Ontario’s New Compensation Transparency Requirements: How Employers Can Get It Right

This is a continuation of our previous post about Ontario’s new job posting requirements.

Beginning January 1, 2026, Ontario employers will be subject to new rules regarding the advertising of compensation in job postings. 

These changes, introduced through the Working for Workers Four Act, 2024, and Five Act, 2024, are designed to promote fairness and transparency in the labour market.

While these updates may seem straightforward, they will have ripple effects across both recruitment and employee retention. 

Here’s what you need to know and how to prepare.

1. What the Law Requires

These rules apply to employers with 25 or more employees. 

If you’re below that threshold today, it’s still wise to prepare, as compensation transparency becomes more complex as your team grows.  

Starting in 2026, employers must include compensation information in all job postings that are publicly advertised. 

Specifically:

• Compensation or Range: Each posting must include either the expected compensation or a pay range.
• $50,000 Band Limit: If a range is used, the difference between the top and bottom cannot exceed $50,000.
• High-Salary Exemption: Postings with an expected annual compensation over $200,000 are exempt.

The Employment Standards Act defines “wages” broadly, encompassing salary, commission, piecework, and other forms of direct pay. 

Employers should carefully assess which elements to include and ensure they remain compliant.

2. How to Set a Compliant Pay Range

Determining an appropriate compensation range isn’t as simple as picking numbers. 

Employers should take a deliberate approach:

1. Start with market benchmarks: Use industry data to understand the going rate for the role.
2. Review internal equity: Align with existing salaries for comparable positions within your organization.
3. Apply the $50,000 band rule: Check to ensure your range doesn’t exceed the legal maximum.
4. Document your methodology: Keep records of how ranges were determined in case of an audit.
5. Standardize across postings: Create templates to ensure consistency across roles.

For startups and scale-ups, where pay structures may be less formalized, this will likely mean creating your first comprehensive compensation framework.

3. The Impact on Current Team Members

One of the most overlooked aspects of compensation transparency is its effect on your existing workforce.

• Pay Equity Risks: If job postings show higher pay than what current employees earn for similar roles, it can create dissatisfaction.
• Retention Concerns: Employees may be tempted to leave if they feel undervalued.
• Communication Needs: Without a clear narrative, transparency could backfire and erode trust.

This is why it’s critical to conduct a pay equity review before the new rules take effect. 

Proactively addressing discrepancies will help prevent turnover and reinforce your credibility as an employer.

Why This Matters for Growing Businesses

For smaller companies and venture-backed scale-ups, compliance is only part of the equation. 

Done right, compensation transparency can:

• Strengthen your employer brand in a competitive talent market
• Build trust with employees, reducing turnover risk
• Provide a foundation for a more structured compensation strategy as your organization grows

These rules will apply to employers with 25 or more employees. 

If your business is not at that threshold today, it’s still important to prepare. 

Compensation transparency becomes more complex as your team expands, and addressing equity issues early will prevent costly adjustments later.

On the other hand, failing to prepare could lead to compliance issues, reputational harm, and challenges in both hiring and retention once you cross the 25-employee mark.

How TROIS Collective Can Help

At TROIS Collective, we help founders and leaders of growing businesses navigate HR and compliance changes with confidence. 

Our team can support you by:

• Conducting compensation audits and benchmarking
• Designing compliant job posting templates
• Advising on internal communications to manage employee expectations
• Building a long-term compensation philosophy aligned with your business goals

Quick Compensation Transparency Requirements

Before Ontario’s 2026 job posting rules take effect, use this checklist to ensure your organization meets the new compensation transparency standards and avoids compliance risks.

☐ Confirm whether your organization has 25 or more employees

☐ Audit current compensation structures and identify existing pay ranges

☐ Benchmark salaries against relevant industry and market data

☐ Ensure pay ranges comply with the $50,000 maximum band rule (unless exempt over $200,000)

☐ Document how compensation ranges are determined and updated

☐ Conduct a pay equity review to identify internal risks or disparities

☐ Develop compliant job posting templates with standardized pay language

☐ Train hiring managers and recruiters on how to explain pay ranges transparently to candidates

Conclusion

Ontario’s new job posting and compensation transparency requirements go beyond compliance, they’re a chance to strengthen trust, fairness, and employer brand.

By preparing now, you can ensure your hiring process aligns with the 2026 standards while positioning your business as a transparent and forward-thinking employer.

If you’d like to prepare your business for these changes, reach out to TROIS Collective to build compliant, transparent, and effective recruitment systems that keep your organization ahead of Ontario’s evolving employment laws