“The decision makes clear that the Human Rights Code requires employers and compensation setters to be proactive in monitoring for the well-known effects of systemic gender discrimination in compensation of women workers,” said Adrienne Telford, a partner at Cavalluzzo LLP and counsel for the Association of Ontario Midwives with Lara Koerner-Yeo, Jackie Esmonde and Mary Cornish.
“A key message is that when setting compensation for female predominant job classes or professions, employers and compensation setters must use a gender sensitive human rights lens to objectively value the work in comparison to male predominant job classes and professions. This case shows that ignoring gender and ignoring the equity concerns of women workers can lead to serious human rights violations and exposure to significant damages even though those violations may have been unintentional,” she added, suggesting that employers use an “intersectional human rights lens, which takes into account Code protected grounds of discrimination,” including gender, race, gender identity, and disability, at the outset.
Cornish, of Cornish Justice Solutions, noted that “the Court of Appeal decision highlights again that occupational sex segregation for women and low wages go hand in hand.”
The “decision accepts that deeply held attitudes and practices have led employers and compensation setters to give less value to women’s work because they are women. It recognizes that such undervaluation happens because of a web of attitudes, compensation systems and structures which have disadvantaged women,” she stressed.
In Ontario (Health) v. Association of Ontario Midwives, 2022 ONCA 458, the court heard that the respondent Association of Ontario Midwives (AOM) brought a human rights complaint in 2013 “on behalf of more than 800 midwives, alleging systemic gender discrimination” by the MOH, “which funds Ontario’s midwifery program.”
According to court documents, the AOM “challenged the MOH’s compensation practices back to 1994, when Ontario midwives were regulated, and sought compensation back to 1997.”
The Human Rights Tribunal of Ontario adjudicator, Leslie Reaume, “divided her decision into two periods: 1993 to 2005, and 2005 to 2013.”
According to court documents, the adjudicator found that “in 1993, the parties agreed to equitable compensation principles that were designed to ensure that midwives’ compensation was not affected by harmful assumptions and stereotypes concerning the value of women’s work.”
“Significantly,” the court added, “she found that these principles were connected, if not imbued, with gender” and “was satisfied that the parties maintained a connection to the principles until 2005.”
That changed “after 2005,” the court explained, “as the MOH gradually withdrew from the principles they had agreed to in 1993.”
The court noted that in 2010, “after a joint compensation report recommended that midwives receive a 20% compensation increase, the MOH made it explicit that the principles would no longer inform the compensation of midwives and that they would not be replaced with a new methodology for determining appropriate and fair compensation.”
According to court documents, the tribunal adjudicator determined that this “left the compensation of midwives exposed to the well-known effects of gender discrimination on women’s compensation” and concluded that “sex was more likely than not a factor in the adverse treatment midwives experienced after 2005, including the significant compensation gap that developed between midwives and certain family physicians,” who “served as a male comparator.”
Therefore, the adjudicator found that “the MOH was liable for discrimination under Ontario’s Human Rights Code.” She then released a separate decision with remedial orders, “including orders granting a compensation adjustment of 20% back to 2011 and compensation for injury to dignity, feelings, and self-respect in the amount of $7,500 per eligible midwife, plus orders to promote ongoing compliance with the Code.”
The MOH, the court noted, made an application to the Divisional Court for a review of the decisions, but its application was dismissed.
The MOH then appealed to the Court of Appeal, raising multiple issues, which the court narrowed down to: “What is the standard of review of the Tribunal’s decisions post-Vavilov?” “Is the Adjudicator’s liability decision unreasonable?” and is the “Adjudicator’s remedy decision unreasonable?”
Associate Chief Justice J. Michal Fairburn, writing for the Court of Appeal, determined that “the Adjudicator’s decisions are reviewable on a reasonableness standard” and “both of the Adjudicator’s decisions are reasonable.”
Before reviewing the history of the regulation of midwifery, Associate Chief Justice Fairburn noted that “the midwife profession is the ultimate sex-segregated profession: women providing a service for women in relation to women’s health.” She also noted that “there was an obvious risk that midwives would be under-compensated because they are women.”
The court noted that midwifery “has been a regulated health profession in Ontario since January 1, 1994” and before that “midwives were officially excluded from Ontario’s health care system.”
As of 1994, the court noted an initial salary range for midwives was $55,000 to $77,000.
“This placed an entry-level midwife’s salary around the top salary of a CHC [community health clinic] senior nurse, and the highest compensation level for a midwife at approximately 90% of the base salary of an entry level CHC family physician,” the court explained, noting that midwives’ salaries were then frozen from 1994 until 2005.
After “11 years of compensation restraint,” the court added, the parties “reached a 3-year agreement,” which “resulted in increases to midwife compensation, including a first-year increase of 20% to 29%, depending on experience level, and 1% to 2% increases in the remaining years of the contract.”
The agreement expired in 2008, so the parties “commenced negotiations for a new funding agreement.”
However, the court explained, “the AOM had become concerned that a gender gap in compensation had developed between midwives and their CHC physician comparator.”
In 2009, the parties “reached a new three-year agreement, retroactive to April 1, 2008,” which gave midwives “a raise of 2% per year plus an increase in benefits.” They also agreed to “a joint non-binding compensation review conducted by an independent third-party consultant to inform the next round of negotiations.”
Therefore, in 2010, the parties engaged in a compensation study conducted by the Courtyard Group. The resulting report, the court noted “is central to both the Adjudicator’s decision on liability and her decision on remedy.”
The report noted that “the highest paid midwife was paid $104,847 and the lowest paid CHC physician was paid $181,233. Therefore, the highest paid midwife had gone from being paid 90% to around 57% of the lowest level of pay of a CHC physician.”
According to court documents, the “Courtyard Report recommended a 20% increase in compensation, referred to as an ‘equity adjustment’, effective April 1, 2011, to restore midwives to their historic position of being compensated at a level between senior CHC nurses (now nurse practitioners) and CHC physicians.”
The MOH “raised concerns” about the report’s “methodology and its recommendations” after it was released and “for the first time, advised the AOM that negotiations would be governed by the government’s policy of compensation restraint, consistent with the compensation restraint legislation that had been passed before Courtyard started its work.”
The parties did reach a funding agreement in 2013, but “it was entered into on a without prejudice basis to the AOM pursuing legal action.” So that same year the AOM “brought an application to the Tribunal under the Code, alleging that midwives had experienced systemic gender-based discrimination in compensation.”
In her analysis, Associate Chief Justice Fairburn explained the standard of review and determined that Shaw v. Phipps, 2010 ONSC 3884 is “consistent” with Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65.
“In my view, the Divisional Court’s approach to the interpretation of s. 45.8 in Shaw v. Phipps is entirely consistent with Vavilov. The Divisional Court in Shaw v. Phipps did exactly what Vavilov instructs us to do now,” she wrote, noting that in “Shaw v. Phipps, the Divisional Court engaged in a purposive interpretation of s. 45.8 that took into account legislative intent, recognizing that the legislature intended that the highest degree of deference be accorded to the Tribunal’s determination of facts, its interpretation and application of human rights law, and decisions on remedy.”
Associate Chief Justice Fairburn determined that “the standard of review of the Tribunal’s decisions remains reasonableness, although the application of the reasonableness standard is now informed by the guidance provided in Vavilov.”
On the reasonableness of the adjudicator’s liability decision, Associate Chief Justice Fairburn wrote that “the Adjudicator’s reasoning does ‘add up.’”
“Her reasons reveal a logical chain of analysis grounded in the record and the relevant jurisprudence in support of her key conclusion that sex was a factor in the adverse treatment that midwives experienced and the compensation gap that developed between midwives and CHC physicians after 2005,” she explained.
Associate Chief Justice Fairburn noted that the “Adjudicator recognized from the outset of her analysis that she could not presume a connection between gender and adverse treatment solely from context,” but was “alive to the social context of this claim.”
“Importantly, based on the evidence before her, the Adjudicator found as a fact that in 1993 the AOM and the MOH were both ‘aware of the pervasive nature of system[ic] discrimination in compensation, the stereotypes associated with women’s work and the necessity to ensure that women are paid by reference to objective factors like SERW [skill, effort, responsibility, and working conditions],’ ” she added.
The court noted that, for the adjudicator, “the adverse treatment experienced by midwives started after the 2005 agreement was concluded, as midwives gradually lost the connection to the 1993 principles” and “culminated after the release of the Courtyard Report, when the MOH withdrew from the process and advised the AOM that the 2010 negotiations would be governed by compensation restraint.”
“Having reasonably found that the 1993 principles were connected, if not imbued, with gender, it was open to the Adjudicator to find that the Courtyard Report, which affirmed those principles, indicates ‘that gender discrimination may be an operative factor in the compensation of midwives,’ ”Associate Chief Justice Fairburn explained, noting that it “was also open to the Adjudicator to reasonably find that the Courtyard Report was ‘sufficiently compelling for the MOH to realize that the AOM’s claim of gender discrimination may have some validity.’ ”
Regarding the burden of proof, the court noted that “the Adjudicator knew that the ultimate burden remained on the AOM throughout, and she kept it there.”
“All that shifted to the MOH was the evidential burden, which the Adjudicator found was not met,” Associate Chief Justice Fairburn added.
The MOH argued that “the Adjudicator erred by failing to engage with its expert evidence in her liability decision” and the evidence demonstrates “that gender was not a factor in midwives’ compensation.” However, Associate Chief Justice Fairburn disagreed.
“In my view,” she wrote, “the Tribunal’s treatment of the MOH’s expert evidence was reasonable when understood in the context of the litigation and the decision.”
The judge also found that the adjudicator’s “finding that CHC physicians remained an appropriate comparator is reasonable.”
She noted that “while CHC physicians became female-dominant over time, they were family physicians who worked in a particular setting. After 2004 when the OMA [Ontario Medical Association] started bargaining on their behalf, their compensation was harmonized with the compensation of the larger group of family physicians, who remained more than 50% male even in 2013.”
“CHC physicians became financially aligned with other family physicians, leaving a gulf between the compensation of midwives and CHC physicians. In other words, CHC physicians remained a male comparator in 2013, even though they were predominately women, because their pay had been aligned with a male dominated group,” she added.
Associate Chief Justice Fairburn noted that the MOH repeated “many of the same arguments that it made before the Divisional Court in arguing that the Tribunal unreasonably imposed a positive obligation on the MOH to compare midwives’ compensation to that of CHC physicians.” The Divisional Court found that adjudicator’s decision was reasonable, and the associate chief justice agreed.
“The Code provides the Tribunal with broad remedial discretion to order remedies that are fair, effective and responsive to the circumstances of the particular case. In exercising her remedial discretion, the Adjudicator fashioned a remedy based on the evidence that was before her. The MOH has not pointed to any legitimate basis for interfering with the Tribunal’s discretionary remedial decision,” she explained, dismissing the appeal with Justices Lois Roberts and Francine Van Melle in agreement.
Associate Chief Justice Fairburn concluded that she was “satisfied that the Adjudicator’s decisions on both liability and remedy bear the hallmarks of reasonableness — justification, transparency and intelligibility. They are justified in relation to the relevant factual and legal constraints that bear on them. The reasons are also transparent and intelligible.”
In a statement to The Lawyer’s Daily, Cornish noted that “80.1 per cent of Ontario’s health occupations are held by women, yet they face the widest overall earnings gaps at 46.8 per cent with men in those occupations earning on average $93,377 and women earning on average $43,583.”
“Along with midwives, nurses, nurse practitioners, personal support workers and many other female predominant workers provide critical health-care services. The Court of Appeal decision provides a strong legal warning to the compensation setters for these workers and all of Ontario’s workers,” she added.
“Your time for bringing your practices into Code compliance is up. Compensation setters have a clear proactive responsibility to examine their compensation systems and practices and to take steps to close the gender wage gap. Those who fail to take steps to identify and correct their systemically inequitable compensation practices are subject to major lawsuits which can result in significant compensation and injury to dignity damages and orders to fundamentally change their compensation systems and practices,” Cornish stressed.
“This decision recognizes the need to look at the systemic nature and cumulative effects of policies and conduct on disadvantaged groups,” said Patricia DeGuire, chief commissioner of the Ontario Human Rights Commission which was an intervener on the appeal.
“Duty-holders should proactively monitor for and prevent systemic discrimination which includes ensuring pay equity,” she added in a statement.
The Human Rights Tribunal of Ontario, a respondent alongside the AOM, did not provide comment before press time.
The Ministry of the Attorney General, on behalf of the Crown, declined to comment on the decision.