Dayforce confirmed as replacement for Phoenix as federal government pay system
The federal government is set to move forward with replacing the plagued Phoenix pay system with Dayforce.
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Procurement Minister Joël Lightbound announced Wednesday that the government would start the 'final build and testing phase' of the new platform.
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'The Government of Canada remains committed to modernizing its HR and pay systems in a responsible and transparent manner,' Lightbound said in a statement. 'By investing in the future of HR and pay, we are taking an important step forward in ensuring an efficient, secure, and sustainable solution for public service employees.'
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The announcement came as the federal government continued to work to ease the backlog of pay issues. As of April 23, there were 327,000 transactions in the system remaining to be processed. Of that number, 49 per cent were more than a year old.
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The total of 327,000 represented an improvement on previous months. In late February, the backlog stood at 366,000 transactions and in October 2024 it was 402,000.
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The Liberal government launched Phoenix in 2016 after the previous Conservative government had initiated the platform. Problems soon arose as public servants struggled to get paid fully and on time.
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An auditor general report from December 2024 found that 32 per cent of federal government employees reported errors in their basic or acting pay during the 2023–24 fiscal year.
That was up from 30 per cent in 2022–23 and 28 per cent in 2021–22. However, it was also a steep decrease from the peak of Phoenix's problems in 2019–20, when 51 per cent of employees had to deal with pay errors.
The cost of Phoenix's failure for the government has also ballooned. Since 2017, the federal government has spent at least $3.5 billion on the Phoenix pay system.
It has also cost the federal government money in settlements and compensation for public servants. Last November, the government settled a class-action lawsuit brought by non-unionized and casual employees over the payment system fiasco. And in 2020 Canada's largest public-sector union, the Public Service Alliance of Canada, reached an agreement with the government giving 140,000 workers each $2,500 in compensation over the issues with Phoenix.
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