No. 46                                                                 July 9, 2001

PSAC has taken a consistent position that pay equity adjustments are pay for all purposes. According to Section 11 (7) of the Canadian Human Rights Act, the definition of wages is broader that simply salary rates. It includes "…any form of remuneration payable for work performed by an individual".

It will not come as news to PSAC members who waited years for a resolution of the federal pay equity complaint that Treasury Board has not applied this principle. As a result, the union has made it clear that it disagrees with Treasury Board’s interpretation and application of the pay equity agreement in a number of areas.

In its application of the pay equity agreement, Treasury Board has taken the position that pay equity adjustments are not pay for all purposes until they are folded into salaries rather than accepting the principle that pay equity adjustments are pay for all purposes throughout the retroactive period. The Tribunal had ordered that the pay equity adjustments be recalculated year by year from 1985 on and ordered that the adjustments be folded-in to salary rates effective July 29, 1998.

Whether or not the adjustments were folded-in is not the issue for the union. The salary rates were adjusted year by year and anything related to salary has to be recalculated accordingly. Before the Human Rights Tribunal which heard our case, Treasury Board’s only comment was that it would create an administrative burden to have to do all these recalculations.

While the parties agreed to replace the recalculation of overtime, acting and promotion situations between March 8, 1985 and March 31, 1994 with a 5% lump sum of the total pay equity adjustment for that period, in order to speed up payments and reduce the amount of work involved, the principle of the pay equity adjustments being pay for all purposes remains. The union also agreed to replace the actual recalculation of severance pay with the use of averages in a number of specific situations.

As a result, PSAC filed a Section 99 reference with the Public Service Staff Relations Board (PSSRB). Hearings were held on June 26 and 27 before the Chairperson of the Board.

We are asking the PSSRB to declare that the pay equity adjustments are pay for all purposes in all situations except the two specific areas mentioned in the agreement and outlined above. This would mean that entitlements to such benefits as Education Allowance, cashed-out annual leave, and pay for designated paid holidays as well as Salary Protection and pay for actual hours worked by part-time employees would be recalculated using revised pay rates which include the pay equity adjustments.

During the hearings, Treasury Board’s counsel chose not to cross-examine our witness, nor to call witnesses of his own. Given this, our evidence stands unchallenged regarding the fact that during the Tribunal hearings, Treasury Board never disputed our position that the pay for all purposes principle exists as a matter of law. What is also unchallenged is our view that the negotiations involved in the pay equity settlement only limited the pay for all purposes principle in two specific areas, in order to address Treasury Board’s concerns about the administrative burden.

There is no guarantee that the PSSRB will accept our claim that this is a problem which can be corrected through a Section 99 reference. However, at the end of the hearing, the Chairperson indicated that he wants to thoroughly study all the materials and arguments presented and that it will be some time before a ruling is issued.

Watch for more information on this matter after the ruling is issued.