[Canada] $685 million owed to workers repaid by federal payroll system so far

In Canada, the federal government’s new payroll system has so far cost taxpayers approximately $685 million in back pay and more is still owed, Western Standard reports.

According to Blacklock’s Reporter, the federal government is still calculating the total cost of the Phoenix Pay System (PPS) failure, which began in 2016.

“To date, approximately $685 million has been paid in damages relating to the Phoenix Pay System,” a November 21, 2022, briefing note for Treasury Board President Mona Fortier read.

Last year, around $125 million in compensation was reportedly paid out. This is included in the $685 million figure.

Employees who experienced inaccurate paycheques and ongoing problems with their pay were offered $2,500 for “general damages as compensation for stress, aggravation, pain, and suffering.” 

Around 62 per cent of workers reportedly received incorrect pay. The disruptive errors prompted numerous audits and parliamentary organisations.

“We recognize implementation of the Phoenix Pay System has had an impact on many current and former employees,” the briefing note said.

However, the note did not give a total amount for unpaid claims.

The compensation payments are taxable under employment income.

In 2016, Cabinet launched the PPS with the promise of $70 million a year in taxpayer savings by streamlining 46 separate federal payroll departments dating from the 1970s. 

Instead of making the purported savings, the new software instead mangled payments for around 220,000 current and former federal employees.

Access To Information records reportedly revealed PPS was so mismanaged that it could not read decimal points, incorrectly billed some employees for provincial health premiums and paid casual employees at hourly rates that differed from those they were quoted.

To date, no investigator has calculated the total cost of what the Auditor General described as an “inexplicable failure.” In 2019, the Parliamentary Budget Office estimated costs at $2.6 billion, including ongoing software fixes.

The costs associated with the PPS do not currently include specific claims by employees for other damages, such as foreclosures because an employee could not pay their mortgage, according to a 2021 Department of Public Works briefing note.

“Claims for severe or more personal or financial impacts could include financial losses, mental anguish, or other impacts,” the note said.

“Employees who took sick leave or other types of paid or unpaid leave because of an illness stemming from pay issues may also be eligible to apply for compensation.”

There were no firings connected to the PPS fiasco.

“We saw how that didn’t work,” former Digital Government Minister Joyce Murray previously told the press.

“We will always have respect for taxpayer dollars,” Ms Murray said.

“We also have a great deal of respect for our hardworking public servants. They have had a very difficult time with the pay system over the last few years.”

Source: Western Standard

(Quotes via original reporting)

In Canada, the federal government’s new payroll system has so far cost taxpayers approximately $685 million in back pay and more is still owed, Western Standard reports.

According to Blacklock’s Reporter, the federal government is still calculating the total cost of the Phoenix Pay System (PPS) failure, which began in 2016.

“To date, approximately $685 million has been paid in damages relating to the Phoenix Pay System,” a November 21, 2022, briefing note for Treasury Board President Mona Fortier read.

Last year, around $125 million in compensation was reportedly paid out. This is included in the $685 million figure.

Employees who experienced inaccurate paycheques and ongoing problems with their pay were offered $2,500 for “general damages as compensation for stress, aggravation, pain, and suffering.” 

Around 62 per cent of workers reportedly received incorrect pay. The disruptive errors prompted numerous audits and parliamentary organisations.

“We recognize implementation of the Phoenix Pay System has had an impact on many current and former employees,” the briefing note said.

However, the note did not give a total amount for unpaid claims.

The compensation payments are taxable under employment income.

In 2016, Cabinet launched the PPS with the promise of $70 million a year in taxpayer savings by streamlining 46 separate federal payroll departments dating from the 1970s. 

Instead of making the purported savings, the new software instead mangled payments for around 220,000 current and former federal employees.

Access To Information records reportedly revealed PPS was so mismanaged that it could not read decimal points, incorrectly billed some employees for provincial health premiums and paid casual employees at hourly rates that differed from those they were quoted.

To date, no investigator has calculated the total cost of what the Auditor General described as an “inexplicable failure.” In 2019, the Parliamentary Budget Office estimated costs at $2.6 billion, including ongoing software fixes.

The costs associated with the PPS do not currently include specific claims by employees for other damages, such as foreclosures because an employee could not pay their mortgage, according to a 2021 Department of Public Works briefing note.

“Claims for severe or more personal or financial impacts could include financial losses, mental anguish, or other impacts,” the note said.

“Employees who took sick leave or other types of paid or unpaid leave because of an illness stemming from pay issues may also be eligible to apply for compensation.”

There were no firings connected to the PPS fiasco.

“We saw how that didn’t work,” former Digital Government Minister Joyce Murray previously told the press.

“We will always have respect for taxpayer dollars,” Ms Murray said.

“We also have a great deal of respect for our hardworking public servants. They have had a very difficult time with the pay system over the last few years.”

Source: Western Standard

(Quotes via original reporting)