1. What is the effective date of the new Risk-informed Compliance Framework (RICF) and will there be a transition period to help regulators adjust?
The Office of the Fairness Commissioner (OFC) will launch its new RICF on April 1, 2021, for an initial 12-month transition period. The new scheme will fully come into effect on April 1, 2022.
During the transition period, the OFC’s assessment of a regulator’s risk profile will be based predominantly on its historical performance. Individual regulators will then be placed in provisional risk categories.
The transition period will also provide an opportunity for those regulators with outstanding OFC recommendations to complete the changes necessary to meet these requirements. Finally, during this time frame, OFC staff will obtain information from regulators on how the forward-looking risk factors, identified in the RICF, apply to their situations.
2. Why is the OFC implementing a new regulatory compliance framework?
For the last few years, the OFC has signaled its intent to develop a RICF. A key objective underlying this scheme is to ensure that the Office’s finite compliance resources are focused on those regulators that have not advanced as far as others in developing fair registration practices. To achieve this objective, the OFC has incorporated a number of modern regulator principles into its new compliance framework.
The RICF has been specifically designed to achieve the following three outcomes:
- To enable regulators to more effectively comply with their legal obligations, and to adopt associated best practices, in order to achieve better registration outcomes for all applicants.
- To promote the identification of targeted risk factors to enable necessary mitigation and remediation efforts.
- To reduce unnecessary burdens on regulators and OFC staff, recognizing that all public sector organizations operate with constrained resources.
3. How did the OFC select the historical performance indicators and forward-looking risk factors that will apply to regulators?
The OFC selected these factors based on the experience that it has garnered since Ontario’s fair access legislation was introduced in 2006, advice from subject-matter experts in the spheres of immigration, regulatory compliance and risk management, and the collective input received from regulators.
The OFC has identified five specific measures to serve as historical performance indicators. These are:
1. The nature and extent of material compliance recommendations that the OFC has issued to the regulator in the last compliance cycle.
2. The extent to which the regulator has complied with these recommendations and avoided new issues.
3. The regulator’s observed motivation to work with the OFC on defined compliance objectives.
4. The content of decisions issued by the courts or tribunals that discuss the regulator’s registration practices.
5. The degree to which the regulator’s registration processes exhibit the attributes of transparency objectivity, impartiality and fairness, as demonstrated, for example, by the number of OFC recognized “commendable practices” and/or other best practices and innovations that the regulator has instituted over time.
The five forward-looking risk factors focus on a regulator’s operating environment, stability, overall reliance on third party-service providers and policy considerations.
These factors pertain to:
1. Organizational Capacity.
2. The overall control that a regulator exerts over its assessment and registration. processes.
3. The response to emergency situations, such as the Covid-19 pandemic.
4. Over-reliance on Canadian experience requirements.
5. Public policy considerations, specifically:
a. critical labour shortages of professionals or tradespersons that involve the regulator, and
b. the need to apply inclusion and anti-racism approaches to the regulator's assessment and registration processes.
4. What are the risk categories under the new compliance framework?
There are three risk categories into which a regulator may be placed according to its performance and risk profile.
- Low – those regulators whose performance constitutes full compliance with the objectives of fair access legislation and that exhibit a low risk profile.
- Moderately Low – those regulators whose performance constitutes substantial compliance with the objectives of fair access legislation and that exhibit a moderately low risk profile.
- Moderate to High – those regulators whose performance falls short of compliance with the objectives of fair access legislation and that exhibit a medium to high risk profile.
5. What methodology will the OFC employ to place regulators into discrete risk categories?
In determining a regulator’s risk category, the OFC will employ a three-step process. It will:
Step 1: Assess the historical performance of a regulator using the five indicators described above.
Step 2: Assess the forward-looking risk factors by determining the likelihood that each risk would occur and the impact of that risk.
Step 3: Determine the cumulative risk category by aggregating the results of the historical performance and forward-looking risk assessments.
6. How will the OFC ensure consistency in the application of risk categories, given the diverse mandates and circumstances of regulators?
While the OFC will refine its risk assessment methodology over time, notably during the first year of operation, the Office will strive to implement a consistent approach. This objective will be achieved by relying on evidence, focusing on relative performance across regulators and by instituting an internal review process.
7. What are the implications to a regulator if it is placed in the moderate to high compliance category?
The risk category attributed to a regulator will determine the relative degree of attention that the OFC applies to the regulator and the appropriate compliance activity or tools used to either monitor the regulator’s compliance or bring it to compliance.
The nature and extent of these activities will be based on a compliance continuum. Those regulators that are in the low risk category will receive a “light touch”. The OFC will reserve its more focused compliance processes (e.g., more frequent meetings, completion of an action plan, reports and/or audits) for those regulators that are placed in the moderate to high risk category.
8. How does a regulator move out of the moderate to high risk category into a lower one?
The OFC’s ultimate goal is for regulators to establish registration practices and processes that are transparent, objective, impartial and fair. The historical performance and forward-looking risk components of the framework provide insight on how regulators are meeting this general duty. Therefore, where a regulator makes progress in addressing its forward-looking risks, the OFC would consider whether the steps taken were sufficient to move the regulator down one or two risk categories. During the transition year, the OFC will further refine this process and provide further information to regulators.
9. Will the regulator have the opportunity to dispute the risk category in which it is placed? How would that work?
The OFC’s approach to regulatory compliance will be based on transparency, professionalism and collaboration. The OFC welcomes collaborative dialogue with regulators on issues or concerns about their specific risk category. The OFC will consult with the regulators on a defining such a process. More information will be shared with the regulators at a future date.
10. What are the implications for a regulator that is unable to implement its outstanding OFC recommendations during the transition period?
During the transition period, the OFC’s Compliance Analysts will work with their regulators towards implementing any outstanding compliance recommendations. This period will provide the affected regulators with an opportunity to move to a different risk category.
Towards the end of the transition period, the Compliance Analyst will re-assess the risk categorization, in discussion with the regulator. This re-assessment would turn, to a large degree, on the extent to which the regulator has made progress in implementing any outstanding compliance recommendations. On this basis, if a regulator is unable to make any meaningful changes, then the provisional performance compliance category ascribed to a regulator would be confirmed.
11. Will the OFC publicly disclose the risk categories of individual regulators in its annual report or otherwise?
One of the OFC’s modern regulator principles is that the office strives to be an accountable regulator that it is prepared to justify its decisions and is open to public scrutiny. The OFC may, therefore, decide to publicly disclose the risk categories of individual regulators, subject to any obligations contained in the Freedom of Information and Protection of Privacy Act. If such a decision is subsequently made, the OFC will notify the regulators in question in advance of disclosure. It would not be the OFC’s intention to provide such disclosures in the transitional phase of the scheme.
12. Will the OFC exercise its audit powers under this new framework?
The province’s fair access legislation affords the OFC with the authority to require a regulator to undergo an audit. The audit process is analogous to an independent investigation conducted by a qualified third-party service provider that the OFC approves.
Typically, such a process would constitute a defined and targeted review of material and persistent deficiencies in a regulator’s registration processes. The audit would yield a report with findings and recommendations. Under the legislation, the cost of the audit is borne by the regulator and the final report must be filed with the minister.
Given the significant nature of the audit authority, and consistent with past practice, the OFC will employ this tool only when necessary.
13. Will the OFC modify its risk factors in the future?
The OFC will review the relevance and appropriateness of its forward-looking risk factors on an annual basis. Any decision to modify the risk factors will go through a thoughtful analysis with appropriate consultation.
14. How will the OFC collect the information that it needs to populate its RICF? In particular, will it need to modify the information that it now requests in its Fair Registration Practices Report (RPF)?
Under its current compliance framework, the OFC collects relevant information/data about a regulator’s registration practices, challenges and accomplishments through various mechanisms, including the Fair Registration Practices (FRP) report, periodic meetings, the regulator’s annual report, council minutes and a review of the organization’s website.
During the transition period, the OFC will review these processes to ensure that they align with the RICF. The OFC will then make appropriate modifications to the type and breadth of the data collected and the frequency of the process. These adjustments will be made to:
- ensure that the assessment of regulator risk categories is accurate,
- inform the Office’s strategic planning process and priorities, and
- facilitate the evaluation of program efficiency and effectiveness.
15. How will the OFC and Ministry of Health (MOH) ensure that their respective reporting requirements are complementary and do not overlap?
The MOH has recently launched its College Performance Measurement Framework (CPMF), which is a new reporting requirement for health colleges. The MOH and OFC are currently reviewing the parameters of their respective reporting requirements to identify any overlaps and to develop strategies to mitigate any unnecessary administrative burdens.