Question Period Note: Progress on Improving Human Resources and Pay for Public Servants

What is the government doing to fix the public service pay system once and for all?

• All public servants deserve to be paid accurately and on time.
• The Government of Canada remains committed to resolving outstanding pay issues while modernizing public service pay.
• We continue to work with all partners, including bargaining agents, to simplify pay rules and reduce the number of HR systems in the government.
If Pressed: Union requests for additional damages:

• We are aware that bargaining agents have requested additional compensation for general Phoenix damages incurred after March 31, 2020. We are committed to a continued dialogue with bargaining agents on this issue.

Phoenix Damages entitlements for employees (current and former) are provided by the following Damage Agreements with the Bargaining Agents:
1) 2019 (all bargaining agents except PSAC) and 2020 (similar agreement with PSAC) Damages Agreements
In 2019 and 2020, the Government of Canada ratified agreements with all bargaining agents to compensate employees impacted by the implementation of the Phoenix Pay system. Many separate agencies signed similar agreements covering their employees.

2) Claim Process for Severe Impact Claims pursuant to the 2019 and 2020 MOA The claims processes for issues taking place between April 1, 2016, to March 31, 2020, for former and current employees launched in November and December 2021.

To date, approximately $711M has been paid in damages relating to the Phoenix pay system, including some $26 million in 2023.
Public Services and Procurement Canada (PSPC) administers payroll for more than 430,000 current and former employees on a biweekly basis. The Public Service Pay Centre provides full compensation advisory services to approximately 250,000 active employees. As of April 23, 2025, the Pay Centre is reporting 161,000 transactions in their queue that are over 1 year past the date received. PSPC continues to make progress on older cases. For 2025-26, PSPC has presented a plan aiming to address 104,000 existing backlog cases.
Bouchard Class Action Settlement
On April 15, 2025, the Superior Court of Quebec approved the Bouchard class action settlement agreement with the Government of Canada. This approved settlement provides compensation to class action members without grievance rights who experienced pay issues due to Phoenix. Class action members are students, casuals, terms less than three months, part-time workers working less than one third of the normal work schedule, and Governor in Council appointees.
To be compensated under the settlement agreement, class action members must file their claim no later than October 24, 2025. Settlement of the Bouchard class action lawsuit could cost the Government of Canada up to $25M. The final cost is dependent to the number of claims that are received and approved.
Responsibilities
In May 2023, the Prime Minister announced the creation of the Enterprise Pay Coordination Office within PSPC. Its mandate is to lead, coordinate and implement the development of an integrated, enterprise strategy on HR and pay moving forward. This includes day-to-day administration under the current Phoenix pay system and any future pay system that is currently being tested and explored. Effective June 26, 2023, Alex Benay was appointed the Associate Deputy Minister of Public Services and Procurement for Enterprise Pay Coordination.

Within TBS, various portfolios support the current stabilization and modernization efforts in HR and Pay. TBS-OCHRO is the business owner for human resources and leads several key efforts in support of HR and Pay. This includes - through policy review and collaboration with

bargaining agents - work to reduce the number of rules that must be understood by employees and configured and implemented in the 30 HR systems currently in place across the public service. OCHRO also leads efforts to reduce and consolidate the number individual HR systems in use and promote the use of government-wide HR technology solutions to deliver HR and pay services more effectively and efficiently.
In addition to the work of OCHRO, TBS manages a Claims Office to ensure the Government meets its legal obligation to implement the 2019 and 2020 Phoenix Damages Memoranda of Agreement (MOAs) negotiated with the bargaining agents. The Office of the Chief Information Officer (OCIO) sets government-wide strategic direction for the governance and management of service, information, data, IT and cyber security initiatives, including HR and Pay. The Office of the Comptroller General (OCG) provides support to HR and Pay initiatives by providing functional direction and ensuring alignment with Government of Canada financial management direction and systems.
Continued issues with the administration of employee’s pay
While the major pay issues observed at the initial roll-out of the Phoenix pay system are practically non-existent, new problems have arisen, such as delays in implementing acting pay, promotion or pay file transfers. These newer issues, in conjunction with the efforts to recover overpayments from employees, has led to a resurgence in the number of individual and policy grievances. Several bargaining agents have requested that the Treasury Board provide employees with additional Phoenix damages. To date, TBS and PSPC have taken part in three exploratory meetings with the BAs to better understand their request.
Simplification and System Standardization (led by OCHRO)
The terms and conditions of employment, including provisions in over 28 collective agreements, result in a myriad of rules, controls, employment conditions, and entitlements. Through policy review and collaboration with bargaining agents, simplification aims to facilitate pay processing.
For example, during the most recent round of collective bargaining, TBS, on behalf of the Employer, and most bargaining agents committed to a Memorandum of Understanding to pursue ongoing collaboration to identify pay administration simplification solutions. These efforts are ongoing and focus on topics, including but not limited to: acting administration; liquidation of leave; retroactive payments and allowances.
In addition to simplifying HR and pay, TBS is also working with partners to standardize human resources and pay processes. Having 30 different core HR systems in use across the federal public service and hundreds of unique peripheral applications has created a highly fragmented HR technology landscape. There is a need to reduce and consolidate the number of HR systems in use and adopt standard HR technology solutions to deliver HR and pay services more effectively and efficiently.
To achieve these objectives, TBS has designated MyGCHR (i.e., a Peoplesoft human resources system) as an interim enterprise standard and is working with PSPC to onboard more departments to the MyGCHR platform. The adoption of MyGCHR provides consistency across departments and ensures that we are prepared for onboarding to a future pay system.

Simplified rules in combination with standardized systems and processes will help us collectively deliver better current and future HR and Pay results, and thereby provide better service to employees, better outcomes for the public service, and better results for Canadians.

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