ARCHIVED CD 1996-039

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September 16, 1996

Ottawa, Canada
K1A 0S5

SUBJECT: Automation of Entitlements and Recovery of Overpayments Enhancements

1. PURPOSE

1.1 The purpose of this directive is to provide you with information concerning the new automated process for commencing entitlements which are retroactive in nature. Refer to Personnel Pay-Input Manual (PPIM) 9-5-2 for affected entitlement codes. A Job Aid is attached to provide you with appropriate input examples.

2. BACKGROUND

2.1 The enhanced automated process is part of a larger undertaking known as the Compensation Productivity Initiative (CPI) which will focus on increased automation, standardization and consolidation within the Compensation Service Line.

3. POLICY

Effective September 30, 1996, the Regional Pay System will be enhanced to automatically calculate the retroactive period when an entitlement is commenced, (based on a Monday to Friday standard Work Week). It must be noted that departments will have the capability to override this automated process. This initiative does not change the current procedures for Pay Action Code (PAC) 18 stop and PAC 18 amend.

If the automated process is utilized, departments will no longer have to:

• complete the retroactivity fields 67/68 to generate a retroactive payment,
• adjust the retroactive payment request by Leave Without Pay (LWOP) periods, and
• report a recovery transaction for the entitlement that is overpaid due to the LWOP period.

4. PROCEDURES/INSTRUCTIONS

4.1. Enhanced Automated Process

The automated process for retroactive adjustments will be applicable to entitlement codes noted in 1.1 as they pertain to weekly paid (3C), bi-weekly paid (7B and 7C), and monthly paid accounts (6C).

4.1.2 Accounts that are excluded from this process are: bi-weekly accounts paid in arrears (7A), Department Individual Agency Number (IAN) accounts (6C), accounts currently on Leave With Income Averaging (LIA), Pre-retirement Transition Leave (PRL) and accounts currently on a Reduced Work Week (RWW) for House of Commons (HOC) employees.

4.1.3 The Regional Pay System (RPS) has been modified to access the Salary Service Data base during a retroactive period to take into consideration past periods of LWOP, LIA, On-going LWOP, PRL and RWW for HOC employees. Salary Service will also be accessed to take into consideration a change in pension status, a change in assigned work week (Assigned Work Week (AWW)), a change in pay cycle and the current/arrears (C/A) indicator when a retroactive payment is generated.

4.1.4 A new on line screen, Entitlement Arrears Recovery (EAR) has been created to allow departments to correct and collect overpaid retroactive payments that have been calculated incorrectly. Unlike the on line screen, Entitlement Recovery (ENR), utilizing the EAR screen will not update Salary Service History.

4.1.5 An overpaid entitlement reported on batch can now be collected by departments without having the transaction updated to Salary Service History. A PAC 17C on form DSS 2517T/2549 is to be utilized to request this type of transaction.

4.1.6 A new form, Public Works and Government Services Canada (PWGSC) 7340-1 has been created to allow departments to correct underpaid retroactive payments that have been calculated incorrectly, by making an additional payment without the transaction updating Salary Service History.

4.1.7 All input instructions for these new processes are included in the Personnel - Pay input Manuals changes: PPIM AMENDMENT No. 39 (Volumes IV, V) and no. 46 (Volumes I, II, III) dated August 1996.

4.2 Full Time Employees (AWW is not less than Scheduled Work Week (SWW) )

Departments are no longer required to complete the RETROACTIVITY FIELDS 67/68 (H/D/W'S IND/# of H/D/W'S), when creating an entitlement commence transaction (PAC 18C/Entitlement Commence - ENC), for active and temporarily struck off strength (TSOS) accounts, for a closed period in the past or an open period with an effective "from" date prior to the current pay period. The RPS will now determine if an adjustment is required in the form of a supplementary payment or an additional payment to be reflected on the next regular pay. A payment to be reflected on the next regular pay occurs when the effective "from" date of the entitlement commence is within the current pay period.

4.3. Exceptions

As a result of the change to "Pay Date" that was implemented in February 1992, the enhanced automated retroactivity process is limited to January 16, 1992. Therefore, if the effective date of the entitlement commence is prior to January 16, 1992, two inputs are required. The first input will include the period up to January 15, 1992 with the retroactivity fields (67/68) completed. The second input will be from January 16, 1992 onward and will not require the completion of the retroactivity fields. (Example 1 of the Job Aid will assist departments with specific input requirements.)

4.4. Leave Without Pay

When the automatic retroactivity process is used, fields 67/68 are to be left blank. The current procedure of reducing the number of days of a retroactive period by LWOP or the reporting of a transaction to recover the overpaid entitlement due to LWOP, (PAC 18R), will no longer be required to be input by the departments. This LWOP information will be retrieved and utilized from the Salary Service records to reduce the retroactivity period.

However, if departments complete the retroactivity fields 67/68 to generate a supplementary payment, the retroactive period must be reduced by the period(s) of LWOP. A (PAC 71 / Entitlement Adjustment (EAJ)) 202 transaction to collect the pension contributions due on the LWOP period must be submitted.

Example 1:

• 18C 144 eff. 11/01/96 @ 994.00 input for PP03/96 (start 25/01/96) Flds. 67/68 completed - 60 hrs. due to 15 hrs. LWOP (17/01/96-18/01/96)
• Additional input req'd. 71 202 eff. 17/01/96-18/01/96) @ 994.00 15 hrs.

If the entitlement being commenced is subject to the "10 day rule" (e.g. Bilingual Bonus), and the employee has past period(s) of LWOP (301/306) during the retroactivity period, the system will ensure that the employee has earned pay for the required number of days before generating the full month's payment.

If the LWOP (301/306) identified reduces the required number of days in the month(s) to less than 10 days, the system will not generate a payment for the month(s), but will generate pension contributions to be collected on the non-paid entitlement if the employee is a pension contributor.

Example 2:

• 18C 141 eff. 01/06/96 @ 800.00.
• Input for PP17/96 (start 08/08/96)
• LWOP 301 or 306 totalling 14 days in the month of July/96.
• The number of days to be paid in the retroactive period is 25 (i.e. 48 days less 23 days for July).

Therefore, the RPS will collect the pension contributions required on the 23 days reduced from the retroactive period.

4.5. Pension Contributions

If the employee is a contributor, and the automatic retroactivity process is in use, the RPS will automatically calculate and collect the pension contributions at single rate on the entire retroactive payment, including the LWOP period. If any portion of the pension contributions is to be calculated at double rate , the Pay Office will manually calculate and collect that portion.

4.6. Change in Pension Status

If there has been a change in Pension Status during the retroactive period, other than from one non-contributor status to another non-contributor status, the Pay Office will manually adjust the pension contributions as is the current process.

4.7. Change in Assigned Work Week (AWW)

If there has been a change in AWW during the retroactive period, the retroactivity fields 67/68 must be completed or the RPS will produce an on line reject message to the department stating that the retroactivity fields must be completed in order for the transaction to process. Batch clients will receive the reject message the following day. (See example 2 in the attached job aid).

4.8. Change in Pay Cycle and/or Current/Arrears Indicator

If there has been a change in Pay Cycle and/or C/A indicator during the retroactivity period and fields 67/68 are left blank, the transaction will process, and warning message W57 will be produced advising the department that a manual adjustment may be required since the payment will be calculated based on the current Pay Cycle and/or C/A indicator.

4.9. Percentage Rate Based Entitlements

The RPS will automatically generate a payment, for a closed period in the past, based on the percentage value and the gross earnings amount reported by the department on the entitlement commence input transaction.

4.10. Override Indicator

Under certain circumstances, there will be situations where the automated retroactive adjustment process should not occur, such as when an adjustment to the input does not require a full payment, or in the event of a transfer-in where the entitlement being reported was already being received in the transfer-out department.

The department will have the option to override the automated retroactive adjustment process by inserting an "X" in field 67 (H/D/W's indicator). This indicator will have the affect of by-passing the automated retroactive process, the entitlement will be commenced for the current pay period and warning message W50 will be produced advising the department that a manual adjustment may be required.

4.11. Corrections to Retroactivity Adjustments

In order to allow the departments to correct a retroactive payment adjustment or to submit an adjustment as a result of overriding the automated retroactive adjustment process, without the transaction updating Salary Service History, the following types of input are available:

To issue an additional payment: the Entitlement Adjustment screen (EAJ) will be used for on-line transactions and PAC 71 transactions on form PWGSC 7340-1 will be used for batch transactions. (See example 6 in the attached job aid.)

To allow departments to adjust a retroactive payment when a recovery is required: the Entitlement Arrears Recovery (EAR) screen will be used for on-line transactions and PAC 17C transactions on form DSS 2517T and/or 2549 will be used for batch transactions. (See example 5 in the attached job aid.)

4.12. Part Time Employees (AWW is less than SWW)

The same automated process applies to part time employees as well as to full time employees. However, for the system to automatically generate a payment for the retroactive period, the entitlement commence (18C / ENC) must have an effective "from" date equal to the start date of a pay period, and for a closed period, the effective "to" date must equal the last date of a pay period.

If the effective "from" and/or "to" dates do not meet the previously stated conditions, the department will have to complete fields 67/68 to generate a payment. (see example 3 in the attached job aid.)

NOTE: The same process as described for part time employees applies to employees working a non regular Monday to Friday Work Week (field 34 = 3).

4.13. Leave Without Pay (part time)

The retroactive period resulting from an entitlement commence transaction will be automatically reduced by period(s) of LWOP if the entitlement is subject to LWOP, the LWOP period is resident in Salary Service with fields 67/68 completed and the entire LWOP period is within the retroactive period.

If any of the aforementioned conditions is not met, the retroactive payment will process without being reduced by LWOP, and warning message W53 will be produced advising the department to verify the supplementary payment. The department will be responsible to submit a recovery transaction and a transaction to collect the pension contributions on the LWOP period, if required. (See example 4 in the attached job aid.)

Note: Departments must submit a recovery transaction and a transaction to collect pension contributions for TSOS period(s) as these LWOP period(s) will not reduce the retroactive payment due to insufficient information in the Salary service Data Base.

4.14. Edits, Rejects and Warnings

This new process will affect the edits/verifications presently being done on entitlements commence. A number of rejects and warnings will be produced to assist Departments with their input. refer to PPIM 7-3-3-2 for the detailed list of rejects and warnings.

4.15 All input instructions for these new processes are included in the Personnel-Pay Input Manuals changes: PPIM AMENDMENT No. 39 (Volumes IV, V) and No. 46 (Volumes I, II, III) dated August 1996.

5. INQUIRIES

5.1 Any request for information regarding the foregoing should be addressed to your PWGSC Client Service Centre.

Original Signed by
P. Charko

P. Charko
Director General
Compensation Sector
Government Operational Service

Reference : CJA 9015-18, 9022-13-1