Pay talks fail with Canadian union PSAC

By on 11/09/2019 | Updated on 24/09/2020
The Public Service Alliance of Canada has accused the government of proposing to “short-change” its members for the “pain and suffering” caused by the failed Phoenix pay system. (Image courtesy: Michel Rathwell,/flickr).

A week of negotiations between Canada’s largest public sector union and the federal government has failed to produce a deal before the autumn’s federal election, raising the possibility of strike action.

The Public Service Alliance of Canada (PSAC) has accused the government of walking away from contract negotiations affecting more than 70,000 federal employees, who are members of the union’s Program and Administrative Services unit.  

The latest round of bargaining between the PSAC and the Treasury Board began on 1 September and ended six days later without a deal being reached. The union blamed government for “squandering one last pre-election opportunity to deliver a fair deal” to PSAC members.

In a statement, it said government made a wage offer that “fell short of providing PSAC members – the largest group of workers in the federal public service – with even the equivalent wage increase that was negotiated with other federal bargaining agents”, and that the government had refused to provide proper compensation for harm caused by the failed Phoenix pay system. The government rejects the charge.


The union accused the government of proposing to “short-change” PSAC members for the “pain and suffering” caused by Phoenix. The centralised pay system was introduced in 2016, but suffered ongoing problems prompting government to announce last year that it would be axed.

In May, other civil service unions agreed a compensation deal with the government – accepting an offer of five days’ annual leave, plus a compensation package for those who’d suffered financial loss.

However, PSAC rejected the offer of additional leave, holding out for further concessions on pay and hours. Subsequent talks have failed to reach agreement. “After finally agreeing to cash compensation rather than days of leave, the government’s offer remained meagre and insufficient to recognise the damages inflicted on public service workers over the last four years,” the union said.

“We had made it clear to Treasury Board that we would return to the bargaining table, but only to discuss an improved offer – one that includes annual wage increases that meet or exceed inflation, improved work-life balance – and equitable monetary compensation for the Phoenix nightmare,” said PSAC national president Chris Aylward. “PSAC came to the table in good faith, but instead of using this opportunity to deliver a fair deal for our members, the government walked away.”

Another chance?

With a federal election set for 21 October, there will be no additional opportunity to return to the bargaining table until after that date. The union has said that while negotiations will continue post-election, it is preparing for possible strike action in the new year.

In an email to CBC News, a Treasury Board (TSB) spokesperson said the government put a fair offer on the table and was disappointed the union didn’t accept it.

“It is not an accurate characterisation to say the government’s offer fell short of the wage increases agreed to with other bargaining agents. We put a fair offer on the table that was in keeping with recent agreements with other bargaining agents and gave due consideration to PSAC’s request to resume negotiations. PSAC has chosen to decline this offer,” a TSB spokesperson said in a written statement.  

Having announced its intention to replace Phoenix, in June the government named three tech suppliers which will help it explore its options. However, in August Canada’s digital chief Alex Benay – who had been overseeing the project – announced his departure. Phoenix’s failure, Benay told GGF in February, provided a “catalyst to doing things differently”; the digital leader had begun a process that involved “breaking the process into smaller deliverables; engaging vendors right from the beginning; putting users at the centre of everything, and letting them test what we’re doing.”

  • This article was amended at 3.50pm BST on 11 September 2019. Although we state that the government announced its intention to replace Phoenix and is exploring its options, we also stated that the Phoenix pay system had been ‘axed last year’. In fact, the government announced last year that the system would be axed – it is still in operation until an alternative system is implemented. We have changed one sentence to clarify this.

About Mia Hunt

Mia is a journalist and editor with a background in covering commercial property, having been market reports and supplements editor at trade title Property Week and deputy editor of Shopping Centre magazine, now known as Retail Destination. She has also undertaken freelance work for several publications including the preview magazine of international trade show, MAPIC, and TES Global (formerly the Times Educational Supplement) and has produced a white paper on energy efficiency in business for E.ON. Between 2014 and 2016, she was a member of the Revo Customer Experience Committee and an ACE Awards judge. Mia graduated from Kingston University with a first-class degree in journalism and was part of the team that produced The River newspaper, which won Publication of the Year at the Guardian Student Media Awards in 2010.


  1. Marco says:

    Good on PSAC! Hopefully the next government reaches a fair deal for all of us affected by “the Phoenix nightmare,” as Mr. Aylward so rightfully puts it. Only a government under Mr. Singh would seem to be able to make that happen.

  2. Tim Bullock says:

    Just a minor point of clarification: Phoenix may have suffered an axe wound, but it is still operating. It will continue to do so for a few years yet, until the replacement solution is implemented.

    • Mia Hunt says:

      Hi Tim,

      Thank you for highlighting this. You are correct. We state in the article that the government announced its intention to replace Phoenix and is exploring its options, however, we also wrote that the system was ‘axed last year’ – this was not clear. We have amended the article and have added a correction at the bottom.

      • Andrew says:

        Lets be more specific and say that Phoenix must be fixed and operating well before a new system is introduced. If that is not done, the risk is that bad data will be migrated to the new system. Therefore, it appears work continues on fixing the current system while the new system is being developed.

    • Lu says:

      With that said, why would any Union accept compensation for the Phoenix debacle if the nightmare isn’t even over yet??? Kudos to Mr. Aylward for standing firm.

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