Seven years and counting: the Phoenix pay disaster still impacting workers today

We are marking yet another bleak anniversary – the seventh year of the Phoenix pay disaster. From overpayments and underpayments to missed paycheques, delayed retirement severance and botched pay grades, more than half of all federal public service workers continue to suffer pay issues because of a broken pay system. 

Every day, PSAC members, retirees and former members come to our Phoenix team for help with their pay issues when they have nowhere else to turn. We’ve been supporting federal public service workers navigate the Phoenix fiasco since it was launched, and we’ve seen it all.   

Being paid properly, and on time, is a fundamental aspect of the employment relationship. Seven years later, we’re asking: why can’t the federal government – Canada’s largest employer – get this right, when other employers can? 

The state of the disaster 

There continues to be a massive backlog of 418,000 pay problems, both old and new. Despite commitments from the government to reduce the backlog of issues, the pay problems continue to pile up – growing by nearly 10 per cent per year since 2018.   

Two major problems members are currently facing are delays in finalizing their file when they leave the federal public service and delays in processing their file when they transfer to a department.  

As of January 19, 2023, there are more than 48,800 termination cases impacting retired and former PSAC members that are waiting to be processed by the Pay Centre. Many of these cases are two to four years old, with some even older than that. This is despite the Pay Centre’s own service standard for processing terminations in 20 business days.  This means that members are not getting paid out the funds the employer owes them – severance pay, vacation leave, and compensatory leave. It also means that, for retirees, their pensions payments are not correct.  

For transfers, The Pay Centre recently confirmed that, as of January 2023, the backlog of transfers exceeds 16,000 cases. Due to the delay in processing these transfer cases, members are waiting years to be paid their new, correct rates of pay and to receive their proper leave entitlements.  The Pay Centre’s own service standard for processing transfers is 45 business days. Meanwhile, 28 per cent of the 16,000 unprocessed transfers are over a year old. 

Delays in transfers and terminations are just two examples out of many types of pay problems our members are facing.  

Without confidence in the pay system, employees continue to suffer undue hardship. Careers are put on hold as employees turn down promotions and transfers for fear of being “Phoenixed.”  

What PSAC is fighting for 

The Phoenix pay fiasco is a national disgrace that still affects the lives of tens of thousands of Canadian workers, and this government has consistently failed to do what it takes to make this right.    

On the anniversary of Phoenix, PSAC continues to call on the government to:  

  • hire more compensation staff to reduce the number of Phoenix cases created every day and to eliminate the constant backlog;  

  • halt the recovery of overpayments until there is accurate data to back up the overpayment claims;  

  • negotiate additional general damages for ongoing pay issues and access to future compensation claims beyond the previous damages agreement which ended in 2020;  

  • launch a national inquiry into the Phoenix pay debacle in order to avoid future pay disasters; and  

  • properly consult and engage with unions on the Next Generation pay system. The new pay system cannot be launched without input from PSAC and the members who process pay.  

It is time for the government to take urgent action to resolve the Phoenix pay backlog and prioritize solutions to end this disaster. 

If you or someone you know is affected by the Phoenix pay disaster and need help, contact PSAC’s Phoenix team by selecting one of the Phoenix options in the “What is your inquiry about?” drop down menu. 


March 1, 2023