported the law “somewhat”. Clearly, the bill is favored among Canadians.
So, what are the positive impacts it could have on your organization? Keep reading to find out.
1. Builds trust between employer and candidate
Trust is everything in the recruitment process, especially when it comes to the relationship an employer has with their candidates. Most candidates want to know how much a position pays before they apply to see if the position is worth it, and if they can’t find it in your job posting – they’ll look elsewhere. When you’re not upfront, both parties don’t understand what the other expects, and this can lead to a rocky relationship from the start.
Candidates will feel more respected when the job salary is listed, as it shows that the employer is trying to be transparent with them from the start. No one wants to work for a company that has a company culture of secrecy.
2. Attracts top talent
Did you know that according to the 2023 Resume Lab Financial Transparency at Work Report, 80% of professionals stated that they wouldn’t apply for a job if the business wasn’t being transparent about salary details?
In such a tight labour market, having a competitive salary posted in your job description may create a competitive advantage over your competition. Taking the uncertainty out of the recruitment process, especially with the stress of financial negotiations, will entice those Candidates who are passively looking for roles which pay more than the one they're currently in.
3. Increases employee retention
Showing the salary in the job posting from the start will mean that the candidate knows how they’re being compensated before they apply. This means that when they do apply, they’ve determined that the pay is fair for the job they are doing. This will not only save you time and money from having candidates disqualify themselves from the recruitment process after learning about the pay, but it will also increase employee retention in the long run.
Recruiters will be able to focus on candidates who are interested fully in the role, focusing on aspects of the position like responsibilities, experience, and company culture, instead of wasting time on salary negotiations and on those candidates who will later become uninterested once they find out what the salary is. This will help your company find the right fit faster.
Want to know what else to include in job postings to truly make them shine and attract top talent? Download our playbook today to learn about our effective recruitment strategy here.
