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Kadie Ward, commissioner and CAO of Ontario’s Pay Equity Commission, says that more inclusive, equitable workplaces are better able to innovate and attract top talent.Galit Rodan

Many employers may be overlooking a strategy that could help their companies bounce back faster from the economic havoc wreaked by the COVID-19 pandemic, while building a brighter future for all Canadians.

According to Kadie Ward, commissioner and CAO of Ontario’s Pay Equity Commission, there’s ample evidence that narrowing the gender representation and wage gaps – which COVID has widened even further – could help companies become more innovative and better equipped to compete in a changing world, while promoting inclusive economic recovery.

Ms. Ward points to longitudinal research showing that companies that lead in gender diversity and inclusion are more likely to outperform less diverse peers on profitability and radically innovate by better anticipating shifts in consumer needs and consumption patterns. Inclusive workplaces are also better able to attract and retain top talent, she adds. That’s key in the context of the pandemic and the “Great Resignation.”

“Companies who value gender diversity and wage equity are more likely to bounce back because they understand the diversity of the market,” Ms. Ward says. “Ideas and innovations are gender neutral, and not recognizing that and not compensating [everyone] equitably and fairly is detrimental to business growth and the economy.”

Canada’s progress – or not?

Thanks in part to Ontario’s pay equity legislation – the first of its kind in the world when it was introduced in 1987 – wage disparities between men and women have shrunk somewhat.

“Since 1998, every province has closed the wage gap between five and 13 per cent,” Ms. Ward notes.

Still, the wage gap in Ontario as of 2020 was 11 per cent, which means that, in 2021, for every $1 earned by a male worker on an hourly basis, a female worker earned 89 cents. When calculated on the basis of average annual earnings, the gap is even larger – 29 per cent.

Figures are even more dismal for certain groups of women: for instance, according to the 2016 Statistics Canada Census, Indigenous women face a 35 per cent gap in average annual earnings.

“Even before the pandemic, compared to other OECD countries, we were the eighth worst [on gender pay equity],” says Paulette Senior, president and CEO of the Canadian Women’s Foundation.

“We had been slowly pushing forward, but now the progress has been stalled, and the gap very much widened,” she says.

The COVID-19 pandemic has also highlighted a key contributor to the gender pay gap: the segregation of women into relatively poor-paying job categories.

“Women are working in essential care services, with non-essential pay,” Ms. Senior says. “If there’s one thing this pandemic has shown us is that we have to build mutual care and support into our infrastructure as we would build bridges.”

The Pay Equity Office (PEO) works with organizations to ensure work of equal value is compensated for equitably within an organization.iStockPhoto / Getty Images

Fresh thinking

Inequalities persist in the labour force because of the continued devaluation of work historically or typically done by women, says Ms. Ward. It’s a problem that the Pay Equity Office (PEO) strives to address by administering Ontario’s Pay Equity Act and making sure that work of equal value is compensated equitably within organizations.

To that end, the PEO engages with Ontario companies to ensure they are aware of the Pay Equity Act and have practices that allow for pay equity, focusing particularly on small- and medium-sized businesses that might have more challenges implementing the Act.

Besides supporting workplaces to achieve compliance with the Pay Equity Act and, where appropriate, referring matters to the Pay Equity Hearings Tribunal, the PEO also educates people about their legal rights and responsibilities and will conduct an investigation if they receive a complaint. “Primarily women, but there have been cases where men have submitted a complaint to the PEO alleging wage inequity,” Ms. Ward says.

It’s important to understand that the pay equity gap and gender inclusion in the workplace are intertwined, she adds.

“If we continue to have fewer women in the workplace, or discriminate against women in the workplace – then it’s going be a lot harder to achieve pay equity.”

Wage and representation gaps often stem from a false scarcity mindset, Ms. Ward notes.

“Companies have a problem when they believe that talent is scarce, or if they tend to look for it only in certain prescribed groups – white, heteronormative males, for example,” she says. “But it’s not scarce, it’s in everybody – we just have systems that don’t allow us to see it. We need to tackle that bias to support gender and pay equity in the workplace.”

Dismantling bias can improve a company’s bottom line. For instance, a 2020 report from McKinsey & Company concluded that “the relationship between diversity on executive teams and the likelihood of financial outperformance has strengthened over time.” Consequently, “gender diversity and inclusion are more important than ever in the wake of the COVID-19 crisis,” Ms. Ward says.

Seize the day

Corporate Canada has an important leadership role to play rebuilding the country’s economy, Ms. Senior says. Organizations should be leading with better gender-relevant policies and practices to help women and diverse people thrive. And that will only benefit them in the end.

“By addressing the discriminatory practices and prioritizing sponsorship, mentorship and development opportunities, [organizations] can have and retain a more robust workplace,” Ms. Senior says.

Ms. Ward notes that companies who do not lead in diversity and inclusion may lose out on very real opportunities to innovate their business model and strengthen their business recovery.

“For economic recovery to be robust, and for companies to thrive, they must promote gender and wage equity,” she says. “Women, work and equity are at the core of innovation, inclusive prosperity, and the way forward out of this recession.”

Advertising feature produced by Globe Content Studio with Pay Equity Office. The Globe’s editorial department was not involved.