Navigating Ontario’s New Pay Transparency Rules: What HR Leaders Need to Know
- jrezvani
- 7 days ago
- 2 min read
Ontario’s new pay transparency legislation, taking effect January 1, 2026, will apply to organizations with 25 or more employees. These rules will change how employers advertise compensation, creating both compliance challenges and strategic opportunities.
Whether you’re hiring an executive or recruiting for an entry-level role, your postings will soon face stricter requirements. This guide breaks down the key rules, common pitfalls and what HR leaders need to do to prepare. At the end, you can download our 90-Day Implementation Checklist to get your organization ready before the deadline.
Above $200K: The Executive Exemption
If a position’s expected annual compensation (or the high end of a posted range) exceeds $200,000, you are not required to include salary information in the posting.
What This Means for You:
You can post executive, senior leadership and highly specialized roles without salary disclosure.
You avoid revealing sensitive pay data that could help competitors.
You retain flexibility in high-level recruitment negotiations.
The Catch: The $200K calculation follows the Employment Standards Act (ESA) definition of “wages,” which includes all forms of monetary compensation for work:
Included: Base salary, guaranteed bonuses, predictable commissions and other fixed cash equivalents.
Excluded: Stock options, most benefits and one-time sign-on bonuses.
Example:
$190K base + guaranteed $20K bonus → Over $200K threshold → Exempt
$180K base + potential $40K performance bonus → Likely under $200K → Not exempt
Below $200K: The $50,000 Range Rule
For positions below the $200K threshold, salary ranges cannot exceed $50,000 from minimum to maximum.
Large ranges that previously covered entry-level to senior experience levels will no longer be compliant. Employers may need to post separate roles for different experience levels or restructure ranges.
Gray Areas That Can Trip You Up
1. Bonus Structures
Performance bonuses: Not included unless guaranteed.
Sales commissions: Count toward the $200K if reasonably predictable.
Sign-on bonuses: Excluded as one-time payments.
2. Variable Compensation
$180K base + $40K potential bonus = Likely still under $200K.
$190K base + $20K guaranteed bonus = Over $200K threshold.
3. Multi-Level Roles
“Manager/Senior Manager” postings spanning $150K–$220K will likely require separate postings or narrowing the scope.
Strategic Implications for HR Leaders
Salary Band Restructuring
Compress ranges to meet the $50K limit.
Introduce more granular job levels.
Reassess internal equity to avoid compression issues.
Competitive Intelligence
Competitors’ postings will reveal more about their pay practices.
Benchmarking becomes more transparent - and critical.
Geographic pay differences will be more visible to candidates.
Internal Communications
Equip managers to answer questions like:
“Why is the posted range different from my current pay scale?”
“Can I negotiate beyond the posted maximum?”
“How does this affect my career progression?”
Get Your 90-Day Implementation Checklist
With the January 1, 2026 deadline approaching, HR teams should be working now to:
Audit current postings and ranges for compliance.
Update salary bands to fit the $50K rule.
Train hiring managers on the new requirements.
Communicate clearly with employees and candidates.
We’ve created a step-by-step 90-Day Implementation Checklist to guide you through every stage of compliance.
