Pay discrimination against persons with disabilities: Canadian evidence from PALS

Abstract

The objective of the study is to estimate the extent of pay discrimination against persons with a disability in Canada. The methodology involves decomposing or partitioning the pay gap between persons with disabilities and a comparison group of persons without disabilities into a portion due to differences in the pay-determining characteristics and a portion due to the differences in pay when they have the same characteristics – commonly attributed to discrimination. In this study, we further control for differences in performance by restricting the analysis to persons with a disability that does not limit their performance at work. The data is from the 2006 Participation and Activity Limitation Survey linked to the 2006 Census. We find that persons with a disability that does not affect their performance at work are still paid about 10% less than a comparison group with no disability but with the same pay-determining characteristics.

Keywords::

• Canada
• compensation
• disability
• labour
• pay

Acknowledgements

Morley Gunderson is the CIBC Professor of Youth Employment at the University of Toronto and a Professor at the Centre for Industrial Relations and Human Resources and the Department of Economics. He is also a Research Associate of the Centre for International Studies, and the Institute for Human Development, Life Course and Aging at the University of Toronto and a Fellow of the Royal Society of Canada. Byron Lee is an Assistant Professor in Management at China Europe International Business School (CEIBS). Financial assistance from the Social Science and Humanities Research Council and the Natural Science Foundation of China (Project No. 71202147) is gratefully acknowledged.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

^† The authors have made an equal contribution to this paper.

^1. The long-term poverty rates for the different vulnerable groups are: unattached individuals age 45–64 (29.2%); persons with a disability (26.1%); recent immigrants (25.6%); lone parents (21.8%) and Aboriginal persons living off-reserve (15.7%) (higher for those living on-reserve, but data not available).

^2. The theoretical perspectives emphasised in economics are outlined in more detail, for example in Baldwin and Johnson (2006) and Gunderson (2006). The perspectives emphasised in organization behaviour and psychology are discussed in various chapters in Dipboye and Colella (2005a, 2005b) with the two perspectives contrasted in Harcourt, Lam, and Harcourt (2005).

^3. The importance of workplace accommodations are emphasised, for example, in Burkhauser, Butler, and Kim (1995), Burkhauser, Butler, Kim, and Weathers (1999), Campolieti (2005, 2007, 2009) and DeLeire (2000a, 2000b).

^4. As is well known in the decomposition literature, different concepts of non-discriminatory pay can be used to evaluate or weight the endowment differences (Baldwin & Johnson, 2006, p. 132; Van der Muelen Rogers, 2006; Jann, 2008). Our results are not sensitive to the use of alternative weights, so we report those based on the wages of non-disabled persons on the grounds that they reflect a non-discriminatory norm.

^5. The full regressions with the control variables are available on request for each specification. They are illustrated subsequently in Table 3 for persons with no disabilities and those with disabilities that are not work limiting.

^6. The discriminatory components in those studies were 17% for males in Johnson and Lambrinos (1985), 15% for males in Baldwin and Johnson (1994), 5% for females in Baldwin and Johnson (1995), 7% for males and 5% for females in Baldwin (1994), 12% for males in Baldwin and Johnson (2000) and 5% for all persons in DeLeire (2001). The studies often had a range of estimates corresponding to different estimation procedures and groups, so the numbers cited above should be regarded as generalizations.

^7. The importance of discrimination against persons with disabilities on the part of customers is documented in Baldwin (2006). The importance of co-workers in providing a hospitable or a hostile work environment is discussed in Mesmer-Magnus and Viswesvaran (2009). The negative perception of emotional instability can arise from the fact that it can lead to danger or peril as well as disruptiveness, which are characteristics that can foster negative reactions on the part of co-workers or customers (Stone & Colella, 1996).

^8. Evidence that competitive market forces dissipate discrimination is given in Ashenfelter and Hannan (1986), Black and Brainerd (2004), Black and Strahan (2001), Hellerstein, Neumark, and Troske (2002), Meng (2004) and Wright et al. (1995).