Next Generation HR and Pay, and how we’re going to do things differently

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August 28, 2018

As the President recently announced, the Government of Canada is taking steps towards the creation of a new pay system. It’s important and exciting work, and we’re committed to doing things differently. We’re exploring options for a next generation HR and pay system that can eventually replace Phoenix.

What will be different?

The question that I’m sure is on a lot of people’s mind right now is: what will be different? First and foremost is that we need a system that can better integrate our human resources and pay services. The next generation HR and pay system will be mobile, accessible, and available 24/7, because that is exactly what our public servants expect, and deserve, from a modern system.

It will also be grounded on the understanding that people management goes well beyond employment transactions:

  • It must be an integral part of operational objectives – getting the job done -- and requires ongoing leadership and investment of time and resources.
  • Everyone must be engaged: managers, employees, human resources practitioners, central organizations, and bargaining agents.
  • It must centre on users, including employees, compensation advisors and managers, who are involved at all stages of system design, development and implementation.

We have every intention of building the system the right way. We’ve committed to working with experts, unions and technology providers to build a system that places employee needs at the centre of design, is informed by past experiences, and is mindful of risks. Most importantly, we commit to remaining agile throughout the process, and to course correct without hesitation.

We need a new modern system that supports users from the day they are hired to the day they leave the public service.

Stabilizing the current system is still crucial

The recognition that Phoenix is not the long-term solution does not take away from the importance of stabilizing it. We have to do this before we transition to a new system because paying employees accurately and on time is critical.

Public Services and Procurement Canada is leading this important work, with the support of the Treasury Board of Canada Secretariat. Through the integrated team, we will continue to devote every effort to finding solutions, and to make this right for our employees.

Our promise to be open on the path forward

Throughout the process of stabilizing Phoenix and identifying a new HR and pay system, we plan to issue frequent, transparent communications. We’ll also use different communications channels to update on project milestones, and when possible, provide a glimpse “behind the scenes” of work in progress.

And with that in mind, I’m happy to share that so far this summer we have:

  • conducted a preliminary vendor analysis
  • issued a Notice of Proposed Procurement
  • studied private sector expertise with the goal to identify potential innovative alternatives for a new system
  • continued our dialogue with unions on the way forward

This fall we will:

  • host employee user experience workshops
  • issue a request for proposals for a new HR and pay system

We are committed to working with employees, experts, unions and technology providers to get this right. We’re at a crucial step in designing a new service that ensures public servants are paid accurately and on time. No alternative is acceptable.

Have thoughts on what a next generation HR to pay system needs to be capable of, or suggestions on how you think it should work? I invite you to submit your ideas directly by email to the team.

Thank you.


Alex Benay

Chief Information Officer, Government of Canada

Alex Benay currently serves as the Chief Information Officer of the Government of Canada. Prior to this appointment, Alex was the President and Chief Executive Officer of the Canada Science and Technology Museums Corporation since July 2014.

From 2011 to 2014, he was Vice-President of Government Affairs and Business Development at OpenText. He has played a leadership role in Canada’s digital industry, as well as in promoting the global shift to digital in organizations such as the G20, the Commonwealth Secretariat and the Olympics. Before joining OpenText, Alex managed various teams and programs at the Canadian International Development Agency, Foreign Affairs and International Trade Canada, Natural Resources Canada, and Library and Archives Canada.

Blog comments

Anonymous - October 10, 2018

It would be important for the new pay system to be able to also contact a compensation advisor in our department for something specific about our pay. Every Departments have their specificities and having in-house compensation advisors would be important. Also it would be nice to be able to have the provincial tax deductions made on our pay based on the province of residence of the employee rather than the province of work. For example, an employee working in Gatineau, Québec but living in Ottawa should be able to have his pay with tax déductions made based on his province of residence rather than his province or work. This could be programmed based on the employee's residence address. Thank you.

Fred - September 11, 2018

"What will be different?... The next generation HR and pay system will be mobile, accessible, and available 24/7, because that is exactly what our public servants expect, and deserve, from a modern system."

Actually only real difference public servants want is for the thing to work. To get paid on time for services rendered. Please don't forget that the CWA just prior to Phoenix launch that many departments were using simply worked. While there is no simple going back (after all you can't unscramble an egg) it's worth remembering.

We'd all love a "user friendly" system. But we have learned that the opposite of "user friendly" in the Phoenix context is not, as we once imagined, "not-user-friendly". In fact the opposite of "user friendly" turned out to be "user hostile". That is to say, the system actively works to frustrate the user, through some sort of malevolent will it seems. Just when you think you've hit bottom with this system something gets worse.

Don't get so lost in finding ways to be agile that we forget what the actual order is: a system that sorts out the existing scrambled-egg of a pay mess. We're told (by PSPC) that the cost of fixing the system is around $1.1bn. One is tempted to be facetious and answer: "Why not take that money and simply hire $10,000 AS-2's (around the country) for a year on one-year contract. Spend 6 weeks to train them up, give each of them 20 cases to figure out (surely they can get trained and figure out 20 cases in a year) and we're golden!" But seriously, before thinking about "high-tech" solution think about system solutions that are robust and when there is a system disturbance, revert to the mean quickly rather than careening off the road. Consider having more knowledgeable humans within reach of employees and managers dealing with the more complex transactions. It was a mistake for departments to send everyone to Miramichi.

Stephen Archdeacon - September 07, 2018

1) Use a test-driven agile development approach. Minimize paper-based requirements and detailed design documents.
2) Use hands-on subject matter experts to guide the evolution of the system and validate the automated test-cases. Make the evolving system the specification.
3) Release functionality incrementally. Avoid the ‘Big Bang’ conversion and release. Start by reverse engineering and replacing legacy system functionality, before re-engineering an entire business process. Use the legacy system as the specification for the first release of the new system.
4) Pilot new functionality for feedback before a full rollout is undertaken.
5) Reduce the no. of moving parts by changing one input to each output at a time.
6) Minimize temporary solutions and throw away code in general, except where it pertains to maintaining a parallel legacy system as a backup.
7) Introduce major releases in parallel with the legacy system(s) they will replace. The new system will need the ability to update the old system database in parallel, until the new system outputs are proven.
8) Decommission legacy systems after replacement systems have a proven track record.
9) Reduce dependencies on external organizations.

Andrew Anderson - September 06, 2018

Have every department mandated to run payroll for themselves. National standards, but let GAC, ESDC, ISED and everyone find their own solution - whether in-house or contracted out or some hybrid.

Benefits: 1. More opportunities for Canadian companies to compete; huge projects like Phoenix or the future HR/Pay monster are only bid on by huge multinational consulting companies, locking out Canada's innovative small and medium IM/IT firms.

2. No single point of failure. If DFO's new system flames out, they can look to their peer departments for other solutions.

3. Marketplace of innovation. Monopolies crush innovation. Competition spurs it on.

4. DM accountability. DMs should be accountable. The current construct leaves them without leverage.

Hal - September 10, 2018

When the government is beholden to one vendor, you get dramatic results like Phoenix (or data center, or emails, etc.). Large private sector orgs can mandate and impose change and everybody has to follow. It doesn't work so well when dealing with an even larger scale beast like the gov't with so many different mandates, initiatives, rules and regulations, change and decision making steps, etc. etc.

Hal - September 10, 2018

When the government is beholden to one vendor, you get dramatic results like Phoenix (or data center, or emails, etc.). Large private sector orgs can mandate and impose change and everybody has to follow. It doesn't work so well when dealing with an even larger scale beast like the gov't with so many different mandates, initiatives, rules and regulations, change and decision making steps, etc. etc.

John Doe - September 05, 2018

The IT system is only half the problem, how about fixing the business first?

- More than 80,000 pay rules needed to be programmed into Phoenix; this is because there are more than 105 collective agreements.
- 460 pay advisors in the Miramichi Pay Centre to do the work of the previous 1,200 pay advisors in the 46 departments and agencies.
- HR processes such as interdepartmental deployments can take months to process leaving employees in limbo without access to ANY HR system to handle regular requests such as leave or overtime which impact payroll.
- Etc.

Amy Retired - September 11, 2018

The policy is in need of a serious overhaul. It changes continuously and needs updating a lot of the time. There have been several grievances and changes because of its inconsistencies over the years.

It's not just the specs that need to be programmed but the information needs to be set out in a format that makes it easy to search, parse and update across various media - information for employees, managers, unions, HR, Compensation Advisors, and programmers.

Also since employee history must be known in order to determine employee entitlements, the idea that the model could be based on transactions was ludicrous. The business process should be rooted in employee account, not transaction! That way the right hand would know what the left hand was doing.

Johanna Jenkins - September 04, 2018

When pay does not come through, the current process of an employee embarking (entirely alone for the first part) on a convoluted voyage to get a Priority Payment loan or an Emergency Salary Advancement loan should be eliminated in favour of procuring the affected employee emergency replacement Pay. Not a temporary loan as in the current emergency system but actual pay the employee gets to keep. This was what we had before with individual compensation advisors in various departments, real pay could be procured instead of just loans which risked getting recovered incorrectly, as currently happens.

With the current Canada Revenue Agency rules and regulations in place, all employees owing Crown monies constantly have to pay back the Crown more money than they truly owe. It happens for a variety of reasons such as: 1) recovery of a Net over-payment went into the following calendar year due to backups in processing at the Pay Centres - the over-payment gets recovered as a Gross repayment which the employee cannot recover from until receiving an amended T4 a year or more later; 2) Priority Payments are based on an employee's guess of 66% (an estimate of Net pay) of their missing salary , overtime or acting pay, however if the employee gets it wrong, they can end up owing additional funds back to Crown, or at least Pay Centre is forced to recover the error that way; and 3) both ESA's and PP's are frequently still recovered well before an employee is made whole on all their missing pay. ESA's and PP's are still often recovered at 100% rate off of a regular pay day, leaving employees in a constant state of being owed more missing pay and requiring further ESA's/PP's to keep paying their bills.

The accounting and all the teeter totter motion of all these loan and recoveries of loans must be a large burden on both the Pay Centre and individual Departments. Get out of the business of loaning employees their missing pay as much as possible, and simply procure for affected employees a full or partial emergency pay instead. Involve and engage departmental HR resources to help calculate the amount of pay which is missing, quickly, if need be, but stop putting the burden on employees and their Departments to track loans and prove what an employee is owed repeatedly for the same pay mistake.

Additionally, over-payments, ESA's and PP's are still being recovered without advising employees first, are being taken from first available funds (salary, OT or retro pay), often at a 100% rate of salary, putting employees back into a state of existing for weeks without any pay at all. Recoveries done in this manner remain inconsistent with PSPC publicly stated rules for recoveries and in a manner which is inhumane for many employees. The pay system seems to so overburdened there is no time or ability to properly advise or negotiate with the majority of pay affected employees before recovering over-payments and 'loans', adding stress, confusion and a domino affect of employees needing more emergency loans to deal with the recovery of prior loans which resulted in a $0 pay day.

Please get out of the 'loan' business. Simplify the system to estimate an employee's missing pay (or have an employee identify the amount missing and an authorized manager verify it) and simply pay them that Net amount - small corrections later on can be enacted without the current significant burden to employees, their managers, their Departments, or, hopefully, Pay Centres.

Ian Christie - September 03, 2018

Although it may be difficult, consideration should be given to working with the bargaining units to standardize the multitude of business rules, most of which come from the collective agreements. Building a system to accommodate all the existing business rules makes for a costly and complex system.

Hal le - August 31, 2018

If the issue is to manage and pay properly, focus on paying before going big. A lifestyle change may be needed but the surgery is more urgent.

Procurement idea:
- Identify what is important. Total Cost of Ownership, Lowest cost bid, functionality at any costs, etc. Make decisions - don't say everything is important
- Make it a hack competition rather than deciding 1 vendor in advance
- If you want to do it fast, give some incentives and not just internal bonuses
- For the hack, set up some test data - x nbr of collective agreements, x nbr of personnel to be pay
- Introduce change but don't telegraph it in advance. Let the vendor teams handle it
- Does it require mostly coding/testing or is it mostly configuration? COTS means common or customized?
- Fairly compensate participants if doing the hack. The really big guys can absorb the costs of a prolonged effort like this. SMBs are out on a limb to do this and having some approach that gives some compensation and recognition will help even the playing field for the smaller players who want to go for it.

Christine Ménard - August 31, 2018

Pay stub should include an indication of the annual rate of pay.

In reply to by Christine Ménard

STEVEN Yawney - September 01, 2018

Need pay and back pay rate sheet for my company billing

Calvin Martini - August 30, 2018

Bring pay experts close to the point of service. Empower the experts with decision making authority to solve process problems and bend rules to compensate for mismatches in the timing of bureaucratic processes, priorities and workloads. Support the pay experts with flexible and efficient tools that eliminate paper and automate their workflows.

The experiment of eliminating pay experts and moving to self serve has failed. It's time to bring the experts back to the clients.

Jordana Ross - August 30, 2018

Like the title suggests, we are overdue for pay stubs that are easy to understand. The current ones make it very hard to track if deductions are being taken off appropriately (for example dates of leave don't even show, just lump sums, and they sometimes don't get processed on the pay you'd expect them to)...

Titles like "Dates you were on leave", "Overtime", etc. would be extremely helpful.

Chris - August 30, 2018

Certain tasks in Phoenix take a long time to be processed - for example transfers between departments (Transfer In/transfer out). The outgoing HR advisor needs to do data entry but then it gets stuck in the pay centre for a long time - I have employees who arrived 18 months ago who are still with their old department in the system because the file is waiting at the pay centre. This creates a lot of admin burden and unintended issues: manual recovery of pay, can't delete surplus positions if the employee is not deployed out, employee is in the wrong department in PSPM etc. If the outgoing HR advisor enters the data, why can't it go automatically to the incoming HR advisor to do data entry and then the pay aspect is automated (that is the idea of HR2Pay). It seems like a minor issue, but it is a major irritant for managers and employees and there are probably a lot of these "simple" transactions clogging up the queue, leaving less time for high priority transactions (i.e. maternity leave) that may require compensation advisor interaction.

Stephanie - August 30, 2018

One idea, at least in the short term could be to contract out about half of the pay files to a private company like ADP and have the other half be processed internally. The city of Toronto did something similar with garbage collection. This way, all of our eggs aren’t in one basket so if there are issues then there is another side willing to take over, and it would encourage both sides to do the best work possible because of one side doesn’t do the job well, then the other side will get more work. This would be a great kind of accountability. (Would need conditions to state at what point the other side gets more work...)

Guy B - August 29, 2018

One of the main problems with Phoenix was its implementation.They moved hundreds of thousands of pay files in two big waves, ending with tens of thousands of pay issues. Had they done it imcrementally starting with smaller departments they would have been able to detect problems early with a minimal number of issues to address before moving to another department.

This is project management 101.

Let's hope implementation of the future system will be smarter.

Sheri Albers - August 29, 2018

Conventional wisdom would have told us to not build Phoenix in the first place: "Don't put all your eggs in one basket." and "If it ain't broke, don't fix it." So now they want to try again? Perhaps the answer is not in procurement, but in collaboration. For example, the CRA has a pay system in SAP that has been working well for years. Other departments had their working solutions, whose was best? Why are we trying to re-invent the wheel? If a department needs a pay system, one possible solution would be for them to look for a partner department with a good system that can expand to meet their needs (similar to CRA and CBSA sharing IT resources). As departments who need better pay systems partner with departments with good, solid existing systems, over time, a central "winner" would emerge as the best model, and the rest of the departments can be brought on board as needs arise. The problem with Phoenix was not only that it was implemented poorly, but that it was forced upon departments that did not need to be fixed. Before you try to find a new solution, allow departments to roll back to systems that already work. The benchmark for a new system should be something better than the best old system, not just better than Phoenix. Sometimes you need to back up to move forward.

Hope - August 29, 2018

1) Having a human being assigned to each employee is pivotal. While automating a modern digital HR service will usurp the need for frequent human to human interaction, it is critical that humans can be reached if absolutely necessary, and that those humans have the capacity (and necessary training) to respond to and do actions on behalf of the employee.
2) An accurate status of ongoing tickets or issues that is visible to employees is needed, and will cut down on the call volumes of public servants with pay issues. Changes to that status should trigger an email or text notification, so that employees don't have to spend time logging in to check every day.
3) Any solution should be created with a safety net back-up plan that can be activated should issues arise.
4) Issues of missing pay should *not* be triaged solely by monetary amount but should take into consideration the ratio of the missing amount to income. For example, $2000 missing off someone's pay who makes $125K *may not be as meaningful* as $500 off a student's pay who makes $30K a year. This is an equity issue that needs to be considered.

Thanks for taking the time to read this, and best of luck with creating a new, workable system for us!

Anonymous - August 30, 2018

Yes! #2 especially. Can't tell you how many times my tickets would be classified as 'resolved', when in fact they were not. If we can order pizza and track when it's in the oven, on its way to us and delivered.. we should apply the same to support!

Jennifer Hill - August 29, 2018

The existing peoplesoft - pheonix world of maternity leave is extremely confusing. I have spent many hours on the phone, by email making sure I've completed the right forms, put in the right leave amounts and with 5 weeks left before my leave I still feel as if I have no control over whether this will be processed properly. There should be dedicated and knowledgeable people who deal with these life events and the process should be singular and as simple as possible. The number of forms I filled out and scanned over was silly. The fact that no one explains them to you or advises you on their impact is also not ideal. I'm all for a more digital environment, but well trained people and a dummy proof user experience need to be up their as priorities.

Fred - September 11, 2018

This comment is very much on the money - from time to time complex pay transactions arise. Employees need to be able to talk to someone with the wherewithal to actually help. There have been incremental improvements at the call centre, but it's not enough. We don't need to hear: "your issue may be escalated at some point in the future, depending on your story and some unknown factors at the Pay Centre, and once that is done at some indeterminate point in the future your pay file may be actioned". That's what we are hearing now.

Larry Menard - August 29, 2018

Integration with the financial system is essential and simplifying processes and rules will go a long way toward better use of self-serve tools. Unions must collaborate on the simplification of rules given that most originate in collective agreement language.

Vernon von Finckenstein - August 30, 2018

You are right Larry...data and interoperability will drive how the new parts fit into our complex jungle of back-office systems!!! It will be crucial!

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