Ontario's New Pay Law: A 'First Step' or a Missed Opportunity?

MISSISSAUGA, Ontario – January 22, 2026 – As of the new year, a significant shift has occurred in Ontario's job market. New legislation, part of the province's ongoing 'Working for Workers' acts, now compels many employers to disclose salary ranges in public job postings. The move is being hailed by the government as a major step toward fairness, but for one of the province's largest unions, it's a half-measure that leaves the deep-rooted problem of pay inequity largely untouched.

United Food & Commercial Workers (UFCW) Local 175, representing over 70,000 workers, has publicly welcomed the change but is simultaneously sounding the alarm. The union argues that while transparency at the hiring stage is positive, the law stops short of addressing the systemic wage discrimination that persists for millions of current employees, particularly women.

A New Era of Transparency in Hiring

Effective January 1, 2026, the amendments to Ontario's Employment Standards Act introduced new rules aimed at leveling the playing field for job seekers. Employers with 25 or more employees must now include expected compensation or a salary range in all publicly advertised positions. The legislation also mandates disclosure if artificial intelligence is used in the screening process and prohibits employers from requiring 'Canadian experience'—a long-criticized barrier for new immigrants.

Advocates for the law believe it empowers workers by providing critical information upfront, reducing the historical power imbalance where salary negotiation was shrouded in secrecy. Kelly Tosato, President of UFCW Local 175, whose membership is over 52 per cent women, acknowledged the positive aspects.

“The new pay transparency legislation is a welcome and long-overdue first step toward fairer workplaces,” Tosato stated. By requiring salary disclosure, she noted, the province is acknowledging that “pay secrecy fuels inequality.” The goal is to reduce the risk of discriminatory wage-setting before a candidate is even hired.

However, the applause from the union is heavily qualified, framing this legislative victory as just the beginning of a much longer fight.

The Persistent Gap: Transparency vs. Equity

The central critique from UFCW and other advocates is the stark difference between transparency and equity. While the new law shines a light on pay for prospective hires, it does little to illuminate or correct pay discrepancies for those already in the workforce. This is a critical omission, the union argues, in a province where the gender pay gap remains stubbornly wide.

According to recent analyses based on Statistics Canada data, an Ontario woman earns on average just 72 cents for every dollar earned by a man when looking at annual earnings. While the gap narrows to 87 cents when comparing hourly wages, the disparity remains significant and has persisted for decades. For racialized women, Indigenous women, and women with disabilities, the gap is substantially wider, sometimes approaching 50 per cent.

UFCW Local 175 cautions that the new legislation, in its current form, will not close this gap. “The new requirements focus narrowly on job postings and do not require employers to correct existing gender pay gaps, provide workers with access to internal pay information, protect against retaliation or ongoing pay secrecy practices, or ensure strong, proactive enforcement,” said Tosato.

This creates a scenario where women may still be hired at the bottom of wide pay ranges, or find themselves paid less than male colleagues in the same role within the same company, with no new mechanisms to challenge the disparity. The burden of raising concerns remains on individual workers, a process that can be intimidating and carry professional risks.

The Union Blueprint for a Fairer System

Drawing on decades of experience, UFCW is pointing to its own collective agreements as a model for what a truly robust system looks like. The union is calling on the provincial government to adopt a more comprehensive framework that moves beyond simple disclosure at the hiring stage.

“Pay transparency only works when paired with accountability and enforceable standards,” Tosato explained. “In unionized workplaces, salary grids, classifications, and wage rates are negotiated, written into collective agreements, and accessible to all members. Transparency reduces discrimination, limits arbitrary pay decisions, and promotes fairness across genders and job classes.”

To achieve this standard across the province, the union has outlined five key demands:

1. Extend transparency to include all current workers, not just new hires.
2. Require employers to justify pay differences that exist within the same job class or salary range.
3. Protect workers’ right to discuss pay with colleagues without fear of reprisal from their employer.
4. Mandate gender pay gap reporting for larger employers to publicly track progress.
5. Shift to proactive enforcement, moving away from a complaint-based system to one that includes government audits and meaningful penalties for non-compliance.

These measures, the union contends, would shift the responsibility from the individual employee to the employer and the system itself, embedding fairness into workplace structures.

A Legislative Patchwork with Enforcement Gaps

Ontario is not alone in legislating pay transparency. British Columbia and several Atlantic provinces have enacted similar laws requiring salary ranges in job postings, aligning with a growing trend across North America and Europe. However, critics point out that Ontario's current approach is arguably weaker than what the province itself had previously planned.

In 2018, a different provincial government passed the Pay Transparency Act (Bill 3), which was never proclaimed into law. That act included more stringent measures, such as prohibiting employers from asking candidates about their salary history and requiring large employers to track and report on their gender pay gaps. The absence of these elements in the 2026 legislation is seen by many as a significant missed opportunity.

Legal experts have also raised concerns about the practical impact of the new rules, with some suggesting they risk being “more symbolic than substantive” without a clear and robust enforcement strategy. While employers face potential Ministry of Labour investigations, the lack of automatic audits or severe penalties may lead to inconsistent compliance.

For their part, some employer groups like the Ontario Chamber of Commerce have acknowledged the pay gap as a serious issue but have also urged caution, emphasizing the complexity of the problem and the administrative burden new legislation can place on businesses.

As Ontario embarks on this new chapter of workplace regulation, the debate is clearly drawn. The government has delivered a law that promises more power to job seekers, but for thousands of workers and their advocates, the fight for true economic equality is far from over. As Tosato concluded, “Workers, and particularly women, deserve a system that doesn’t just reveal pay, but ensures it is fair. Pay transparency is progress. Pay equity must be the goal.”