Problems with Phoenix pay system extending to pension plan members

The federal government’s difficulties with its problem-plagued Phoenix pay system are now affecting pension plan members who won’t be receiving their pension and insurance benefits statements this year due to potential inaccuracies with the information.

And while much of the attention on Phoenix has focused on employees not getting paid on time, it has also been causing problems for retirees. “There are many retirees who are not getting their pensions or severance on time, and this creates significant financial problems and stress for them,” says Robyn Benson, national president of the Public Service Alliance of Canada, the union representing federal government workers.

“Many public service employees have experienced delays in receiving their pension because their termination information was not sent to the pension centre on time because of Phoenix,” she adds.

“The ordinary service standard is 20 days, but the employer isn’t meeting that standard consistently. This means that they continue to get paid their regular salary, which creates an overpayment situation and further financial problems and instability for public service workers. There have been numerous instances where severance pay is late as well. This problem is made worse because retired public service employees can’t access the Phoenix pay system.”

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Launched in 2016, the Phoenix system has resulted in tens of thousands of workers receiving incorrect amounts or not getting paid at all. This is the first time, however, that problems with the system have affected the pension statements. “This year, to ensure plan members do not receive inaccurate statements due to issues with the Phoenix pay system, the pension and insurance benefits statement will not be issued in either print or electronic format,” the government said in a notice on Aug. 1.

“While statements will not be available, employee pension and benefit plan eligibility or entitlements will not be affected.”

Although the union and the government are looking to resolve the issues, Benson acknowledges there’s no quick fix to a problem the Liberals have blamed on staff cutbacks by their Conservative predecessors as they implemented the switch to Phoenix. “The government must rebuild the internal expertise that was lost by the elimination of compensation advisor positions in 2011,” she says.

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“This includes increasing the capacity at the Miramichi pay centre and the satellite offices and incorporating more of these essential workers back into departments. They must bring back experienced former compensation advisors as well as hire and train new staff.”

A spokesperson for the Treasury Board of Canada Secretariat told Benefits Canada the government is “committed to rectifying these issues as quickly as possible and [is] making progress to resolve them.” The spokesperson noted the issues with the statements won’t affect retirees receiving a public service pension as only active employees get them.

In the meantime, the government is encouraging plan members to contact its pension centre if at least one of the following circumstances applies:

  • They’re within six months of retirement or leaving the public service. In that case, the government will be able to provide a personalized pension estimate.
  • They’re dividing their pensions because of a relationship split or they need information about a service buyback.

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