Evidence of meeting #24 for Government Operations and Estimates in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was paid.
A video is available from Parliament.
2:45 p.m.
Conservative
2:45 p.m.
NDP
Erin Weir NDP Regina—Lewvan, SK
I think what we've heard so far really underscores the need for this committee to hear directly from the minister. I would note again that she is in Ottawa today, so it's quite unfortunate that she has not made herself available for this meeting.
I would like to start where your statement concluded, by mentioning that a large number of federal employees have been paid correctly. To me, that's a little bit like saying that two out of three isn't bad. But I really don't think that is very much consolation to the third of the federal employees who have not been paid correctly.
Deputy Minister Lemay, you've suggested that based on what was known at the time, the decision to implement Phoenix was defensible. I would ask, knowing what you know now, do you still think it was the right decision?
2:45 p.m.
Deputy Minister, Department of Public Works and Government Services
I will answer in the same way I just did. I think we could have taken additional measures, but the move to the second wave and the move to Phoenix is the right decision. But I would have done it a little differently, and I would have taken additional measures knowing what I know today.
2:45 p.m.
NDP
Erin Weir NDP Regina—Lewvan, SK
Okay. I think you said that the implementation of phase two was somehow inevitable or sensible based on phase one already being in place. Do you regret, though, the implementation of phase one? Do you think Phoenix was the right way to go from the beginning?
2:45 p.m.
Deputy Minister, Department of Public Works and Government Services
Phase one had a lot of planning and a lot of testing, and as I said in my presentation—and maybe we can expand I on this if you wish—there were a number of steps taken before launching it. There was testing. The launch was actually delayed. It was originally planned in three, got moved to two, it was delayed, and there was a third-party assessment. And again, I remember even the Secretary of the Treasury Board checking with all departments as to the readiness of everyone for the change to Phoenix. At the time, it was definitely felt that we were ready, as ready as we could be.
In terms of the system and the data, again, I think that the change management portion is something we underestimated, and maybe having a few additional people to help us to the transition would have been better.
2:45 p.m.
NDP
Erin Weir NDP Regina—Lewvan, SK
You've also said that you can't address what you don't know, and you referenced the fact that when the minister was in this very chair on May 17, and I asked her about Phoenix, she indicated that there were only 77 unresolved cases. We now know that there are 80,000 federal employees who have not been paid correctly. I'm wondering how the number went from less than 80 to 80,000. How was your department and the minister not aware of the gravity of this problem sooner?
2:50 p.m.
Deputy Minister, Department of Public Works and Government Services
A couple of things. Maybe I should first clarify that the 80,000 are not people going without pay. These are different things. These issues concern acting promotions, transfers, extra duty pay, and things like that.
As for the number that the minister gave, it's the number that we were tracking. It is the number that we were tracking at Miramichi when we were getting complaints. This was from our intake and our tracking of complaints in cases resolved and left to resolve. Those are the numbers we had.
Following my meeting with the unions on April 25, I believe, one of the decisions was that we would have regular meetings to make sure that we heard all of the issues, because the biggest challenge in the implementation at first was that we were hearing things, but we didn't have the data. We were asking to have all the information from every channel that we could, so we could address some of the issues. The unions worked really closely with us to try to get us everything that they heard from their members, and then they sent another series directly through Minister Foote's office. At that point, we realized we were at capacity with the phone lines, and it was when we decided to put our web form up so that we could ask people to go to the website and fill in the forms and make sure we had all the information. That attracted and got us the real information and data, because a number of employees have told us about their issues through that web form. The numbers grew substantially from that point.
2:50 p.m.
NDP
Erin Weir NDP Regina—Lewvan, SK
I have another question about the transmission of information within your department. It's been reported that it was known back in January that Phoenix had breached the personal information of federal employees, yet the minister indicates that she was not aware of this privacy breach until last week. I'm wondering how that happened.
2:50 p.m.
Deputy Minister, Department of Public Works and Government Services
I think we have to remember that there are processes that we follow in the event of privacy breach. I don't want to diminish in any way the importance of this, but the fact that the breaches are about information, employee names, and employee numbers, there's not a lot that you can do with that. You can't go into the systems; you need other things like codes and other sorts of codes. So the evaluation that was done and is still the one that remains today from our investigation section is that the risk is actually very low. In very low-risk cases, there's no need in the process to advise the employees because there's really no risk to their personal information. The process was not to immediately inform the minister.
We have actually changed the process after this, because Phoenix being Phoenix, even if the risk is very low, the minister felt it is extremely important. We are all on the same page. So for any small Phoenix issue, we have now developed a process to make sure that we're all aware immediately.
2:50 p.m.
NDP
Erin Weir NDP Regina—Lewvan, SK
You mentioned that the federal payrolls are very complex and also that the concept of Phoenix was to run them using off-the-shelf software from IBM. Do you believe that it was realistic to think that off-the-shelf software could handle the federal payrolls?
2:50 p.m.
Deputy Minister, Department of Public Works and Government Services
It's an off-the-shelf software, but as we have said, we modified it to fit our needs, and there are 80,000 rules that we had to put in. It is a customized off-the-shelf software, let's put it that way. But it is a proven system. It's a system that has worked well, so that was the decision, and to my knowledge a good one.
July 28th, 2016 / 2:50 p.m.
Liberal
Nick Whalen Liberal St. John's East, NL
Thank you very much, Mr. Chair, and thank you all for coming here today.
In my riding of St. John's East, there happen to be, even though it's as far east as you can get from here, a number of people who work irregular hours who are having difficulty getting their rightful pay, especially ships' captains and whatnot.
From earlier testimony, my understanding is that it used to take eight to twelve weeks for regular pay to be paid, yet the time between phase one and phase two was only about eight weeks. I would thus not expect people to complain seriously during that type of window; they wouldn't even necessarily have noticed that there were glitches with the system in the timeline before the phase two decision was made.
What do you think about that?
2:55 p.m.
Deputy Minister, Department of Public Works and Government Services
We actually have a number of cases in the backlog that pre-date by quite a bit. You're right that, when you look at the past, there was a time between work done and work paid. The expectation with this system is that we'll be much better. The transition has made it such that we are seeing cases that are unacceptable and that we have to fix, but the hope is that once we're to our steady state, we will be much further ahead than before.
At this point, we're hearing a lot of things, which is good. I think it's really important to know that...we need this information, and some of it will be on things that we would have never heard before. The fact that we had this issue and that it has been so prominent is good, because we're going to get everything out, all of the issues that employees are having, and we'll be able to address them.
2:55 p.m.
Liberal
Nick Whalen Liberal St. John's East, NL
It sounds to me as if there will be a certain amount of continuous change management to be done. You talked about some enhancements, changes to manager processes that will be happening going forth. Are there extra non-budget expenditures going into the additional design work that's being done to customize Phoenix?
2:55 p.m.
Deputy Minister, Department of Public Works and Government Services
That's a good question. The plan was that there would be $70 million in savings every year with the implementation of Phoenix. I think it's fair to say that this year we won't achieve that. We estimate the cost of the one-off—the temporary unit, the call centre, and all those initiatives—to be between $15 million to $20 million, and we are still evaluating the cost. We will be working on other ways, as you mentioned, to accelerate and enhance, so we're evaluating the cost of that.
I don't have a number for you today, but remember that there was a planned $70 million a year in savings.
2:55 p.m.
Liberal
Nick Whalen Liberal St. John's East, NL
Maybe we won't worry too much about the timeline of how the backlog developed, but with respect to remedying the backlog, I'm looking at some of the numbers from your presentation earlier and then from your presentation today—your weekly update. It seems, with about 56 employees working on resolving backlog issues, that they got through 1,100 in one week. You extrapolate that out for the number of new independent centres and are saying that we should be through this at the end of October.
Will you be able to continually update us, week by week, as to whether or not this is still an achievable target?
2:55 p.m.
Deputy Minister, Department of Public Works and Government Services
Absolutely, and thank you for the question. It's on the website. I wanted to mention in my presentation that we actually have put a workflow timeline....
Maybe I can pass this around. I'm sorry; it's just off the press this morning, and we're putting it on our website. It gives employees the possibility of looking at the types of issues and when we expect to have them resolved.
Yes, we will update this on a regular basis.
2:55 p.m.
Liberal
Nick Whalen Liberal St. John's East, NL
That's good. Managing expectations of employees is really a huge part of the battle here, because people are quite upset right across the country.
With respect to the issue you noted around automated retroactive pay adjustments not being provisioned in the system, will the enhancements that are being made to the system allow managers to do retroactive automated pay adjustments so that those will also be processed more efficiently?
2:55 p.m.
Deputy Minister, Department of Public Works and Government Services
Maybe I can let Rosanna give you a little bit of detail. I believe it's going to be in July.
2:55 p.m.
Rosanna Di Paola Associate Assistant Deputy Minister, Accounting, Banking and Compensation, Department of Public Works and Government Services
Yes. We have a few retroactive automations going in. We have one going in mid-August to allow the retroactivity calculations to be done automatically. Right now they all have to be done manually, so there has to be a compensation adviser who has to manually go in and intervene versus putting in the dates in the past and allowing Phoenix to automatically calculate. So those things are going in.
There is one other big “mass retroactivity”, which is what we call it. As collective agreements get signed, we have to then pay back. For PSAC, for example, I think, for the next collective agreement, whenever it gets signed, we have to go back a year or two. This will allow Phoenix to automatically calculate those.
3 p.m.
Liberal
Nick Whalen Liberal St. John's East, NL
Are you saying this functionality, which would be required or expected to be needed in the case of any type of union negotiation, did not exist in February? Or did it exist and people weren't properly trained on it? What was the status of the ability of the system to handle retroactive pay adjustments at the time of launch?
3 p.m.
Associate Assistant Deputy Minister, Accounting, Banking and Compensation, Department of Public Works and Government Services
It could handle it, but needed a manual intervention versus an automated process. What we're doing in mid-August and then in mid-September is allowing the system to automate that calculation.
3 p.m.
Liberal
Nick Whalen Liberal St. John's East, NL
I have one final question. Our committee is seeing a fair number of issues arising out of the change management process on the IT side in government. One of the things that I've noticed, and I'm hearing certain witnesses say that it's all of a piece and to do it all in one fell swoop, to just implement the system. But my experience in the private sector has been that you would pilot certain new initiatives. You'd do it with a small percentage of the number of people involved. You'd check to see how that affected the training times. You would measure the types of timelines that are required to resolve problems, maybe 5%, and then you would be able to multiply that by 20 and figure out how many additional resources you would need to roll out the full process. I'm wondering why pilots were not used.
3 p.m.
Associate Assistant Deputy Minister, Accounting, Banking and Compensation, Department of Public Works and Government Services
Our initial intent was to pilot, and then around May of last year, we decided we weren't quite ready to go ahead with the pilot. But what we did was to reconfigure the way we were going to go live. Rather than go live with a mishmash of departments, we took a grouping of 34 departments. They had two things in common. One, their pay was being administered at the pay centre, so there was a concentration of compensation advisers, the people who really know how to administer pay, in one location, targeted. We could go there, “SWAT-team” it, and everybody was there to gather around the people who were going to use it. That was one commonality.
The second commonality of these 34 departments was that they were all on the same PeopleSoft HR platform. Phoenix is based on a North American payroll with PeopleSoft, so the two integrate perfectly. You enter information into a chart; it flows into payroll. That integration was key. It eliminated the need to do duplicate key entry, which was the case before we went live with Phoenix. Before we went live with Phoenix, every time anybody did acting pay—the deputy mentioned acting, as an example—somebody had to put the information in a chart. They'd have to re-key it into payroll. The error rate was high. That was all fixed. The first grouping of “go-live” in February was very concentrated. It was the same types of departments. It was just the right approach in our view.
