What is the Phoenix Pay System?
For years the federal government considered consolidating the pay administration which was spread across dozens of departments and agencies. In 2009, Cabinet finally approved the Transformation of Pay initiative which centralized the pay administration of federal departments and installed a new system that became known as Phoenix. The $200-million contract was awarded to IBM, and fourteen hundred pay administrators were phased out and replaced with 550 employees in Miramichi. During testing, employees complained about delayed and incorrect pay. Regardless, Phoenix was rolled out in February 2016, and by April 2016 it was clear that the system had several defects.
What was the effect?
The Ottawa Citizen estimated that 30% of employees had errors in their paycheques. These errors have ranged from severe overpayments to employees and retirees not being paid at all. These problems have also led to significant issues with income taxes for many of those affected. By February 2018 there were a reported 633,000 outstanding requests to fix pay-related errors. The auditor general said that a sustainable solution will take years and “cost much more than the $540-million the government expected to spend to resolve pay problems".
In January 2018, Federal Retirees surveyed its members to find the extent of Phoenix’s effect on its membership. Of the nearly 3,000 who responded to the survey, almost 1,400 individuals reported experiencing issues related to the Phoenix Pay System. The issues affecting members varied from irregularities (overpaid, underpaid, not paid) on acting pay, regular pay, vacation pay and severance but also included retroactive pay, income tax, and expenses not being reimbursed.
What has been done by the National Association of Federal Retirees?
The Association made the resolution of Phoenix related issues one of its advocacy priorities. The National Association of Federal Retirees first worked with the Public Service Pension Centre to highlight the problems faced by its members and included an ask to fix Phoenix as part of its lobbying efforts with federal politicians from every political party and with staff at the departments involved. The Association also joined its labour partners to bring attention to these issues in the media and several stories were written by Association staff and posted to our website to highlight the issues. The Association continues to push the government to act swiftly to find a solution so that employees and retirees can be properly compensated.
Why haven’t the unions filed a class action lawsuit on the employees’ behalf?
Section 236 of the Public Service Labour Relations Act (PSLRA) prohibits the ability of unions and any public service employee to sue the federal government.
What can I do?
While there have been few solutions offered to those who have been affected, there are still many things that you can do to get help:
File a complaint
- If you have an ongoing issue and have not yet filed a complaint or opened a case, contact the Phoenix Pay System Call Centre at 1-855-686-4729 or if you are outside Canada and the U.S. at 506-424-4330. You may not receive an immediate response, but it is important to log your issue.
- Take the time to fill out feedback forms online here.
Get clarity on income tax and other government benefit impacts
- If your issue is related to your income taxes, contact the Canadian Revenue Agency at 1-888-686-4729.
- You can visit the Treasury Board’s website for information on submitting claims related to impacts to income taxes and government benefits
- You can visit the Government of Canada’s Frequently Asked Questions – 2017 Tax Implications of Phoenix Payroll Issue page
- Read these tips on how to deal with T4 errors and other tax-related issues
Get expenses reimbursed
- If you have incurred out-of-pocket expenses because you were underpaid, you can submit a claim with the Treasury Board of Canada. For example, if you used your line of credit to cover regular payments while you were underpaid and have incurred interest charges, you can claim those expenses. This includes reimbursement for tax services.
Severance payment issues
- If your issue is related to severance payments, contact your former department as soon as possible and advise them that you are having an issue. You can also try to contact your former union and try to get your case escalated.
Get compensation for damages
- On June 13, 2019, the Government of Canada and 15 public service unions finalized a joint agreement to compensate more than 146,000 current and former employees who may have been impacted by the Phoenix pay system and on Nov. 29, 2019, the Government launched a process by which former employees can request the general compensation for damages. Read our news post to find out more about this process or visit the Treasury Board online to file a claim for compensation for damages caused by the Phoenix pay system.
Get more information
- Get news and updates on Phoenix, find out about collective agreements and other pay issues, and find out about the incentive package available to former compensation advisors who return to help out with Phoenix.
- Write to your member of Parliament, the Prime Minister, President of the Treasury Board, Minister of Finance and Minister of Public Services. Explain what your issues have entailed and the effect that your issues have had on yourself and your family. You can look up your member of Parliament by visiting www.ourcommons.ca/parliamentarians/en/members
- Get involved on social media and use these hashtags: #replacephoenix, #FixPhoenix, #ArrangezPhénix