New pay transparency and job ad rules set to hit Ontario employers

Salary ranges and AI disclosures will soon be mandatory in job postings across Ontario. With enforcement set to begin in January 2026, SMBs have limited time left to prepare.

Small and medium-sized businesses across Ontario are running out of time to get ready for major changes to how they advertise jobs. Starting 1 January 2026, employers will be required to include salary ranges in all publicly posted job ads. They will also need to disclose if artificial intelligence is used at any point in the hiring process.

The changes fall under amendments to Ontario’s Employment Standards Act, introduced through Bill 149. The legislation was passed in 2024 as part of the government’s broader “Working for Workers” agenda. While the bill has been on the books for months, the key hiring provisions are only now set to take effect.

The new rules apply to listings on job boards, company websites, recruiter ads and social media. Employers will need to post either a set wage or a clearly defined salary range that reflects the actual compensation on offer. General terms like “based on experience” or “competitive salary” won’t meet the legal requirement.

At the same time, any employer using AI to screen, filter or rank candidates must state that clearly in the job ad. The legislation doesn’t define AI in technical terms, but tools that use algorithms to evaluate resumes or score interviews are likely to fall under the rule.

David Piccini, Minister of Labour, Immigration, Training and Skills Development, said the government introduced the changes to support transparency, protect workers and make hiring fairer across the board. “At a time when many companies are posting record profits, it is only fair they communicate transparently about how they pay workers,” Piccini said in an Ontario government news release. “And as the use of artificial intelligence in Ontario skyrockets, our government will continue to take action to ensure workers aren’t excluded from the job market because of technological biases and that their privacy rights are protected.”

The province has also pointed to the role of pay transparency in closing gender and racial wage gaps. Ministry figures show that only 37 per cent of job ads in Ontario included pay information as recently as 2022. The government expects that number to rise sharply once the new requirements are enforced.

With enforcement only weeks away, many SMBs will need to act fast to bring job ads, application forms and hiring systems in line. Most small businesses do not have formal salary bands in place. Many rely on flexible or ad hoc pay structures, with limited documentation. That approach will need to change. Employers must now decide how to represent pay ranges clearly, and how to do so consistently across job postings.

For roles where pay varies by location or experience level, the law does not require a narrow range — but the information must be visible and truthful.

The new AI disclosure rule may also catch employers off guard. Many hiring platforms now include automated tools by default. Resume screeners, video interview assessors and other ranking systems often use algorithmic decision-making behind the scenes. If a business uses such tools—directly or through a vendor—it must disclose that use in the job ad.

Failure to comply with the new rules could result in penalties under the Employment Standards Act. The Ministry of Labour has not announced a grace period, and employers should assume that enforcement will begin immediately in the new year.

The province has not released a final enforcement guide but has stated that job postings will be subject to inspection. Complaints may also trigger compliance investigations. Ontario’s upcoming enforcement approach builds on other recent employment reforms, such as measures to curb job ad “ghosting.” Read about Ontario’s anti-ghosting rules here.

What SMBs can do now

For SMBs, the priority in the lead-up to January should be clarity and documentation. That starts with identifying which roles are regularly advertised, reviewing current ad templates and removing any language that no longer meets the standard.

Businesses should create clear salary ranges, even if they are broad. If no formal compensation structure exists, it may be time to introduce one — at least for the most frequently hired positions.

Employers should also assess whether any AI tools are used in the recruitment process, including through third-party platforms or software. If automation is involved in filtering or assessing candidates, that needs to be declared. Internal-only postings or direct referrals that are not advertised are not affected.

Several organizations have voiced support for the changes. Cathy Taylor, executive director of the Ontario Nonprofit Network, said the move will help promote equity in hiring. “When salary ranges are disclosed on postings, job seekers have an easier time identifying whether the position and its compensation are the right fit,” Taylor said in a statement issued by the province. “Equitable compensation practices such as pay transparency can help reduce the gender wage gap and address systemic barriers.”

Businesses that prepare early will have fewer disruptions in January. Those who wait may find themselves scrambling to update ads and systems at the last minute.