Scenario 5 Flashcards
Lorelyn is a senior HR professional at a medium-sized manufacturing company, RAC Parts, in Windsor, Ontario. The company spent the latter half of 2016 preparing for a merger with TIK Inc., which was finalized in January 2017. The new company is called TIK-RAC Inc. With the merger finalized, TIK-RAC’s CEO asks Lorelyn whether the company is required to review its pay equity plan. RAC Parts and TIK last reviewed their respective pay equity plans in April 2016 and May 2016. After her review, Lorelyn reports that there are significant differences between the 2 pay equity plans. When is TIK-RAC required to review its pay equity plan again? a) Immediately b) Apr-17 c) May-17
The answer is a. Immediately Functional Area: C4 Rationale(s): A is correct. The employer is obligated to review the pay equity plan once a year, but it must review the plan after significant changes to the business – such as a merger. B is incorrect. While an employer must review the pay equity plan once a year, it must review the plan after significant changes to the business. C is incorrect. While an employer must review the pay equity plan once a year, it must review the plan after significant changes to the business. Reference(s): Unit 5: Understanding Employment Legislation, Module 9: The Pay Equity Act. Filsinger, 2015, pp. 289-300. Canada.ca, Tips on How to Implement Pay Equity (https://www.canada.ca/en/employment-social-development/programs/pay-equity/implement.html). Ontario Pay Equity Commission, A Guide to Interpreting Ontario’s Pay Equity Act, Part I (http://www.payequity.gov.on.ca/en/tools/Pages/guide_to_act8.aspx).
Lorelyn is a senior HR professional at a medium-sized manufacturing company, RAC Parts, in Windsor, Ontario. The company spent the latter half of 2016 preparing for a merger with TIK Inc., which was finalized in January 2017. The new company is called TIK-RAC Inc. With the merger finalized, TIK-RAC’s CEO asks Lorelyn whether the company is required to review its pay equity plan. RAC Parts and TIK last reviewed their respective pay equity plans in April 2016 and May 2016. After her review, Lorelyn reports that there are significant differences between the 2 pay equity plans. In what circumstances would a review of TIK-RAC’s pay equity plan not be necessary? a) If TIK-RAC hired several administrative assistants for its executive staff. b) If TIK-RAC bought a supplier’s manufacturing plant. c) If TIK-RAC installed a new communication network.
The answer is c. If TIK-RAC installed a new communication network. Functional Area: C4 Rationale(s): A is incorrect. An employer should review the pay equity plan anytime jobs are added or eliminated. B is incorrect. An employer should review the pay equity plan when the business has been sold or has acquired another business. C is correct. A company-wide communication network will not affect the value of any jobs in the company. Employers are obligated to review the pay equity plan only when the new technology affects the value of related jobs. Reference(s): Unit 5: Understanding Employment Legislation, Module 9: The Pay Equity Act. Pay Equity Act, R.S.O. 1990, c. P.7, s. 13.
Lorelyn is a senior HR professional at a medium-sized manufacturing company, RAC Parts, in Windsor, Ontario. The company spent the latter half of 2016 preparing for a merger with TIK Inc., which was finalized in January 2017. The new company is called TIK-RAC Inc. With the merger finalized, TIK-RAC’s CEO asks Lorelyn whether the company is required to review its pay equity plan. RAC Parts and TIK last reviewed their respective pay equity plans in April 2016 and May 2016. After her review, Lorelyn reports that there are significant differences between the 2 pay equity plans. When Lorelyn reviews the existing pay equity plans for RAC Parts and TIK Inc., respectively, she discovers significant differences between them. The CEO asks Lorelyn to develop a new equity plan for TIK-RAC that recognizes the lower cost elements from each existing plan to lower the company’s overall costs. How should Lorelyn respond to this direction? a) She should advise that the company could adopt whichever previous plan provided the lowest costs in its entirety. b) She should advise that a new plan could be established based on the statutory minimums. c) She should advise that there is no way to lower costs.
The answer is c. She should advise that there is no way to lower costs. Functional Area: C4 Rationale(s): A is incorrect. Pay equity adjustments must be based on the higher of the original rates and lowering rates would be counter to the Pay Equity Act. B is incorrect. A pay equity plan is devised based on wage gaps between male and female employees for jobs requiring similar skill, effort, responsibility, and work conditions. When a gap exists, the higher rate is to be used. C is correct. A pay equity plan is to reduce the wage gap between men and women. If there are significant differences between the 2 plans, employers should increase (not lower) the pay rate to maintain pay equity in the company. Reference(s): Unit 5: Understanding Employment Legislation, Module 9: The Pay Equity Act. Pay Equity Act, R.S.O. 1990, c. P.7, s. 13.
