ARCHIVED CD 2000-019
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June 21, 2000
SUBJECT: Implementation of Pay Equity for the PE Group
1.1 The purpose of this directive is to provide Compensation Advisors in departments with information on the implementation of the Pay Equity agreement for the Personnel Administration (PE) Group.
1.2 In this text, use of masculine is generic and applies to both men and women.
2.1 An agreement to settle all existing Pay Equity complaints was reached between the representatives of the Personnel Administration National Assembly (PENA) and Treasury Board Secretariat (TBS) on November 26, 1999. This agreement was ratified by employees in the PE Group, and was then approved by the Canadian Human Rights Tribunal (CHRT) on February 24, 2000.
The criteria for this Pay Equity agreement are similar to the Public Service Alliance of Canada (PSAC) Pay Equity agreement. The differences between the two agreements are the retroactive period, the payment amount, the eligibility in acting situations and the treatment of benefits paid under the Disability Insurance (DI) and Long-term Disability Insurance (LTD) plans. As a result, modifications will be required to the existing Pay Equity programs to accurately process the retroactive payments for employees in the PE Group.
3.1.1 This settlement applies to all current and former employees who were or are employed by a department or agency listed in the Public Service Staff Relations Act (PSSRA), Schedule 1, Part 1 and who have service in the PE Group as indeterminate, term, casual or seasonal employee, during the retroactive period.
3.1.2 The retroactive adjustment will be calculated on the actual periods of service in the PE Group Bargaining Unit Designator (BUD) code 30700. This adjustment will be reduced by periods of leave without pay (LWOP), with the exception of maternity leave where the employee received maternity benefits.
3.1.3 Employees whose substantive position is outside the PE Group but who were acting PE's during the retroactive period will be eligible to the Pay Equity adjustment for the period of acting service based on the acting level. Employees whose substantive position is in the PE Group but were acting outside the group during any or all of the retroactive period will be entitled to the adjustment based on their substantive level. Employees who were acting within the PE Group will be entitled to the adjustment based on their acting level.
3.1.4 The Pay Equity adjustment amounts are to be prorated for part-time employment based on the assigned work week (AWW) during the retroactive period.
3.2.1 The retroactive adjustment covers the period from October 1, 1991 to September 30, 1999. The retroactive payments are to be considered pay for purposes of the Public Service Superannuation Act (PSSA) but not for any other purpose or benefits related to salary. The Pay Equity retroactive adjustment is considered to be all inclusive. Recalculations are not to be made on salary related benefits such as overtime, severance pay and unused leave for this period. There is no provision for interest payments in this agreement. All adjustments will be automatically charged to a special TBS coding.
3.2.2 Retroactive payments from October 1, 1991 to September 30, 1999 are based on the level within the PE Group as follows:
|PE-0 (PE-DEV), PE-1 and PE-2||$2,300 per year|
|PE-3 and PE-4||$2,500 per year|
|PE-5, PE-6 and PE-7||$2,700 per year|
3.2.3 In the case of deceased employees or former employees that have since died, any payments owed will be made payable to the estate. The administrator of the estate will be responsible for payment distribution.
3.2.4 All employees who are in a PE position as of October 1, 1999 will be entitled to an increase of $5,500 in their annual basic rate of pay. All salary related benefits effective on or after October 1, 1999 are to be recalculated by Compensation Advisors in departments taking into account the new rate of pay.
3.2.5 Disability and long-term disability benefits will be subject to the terms and conditions of the DI Plan. For additional information, refer to section 3.11.7 (for DI) and section 4.8.17 (for LTD) of the Insurance Administration Manual (IAM).
4.1. Pay Equity Adjustments
The last Treasury Board employing department will be responsible for the issuance of Pay Equity adjustment payments for all current and former employees who have worked in various departments during the retroactive period previously stated. The retroactive payments for the period from October 1, 1991 to September 30, 1999 are all inclusive. Recalculations will not be made for any salary related benefits such as overtime, severance pay and unused leave that may have occurred during this period.
The following reports will be produced late in June 2000 to facilitate the work of Compensation Advisors in departments.
4.2.1. Pay Equity Account Select Report
This report is a list of all accounts with service and/or employment periods in the PE Group (BUD code 30700) from October 1, 1991 to date including LWOP records. This report can be used to verify the accuracy of the historical information on the Salary Service History (SSH) that will be used to produce the automated payment for all 7B and 7C records.
4.2.2. Dual Employment/Remuneration Report
This report will list all accounts with dual employment/remuneration, i.e. all accounts for which there is a code "1" in field 19 and a code "02," "13" or "64" in field 39 of the Master Employee Record (MER). The report will be forwarded to both departments, where applicable, for additional adjustments that may be required.
4.2.3. Educational Leave Report
This report will list all accounts in the affected group with service paid using entitlement code 077 - Educational Allowance during the retroactive period. Compensation Advisors in departments will be required to adjust the Pay Equity automated payment and the basic rate of pay where applicable.
4.2.4. No Master Account Report
This report will be produced, if applicable, to identify affected accounts where records were found on the SSH but the MER does not exist on the Regional Pay System (RPS) for these accounts.
Compensation Advisors in departments will be required to create a taken on strength (TOS) transaction, using employee type code "X", and a struck off strength (SOS) transaction for these accounts. These transactions must be processed prior to the automated retroactivity process as identified in subsection 4.4, in separate updates but within the same pay period to ensure that regular pay cheques are not produced.
4.3. Entitlement Codes
The following new entitlement codes have been created for the processing of the PENA pay equity adjustments:
|311||PE Group Pay Equity Retroactivity Adjustment - Pensionable (October 1, 1991 to September 30, 1999)|
|312||PE Group Pay Equity Retroactivity Adjustment - Non-Pensionable (October 1, 1991, to September 30, 1999)|
|313||PE Group Pay Equity Basic Pay Adjustment - Pensionable (October 1, 1999, to current)|
|314||PE Group Pay Equity Basic Pay Adjustment - Non-Pensionable (October 1, 1999, to current)|
|315||PE Group Pay Equity Salary Adjustment - Pensionable (October 1, 1999, to current)|
|316||PE Group Pay Equity Salary Adjustment - Non-Pensionable (October 1, 1999, to current)|
|317||PE Group Pay Equity Overtime Adjustment - Non-Pensionable (October 1, 1999, to current)|
|318||PE Group Pay Equity Separation Benefits - Eligible (October 1, 1999 to current)|
|319||PE Group Pay Equity Separation Benefits - Non-Eligible (October 1, 1999 to current)|
|320||PE Group Pay Equity Allowance Adjustment - Pensionable (October 1, 1999 to current)|
|321||PE Group Pay Equity Allowance Adjustment - Non-Pensionable (October 1, 1999 to current)|
|323||PE Group Pay Equity 4% Vacation Pay Adjustment -Non-Pensionable (October 1, 1999, to current)|
Deduction code 595 (Federal Income Tax) has been added to the list of allowable deduction codes on the Supplementary Deduction (SDD) screen. The above listed new entitlement codes, with the exception of codes 318 and 319, have also been added to the list of allowable codes on the Overpayment (OVD) screen.
4.4. Processing Schedule
The following is the anticipated processing schedule for the implementation of the PENA Pay Equity:
- Late June 2000 Production of Reports.
- By June 30, 2000 -- Requests for corrections to SSH sent to Regional Pay Offices.
- July 13 to 17, 2000 -- Input of additional transactions such as Letter of Authority (Tax Waiver) for retroactive period from October 1, 1999, to July 19, 2000.
- July 14, 2000 -- Update Pay Rates Control File with new rates of pay.
- July 17, 2000 -- Produce automated retroactivity for period from October 1, 1999 to July 19, 2000 for 7C accounts and to July 5, 2000 for 7A or 7B accounts.
- July 21 to 24, 2000 -- Input of additional transactions such as Letter of Authority (Tax Waiver) for retroactive period from October 1, 1991 to September 30, 1999.
- July 24, 2000 -- Produce automated retroactivity for 7B and 7C service for the period from October 1, 1991 to September 30, 1999.
The retroactive payment for the period from October 1, 1991 to September 30, 1999 will be automatically calculated and paid for accounts with periods of service in the PE group in a 7B or 7C pay frequency. The automated retroactive period will be paid using the new entitlement codes 311 for pensionable service and 312 for non pensionable service and will be split by fiscal year and taxation year. All periods of service in the PE Group during this period of retroactivity in a 7A pay frequency will have to be input by Compensation Advisors in departments.
5.2. Retroactive Payments for SOS Accounts
If the account is currently in SOS status and the employee received a Return of Contributions (ROC), pension contributions will not be withheld from the adjustment payments. If the account was SOS, the employee received a ROC and has since returned to work, pension contributions will be calculated and withheld from the payment of pensionable service as identified by entitlement code 311.
The rate of pay to be used to calculate the payment for employees who were acting within the PE Group will be prorated on a daily basis for the acting period. Employees whose substantive position is within the PE Group but who were acting outside the group will receive the adjustment based on their substantive position. Employees whose substantive position is outside the group but who were acting as a PE during the retroactive period will receive the entitlement based on the acting position for the period of acting service.
The automated payment will be based on the SSH records. If the earliest SSH record for an employee whose substantive position is in the PE Group reflects an acting position in a group other than the PE Group then the automated payment will be paid effective from the date of service in the affected group (end of acting period). In these instances, Compensation Advisors in departments will be required to report an additional adjustment for employees based on their substantive level for the acting period.
5.4. Part-time Service
Employees who have periods of part-time service during the retroactive period will have the automated payment prorated to the hours identified as the AWW. The message "WC9 - AWW < SWW - Verify Pmt - Adjt. May be req'd" will be produced for Compensation Advisors in departments to verify the automated payment and report adjustments if required.
5.5. Non Standard Work Week (NSWW)
Employees who work a NSWW and have code 1 or 3 in field 34 will have an automated payment produced. The message "WC8 - NSWW = 3, Verify Pmt - Adjt. May be Req'd" will be produced for Compensation Advisors in departments to verify the automated payment and report adjustments if required.
The Pay Equity adjustment amount will be reduced by periods of LWOP, preretirement leave (PRL) and past periods of leave with income averaging (LIA) with the exception of maternity leave.
The eligibility criteria for this period stipulates that employees who have periods of maternity leave - reason code "K" and who were in receipt of maternity benefits are eligible for the payment and the period of maternity leave is not to be used to reduce the adjustment amount. During the automated adjustment process, periods of maternity leave - reason code "K", where the employee was active on the day immediately prior to the start of the LWOP reason code "K" period, will be considered as active service for a period from the "Temporarily struck off strength " (T-SOS) date up to the earliest of the following dates:
- 17 weeks from the start of the LWOP period, or
- the "Retaken on strength" (Re-TOS) date, or
- the end of the adjustment period which is September 30, 1999.
Compensation Advisors in departments will be required to verify eligibility and adjust the amount paid if applicable.
If a LWOP record is identified for a part-time account and the from or to date of the LWOP is not equal to or within the retroactive period the message "WS9 - LWOP on S/S, Verify Pmt. - Manual Adjustment may be req'd" will be produced for Compensation Advisors in departments to verify the automated payment and report adjustments if required.
5.7. Pension Deficiencies
Pension deficiencies owing for periods of LWOP will be withheld from the supplementary payment at the single rate or double rate based on the reason code for the LWOP. The special pension contribution rate of 4.7% for single rate and 9.4% for double rate will be applied to the payments with an "Effective To" date prior to December 27, 1996. A notification will be produced when the double rate contributions are recovered for periods of LWOP for Pay Office personnel to verify the deficiencies collected. Pension regulations stipulate that effective May 1991, the deficiencies for the first three months of LWOP are to be collected at single rate but the deficiencies will be calculated based on the LWOP code.
5.8. Death in Service
If the account is SOS with reason code "17 - Death in Service" and the effective date of SOS is prior to February 25, 2000, the automated retroactive payments will not be produced and message NA8 - "Death in Service - Payment must be Handled Manually" will be forwarded to the Pay Office. Pay Office personnel must ensure that statutory deductions are not withheld and the statements of remuneration paid (T4, Relevé 1) do not include the Pay Equity adjustment amounts. If the account is SOS with the reason code "17 - Death in Service" and the date is on or after February 25, 2000 then the normal process applies and the payments will be produced automatically.
5.9. Increase to Basic Rate Effective October 1, 1999
All employees in a PE position on July 14, 2000 will automatically have their salary revised to the new rates as per the attached Appendix A. The revised salary reflects the $5,500 increase in the annual rate of pay as stipulated in the agreement. The new rate of pay will be reflected on the regular pay for pay period 16, 2000 (regular cheque dated August 2, 2000).
The retroactive adjustment for the period from October 1, 1999 to July 19, 2000, for 7C accounts and to July 5, 2000 for 7A or 7B accounts will be automatically produced on July 17, 2000, using the existing automated process used for collective agreements. The retroactive period will be split on March 29, 2000 for pension plan purposes. The retroactive adjustments for 7A accounts and for employees currently paid on the basis of a simple minimum-maximum range (PE-DEV and PE-6 Performance Pay) will also be automated in this process. The payments will be produced using the new entitlement codes 313 for pensionable service and 314 for non pensionable service.
These retroactive payments will be based on the same formula as those applied for the period from October 1, 1991 to September 30, 1999, with the exception of LWOP for maternity leave. Periods of maternity leave that occurred between October 1, 1999 and July 19, 2000 will reduce the automated payment produced for this period. Compensation Advisors in departments will be required to make the necessary adjustments.
5.10. Recalculations Effective October 1, 1999
Recalculations of all salary related events, such as promotions, acting, lateral transfers, maternity benefits and overtime, will be required where the "Effective From" date is October 1, 1999, or later. Compensation Advisors in departments will be required to report the adjustments following the instructions in section 6 of this Compensation Directive as well as modifying any ongoing entitlements as required.
5.11. Letters of Authority
The special $10,000 Letters of Authority can also be used to waive the tax on Pay Equity adjustments resulting from the PENA agreement but it should be noted that employees who will receive adjustments resulting from both the PSAC and the PENA agreements can only have one Letter of Authority of $10,000 applied. A waiver of $10,000 cannot be completed for each of the Pay Equity agreement adjustments. Departments will be required to control the amount of the waiver and the residual, if any, after each Pay Equity payment (PSAC and/or PENA) is issued until such time as all of the allowable amount of the waiver is used. Transactions to apply tax waivers to the automated retroactivity must be input by Compensation Advisors in departments using Entitlement Commence (ENC) screen and codes 395 and/or 396 by the deadline identified in the processing schedule (subsection 4.4).
5.12. DI, LTD and Supplementary Death Benefit (SDB) Premiums
DI, LTD and SDB premiums must be adjusted effective March 2000 to reflect the premium calculations based on the new revised salary. Since these new rates of pay will not be reflected on the employees'regular pay until August 2000, adjustments will be required for the period from March to July 2000. Adjustments can be recovered from a retroactive payment using the SDD screen or from a regular cheque using a Deduction Commence (DEC) screen with the appropriate deduction codes.
All adjustment transactions reported by Compensation Advisors in departments must be split by taxation year and for March 29, 2000, (to differentiate between the two pension funds).
6.1. 7A Service
Compensation Advisors in departments will be required to report all periods of 7A service during the retroactive period from October 1, 1991, to September 30, 1999. These will not be automated. A report of all Pay Action Codes (PAC) 33 processed during the retroactive period, totaled by fiscal year for all employees in the PE Group will be produced by TBS. These periods of service will be reported using the ENC screen and the new entitlement code 312 and must be split by taxation year.
6.2. Vacation Pay and Payment in Lieu of Statutory Holidays
Compensation Advisors in departments will be required to report all adjustments to Vacation Pay (code 073) and Payment in Lieu of Statutory Holidays (code 173) for part-time accounts for the period from October 1, 1999 to July 19, 2000 for 7C accounts or to July 5, 2000 for 7A or 7B accounts. This entitlement will not be automatically calculated and paid on the retroactive adjustment nor on any adjustments resulting from the recalculations. The adjustment is to be reported using an Entitlement Adjustment (EAJ) screen and the new entitlement code 323.
6.3. Recalculations of Basic Pay
Compensation Advisors in departments will be required to recalculate all salary events such as promotions, acting and lateral transfers with an effective from date of October 1, 1999, taking into account the new basic rates of pay for the PE Group as per Appendix A. The adjustments are to be reported using an Entitlement Amend (ENA) closed period from the start of the retroactive period to July 19, 2000 for 7C accounts or to July 5, 2000, for 7A or 7B accounts and the new entitlement code 315 or code 316. A Revision (REV) screen, open period, is to be used with an effective date of July 20, 2000, entitlement code 001 or 002 as applicable, for ongoing changes. Field 71 must be completed on the ENA screen with WW in positions 1-2, the standard work week (SWW) in positions 3 to 6, the AWW in positions 7 to 10, the NSWW indicator in position 11 and PE in positions 12 and 13. For example, the SWW for employees in the PE group is 37.50, if the AWW is 30 hours per week and the NSWW is 2; WW375030002PE would be indicated in field 71. If field 71 is not completed then the current value as per the employee's MER will be imposed.
6.4. Recalculations of Allowances
Compensation Advisors in departments will be required to recalculate all salary based allowances such as maternity benefits, separation benefits and overtime with an "Effective From" date of October 1, 1999, or later. The screen and entitlement code to be used for the adjustment will be based on the allowance adjustment being reported.
6.4.1 For the following ongoing allowances the ENA screen is to be used with the appropriate entitlement code. The system will generate an EAJ with entitlement code 320 or entitlement code 321.
|006||Offender Supervision Allowance|
|015||Dirty Work Allowance|
|020||Temporary Assignment Allowance|
|027||Dual Remuneration - Subject to Superannuation|
Field 71 must be completed on the ENA screen as outlined in subsection 6.3 above.
6.4.2 For recalculations of overtime effective October 1, 1999, adjustments are to be reported by Compensation Advisors in departments using the Extra Duty Pay (EDP) screen with the new entitlement code 317.
6.4.3 For the recalculation of all allowances not mentioned in subsection 6.4.1 above for a closed period in the past, the EAJ screen is to be used with the new entitlement code 321.
6.4.4 For adjustments to Separation Benefits due to recalculation, the Termination Entitlement (TEC) screen is to be used for SOS accounts with entitlement code 318 or code 319. If the employee has since returned to work these new entitlement codes are to be reported on an EAJ screen.
6.5. Statement of Qualifying Retroactive Lump Sum Payment (SQRLSP)
The SQRLSP will automatically be produced in February 2001 for this adjustment. This statement will provide employees with a breakdown of the amounts applicable to each year in the retroactive period and will allow them to apply to Canada Customs and Revenue Agency (CCRA) for a recalculation of their previous income tax returns.
7.1 Any request for information regarding the foregoing should be addressed to your Public Works Government Services Canada (PWGSC) Compensation Services Office.
Original Signed by
Government Operational Service
1 - Old Rates Effective October 1, 1999 / A - Rates Effective October 1, 1999
|Performance Pay PE-6||1||62,622||to||73,892|
- Date modified: