Phoenix ‘nightmare’ still haunts officials, over 6 years later

From confiscating a family home to being pushed into retirement for overpayments, public servants are opening up about how their lives are still deeply impacted by the infamous Phoenix pay system over six years after the problems began.

The ailing pay system cost more than $2.4 billion as of April 2022 and a replacement system is in the works. In 2018, a federal report indicated that it could take five years to stabilize Phoenix.

As that deadline approaches, the Phoenix pay system remains a source of “nightmare” for some government employees across Canada.

Many federal employees have gone unpaid for long periods of time, been paid less than expected, or been overpaid since the Phoenix system was implemented.

Public Services and Procurement Canada (PSPC), the federal department responsible for operating and maintaining Phoenix, declined an interview. In an emailed statement, PSPC said it had encountered “challenges” that temporarily slowed its attempt to clear up outstanding Phoenix issues.

“The number of transactions received at the payment center in 2021 increased significantly compared to previous years. This trend has continued in 2022,” the statement said.

“We continue to reorganize the workload so that the most complex transactions are handled by our most experienced staff and we are accelerating our recruiting and hiring efforts to fill vacant positions.”

When asked to comment on the ongoing difficulties some federal public servants are experiencing, PSPC said affected employees should contact its Customer contact center.

Here are the stories of four public servants whose lives are still touched by Phoenix today:

No pay for months

With paychecks currently totaling $0, Jordan jokes that they are “volunteering” for the Government of Canada.

“In a sense, I’m volunteering until my debt created by the Phoenix payroll system is paid off,” said the Alberta employee who works in the Public Safety portfolio. “I did not create this debt.”

CBC has agreed not to use Jordan’s real name as they fear it will jeopardize their careers.

“It’s just a very difficult position to be in, given the pandemic, given everything that’s going on in the world.”

Today, Jordan manages to make ends meet by finding other sources of income and saving.

The problems started in 2016 when Jordan went on unpaid leave for several months. Phoenix did not process this leave and continued to send checks totaling approximately $11,000. Phoenix had also mistakenly placed Jordan in a higher compensation category, as well as the wrong pension category, putting them in more than $20,000 in debt on the government’s books.

“I still don’t know the exact total,” Jordan said, adding that it took several years of waiting and advocating from management to start seeing results.

“On my own, I don’t think I could have finally gotten help.”

Jordan’s paychecks will total $0 for the next few months while the Alberta-based federal official works on Phoenix overpayments. (Submitted by Jordan)

Jordan was offered two options: pay it off gradually over the next few years or pay it all off now. They chose the latter.

“When this overpayment…is finally settled, who knows…what will happen next year?” said Jordan. “It seems there’s no end in sight for this. It’s just a nightmare.”

Still haunted in retirement

Christiane Villeneuve is retired, but that didn’t stop the federal government from sending her another letter in February asking for more money.

It’s a small amount compared to the more than $11,000 her employer has recovered from her over the past six years due to Phoenix overpayments.

WATCH | The constant wage battles led to panic attacks, according to a retired civil servant:

Constant battles with Phoenix pay system caused panic attacks, says retired civil servant

Christiane Villeneuve retired from her job at Employment and Social Development Canada — only a year before she was eligible for a full pension — because the stress of battling the Phoenix pay system was too much.

The former Employment and Social Development Canada (ESDC) employee in Gatineau, Que., said her problems began in 2016, after she went on sick leave. She was overpaid for three months that year and didn’t repay the last dollar until July 2021.

During that time, she spent hours and hours checking her pay stubs every two weeks and emailing and calling the Phoenix call center.

“I had to take anti-depressants, I had panic attacks, anxiety attacks…I went to bed at night so worried about what’s going to happen tomorrow, you know?” said Villeneuve.

She says she had to file her income tax for 2016 several times because the government kept changing her T4 slips.

At times, she said Phoenix “provides a different amount, every two months,” ranging from $14,000 to $18,000, resulting in inexplicable deductions and inconsistent collection payments. On a few occasions, Villeneuve’s take-home pay was around $28.

“Having to fight to get my salary right every two weeks really pissed me off,” Villeneuve said.

She was “so fed up” that she retired in 2021, a year early.

Christiane Villeneuve’s net earnings have totaled around $27 on multiple occasions, courtesy of Phoenix. (Submitted by Christiane Villeneuve)

Foregoing full board was worth it, she says now.

“There are still some outstanding issues, but… I can sleep at night.”

A civil servant for more than 30 years, Villeneuve says he expects fair treatment from his employer.

“I was very, very disappointed,” she said. “I would say to people who think[ing] to join the government to think again.”

Lost family home, “crumbled” lives

For more than a decade, Taylor hoped to become a permanent employee of the Canada Revenue Agency.

So in 2017, when an opportunity arose to offer the contract employee a better paid position, she took it.

That’s when the Phoenix payroll system began to collect large overpayments from his account. The fluctuating deductions were sometimes so severe that she could not afford to pay her mortgage on her family home, which was built for them in 1996.

“No one could explain why, and what [the overpayments] were for,” she says.

CBC has agreed not to use Taylor’s real name because it fears speaking out could jeopardize her future employment.

Taylor asked for help from her supervisors, her union, her local deputy and lawyers – to no avail.

In 2019, after defaulting on her mortgage, Taylor lost her home. She and her children now live in subsidized housing.

“I had no other choice. I lost my home,” she said. “I have two daughters now 18 and 11 who have grown up in a beautiful, lovely home… Their lives have fallen apart because of Phoenix.”

Taylor had her family home built in 1996. She says her family lost it after she couldn’t make mortgage payments due to Phoenix-related issues. (Submitted by Taylor)

Since her contract ended in 2018, Taylor has received two T4s from the CRA – one in 2019 and one in 2021, falsely claiming she had employment income in those years.

“How long will this go on?” she asked. “They owe me my credit history. They owe me my house. They owe my daughters their stability. They changed me, but they changed my kids permanently. There’s no amount that could fix this. problem.”

In February 2020, the CRA sent her a letter stating that she owed $6,926.38 in overpayments. A few months later, he sent another letter saying the balance “wasn’t correct” and that she actually owed $5,925.88.

The agency now recovers that balance by taking it out of Taylor’s annual tax refunds. Meanwhile, a letter from Canada Mortgage and Housing Corporation dated May 4, 2022 states that Taylor now owes more than $33,000 to First National, her lender, due to “losses incurred as a result of [her] fault.”

“I have no credit. My life just fell apart,” Taylor said. “It is incomprehensible that this is due to the Government of Canada.”

Underpaid and overwhelmed

No one warned Serena about taking the promotion. Moving from another department to ESDC was something she felt was a positive life event during a difficult time.

But 10 days into her new job, the Ottawa employee received an email from human resources. The message at the bottom of the email took her by surprise.

“There was a sentence about it taking up to 18 months for my payroll file to transfer,” she said. “I was still being paid based on my previous salary at my previous job. That’s when I realized something was wrong.”

CBC has agreed not to use Serena’s real name as they fear there will be repercussions.

Since September, Serena has been working her highest-paying job for the same salary as before – a difference of about $12,000 a year.

“I was completely shocked and very frustrated,” she said.

Serena received this email when she accepted her new position. (Sent by Serena)

Serena believes her managers are overlooking her financial struggles because she is a single young woman doing a “good paying job”. They told him to consider it a “forced savings account”.

But the 32-year-old moved into a flat with higher rent last year, anticipating her salary would rise.

Instead, she says she has a tight budget each month while paying off her student loans. She’s also seen unexplained deductions from her paycheck during this time, making her “really anxious” and prompting her to take a week off to deal with the stress.

“I have to budget very diligently every month to cover all my expenses,” she said. “Constantly worrying about financial issues kind of keeps me from just enjoying my life.”

Serena says she’s “completely in the dark” because no one will tell her when to expect her new salary to finally kick in.