ARCHIVED Services Pay Directive: 1990-093 (46)
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September 20, 1990
SUBJECT : Direct Deposit, P.S. Pay - Duplicate Payment/Replacement Payments
1.1 The purpose of this directive is to reiterate for departments and paying offices the definition of duplicate and replacement payments, the circumstances under which each type of payment is made and the procedures for cancellation of a direct deposit payment when a Returned Item Voucher is involved. Refer also to the procedures as outlined in the Personnel Pay Input manual (PPIM) 7-5 and the Pay Office Procedures manual (POP) Chapter 29.
2.1 Service Pay Directive 1988-063 (040) indicated that a Duplicate Payment could not be issued if the payment was reported as a reject, intercept, recall or unpostable. This interpretation of the Direct Deposit Regulations was incorrect.
3.1. Duplicate Payment
A Duplicate Payment is a payment issued to an employee in the form of a series 422 paper cheque in the same amount as the original net payment under the following conditions:
- when an employee advises their departmental personnel officer that they have not received their direct deposit payment on the official due date and;
- the department has confirmed with their pay office that the direct deposit payment, for whatever reason, has NOT been deposited on the due date.
- Under the above circumstances, departments must ensure that the employee has completed an Undertaking of Indemnity Form (DSS 536) prior to requesting the Duplicate Payment. The indemnity form provides a signed statement from the employee that the payment was not received and that the employee agrees to reimburse the Receiver General should the original payment subsequently be credited to the employee's account.
The DSS 536 should then be submitted to the Accounting Section of their local SSC pay office. The Accounting Section of the pay office will issue the duplicate payment upon presentation of the DSS 536.
3.2. Replacement Payment
A replacement payment is a payment issued to an employee in the form of a series 422 paper cheque in the same amount as the original net payment. A replacement payment is issued by the Accounting Section of the applicable SSC pay office under the following circumstances:
- when the direct deposit payment is rejected by the Direct Deposit Interface System (DDIS)
- when a direct deposit payment is rejected by the Direct Clearer
N.B. in the above two cases, a replacement cheque is issued automatically by the accounting section of the pay office and no additional action is required by departments.
- as a result of an intercept
N.B. in the above case a replacement cheque will be issued automatically if the department has entered a Return Flag of "1" on the Direct Deposit intercept Request Form DSS 8432-1. If a Return Flag of "C" is entered the payment will be cancelled and no replacement cheque will be issued. Please refer to PPIM 7-5-1 page 5.
- as a result of a recall or a return from an individual financial institution
N.B. in the above instance, a replacement cheque will only be issued upon confirmation of receipt of a Returned Item voucher (RIV) in the National Operations Liaison Unit, SSC and confirmation that a duplicate payment has not already been issued.
It is recognized that significant time delays can occur for the return of RIVs from individual financial institutions. Due to this factor departments are advised to use the Duplicate Payment procedure in the case of recalls or returns in order to ensure payment to individuals are as close as possible to due date.
If a Duplicate Payment is made and the final results of a Trace request indicate that the original funds were in fact deposited to the employee's account or if the original payment was found in fact to have been a reject, intercept, unpostable or recall and a replacement cheque issued then it is the responsibility of the department to initiate recovery action.
3.4. Cancellation Procedure
Where an individual is not due the original direct deposit payment and it has been returned from the financial institution as a Returned Item Voucher (RIV), it is permissable for the pay office, upon advice from the department, to use the RIV as a cancellation instrument and input a Returned Payment action (PAC 19) to adjust the year to date totals on the employee's master file and adjust the departmental expenditure. It is not necessary to issue a replacement cheque and send it to the department for subsequent return and cancellation. In this instance, the RIV should be attached to the cheque issue list summary (DSS 7456) when reporting cancellation to CRCE.
It is also permissable to cancel a direct deposit payment by use of a source 046 Central Accounting journal voucher. A copy of the Returned Item Voucher should be attached to the source 046 JV when submitting it to the department for their approval. The JV should show a debit to the Receiver general (use coding 340016242) and a credit to the appropriate departmental expenditure. In the particulars portion of the JV, the pay office must identify the direct deposit payment (series and payment number) and the reason for the JV (eg. to cancel direct deposit payment identified, employee Struck Off Strength 13/06/90). The departmental finance section will subsequently forward the approved JV to Cheque Redemption and Control Branch (CRCB). The pay office should retain a copy of the source 046 JV for control and reconciliation purposes.
4.1 Any queries on the foregoing should be addressed by telephone to the Direct Deposit Project, Cathy McBride 819-956-5716.
Original Signed by
Government Operational Services
- Date modified: