LEGISLATIVE REVIEW OF
THE EMPLOYMENT EQUITY ACT
A DISCUSSION PAPER

I. SETTING THE STAGE

Purpose of this paper

This paper will provide a basis for consultations which the Canadian Human Rights Commission is holding in connection with the five year review of the Employment Equity Act.

The paper provides a brief overview of the Act, the role given the Canadian Human Rights Commission in its enforcement, and the results of four years of compliance reviews conducted by the Commission. Based on this experience, the paper then provides a list of possible recommendations for revisions to the Act which would, in the Commission's view, result in improving the effectiveness of its mandate.

Annexes

Appendix 1 provides a description of the statutory requirements and the Commission's assessment factors guiding the conduct of audits. Appendix 2 provides highlights of the progress made by the four designated groups in the private and public sectors.

Legislative review

Section 44(1) of the Employment Equity Act states:

Five years after coming into force of this Act, and at the end of every five year period thereafter, a comprehensive review of the provisions and operation of this Act including the effect of those provisions shall be undertaken by such committee of the House of Commons as may be designated by the House for that purpose.

The Act was given Royal assent on December 15, 1995 and came into force October 24, 1996. A legislative review, therefore, is required commencing October 24, 2001. The review has been referred to the House of Commons Standing Committee on Human Resources Development and the Status of Persons with Disabilities.

II. THE COMMISSION'S MANDATE

The 1996 Act

With the implementation of a new Employment Equity Act in October 1996, the Canadian Human Rights Commission was given the authority to audit the performance of employers in order to ascertain whether they are complying with the legislation, and to require action when they fail to do so.

Whereas the original legislation applied only to private sector employers, the Act now includes the public service.

The Act's main purpose remained unaltered: to achieve equality in the workplace so that no qualified person is denied employment opportunities, and to correct the conditions of disadvantage in employment experienced by women, visible minorities, Aboriginal people and persons with disabilities.

What employers are required to do

As a first step, employers whose workforce is not fully representative must implement twelve statutory requirements in order to achieve compliance with the Act. See annex 2 for a description of the requirements and the Commission's assessment factors.

Employers are first required to survey their employees to find out if they belong to a designated group. They must then undertake a workforce analysis to determine if gaps in representation exist, and, where under-representation is found, complete an analysis of those employment systems which may contain barriers for the designated groups. Based on this assessment, an employer must then develop a plan to remove barriers, implement positive measures to correct the effects of past exclusion, and establish hiring and representation goals.

In implementing their employment equity plan, employers are required to monitor whether they are making reasonable progress, and if not, to make the necessary adjustments. The Act also introduces a requirement to invite employee representatives and bargaining agents to provide their views on the preparation, implementation and revision of the employment equity plan, to ensure that the workforce is kept informed and that appropriate records are maintained.

What employers are not required to do

It is important to note that the Act also explicitly states what employment equity does not mean and what employers are not required to do. It clearly specifies that employers are not required to implement initiatives that would constitute undue hardship, to create new positions, to establish quotas, or to hire and promote unqualified employees, nor to undertake lay-off or recall outside the seniority provisions of collective agreements.

Guiding policy

A guiding policy enshrined in the Act requires negotiation and cooperation as the preferred approach. Section 22(2) states that wherever possible, cases of non compliance will be resolved through persuasion and the negotiation of written undertakings and that directions be issued and that applications for orders be made only as a last resort.

General audit process

A short description of the Commission's audit process is attached as annex 1.

The Commission's compliance work began in October 1997, one year after the implementation of the new legislation. The audit process reflects the guiding principles outlined above.

Our compliance review officers examine documentation, they conduct on-site visits, interview managers, employees and union representatives, and then assess whether the employer is in compliance. The Act is written in such a way that it allows employers who are not in compliance to achieve compliance as a result of the audit. If compliance review officers find areas of non-compliance, they negotiate signed undertakings with employers giving them a maximum of one year by which to conduct the necessary activities.

At the end of that period, compliance review officers return to do a follow-up audit and check that the undertakings have been implemented.

Enforcement process

The Act allows for progressive enforcement action when employers fail to cooperate, refuse to sign undertakings or fail to respect the undertakings which were agreed to. However, as outlined above, the guiding policy enshrined in the Act requires that enforcement action should only be taken as a last resort.

A direction is first issued by the Commission, stipulating the work required and the time limit for its completion. Employers may request a tribunal to reconsider the direction. When a direction has not been fulfilled, the Commission may also ask a Tribunal to issue an order. The Federal Court may carry out a judicial review of a decision of the Commission or a tribunal. A tribunal order may be registered with the Federal Court, thus giving it the force of a court order.

Monitoring for progress

Once employers have been found in compliance, the Commission will monitor their progress against their hiring and promotion goals, based on the annual reports which they must submit to Human Resources Development Canada in the case of the private sector, and the Treasury Board in the case of the public service. Where goals are not being met, the Commission may initiate a new audit in order to determine if the employer has made all reasonable efforts to implement the plan.

III. CURRENT STATUS

Number of employers audited

Since the first audits were launched in October 1997, the Commission has initiated audits of 215 employers. These represent 50% of the employer pool, and 80% of the employee population.

This includes 99% of the public service population, 82% of private sector employees and 43% of employees working for so-called "separate employers", such as the Canada Customs and Revenue Agency, the National Film Board, or the Office of the Auditor General.

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Employers in compliance

There are currently 73 employers in compliance, Of those, only 8 were in compliance at the time of the initial audit . This means that the Commission has been required to negotiate undertakings, then return to do a follow-up audit in just about every case. As a consequence the 215 employers in the audit pool thus far have required 371 audits. On the average, it takes up to 3 years before the Commission is able to issue a final finding of compliance to an employer who required undertakings.

Rate of compliance

In about 80% of all cases, however, employers were in compliance when the Compliance Review Officer returned to do a follow-up audit. This demonstrates that the cooperative approach required by the Act works well in general.

Directions & Tribunals

To date, the Commission has issued 20 directions to employers, most of whom had failed to take the corrective actions that were negotiated. One employer had failed to cooperate with the auditor. Five employers to whom directions had been issued have achieved compliance. Three others have been referred to Tribunal, although no tribunal hearing has yet taken place. The Commission withdrew its reference to the tribunal in one case where the employer reached compliance before the hearing, and there are encouraging signs that this may happen in other cases as well.

Consultations with advocacy groups

One of the recommendations from the Canadian Human Rights Act Review Panel, under the Chair of the Honourable Gérard V. La Forest, was to the effect that a process be established to ensure that community groups have a way of giving input into the Commission's implementation of its responsibilities under the Employment Equity Act . The Commission agrees with this recommendation and will be formulating a formal consultation strategy in this respect.

IV. PREPARING FOR THE REVIEW OF THE ACT

Program evaluation

In preparing for the review of the Act, the Commission is conducting an independent evaluation of its compliance audit program to see whether or not objectives are being met, and how it can improve on its overall approaches. This evaluation includes a survey of employers' interviews with partners and private sector consultants, and a review of pertinent documentation. It will focus on the pertinence of the Commission's audit requirements, on the scope of audits, and on the effectiveness of processes. The Commission will have the results of this evaluation by spring 2002 Consultations In addition to this program evaluation, the Commission is holding consultations with various groups with interest in the Act in order to gain insight into their particular concerns. This discussion paper and the following recommendations are intended to generate productive dialogue in this regard.