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The Compliance Audit Update

We wish to thank Edmond Montgomery Publications Ltd. for allowing us to publish the December 1999, Volume 9, Number 12 issue of their bulletin on our Web Site.

The Compliance Audit Update
Abstract from December 1999, Volume 9, Number 12 issue of the bulletin:

Valuing Diversity
Employment Equity in Canada's Changing Workforce

The federal Employment Equity Act ("the Act") gives the Canadian Human Rights Commission ("the Commission") the mandate to undertake compliance audits of approximately 420 employers, including federally regulated companies in the private sector, federal Crown corporations, and government departments and agencies. For nearly two years, the Commission has held an audit frame- work in place to assess the employer’s employment equity status based on the 12 statutory requirements established by the Act. Employers must demonstrate that the necessary steps are being taken to meet the requirements.

Employers were given one year from October 24, 1996, the date the Act came into effect, to bring themselves into compliance. In November 1997, the Commission began its audits, setting for itself a target of initiating 83 audits by the end of 1998. This goal reflects the Com-mission’s intent to audit all employers at least once within the first five-year audit cycle.

As of fall 1999, 128 employers - 100 from the private sector and 28 public sector departments and agencies - had been notified of the Commission's intention to undertake an audit. Compliance review officers have completed 76 initial compliance audits. Of this number, only two were in compliance.

The Commission is also conducting follow-up audits of those employers that were not initially in full compliance. Of the 35 follow-up audits that have begun, the Commission is reporting that 23 employers are now showing signs of compliancy, and that relatively little work remains for the remainder to achieve full compliance.

On the basis of the reviews conducted to date, the Commission has been able to report the following initial findings:

• At the time of the initial audits, the vast majority of employers still require significant undertakings and a follow-up audit before they are in compliance.
• The follow-up audits show there areearly indications of positive trends, although many employers are still struggling with the more complex aspects of employment equity. The Commission has identified two significant problem areas: (1) working-force analysis, including thorough employment systems reviews to identify barriers to full representation; and (2) the setting of appropriate goals.
• There is a need for the public agencies that are mandated to provide technical support on employment equity - the federal Treasury Board and the Public Service Commission of Canada for public sector employers and Human Resources Development Canada's (HRDC) regional network of workforce equity officers for the private sector - to provide employers with the necessary tools and training to achieve compliance with-out having to go through the costly and time-consuming follow-up audit process.

What do these findings suggest for the nearly 300 employers that have not yet been audited? They suggest that the legislation establishes a high standard of compliance, that the Commission will be auditing employers and promoting compliance against this high standard, and that most employers face major challenges in bringing their workplaces into compliance with the legislation.

Compliance audit update

In the remainder of this issue, we out-line the compliance audit requirements and the key questions that employers must be able to address to achieve compliancy at the initial audit stage.

REQUIREMENTS

1. Workforce survey and data system
- The employer must collect work-force data.- Self-identification for people with disabilities, Aboriginal peoples, and members of visible minorities must be voluntary.
- Information collected for the purposes of a workforce analysis must be kept confidential and used only for the implementation of the requirements of the Act.

2. Workforce analysis
- The employer must analyze work-force data in order to determine the degree of under-representation of designated groups in each occupational group.

3. Systems review
- The employer must review its employment systems, policies and practices to identify barriers to members of designated groups for occu- pational groups in which under-reppresentation has been found.

4. Elimination of barriers
- The employment equity plan must specify the short-term measures the employer will implement to eliminate barriers identified through its systems review.

5. Accommodation
- The employment equity plan must include provisions for the reasonable accommodation of employee's needs.

6. Positive policies and practices
- The employer must prepare an employment equity plan that specifies short-term positive policies and practices aimed at providing opporunity to members of under-represented designated groups with respect to hiring, training, promotion, and retention.

7. Hiring and promotion goals
- The employment equity plan must contain short-term goals for the hiring and promotion of people from designated groups in each occupational group in which under-representation has been found, along with measures to be taken each year to achieve these goals.

8. Representation goals
- The employment equity plan must include longer-term goals for increasing designated group representation in the employer's overall workforce, along with a strategy for achieving those goals.

9. Monitoring and revision of plan
- The employer must make reasonable progress and must monitor implementation of its employment equity plan on a regular basis to assess whether in fact reasonable progress is being made.
- At least once during the period covered by the short-term goals, the employer must review and revise its employment equity plan. Revision must include the updating of goals and any other changes that monitoring suggests are required or that are necessitated by changing circumstances.

10. Provision of information
- The employer must provide information to its employees on the purposes of employment equity and the steps taken to implement employment equity.

11. Consultation
- The employer must consult with employee representatives, including bargaining agents, where they exist, about the assistance that representatives could provide with respect to communication with employees and the implementation of employment equity.

12. Maintaining records
- The employer must maintain employment equity records with respect to its workforce, its employment equity plan, and the implementation of its employment equityplan.

WORKFORCE SURVEY AND DATA SYSTEMS: ISSUES AND CONSIDERATIONS

1. Is the self-identification questionnaire consistent with the specifications in the Act, ss. 3 and 9, and in the regulations, ss. 3, 4, 5, and schedule IV?

2. Is the purpose of the questionnaire consistent with the purpose of the Act, and does the information obtained through the questionnaire enable employers to meet their obligations under the Act?

3. Are the self-identification questions for people with disabilities, Aboriginal peoples, and members of visible minorities consistent with definitions contained within the Act?

4. Does the questionnaire meet specific obligations prescribed in the Act and regulations - for example, does it define "people with disabilities," "Aboriginal peoples," and "members of visible minorities"?

5. Has the questionnaire been distributed to all employees?

6. Did the employer introduce the workforce survey exercise with an adequate lead-up strategy and make every effort to ensure a reasonable rate of return?

7. If the rate of return was too low, did the employer develop a follow-up strategy aimed at increasing the response rate?

8. Did the employer make the questionnaire available in alternate formats on employees' requests?

9. Was the employer's lead-up strategy developed with regard to the size of the organization, whether employees are geographically dispersed, whether the organization operates in more than one sector, and other factors? For example, in a larger organizational setting, was a formal communications strategy developed that included letters to staff, articles in in-house newslet- ters, posters, staff meetings, and other communications vehicles?

10. Did the organization implement follow-up activities to increase the rate of return and to ensure a return rate of as close to 100% as possible?

Have measures been adopted to ensure that workforce data are kept reasonably up-to-date? For example, is a questionnaire provided to any employee who requests it, any employee who wishes to change information previously submitted, and to all new employees?

11. Are the calculations of the representation of the four designated groups based on the employer's total workforce as reported in its annual employment equity report to HRDC for the private sector, and the Treasury Board for the public sector?

12. In order to safeguard against any overestimation of the representation of members of designated groups, is the representation of the four designated groups based on the entire workforce (that is, those who completed a questionnaire and those who did not), not just on the sample that completed the questionnaire?

13. Has the employer taken steps to ensure that self-identification is entirely voluntary? For example, does the questionnaire indicate that responses to the questions on the questionnaire are voluntary?

14. Is this message also featured in the communications leading up to the implementation of the questionnaire?

15. As part of the lead-up strategy, have managers and supervisors been advised that they are responsible for ensuring that self-identification is entirely voluntary? For example, have they been advised of appropriate conduct surrounding the administration of the questionnaire - that is, ensuring that their actions or comments do not or cannot reasonably be seen to coerce employees into self-identifying?

16. Have employees been informed that a person may be a member of more than one designated group? For example, does the questionnaire indicate that a person may be a member of more than one designated group?

17. Is this message also featured in thecommunications leading up to the implementation of the questionnaire?

18. Have measures been adopted to ensure that workforce data are kept reasonably up-to-date? For example, is a questionnaire provided to any employee who requests it, any employee who wishes to change information previously submitted, and to all new employees? Have adjustments been made to the counts of designated group members to reflect the new data? Have terminations of designated group members been recorded as they occurred?

Compliance audit update

19. Does the employment equity office remind employees periodically that questionnaires are available to employees who wish to change information previously submitted?

20. Are questionnaires provided to new employees as part of their orientation package?

21. Is the administrator of the employment equity database notified when employees terminate so that this information can be reflected in the database?

22. Are regular (weekly or monthly) reports produced that reflect the new data on the counts of designated group members?

23. Is there a system in place that is capable of providing up-to-date data on, at minimum, internal representation, hiring, promotion, termination, and salary by designated group and occupational group? Is the system capable of providing reports recruitment, applications,screening, selection, and training and development?

24. Does the employer's information system at least meet the commission's minimum requirements that is, that the system is capable of (1) undertaking periodic "snapshots" that show the representation of the workforce by designated group and occupational group at specific points in time; and (2) undertaking periodic "flows" analyses that show the number and propertion of hires, promotions and terminations by designated group and occupational group between two specific points in time?

25. Has the employer implemented in formation system enhancements in order to meet the Commission's additional information requirements in the following areas: (1) applicant tracking systems that include administering self-identification surveys to job applicants; and (2) training and development tracking systems?

Has the employer implemented information system enhancements in order to meet the Commission's additional information requirements?

26. Does the information system have both a periodic (that is, monthly, quarterly, or semi-annually) and ad hoc (that is, on an "as needed" basis) reporting capability?

27. Has the employer implemented safeguards to ensure that information that might permit someone to ascertain whether an individual has self-identified is kept strictly confidential?

28. Is access to this information available only to staff who are involved in the implementation of employment equity in the workplace, and are exceptions made only where an employee has explicitly agreed to the use of his or her self-identification information for other purposes?

29. Has the employer developed a code of confidentiality that specifies who will have access to the information, the purposes for which people will have access, and their accountability for ensuring that in formation will not be used for other purposes?

WORKFORCE ANALYSIS: ISSUES AND CONSIDERATIONS

30. Has the employer calculated the external representation of designated group members by occupational group? Do these calculations take into account the most appropriate labour pool for the occupatonal group - that is, the entire Canadian workforce or segments of the workforce, taking into account the relevant labour pool as defined by qualifications, eligibility, and geographic area?

31. Has the "most appropriate" labour pool been determined for each occupational group?

32. Are the employer's decisions consistent with the definition of "most appropriate" in the regulations, which refers to "those segments of the Canadian workforce that are identifiable by qualification, eligibility of geography, and from which the employer may reasonably be expected to draw employees"?

33. Has the employer compared the external representation (availability estimates) with workforce data to determine the degree of under-representation, if any, of each designated group in each occupational group?

34. In comparing external representation with workforce data, has the employer used the labour market information that has been made available to it under s. 42(3) of the Act by HRDC? Specifically, is the employer using the 1996 Employment Equity Data Report that has been made available by the Labour Standards and Workplace Equity section of HRDC?

35. For each designated group where under-representation has been found, has the employer (1) compared the shares of hiring its members received with external repreentation; (2) compared the shares of promotions its members received with internal representation; and (3) compared the termination rates of its members with the termination rates for non-designated group employees?

36. Are the results of this analysis used to determine whether systemic barriers are present in the external recruitment and selection process, or in the internal development and promotion process, or both?

SYSTEMS REVIEW ASSESSMENT: ISSUES AND CONSIDERATIONS

37. Does the scope of the review of employment policies and practices encompass: recruitment, selection, hiring, development, training, promotion, retention, termination, and accommodation?

38. Where these policies and practices may contribute to the under -representation of designated group members, are they reviewed in order to identify any employment barriers that may have an adverse impact on their employment opportunities?

39. Does this review include (1) policies and practices covering the workplace as a whole that may contribute to under-representation found in an occupational group, and (2) policies and practices specific only to an occupational group with under-representation?

40. Although the requirement to review employment policies and practices pertains only to those policies and practices that contribute to the under -representation of designated group members, did the employer at least undertake an initial examination of all policies and practices?

41. Does the review also encompass policies and practices specific only to an occupational group with under-representation - including formal policies, such as licensing or credential requirements, within specific occupational groups?

42. Does the review encompass informal practices that are manifested in a workplace culture that is hostile to women or other designated group members?

43. Where under-represented designated group members are receiving shares of hiring that fall below external representation, does the review focus on recruitment, selection, and hiring policies and practices and on accommodation as it relates to these areas?

44. Is the quantitative workforce analysis (discussed above) used to determine whether systemic barriers are present in the external recruitment and selection process, or in the internal development and promotion process, or both?

45. Where under-represented designated group members are receiving shares of promotions that fall below internal representation, is the review focussed on development, training, and promotion policies and practices and the need for accommodation as it relates to these areas?

46. Where under-represented designated groups have termination rates that exceed those of non-designated groups, is the review focused on retention and termination policies and practices and to accommodation as it relates to these areas?

47. Do the results of the employment systems review provide causal explanations for the under-representation found in occupational groups that provide a reasonable basis for the employer to take corrective action?

48. Has every effort been made to ensure that causal explanations havebbeen found and that corrective action is not being based on generalizations or unsubstantiated observations? For example, if a system review concludes that a recruitment and selection system is "unfair," are there specific reasons why it is considered unfair and specific examples of how this unfairness contributes to this under-representation?

49. Where new systems and practices have been introduced after a review has been completed, have the new employment systems or practices been assessed to ensure that they do not constitute a barrier?

50. Has the employer established an ongoing capability to review new employment systems and practices? For example, if the original employment systems review was conducted by a joint union- management task force, have the parties considered using the same one or a new task force to meet periodically (for example, quarterly) to identify and review new employment systems and practices?

ELIMINATION OF BARRIERS: ISSUES AND CONSIDERATIONS

51. Does the employment equity plan include measures to remove each of the barriers identified in the course of the systems review that cannot be justified on the grounds that (1) they are a bona fide or validated occupational requirement; (2) they are protected by provisions of s. 8 of the Act, related to seniority, priorities, or workforce adjustment measures; or (3) they are authorized by law, as per s. 5(a) of the Act, related to employer obligations?

52. Does the employment equity plan include a timetable for the implementation of each of these measures within a reasonable period of time, taking into account (1) the significance of the measure; (2) internal and external resources and constraints; (3) alternatives available; and (4) the complexity and costs of implementation?

53. Although it is possible that the complete elimination of certain barriers may require a longer time-frame, are at least some significant measures to address each barrier being undertaken?

54. Does the order in which barriers are addressed correspond to their relative significance?

55. In setting its priorities, has the employer documented its reasoning? Is the employer prepared to justify its decision to a compliance officer, if requested?

56. In setting priorities, has the employer recognized that some measures to address each barrier must be undertaken within the first three years of the plan?

57. Does the plan include a process to ensure that new employment policies and practices introduced in the future will be assessed for possible barriers?

58. Has the ongoing capability to review new employment systems and practices been incorporated into the employment eqity plan?

ACCOMMODATION: ISSUES AND CONSIDERATIONS

59. Does the employer have a written policy on accommodation?

60. Have provisions related to accommodation been designed to ensure that (1) the needs of applicants and employees from designated groups are accommodated up to the point of undue hardship; (2) accommodation can address both physical accessibility issues and the need for adjustments to policies or procedures; (3) accommodation is achieved through individual assessment; (4) accommodation respects individual dignity, minimizes the individual's discomfort, and maximizes their autonomy; and (5) effective implementation mechanisms are in place to ensure that accommodation will be provided?

61. Do these implementation mechanisms include such elements as a written policy, arrangements to ensure the availability of adequate funding for accommodations, or a strategy for communicating information on accommodation to managers and staff?

62. Is the employer in compliance with the Canadian Human Rights Act with respect to the employer's duty to accommodate short of undue hardship to the employer?

63. Has a written policy been developed that incorporates the above items and helps to demonstrate an employer's commitment to take a proactive stance in fulfilling this duty?

64. Where policies related to accommodation do not already exist, has the employer (1) already adopted alternative procedures to ensure that accommodation takes place; or (2) included measures in its plan for the implementation of procedures or a policy on accommodation?

65. Where the employer has included measures in its plan related to accommodation, are these measures accompanied by an implementation timetable that takes into account internal and external resources and constraints and the complexity and costs of implementation? If certain measures require time to implement, does the employer clearly recognize that there exists an obligation, established by jurisprudence related to the Canadian Human Rights Act, to provide reasonable accommodation of the needs of individual applicants and employees?

66. Does the employer recognize that although a timetable for implementing plans related to accommodation may be acceptable under the Employment Equity Act, this does not reduce or eliminate obligations with respect to accommodation that already exist under the Canadian Human Rights Act?

POSITIVE POLICIES AND PRACTICES: ISSUES AND CONSIDERATIONS

67. Does the plan specify policies and practices that will be instituted in order to improve opportunity for under-represented groups and to promote an equitable workplace environment?

68. Do these policies cover matters such as accessibility, harassment, and support for the integration of designated groups of employees into the workplace?

69. Are these positive policies and practices specific and realistic, and do they reasonably address the causal explanations for the under representation found in occupational groups?

70. Among the positive policies and practices, are there special measures for members of designated groups substantially under-represented in certain occupational groups or in the organization as a whole?

71. Are these special measures aimed, in part, at creating a "critical mass" of designated group employees that will help to make change more self-sustaining?

72. Do these special measures relate to hiring, training, promotion, and retention, and are they (1) carefully tailored to a situation of demonstrable and significant disadvantage; (2) explicitly temporary in nature (meaning that the impact of each measure is reviewed on a regular basis and the measure is left in place only as long as the situation of disadvantage persists); and (3) designed in a manner that prevents undue exclusionary effects on non-designated group members?

73. Are special measures implemented only where there is a demonstrated need?

74. With respect to the requirement to ensure no undue exclusionary effects on non-designated group members, are special measures more likely to be developed in cases where designated groups are severely under-represented? For example, is priority given to special measures that increases the representation of women from 0 percent to a critical mass of 10 percent within an occupational group (given an external representation of much higher than 10 percent), rather than a special measure that seeks to increase the representation of women from 40 percent to 50 percent (given an external representation of approximately 50 percent)?

Does the plan include one-to three-year numerical goals for the hiring and promotion of designated group members in each occupational group in which under- representation was found through the workforce analysis?

75. Does the plan include a timetable for the adoption and implementation of each policy and practice within a reasonable period of time, taking into account (1) the significance of the policy or practice; (2) internal and external resources and constraints; and (3) the complexity and costs of implementation?

76. In developing special measures, does the employer set priorities, taking into account the factors noted above? In setting these priorities, does the employer document the reasoning and is the employer prepared to justify its decisions to a compliance officer, if requested?

77. Are the positive policies, practices, and special measures proposed in the plan sufficient to ensure that short-term hiring/promotion and representation goals are achieved?

HIRING AND PROMOTION GOALS: ISSUES AND CONSIDERATIONS

78. Does the plan include one-to three-year numerical goals for the hiring and promotion of designated group members in each occupational group in which under-representation was found through the workforce analysis?

79. Are these goals based on a realistic assessment of what can be achieved, given the barriers-elimination, accommodation, and special measures that the employer plans to implement?

80. If the employer's goals are expressed as percentages, has their establishment been based on the following considerations: (1) external representation; (2) the degree of under-representation and the requirement that the plan be sufficient to achieve reasonable progress; (3) the impact of goals on non-designited group members; (4) the expected effects of measures in the employment equity plan; (5) current hiring and promotion shares and termination rates for designated group members?

81. If the employer's goals are not expressed as percentages, does their establishment include all of the above, as well as (6) anticipated changes in workforce size; and (7) anticipated turnover?

REPRESENTATION GOALS: ISSUES AND CONSIDERATIONS

82. Does the plan include goals for increasing, over a period of more than three years, the representation of each designated group in the employer's workforce found to be under-represented?

83. Are these goals either numerical, non-numerical, or both?

84. Are numerical goals expressed as the percentage representation of designated groups within occupational groups at some point in the future?

85. Do any non-numerical goals refer to barriers-elimination, accommodation, or special measures that have not been implemented over the shorter term?

86. Where at least some of the representation goals are numerical, are they based on the same sorts of considerations as those listed for short-term hiring and promotion goals, along with the anticipated impact of those short-term goals themselves?

87. Does the employer have a longer- term workforce planning capability in order to set long-term representation goals?

MONITORING AND REVISION OF THE PLAN: ISSUES AND CONSIDERATIONS

88. Are managers clearly accountable and committed to the organization's employment equity plan?

89. Are managers' specific accountabilities under the employment equity plan incorporated into their performance contracts?

90. Does the employer have a system in place for regularly assessing the effectiveness of its employment equity plan?

91. Does each goal within the employment equity plan have specific and measurable indicators of achievement of the goal?

92. Does the system for regularly assessing the effectiveness of the employment equity plan include regular (for example, quarterly) top management reviews of progress towards implementation of the plan?

93. Does the employer's assessment of its employment equity plan include an analysis of progress made since implementation of the plan began? Does this include an evaluation of the attainment of short-term and long-term goals as well as the implementation of initiatives to ensure accommodation, remove employment barriers, and establish positive and special measures? Does this also include actions related to communication, consultation or collaboration, and record keeping?

94. In addition to periodic (for example, quarterly) assessments of the progress towards implementation of the plan, does the employer undertake at least one comprehensive assessment over the life of the plan? Are the results of this assessment thoroughly documented?

95. At least once every three years, does the employer carry out a review of the plan's effectiveness, and make any necessary revisions to the goals and other elements of its plan to reflect changes in circumstances?

96. Are the reasons for any revisions to the goals and other elements of the plan thoroughly documented?

PROVISIONS OF INFORMATION: ISSUES AND CONSIDERATIONS

97. Does the employer have material or presentations to explain the purposes of employment equity and the steps it has taken to implement its program? Has this material been kept up-to-date and provided to all new employees, managers, and staff involved in activities undertaken to comply with the Act? Is this material brought to the attention of all other employees at reasonable intervals?

98. Does the employer have an effective communications strategy that incorporates periodic presentations, newsletters, and memos to all staff, and an orientation program for new employees?

99. Do the materials and presentations provide a reasonable amount of information in a clear, comprehensible manner, and can they be made available in alternate formats on an employee's request?

CONSULTATION ISSUES AND CONSIDERATON

100. Where bargaining agents exist, has the employer invited them to provide their views on the development, implementation, and revision of the employer's employment equity plan, and on the assistance they could give with respect to communication and implementation of employment equity?

101. Has a joint union-management committee been established as the means to undertake the union-management consultations required under the Act?

102. Where bargaining agents do not exist or do not represent the entire workforce, has the employer invited people designated by the employees to act as their representatives to provide their views?

103. Has the employer ensured that the breadth and depth of the unrepresented workforce has been represented in these consultations?

104. Has the employer made all reasonable efforts to ensure that consultation is meaningful and appropriate in terms of the Employment Equity Act?

105. Has the employer carefully documented all consultation activities, as well as the substantive issues and outcomes of the consultation process?

ESTABLISHING AND MAINTAINING RECORDS: ISSUES AND CONSIDERATIONS

106. Has the employer established a system or procedures for the maintenance of orderly employment equity records?

107. Has the employer ensured that the information system and procedures have been thoroughly documented?

108. Do these records contain accurate information on all matters specified in the regulations?

109. Has the employer's chief executive officer or designate certified that all information is accurate?

Publisher's Note

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COPYRIGHT © 1999 EMOND MONTGOMERY PUBLICATIONS LIMITED - 1SSN 1203-732X

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