ARCHIVED CD 2006-010

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May 23, 2006

SUBJECT: Pay processes relating to a bargaining agent's objection to the exclusion of a position

1. PURPOSE

1.1 The purpose of this directive is to provide compensation advisors with information concerning pay processes relating to a bargaining agent's objection to the exclusion of a position.

2. CANCELLATION

2.1 This directive cancels Compensation Directive 2005-006 dated April 19, 2005.

3. BACKGROUND

3.1 The Public Service Modernization Act (PSMA), Bill C-25 received Royal Assent on November 7, 2003. This Act amends the Public Service Labour Relations Act (PSLRA) regarding the processing of union dues deductions at source for employees whose positions have been proposed for exclusion under the Act.

3.2 In April 2005, a new bargaining status indicator "99" was added to field 26 (refer to Personnel-Pay Input Manual [PPIM] Section 9-2) to identify a person employed in a position that has been proposed for exclusion and for which an objection to the exclusion has been filed by the bargaining agent. Changes to the Regional Pay System (RPS) regarding the processing of union dues deductions in accordance with the PSLRA will be implemented on June 13, 2006.

4. POLICY

4.1 Section 76 of the Act provides that when an objection to a request for the exclusion of a position is filed by the bargaining agent, the union dues of the concerned employee must continue to be deducted from his salary but must be held in suspense by the employer until the objection has been resolved. When the notice of objection is resolved or withdrawn, the amount of union dues held in suspense since the effective date of the pending exclusion status is either refunded to the employee or remitted to the bargaining agent.

5. PROCEDURES/INSTRUCTIONS

5.1. The following changes will be made to the RPS:

The following fields will be created on the Master Employee Record (MER) to maintain the history and to accumulate the amount of union dues deductions held in suspense by the employer:

• Field M810 "current year-to-date pending union dues";
• Field MP810 "previous year pending union dues";
• Field M811 "life-to-date pending union dues"; and
• Field MP811 "previous year life-to-date pending union dues".

These new fields can be viewed on the detail screen "Salary Recovery and Pending Dues".

Requirements for the input of the Miscellaneous Staffing Action (MSA) transaction, pay action code (PAC) 05 have changed to allow the process of accounts with the bargaining status indicator "99". When processing the MSA, the RPS will deduct, but not remit union dues to the bargaining agent and will accumulate the amounts to be held in suspense in the M810 and M811 MER fields. When the Public Service Labour Relations Board (PSLRB) renders a decision on the exclusion, the input of a second MSA will either initiate a remittance request to the bargaining agent or a refund to the employee of the union dues held in suspense by the employer. The details are explained in sections 5.4 and 5.5 of this directive.

The processing of union dues deduction refunds input to the RPS with a Deduction Refund (DER) PAC 16R pay transaction for previous year union dues will now be automated in the RPS. The lump sum payment for the refund will be made by supplementary cheque and the RPS will issue the modified T4/Relevé 1. Details are explained in Section 5.9 of this directive.

Note: The T4/Relevé 1 will not be amended when the refund is for the International Brotherhood of Electrical Workers (code 637) or the Canadian Air Traffic Control Association (code 643).

5.2 The following new reports will be generated by the RPS:

Pending Exclusion Decision Report : This report will indicate all the accounts with a bargaining status indicator of "99" where union dues are held in suspense by the employer. Copies of this report will be provided to the bargaining agents and to the Finance, Payroll and Accounting Division (FPAD) of Public Works and Government Services Canada (PWGSC).

Union Dues in Suspense, Remitted to the Union : This report will be produced to communicate to the FPAD the amount of union dues held in suspense by the employer that must be remitted to the bargaining agent when the PSLRB has rendered the decision that the position is NOT EXCLUDED.

Union Dues in Suspense, Refunded to Employee : This report will be produced to communicate to the FPAD the amount of union dues refunded to the employee after the PSLRB has rendered the decision that the position is EXCLUDED.

5.3 The following procedures apply when the compensation advisor receives a notice of objection to a request for the exclusion of a position:

Prior to the input of the MSA to change the bargaining status indicator in field 26 to "99", ensure that union deductions are currently being withheld from the employee's salary. Otherwise, an error message will be produced by the system.

Create an MSA to change the bargaining status indicator to "99" (a person appointed to a position that has been proposed for exclusion but for which an objection to the exclusion has been filed by the bargaining agent). The "effective from" date to be used for this transaction will be indicated on the exclusion situation control list (notice) sent by the Treasury Board of Canada Secretariat (TBS).

Only union dues withheld by using the current union deduction codes will be held in suspense; union dues processed with arrears deduction codes will be remitted to the bargaining agent, even if the employee's bargaining status indicator is "99".

If the MSA is not processed in the RPS in accordance with the "effective from" date, the pay office (PO) will process the arrears.

No other action needs to be taken until the objection is resolved or withdrawn.

5.4 The following procedures apply when the department is advised that the PSLRB has rendered the decision that the position is EXCLUDED or when the notice of objection is withdrawn by the bargaining agent:

The "effective from" date for the MSA to change the bargaining status indicator to EXCLUDED is the first day of the month following the PSLRB's decision.

Create an MSA to change the bargaining status indicator in field 26 of the MER to the corresponding indicator for the employee's exclusion. In field 71 ACCOUNTS CODING of the MSA, input DECISION in capital letters followed by the current union deduction code for the refund of union dues to the employee.

Examples of input for field 71 ACCOUNTS CODING of the MSA:

• If the union dues were withheld for the Public Service Alliance of Canada - code 644, input DECISION644 in field 71 ACCOUNTS CODING.
• If the union dues were deducted for the Professional Institute of the Public Service of Canada - code 642, input DECISION642 in field 71 ACCOUNTS CODING.

The system will stop the union dues deductions in accordance with the "effective from" date of the MSA, which is the first day of the month following the PSLRB's decision. This means that the compensation advisor must not input a Deduction Stop (DES) transaction to stop the union dues deductions.

The refund for the current year will be a lump sum amount added to the employee's regular pay.

The refund of union dues for the previous year will be a lump sum amount issued as a supplementary cheque. The PO will issue the refund for years prior to the previous year by cheque requisition.

The RPS will issue the refund as a supplementary payment if the account is struck off strength (SOS) or temporarily struck off strength (T-SOS), except when the T-SOS is for reason "Y" (pending SOS or T-SOS).

The current and previous years'refund amounts will be updated in the union dues box of the T4/Relevé 1. The employee will receive an updated T4/Relevé 1 for the previous years.

Note : The T4/Relevé 1 will not be amended when the refund is for the International Brotherhood of Electrical Workers (code 637) or the Canadian Air Traffic Control Association (code 643).

5.5 The following procedures apply when the department is advised that the PSLRB has rendered the decision that the position is NOT EXCLUDED:

The "effective from" date for the MSA to change the bargaining status indicator to NOT EXCLUDED is the first day of the month following the PSLRB's decision.

Create an MSA to change the bargaining status indicator in field 26 of the MER to the corresponding indicator for the employee's non-exclusion.

In field 71 ACCOUNTS CODING of the MSA, input DECISION in capital letters followed by the current code of the union dues to be remitted to the union.

Examples of input for field 71 ACCOUNTS CODING of the MSA:

• If union dues were deducted for the Public Service Alliance of Canada - code 644, input DECISION644 in field 71 ACCOUNTS CODING.
• If union dues were deducted for the Professional Institute of the Public Service of Canada - code 642, input DECISION642 in field 71 ACCOUNTS CODING.

The FPAD will remit to the bargaining agent the amount of union dues held in suspense by the employer in field M811 of the MER.

5.6. The following messages will be produced by the RPS:

5.6.1. Messages to the compensation advisor

U47 current union code missing: This reject will be produced when the compensation advisor creates an MSA to change the bargaining status indicator to "99" and no union dues are being withheld from the employee's salary.

U48 effective from date must be = 1st day of month: This reject will be produced when the "effective from" date of the MSA to change the bargaining status indicator to EXCLUDED or NOT EXCLUDED is not the first day of the month.

U50 ded Code in field 71 invalid: This reject will be produced when the deduction code input in field 71 of the MSA is not a valid current deduction code for union dues.

WG2 dual RemunEration - must be handled by po: This message will be produced to advise the PO to verify the validity of the dual remuneration code.

WA4 Automation cannot be done - handled by po: This message to the compensation advisor will be produced when the RPS cannot generate the union dues refund for the current or the previous year. It must be noted that the DES (PAC 16S) will still be generated by the RPS and the ongoing union dues deductions will stop without intervention from the compensation advisor or the PWGSC pay and pension agent. The PO will input the refund by cheque requisition.

5.6.2. Messages to the pay office

UA4 GEN Ded WOULD cause cerTAIN CUR YEAR eleMENTS TO GO NEG: This reject to the PO will be produced when the RPS tries to refund the union dues and the amount of the refund is greater than the amount in field M717 (year-to-date union dues) or, when a DER (PAC16R) is processed and the amount of the refund is greater than the amount in fields M717, M810 or M811.

UA5 gen Ded would cause certain PREV year elements to go neg: This reject to the PO will be produced when a DER is processed and the amount to refund is greater than the amount in fields MP717, MP810 or MP811.

U78 Element would go negative: This reject to the PO will be produced when the PO inputs a union dues refund with a PAC 77R and the amount is greater than the amount in field M717.

2A9 CY UNION DUES < CY PENDING UNION DUES: This reject to the PO will be produced when a cancelled cheque is processed and field M717 would become less than field M810.

NP9 MANUAL ADJ REQUIRED IN THE AMOUNT OF $XXX: This message will be produced when the amount $XXX in field M811 (to-date pending dues) of the MER is greater than the sum of field MP810 (previous year pending dues) and field M810 (current year-to-date pending dues). This situation will arise when there are union dues deductions to refund for a period prior to the previous year. The PO will issue a refund cheque for the lump sum refund amount identified on the message and will also manually modify the T4/Relevé 1.

NQ3 pending dues fields would go neg - adjustments required: This message to the PO will be produced when the amount of union dues refund generated by the RPS is greater than the amount in fields M810 or M811.

NQ4 pending dues fields would go neg - adjustments required: This message is for the PO and will be produced when the amount of the union dues refund generated by the RPS is greater than the amount in fields M811, MP810 or MP811.

NQ5 ACCOUNT PENDING exclusion - manUAL ADJ MAY BE REQUIRED: This message to the PO will be produced when a cheque with a union dues deduction is cancelled in the RPS and the account is pending exclusion. The PO must verify that the adjustment to the employee's earnings generated by the RPS is accurate because the date of the cancelled cheque is prior to the pending exclusion status. The FPAD may need to adjust the union dues remittance report.

NQ7 dual RemunEration - must be handled by po: This message will be produced to advise the PO to verify the validity of the dual remuneration code.

WA4 Automation cannot be done - handled by po: This message is explained in Section 5.6.1 of this directive.

5.6.3 The procedures dealing with the corrections process can be found in PPIM Section 7-3-3-2.

5.7. Position change

If, as a result of a promotion, a deployment, a conversion, an acting assignment or a transfer to another department, the employee is appointed to a new position before the PSLRB renders a decision on the old position, these procedures are to be followed:

• Input the bargaining status indicator that corresponds to the new position in the bargaining status indicator field when creating the promotion, deployment, transfer or acting assignment in the RPS.
• Input a union dues DES Deduction Stop, a DEC (PAC 16C) Deduction Commence or a DEA (PAC 16A) Deduction Amend transaction according to the bargaining status of the new position.

5.7.1 When the decision concerning the former position is rendered, the compensation advisor must create an MSA to change the bargaining status indicator to EXCLUDED or NOT EXCLUDED according to the PSLRB decision, even though the bargaining status for the previous and the new position are the same.

Write DECISION in capital letters in field 71 ACCOUNTS CODING of the MSA followed by the current deduction code for the union dues to be remitted to the bargaining agent or refunded to the employee as explained in sections 5.3 and 5.4 of this directive.

The processing of the MSA will generate a refund to the employee or initiate a request for the remittance to the bargaining agent.

5.7.2 If the bargaining status indicator needs to be corrected to correspond to the new position exclusion status, the compensation advisor must input a second MSA for the next RPS update but before the current pay period is closed to ensure the accuracy of field 26.

DECISION and the union dues code must not be input in field 71 ACCOUNTS CODING when creating the second MSA.

5.7.3 If the employee is transferred to another TB department or PO, PWGSC will remit or refund the suspended union dues manually. An amended T4/Relevé 1 will be issued under the department or PO where the employee was in pending exclusion status.

5.8. Dual remuneration

Create an MSA to change the bargaining status indicator to "99" in field 26.

For cases of dual remuneration within the same department, the RPS cannot determine if the union dues amount being withheld from the employee's salary is solely for the position that the bargaining agent submitted an objection to the exclusion request. Departments are to advise the PO of the union dues amount to be held in suspense by the employer by sending an e-mail or a facsimile. The PO will then adjust the amounts credited by the RPS to the MER fields M810, MP810 and M811, if necessary.

When the PSLRB renders a decision on the request for exclusion, departments are to create an MSA following the procedures described in sections 5.3 and 5.4 of this directive.

5.9 Automated processing of previous year union dues refunds (DER)

The system changes required to implement Section 76 of the PSLRA provided PWGSC with the opportunity to further automate the processing of union dues refunds in the RPS independent from the pending exclusion process.

The RPS will be modified to automatically issue a supplementary cheque for all previous year union dues refunds reported with a DER transaction and a lump sum refund amount. The previous year T4/Relevé 1 will also be amended without manual intervention by the PO.

Note : The T4/Relevé 1 will not be amended when the refund is for the International Brotherhood of Electrical Workers (code 637) or the Canadian Air Traffic Control Association (code 643).

Please note that the DER transaction for the union dues refund must be broken down by calendar year.

5.10 Please refer to PPIM sections 5-4, 9-2, 4-4-05, 7-3-3-2, 14-4-3 and 18-3-4-4 for the pay processing requirements.

5.11 The PPIM and the Pay Office Procedures Manual (POP) will be updated to incorporate all related changes contained in this compensation directive.

6. INQUIRIES

6.1 Any inquiries on the information contained in this document should be addressed to your PWGSC Compensation Services Office.

Original Signed by
B. Fortin

Brigitte Fortin
Acting Director General
Compensation Sector
Accounting, Banking and Compensation

Reference(s): CJA 9006-13-30