4. Status of Audits
How compliance is achieved
Employers can comply with the Act in two ways:
by having a workforce that fully reflects the availability of designated groups in the labour market, and putting in place the mechanisms necessary to enable it to maintain this level of representation; or
if the workforce is not fully representative, by putting in place measures required by the Act to reach full representation; these mechanisms include reviewing their employment practices, developing an employment equity plan and setting goals.
The Commission’s role
There are three main elements to the Commission’s role:
The Commission audits employers for compliance and works with them to correct areas of non-compliance.
The Commission monitors the implementation of employment equity plans and conducts audits if employers fail to make reasonable progress.
If an employer fails to cooperate with the Commission or to achieve compliance, the Commission may, as a last resort, issue a direction instructing the employer to implement measures required by the Act. If the employer does not abide by the direction, the Commission may then refer the case to the Employment Equity Review Tribunal.
Employers under audit
To have an impact on as many employees as possible, the Commission began in 2000 to focus its efforts on large employers (Figures 1 to 4). Although 51.1% of employers (253) are under audit, their employees represent 75.4% of the workforce (714,058 employees) covered by the Act. A list of employers currently under audit can be found at the end of this report.
The slight reduction in the percentage of the workforce under audit (to 75% from 82% in 2001) is attributable to the extension of the Act this year, through Orders in Council, to employees of the Canadian Forces, the RCMP and CSIS. When Parliament passed the new Employment Equity Act in 1995, it made provisions to have the Act apply to the Canadian Forces and the RCMP at a later date to be determined by regulations. It also required that special regulations be passed before CSIS could be audited. The Commission, which has in earlier reports pointed to the government’s delay in passing these regulations, is pleased that the Act has been extended to these organizations. Additional private sector employers also became subject to the Act this year. In total, the number of employees covered by the Act increased from 824,130 to 947,079 and the number of employers subject to the Act rose from 476 to 495.
Since the start of its mandate in 1997, the Commission has initiated audits of 253 employers or 51.1% of the current employer pool. In most cases at least one follow-up audit was required before these employers could be declared in compliance with the Act. As a result, as Table 1 shows, these employers required a total of 416 audits, representing approximately the number of audits that the Commission had estimated it would conduct in the first five years of its mandate.
Table 1 – Audits Started and Completed 1997–2002
| 2002 | Cumulative 1997–2002 |
Started | Completed | Started | Completed |
Initial audits | 38 | 27 | 253 | 180 |
Follow-up to initial audits | 17 | 29 | 144 | 121 |
Follow-up to directions | 5 | 6 | 19 | 10 |
Cancelled | - | 5 | - | 25 |
Total audits | 60 | 67 | 416 | 336 |
In 2002, the Commission initiated 60 audits. These comprised 38 new audits, 17 follow-up audits and five third audits to determine whether employers had complied with directions.
Five audits were cancelled in 2002, for a total of 25 cancelled audits since 1997. Reasons for cancelling an audit include the closing of a business or its absorption into another company, or a drop in the workforce to below 100 employees, the statutory cut-off number for the private sector.
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