Employment Equity Compliance: Addressing under-representation in the Canadian workforce

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The Employment Equity Act is the foundation of the compliance obligations of federally regulated employers under the legislated employment equity program (LEEP) and of federal contractors under the  Federal Contractors Program (FCP).  Federally regulated employers must comply with the nine statutory obligations detailed in the Act, and non-compliance may result in monetary penalties. Federal contractors must comply with the four requirements of the Federal Contractors Program to maintain their eligibility to bid on high value government of Canada contracts.

Compliance starts with understanding your compliance obligations, assessing your compliance readiness, and executing a plan to address gaps where they occur.  With the right guidance and planning organizations will succeed in meeting and benefiting from their compliance obligations.

The History of Employment Equity in Canada

In 1984, Judge Rosalie Abella led the Abella Commission and established the foundation of what would later become the Employment Equity Act of 1986, using the term “employment equity” instead of the well-known U.S. term “affirmative action” to better fit the Canadian context.

Research shows that these four groups, designated under the Act - Aboriginal peoples, persons with disabilities, members of visible minorities and women - have historically faced exclusion and disadvantage in the workplace for reasons that have nothing to do with their abilities. The Act requires organizations to become more inclusive, open and accessible by proactively removing barriers to inclusion faced by these groups.

Employment equity promotes equity, diversity, and inclusion to improve organizational performance. Through equity, the building block of diversity, an organization complies with human rights legislation and eliminates systemic discrimination.  Through diversity, organizations actively access the best talent in the marketplace and through inclusion they actively foster employee engagement.  In its commitment to increase Canada’s productivity and competitiveness, the government of Canada requires that federally regulated employers and federal contractors actively achieve and maintain a workforce that is representative of the diversity of talent that is available in the Canadian labour force.

Federal Contractors under the Federal Contractors Program (FCP)

Federal contractors are provincially regulated employers with a workforce of 100 or more that enter into a federal government goods or services contract, standing offer, or supply arrangement valued at $1,000,000 or more including applicable taxes.

FCP employers enter into a contract compliance relationship with the government of Canada in which their continued business relationship is conditional on their ongoing compliance with their obligations under the Federal Contractors Program. FCP employers that are found to be in non-compliance are placed on a List of Ineligible Contractors and forfeit their right to bid on high value government contracts.

Federally Regulated or Legislated Employment Equity Program (LEEP) Employers

Federally regulated employers must comply with the Legislated Employment Equity Program (LEEP). Federally regulated employers include private sector employers such as banks, airlines, radio and television and telecommunications companies that operate in federally regulated industries, Crown corporations, and other federal organizations that have 100 or more employees. Non-compliance may result in a monetary penalty.

How We Help

We guarantee compliance for our FCP and LEEP client organizations. Here is how.

To begin, we help our clients to fully understand their compliance obligations. LEEP employers must meet the nine statutory obligations detailed in the Act-compliance obligations of LEEP. Employment and Social Development Canada (ESDC), the regulatory agency, established four compliance requirements for FCP employers. We collaboratively assess our client’s readiness in each compliance requirement. We then provide the skills, resources, and know-how to deliver compliance using the most cost-effective approach available. 

Talent is universal and abundant. Opportunity is limited and unequal. LEEP and FCP employers must meet the compliance standards established by the regulatory agencies and demonstrate that they are taking planned and sustained actions to ensure that their workforce reflects the diversity of the talent in the labour market from which they recruit.

Core Concepts - Underrepresentation and Labour Market Availability

Underrepresentation is measured by the degree to which an organization – LEEP and FCP - hires designated groups at their availability in the relevant labour market. Where there is underrepresentation, the employer is required to establish short- and long-term numerical goals and a plan that includes initiatives, strategies and accountability mechanisms to achieve full representation over time.

In addition, LEEP employers must conduct and submit the results of an employment systems review (ESR).    The ESR is the organizational diagnostic tool that helps the organization identify the probable reasons for the patterns of underrepresentation and concentration in its workforce, as revealed by the workforce data.

We conduct the ESR and use these findings to help our clients understand how their policies and practices inadvertently result in the exclusion and underrepresentation of designated group talent in their workforce.

Labour market availability statistics are the data on the number or percentage of designated group members - women, Aboriginal Peoples, members of visible minorities and persons with disabilities - possessing the requisite skills within the relevant labour market for the particular occupations or groups of occupations in the LEEP or FCP employer’s workforce. Depending on the position, the relevant labour market may be national, provincial or the local Census Metropolitan Area (CMA). To illustrate - the labour market for, say, Senior Managers, Middle Managers and Professionals is national whereas, for Clerical Personnel, it is the local Census Metropolitan Area or (CMA).

Here are the specific interventions our clients can expect:

Step One: A Workforce Survey to identify and understand the equity composition of the workforce

Employment equity is a data driven analytical process. The first step is to identify and understand the employment equity composition of our client’s workforce.  We conduct an employment equity self-identification workforce survey. As a measure of database reliability, the government of Canada established an 80 percent survey response rate as a compliance requirement. To achieve the 80 percent response rate, EMC works with our clients to develop a survey administration plan and communications and employee engagement strategy to maximize employee participation. 

Step Two: A Workforce Analysis to identify the patterns of underrepresentation and concentration

Both LEEP and FCP employers conduct an analysis of their workforce to determine the degree of under-representation of designated groups in each occupational group.

EMC works with our clients to assign National Occupational Classification Codes (NOC codes) and to import their data to the government of Canada’s Workplace Equity Information Management System (WEIMS).  WEIMS is an application intended for use by employers under the Legislated Employment Equity Program (LEEP) and federal contractors under the Federal Contractors Program (FCP). 

This application supports employers in discharging their statutory obligations under the Employment Equity Act (EEA) and federal contractors under the FCP.

WEIMS generates workforce analysis (WFA) reports that identify any patterns of underrepresentation (and concentration) of the designated groups in each occupational group (EEOG), compared to their external availability. The composition of an employer’s workforce and the distribution of designated group talent among the EEOGs, is the result of employment decisions and the operation of employment policies and practices over time.

EMC Consultants use these reports to provide a detailed analysis of prevalence and severity of underrepresentation of the designated groups. Our analysis shows the gaps in representation and so, the scope of employment equity challenges to achieve full representation.

The WFA informs the goal setting process for both federally regulated employers and FCP employers. The WFA informs the mandated employment systems review (ESR) that federally regulated employers must conduct and report to CHRC. The ESR findings and recommendations inform the qualitative measures of the 3-year employment equity plan.

Step Three: Set short- and long-term measurable goals

To be in compliance, LEEP and FCP establish short- and long-term numerical goals to increase the representation of the designated groups in the occupational groups in which they are underrepresented.

Short-term goals: cover a period of three years whereas long-term goals are usually for a period of seven years. EMC Consultants establish 3-year short-term numerical goals that are sufficient to ensure reasonable progress towards closing each underrepresentation gap. Factors that are considered in establishing short-term goals include - the degree of underrepresentation, the anticipated growth or reduction of the workforce, and the anticipated turnover during the 3-year period covered by the goals. We consider the following in establishing long-term goals - the effects of the short-term goals and the expected impact of employment equity initiatives.

Step Four: Reasonable Progress. Reasonable Efforts

Once short-term numerical goals are established, the compliance requirement is that LEEP and FCP employers achieve results by making measurable reasonable progress to achieve these goals.

Every three years FCP employers must proactively report their progress to ESDC, through a system of accountability reporting. ESDC requires FCP employers to achieve at minimum 80 percent of their short-term numerical goals. ESDC provides a report card and requires that the delinquent employer provide documentation to demonstrate that it made reasonable efforts.

CHRC Audits: - LEEP employers are not required to proactively report progress. However, they are subject to audit by the Canadian Human Rights Commission every three to five years. Audits may be conducted at random.  Assessments are made in part based on documentation provided by the employer and there may be an on-site visit by a compliance review officer. The Commission representative may interview employees, employee representatives and managers as part of the process for the validation and assessment or analysis of the information provided.

EMC consultants help our clients establish their short term and long-term goals: and develop a corporate plan with strategies, initiatives and accountability mechanisms and review points to make the reasonable progress.

Although the ESR is not mandated for FCP employers, we work with FCP clients to review their talent management policies and practices that the data analysis shows have most adverse impact on the designated groups.  For example, the workforce analysis may show that the designated are clustered in the Talent pipeline (feeder groups) but remain underrepresented in higher level roles. Our consultants will use their experience to examine your career development, mentoring and promotional practices.  We can examine your sourcing strategies to improve your access to a diverse pool of qualified candidates.

Consulting Support

As we explain and illustrate, EMC provides the level and nature of consulting support our LEEP and FCP clients need to succeed.

For LEEP employers, we guide their preparation of the Employment Equity Annual Report due by June 1 of each year. In its Audit reports, CHRC identifies the gaps in compliance and what the employer must undertake - the Undertakings - to regain status as an employer in good standing. EMC Consultants work with our LEEP clients to fulfil these Undertakings.

EMC helps to ensure and maintain employment equity compliance 

Our Canadian Human Resources Reader’s Choice Awards in 2016 and again in 2020 are testaments to our service delivery approach and quality of work over the last many years. EMC guarantees compliance for federally regulated employers who must comply with the legislated employment equity program and for federal contractors that must comply with their obligations under the Federal Contractors Program. We are a full-service Employment Equity and Diversity consulting practice. We help clients establish and maintain their employment equity infrastructure, build internal capacity and achieve and maintain their employment equity quantitative and qualitative goals.

We have expanded our advisory capacity to provide integrated compliance advisory services – across both employment equity and pay equity platforms. Our team now includes pay equity consultants with expertise acquired across private, public, union and non-union workplaces.

Visit our website at: www.employmentmatters.ca