ARCHIVED CD 2005-015
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Note This document has been modified. The changes are identified by a vertical line "|". Revision (|)
August 10, 2005 (Revised August 24, 2005)
SUBJECT: New Contribution Codes for Correctional Service Canada Operational Service
1.1 The purpose of this directive is to provide client departments with information regarding new Regional Pay System (RPS) deduction/entitlement (DEDENT) codes required for Public Service Pension Fund (PSPF) and Retirement Compensation Arrangement (RCA) account contributions, for employees engaged in operational service with Correctional Service Canada (CSC).
1.2 All compensation advisors should be aware of the provision, in the event that CSC employees later join their respective departments.
1.3 For additional information regarding the CSC special pension arrangements, compensation advisors should consult the Superannuation Administration Manual (SAM) Special Bulletin 1994-004 entitled "Correctional Service Canada - Early Retirement Benefits Provision" and section 9 of the SAM.
2.1 Since March 18, 1994, the Public Service Superannuation Regulations provide special pension arrangements for CSC employees engaged in operational service.
The special provision allows for a lower age at retirement and a reduction in the number of years required to qualify for a pension. An additional contribution is required from employees subject to this special provision.
3.1 Every person employed by CSC in operational service and required to contribute to the Public Service Superannuation Account (PSSA) or the PSPF on or after March 18, 1994, is subject to the aforementioned CSC provision and must contribute an additional 1.25% of salary to the PSSA/PSPF or the RCA account. Currently, compensation advisors use pension code 18 to identify those contributors who become subject to the CSC special provisions. The use of this code results in the withholding of an additional 1.25% pension contribution from the employee's salary, for current service.
3.2 Since the employer's share for the additional 1.25% CSC contribution for current service, leave without pay (LWOP), and elections is different than the rate required for the regular PSPF and RCA contribution, there is a necessity to distinguish them when being collected from pay, pensions and/or paid via a lump sum payment.
NOTE 1: The additional 1.25% contribution need only be identified for current contributions, and for recovery of deficiencies for periods of LWOP and elections which will be processed in the future. There is no requirement to convert or amend any existing recovery of deficiencies for LWOP or elections that have already been processed. Therefore, no new Deduction and Entitlement (DEDENT) codes were created under the PSSA, only under the PSPF and the RCA.
NOTE 2: The first phase of this initiative will focus on splitting the current contributions and future recovery of deficiencies for periods of LWOP. The second phase, scheduled to come into effect next year, will focus on the requirements to split contributions for elections processed after the implementation date and for future recoveries from pension benefit entitlements.
3.3 The new DEDENT codes, which have been created to identify the additional 1.25% contribution, are as follows:
- 5B6 Superannuation -- current -- 1.25%
This new code will be used to identify the 1.25% that is already included in the PSPF calculation.
- 5B7 Superannuation -- Single Deficiencies -- 1.25%
This new code will be used to identify the 1.25% that is already included in the PSPF low and high single rate deficiencies (includes arrears and LWOP).
- 5B8 Superannuation -- Double Deficiencies -- 2.50%
This new code will be used to identify the 2.50% that is already included in the PSPF low and high double rate deficiencies (includes arrears and LWOP).
- 5C1 RCA -- current -- 1.25%
This new code will be used to identify the 1.25% that is already included in the RCA calculation.
- 5C2 RCA -- Single Deficiencies -- 1.25%
This new code will be used to identify the 1.25% that is already included in the RCA single rate deficiencies (includes arrears and LWOP).
- 5C3 RCA -- Double Deficiencies -- 2.50%
This new code will be used to identify the 2.50% that is already included in the RCA double rate deficiencies (includes arrears and LWOP).
3.4 If a deduction is created using these new codes, the Deduction Entitlement Select (DDT) screen will recognize it and reflect it accordingly.
| 4.1 These new deduction codes will become effective on August 26, 2005. As of that date, compensation systems will be programmed to reflect the proper split automatically in PSPF and RCA current contributions for accounts with pension type code 18.
4.2. Pay Office
4.2.1 For contributions relating to operational service (reflected by pension type code 18), the pay and pension agents will be required to distinguish the PSPF and/or the RCA contributions from the additional 1.25% CSC contribution using the new codes when issuing a refund of excess contributions, when calculating arrears and deficiencies, or when proceeding with any other type of adjustments to contributions.
4.2.2 RE-Take-on-Strength (TOS) Calculation System
The current version of the RE-TOS Calculation System has the facility to calculate the additional 1.25% contribution and includes it in the PSPF and the RCA contributions. The RE-TOS Calculation System will be amended later this year to split the contributions by generating the new 5B7, 5B8, 5C2, and 5C3 codes to be used by the pay and pension agent for input into the RPS. Until such time as the RE-TOS Calculation System is modified, pay and pension agents will be required to manually split the additional 1.25% CSC contribution from the regular PSPF and RCA contribution. If an employee wants to make a lump sum payment to pay deficiencies, the pay office will provide the split amount of contributions to the compensation advisors so that it can be properly reported on the Public Works and Government Services Canada (PWGSC)- Travaux publics et Services gouvernementaux Canada (TPSGC) 4005 form and through Cash Receipt (CRT) transactions (see section 4.4.2 below).
4.3 Supplementary Calculate Process and Regular Pay Process
4.3.1 Currently, the additional 1.25% contribution is included in the Supplementary Calculate Process and in the Regular Pay Process of the RPS under the PSPF or the RCA codes for accounts with pension code 18. The additional 1.25% contribution will be removed to reflect only the PSPF and the RCA contributions.
The Supplementary Calculate Process (current or previous year) and the Regular Pay Process will be modified to generate code 5B6 to identify the 1.25% CSC additional contribution for the PSPF. This amount will be posted as a separate deduction and will update element 711 of the Master Employee Record (MER). However, the payroll registers for supplementary pay and regular pay will reflect this amount under the allowances/deductions column instead of appearing in the PSSA HI column. That same amount will appear on the bottom half of the cheque stub (as a separate line), though it will be part of the cumulative year to date amount for superannuation (shaded section of the superannuation box).
The Supplementary Calculate Process (current or previous year) and the Regular Pay Process will be modified to generate code 5C1 to identify the 1.25% CSC additional contribution for the RCA. This amount will be posted as a separate deduction and will update element 745 of the MER. However, the payroll registers for supplementary pay and regular pay will reflect this amount under the allowances/deductions column instead of appearing under the RCA deduction (783) and it will appear on the bottom half of the cheque stub (as a separate line). This amount will not form part of the cumulative year to date total shown for superannuation on the cheque stub.
4.4. LWOP and Non-Payables
4.4.1 New PSPF and RCA codes have been created to calculate retroactive LWOP periods applicable to non-payable codes 202 and 270 for accounts with pension type code 18.
Codes 5B7 (for the additional 1.25 % contribution for the PSPF) and 5C2 (for the additional 1.25% contribution for the RCA) will be generated when calculating retroactive (current and previous years) amounts for non-payable code 202.
Codes 5B8 (for the additional 2.50% contribution for the PSPF) and 5C3 (for the additional 2.50 % contribution for the RCA) will be generated when calculating the double portion for non-payable code 270.
4.4.2 When a contributor wants to make a cash payment for LWOP deficiencies, the payment must be sent to her/his compensation advisor who will forward the payment to the Superannuation, Pension Transition and Clients Services Sector (SPTCSS) along with a breakdown of the period to which the payment applies.
The form PWGSC- TPSGC 4005, Superannuation Remittance For Employees on Leave Without Pay, must be used for this purpose. This form has been amended so that the compensation advisor can split the payment to reflect which portion is related to the regular PSPF contribution (or RCA contribution) as opposed to the additional CSC contribution. Compensation advisors must also create CRT transactions, as per Section 4-4-20 of the Personnel-Pay Input Manual, using the appropriate pension deduction codes applicable to the cash payment.
NOTE 1: The form PWGSC-TPSGC 2386, Certification Notice, Pension Support System, has also been modified so that the additional CSC contribution will be split from the regular PSPF and/or RCA contributions.
NOTE 2: Compensation advisors are reminded that upon transfer from one department or pay office to another, all deductions reflected on the DDT screen are to be commenced. This would include any outstanding deficiency for the additional 1.25% pension contribution showing under codes 5B7, 5B8, 5C2 or 5C3 which an employee must continue paying even in the case where she/he no longer works for CSC.
4.5. Contributor System
4.5.1 The Contributor System Contribution and Interest processes have been modified to accept the new DEDENT codes that are passed via the RPS.
The On-line Contribution Maintenance application used by the SPTCSS to correct rejects will also accept input using the new DEDENT codes.
The new contribution transactions will update the PSSA Contributions and RCA Contributions screens. Therefore, the Contribution Summary Screen will display the combined contributions (regular and additional 1.25%) and interest.
As well, the new transactions will be used to support the contribution accounting and reconciliation processes between the Contributor System and the Common Departmental Financial System (CDFS).
4.6 Personnel-Pay Input Manual (PPIM)
4.6.1 The PPIM will be updated to incorporate all related information contained in this directive.
5.1 Any inquiries on the information contained in this document should be addressed to your Public Works and Government Services Canada (PWGSC) Compensation Services Office.
Original Signed by
Acting Director General
Accounting, Banking and Compensation
Reference(s): CJA 9204-3
- Date modified: