Sophie Charpentier is one of some 23,000 federal public servants who have been told their positions could be affected by the government’s current move to reorganize and trim its workforce.

But the idea of ​​leaving her government job terrifies her, because Charpentier worries it might mean she’s never able to sort out a pay issue that began almost 10 years ago.

At one point, she nearly went bankrupt. Charpentier estimates the government still owes her more than $50,000 for work she did.

After launching in 2016, the error-plagued Phoenix pay system overpaid and underpaid thousands of public servants. Although a decade has gone by, the backlog is still long, the government has nearly 1,800 staff working to fix pay transactions, and it’s left many employees like Charpentier still reeling from the impact years later.

Charpentier is far from alone in this situation, according to the major unions. But the government is still unable to quantify the extent of the problem. 

“It’s unacceptable. Unacceptable,” said Sean O’Reilly, president of the Professional Institute of the Public Service of Canada (PIPSC).

The equivalent of 1,769 full-time workers are currently trying to reduce the backlog in the Phoenix system through the payroll centre based in Miramichi, N.B. That’s triple the number of staff first tasked with fixing Phoenix transactions in the early days.

There are still 233,000 transactions awaiting processing, of which 105,000 have been pending for more than a year.

Charpentier’s pay problems bring back painful memories: The first errors coincided with the beginning of her battle against colon cancer.

“I still talk about it and cry about it,” said Charpentier, who lives in the township of Lochaber-Ouest, Que. “It’s a nightmare.”

Since 2016, she’s meticulously documented every inaccuracy. Calendars, financial statements, and pay stubs piled on her kitchen counter attest to the many hours she’s spent trying to sort things out. 

“It’s a second job,” she sighs, as she looks over over the documents.

Charpentier wonders if the government will ever pay her the lump sum she’s entitled to, if she loses her job as part of the workforce restructuring.

The federal government says all public servants will be paid, even those who will lose their jobs or retire early amid the current workforce adjustment. Thousands of public servants are in a state of flux as part of the government’s plan to shrink the bureaucracy by 40,000 positions from its 2024 peak of just under 367,772 employees.

O’Reilly expects the looming mass movements of personnel will further clog the payroll system and increase arrears.

“It’s going to cause more problems,” he said.

Nearly $5B gone

Alex Benay, the associate deputy minister for Public Services and Procurement Canada, who has been responsible for corporate payroll co-ordination since 2023, admits to having very quickly “learned never to guarantee anything with Phoenix.”

The last thing he wants, he said, is for public servants who go through the “traumatic experience” of losing their jobs to suffer pay problems.

But for now, Benay doesn’t foresee any technical problems with the payroll system that could be caused by the current cuts.

At his offices in Gatineau, Que., Benay notes Phoenix has “cost an enormous amount of money” since its launch in 2016. 

“We have no choice but to be more transparent, and we have to live with the consequences of our actions,” he said.

The government originally anticipated Phoenix to save approximately $70 million a year. Instead, the costs have just kept rising.

Spending on Phoenix has hit $4.34 billion, not including the additional $521 million planned for the 2026-27 fiscal year.

Each year, several million dollars are paid to outside consultants to support the payroll system.  IBM, which designed and deployed Phoenix, has received more than $851 million in the past decade.

In 2017, the Office of the Auditor General of Canada published a damning report on Phoenix, accusing the government of failing to “identify and resolve payroll issues in a sustainable manner.”

The following year, a second report described Phoenix as an “incomprehensible failure of project management and oversight.” 

It said executives sacrificed functionality and security to meet budget and delivery deadlines.

Benay points out that one of the “bad decisions” that led to the fiasco was separating human resources and payroll.

“To get out of this problem, we will have to transform the way we manage our human resources” and standardize several processes, he said.

Benay adds that although decisions were made “well above the pay grade of employees,” they were the ones who inherited the consequences.

“It’s inspiring to work with these people, who have worked tirelessly with a predetermined model that didn’t work,” he said.

Formerly chief information officer for the federal government, Benay was working in the private sector when he says he offered to lead this public payroll portfolio. 

He had just returned from trips abroad during which he said he was taunted: “Your country created Phoenix!” he recalled people saying to him. 

“It was embarrassing. Phoenix really had a negative connotation,” Benay said.

“When you tell me something isn’t feasible, I like to try and prove you wrong,” he said, explaining why he wanted to take on the thorny issue. 

“Now we have a chance to fix things, we have the support and the funding, we have momentum.”

Who’s responsible?

“Senior public servants and our leaders must be held accountable,” said Magali Picard, president of the Quebec’s Fédération des travailleurs et travailleuses du Québec (FTQ), who witnessed the Phoenix problems first-hand. 

Back in 2016, she was representing Quebec employees for the Public Service Alliance of Canada (PSAC).

“From the very beginning, the warning signs were incredibly frightening, and we kept being told that ‘everything was under control,’” Picard said.

For Geneviève Tellier, a professor at the school of political studies at the University of Ottawa, the problem is deeper. She says an abundance of rules paralyzes the government.

The federal public service follows procedures but doesn’t question them, Tellier said.

“The civil service must be able to tell the government, ‘This won’t work’,” said Tellier. “With Phoenix, we weren’t ready for implementation, but we had a government that was in a hurry.”

As soon as an error is identified, it must be reported and corrected before moving on to the next steps, added Justin Lawaré, assistant professor of digital management at École nationale d’administration publique, a specialized university for public administration with campuses in Gatineau, Que., Montreal and Quebec City. 

He said the failed deployment of Phoenix, just like that of the SAAQclic project by the government of Quebec, would have required more testing and a phased rollout.

Since “it affects human beings,” governments must “apply a precautionary principle,” Lawaré said.

Toward change… in 2030

Benay hopes that the Dayforce software, which will replace Phoenix, will be fully operational by 2030. 

“That’s a tentative date,” he said with a note of caution.

A $350.6-million contract signed with Dayforce covers work from June 2019 to June 2026. The agreement could be extended until 2049.

“The [internal] team is truly operating at a non-traditional level for the government sector,” Benay noted. “You can’t expect a different result by doing things the same way.”

“We have a management team of about 50 people, and we share our failures to learn and be able to say, ‘It’s OK to talk about what doesn’t work,'” explained Benay. 

Every month, his team even awards a “lemon prize” for the biggest blunder, so they can discuss what happened and how to overcome challenges, Benay said.

A hallway with white walls is covered in words: teamwork, transparency, perseverance, relentless, accessible, tenacity, resilience. 

Staff use the wall daily as a testament to the team’s commitment, Benay said.

In September, the government’s new payroll software will be tested with employee data from three organizations: the Canadian Nuclear Safety Commission, Shared Services Canada, and Public Services and Procurement Canada.

Before transferring files into Dayforce, organizations will have the responsibility to ensure that they contain no payroll errors whatsoever. The arrears must also be at zero.

PSAC’s national executive vice-president Alex Silas argued that “when this change happens, we can say that we have a government that is taking the Phoenix fiasco crisis seriously.”

He also asks the federal government to stop recovering overpayments beyond the limitation period provided by law. 

Since 2016, 483,130 public servants have received overpayments totaling $3.57 billion, according to PSPC data. This amount includes administrative overpayments automatically issued to prevent payroll errors.

For Silas, far too many lives have been affected by Phoenix. Benay agrees.

“No one should know the name of their payroll system,” he said.

As for Charpentier, she would like her salary problems to “go away, like cancer.” She gestures downward.

On her right thigh is a tattoo she had done to celebrate her cancer’s remission. It’s a phoenix — the mythical bird that rises from its ashes.

She hopes it will soon take on a second meaning, and come to symbolize the end of her decade-long pay odyssey.