Question Period Note: Update on Phoenix: support for our employees, stabilization planning, and investments

This note focuses on the efforts and progress to provide support to employees, stabilize the Pay System, as well as financial investments in Phoenix.

Notes:

• All questions related to the Next Generation Human Resources and Pay solution should be directed to the Minister of Digital Government, responsible for Shared Services Canada
• All questions related to the mental health of public servants should be directed to the President of the Treasury Board
• All questions related to the negotiation of collective agreements and compensation for Phoenix damages agreements should be directed to the President of the Treasury Board
• Issues related to income tax are under the purview of the Canada Revenue Agency (CRA). Questions related to the taxability of damages payments should be directed to CRA

• Supporting employees facing pay issues and making sure they are paid accurately and on time is a top priority
  • No employee should be without pay. We have ensured public servants facing pay problems have access to emergency payments
  • We have also focused efforts on priority files such as parental leave, disability leave, student pay and collective agreements implementation
  • We have introduced MyGCPay to all departments and agencies. MyGCPay is a web application that provides employees with a centralized and simplified view of their pay and benefits, to help employees better understand their pay. MyGCPay now has an adoption rate of 89.6% across the Government of Canada
  • As part of our ongoing efforts we have increased our compensation workforce four-fold since 2016, to more than 2,300 employees, increasing our ability to process incoming work to service standard as well as address backlog cases
  • We continue to build strong partnerships between departments, unions and all stakeholders so that pay transactions can be processed quickly and accurately
  • In addition, our Government created the Treasury Board Secretariat (TBS) Claims Office, to compensate employees who have incurred expenses or financial losses because of the implementation of the Phoenix pay system. A new claims process was launched in mid-January 2021, to compensate current and former employees who have experienced severe personal or financial impact

If pressed on support to employees:

• Financial support is and will remain available for employees missing any of their pay. This support includes an emergency salary advance or priority payment
• Flexible measures have been put in place to help minimize financial hardships for employees for the repayment of overpayments related to Phoenix pay system issues.
• The Client Contact Centre (CCC) is available to all current and former federal public service employees with pay and benefit questions, including available options regarding repayment plans
• The Centre escalates cases of hardship so they can be addressed quickly, and agents are trained to respond to situations where employees may be in distress
• Across government, progress has been made to increase mental health awareness. Work continues to better equip managers, practitioners and leaders on how to address pay-related mental health issues in the workplace and to inform employees of the services and support tools that are available, including flexible repayment options

If pressed on Phoenix damages agreements payments to employees:

• All public servants deserve to be accurately paid for their work. The Government of Canada continues to take action on all fronts to resolve pay issues
• We recognize that the implementation of the Phoenix pay system has had an impact, directly or indirectly, on employees
• On October 23, 2020, the Government finalized an agreement with the Public Service Alliance of Canada (PSAC) for damages incurred by the Phoenix pay system and the late implementation of the 2014 collective agreements
• As part of this agreement, most employees represented by PSAC received a payment of up to $2,500 (subject to statutory deductions) along with their regular pay on March 3, 2021 for general damages and compensation for the late implementation of the 2014 collective agreements
• Approximately 175,000 employees received this lump-sum payment

If pressed on performance pay to executives involved in fixing Phoenix:

• Public service executives are eligible for performance pay in accordance with the Treasury Board’s Directive on Terms and Conditions of Employment for Executives
• Between 2016 to 2017 and 2019 to 2020, a number of executives who were assigned duties related to the ongoing response to address Phoenix pay system issues received performance pay against established performance commitments
• Senior executives responsible for the planning and implementation of Phoenix did not receive performance pay for their work on this initiative during 2015 to 2016, when Phoenix was finalized and launched

Claims and compensation: Phoenix Pay System

On January 14, 2021, the Government of Canada launched a new claims process to compensate current and former employees who have experienced severe personal or financial impacts as a result of issues with the Phoenix pay system.

This claims process is another element of the damages agreement co-developed with federal public service unions in June 2019 to compensate approximately 121,000 current and 25,000 former employees for damages caused by the Phoenix pay system.

Claims for severe personal or financial impacts could include financial losses, mental anguish or other impacts attributed to Phoenix pay issues. Employees who took sick leave or other types of paid or unpaid leave because of an illness stemming from pay issues may also be eligible to apply for compensation through this new claims process.

Existing claims processes for expenses, financial costs and lost investment income, as well as general compensation for former employees continue to be available.

This claims process does not apply to current and former employees covered by the damages agreement, signed in October 2020, between the TBS and the Public Service Alliance of Canada (PSAC). TBS continues to work in collaboration with PSAC to finalize the claims processes from this agreement and more information will be shared in the coming months.

TBS is responsible for engagement with Public Services and Procurement Canada (PSPC), employees and unions on collective agreements and compensation for Phoenix damages.

COVID-19 measures

Services related to pay are considered essential and measures are in place to ensure that operational requirements are met. Following the recommendation of the Public Health Agency of Canada, PSPC asked all its employees, including those at the Public Service Pay Centre and the Client Contact Centre, to work from home if possible, while ensuring the delivery of essential services.

Other support measures

The Pay Centre continues to deliver all of its pay services which include regular pay, new hires, return from leave, maternity and parental leave, as well as disability insurance.

Supporting employees and eliminating the backlog remain our top priorities and we continue to see progress.

The CCC remains the first point of contact for current and former federal public servants looking for information or help with compensation and benefits, and for technical issues when using the Compensation Web Applications or MyGCPay. Clients may, however, experience increased wait times when calling the CCC.

We are working closely with all our partners, including employees, unions, Members of Parliament offices, departments and their representatives from HR and pay, to provide support during this challenging time.

Investments in Phoenix

Total investments to deliver pay and respond to pay issues is $2.134 billion:

• $50 million (2016) PSPC – build capacity, enhance technology, employee support
• $142 million (2017) – build capacity, enhance technology, employee support. This included $15 million for Treasury Board Secretariat (TBS) and $127 million for PSPC
• $431.4 million (Budget 2018) PSPC/TBS - build capacity, enhanced technology, and employee support
• $5.5 million (Budget 2018) Canada Revenue Agency (CRA) – process income tax reassessments needed due to pay issues
• $16 million (Budget 2018) TBS – work with experts, federal public sector unions and technology providers on a way forward for a new pay system
• $523.3 million (Budget 2019) PSPC – ensure adequate resources to address pay issues; support system improvements
• $9.2 million (Budget 2019) CRA – process income tax reassessments needed due to pay issues
• $910 million (Budget 2020) – 3-year forward plan funding, to continue efforts to eliminate the backlog of pay issues for public servants, maintain measures to deliver pay and support employees, and stabilize pay for the Government of Canada*
• $47 million (Budget 2021) over the next 2 years to support the workforce dedicated to processing pay transactions to help meet the target of eliminating the backlog by December 2022

*2020 approved 3-year forward plan funding:

• PSPC’s funding request for a 3-year pay stabilization plan was approved by the Treasury Board in 2020. The funding profile was made public in Economic and Fiscal Snapshot 2020
• This investment represents $910M over 3 years to eliminate the backlog of pay issues for public servants and to continue delivering and stabilizing pay for the Government of Canada
• This figure includes amounts for Pension Integrity ($8.7M per year for three years) and $70.4M related to a service contract renewal to adjust and modify the pay system for 2022 to 2023
• The plan prioritizes increased productivity for processing cases; reduced case intake volume; and accelerated implementation of system improvements
• It targets elimination of the backlog by the end of 2022, at which point it will prioritize data quality improvements and preparations for the Next Generation HR and Pay Solution

Stabilizing the pay system

Since the launch of Phoenix, PSPC implemented a series of measures focused on stabilizing the pay system.

These include increasing the compensation workforce, providing employees with greater support through our Client Contact Centre, introducing the Pay Pods model, implementing a backlog reduction strategy through our Strategic Engagement Sector, and implementing technical fixes that have improved payroll processing, such as increased automation of transactions.

On average in 2021 to date, parental and disability leaves have been processed within service standards 99% of the time.

In addition to efforts underway, we are working closely with all stakeholders, including experts, federal public sector unions and the private sector for innovative solutions to accelerate pay stabilization.

We continue to regularly share information on progress with employees and Canadians through various platforms and tools.

MyGCPay

MyGCPay is a web application developed by PSPC to help rebuild federal government employees’ confidence in the integrity of their pay. It provides employees with a centralized and simplified view of their pay and benefits. It helps employees identify pay issues earlier and allows them to monitor their open cases with more detail.

The application allows employees to:

• view the most current information about their pay and benefits
• print important documents such as tax slips and proof of employment
• identify pay issues earlier and, if an employee’s current or former department was served by the Pay Centre, monitor any open enquiries and cases in detail
• access historical information, pay cheques, benefits plans, enquiries, and Pay Centre cases dating back to 2016

Following consultations with Government of Canada employees, the MyGCPay project team has developed a new and improved pay stub.

None