The federal government has begun imposing financial sanctions on the Canada Life Assurance Co. after months of outcry from public servants, retirees and their families who were left fighting for medical claims to be covered, according to a report by the Canadian Broadcasting Corp.

Public Services and Procurement Canada said it’s “taking steps to address startup delays faced by Canada Life and has begun to apply financial consequence mechanisms under the contract,” according to a statement from spokesperson Michèle LaRose in the report.

She said the PSPC isn’t yet in a position to share details about the nature of the sanctions. The move comes after the Public Service Alliance of Canada recently filed a policy grievance against the Treasury Board of Canada for its management of the transfer of the Public Service Health Care Plan to Canada Life, which has impacted tens of thousands of federal public service workers covered under the plan.

Read: PSAC files policy grievance regarding transfer of PSHCP, impacts on plan members

In 2023, the federal government implemented two modifications to their employee benefits plans as a result of amendments negotiated via collective bargaining agreements, including moving its plan administration from Sun Life Financial Inc. to Canada Life, which led to delayed access and complaints from employees.

In an emailed statement to the CBC, a Canada Life spokesperson said the company is working with MSH International and the federal government to improve the level of service for public servants and retirees living or travelling abroad.

MSH International’s program delivery director, Jina Park, said the company has put in place measures to speed up processing times, reduce call centre wait times and prioritize urgent cases.

“We have doubled our claims processing capacity and continue to add more staff to meet demand that was higher than projected in the [request for proposals],” she wrote in an email.

Canada Life didn’t respond to Benefits Canada‘s request for comment.

Read: Canada Life to acquire health-care management firm ClaimSecure