Chris Aylward, president of The Public Service Alliance of Canada, says “old-fashioned favouritism” is alive and well in the public service.

The Phoenix pay disaster that has disrupted Canada’s public service for more than two years is now poised to overshadow the upcoming round of contract negotiations.

The Public Service Alliance of Canada (PSAC), the largest of the 18 federal unions, will be the first at the table in this new round of collective bargaining. It has presented Treasury Board with a list of demands to stave off another Phoenix fiasco – including a role in replacing Phoenix.

It is also seeking significant changes to improve work-life balance, protect job security and reduce the government’s growing reliance on precarious workers.

Treasury Board has made the “simplification of pay administration” one of its priorities — opening the door for what many hope is much-needed overhaul of the morass of pay rules and processes that makes the federal pay regime the most complicated in the country.

PSAC and Treasury Board negotiators exchanged demands last week and are now prepping for an unusual summer negotiating session in mid-July. PSAC presented its ‘common’ and specific demands for four of the bargaining groups it represents. No monetary demands have yet to be exchanged.

Unions are going into this round of bargaining with a strong hand. They feel the massive failure of Phoenix, along with the financial and personal hardship its foul-ups have caused most employees, should be reflected in any new agreements.

The unions and government also have a separate round of discussions underway to negotiate compensation for damages caused by Phoenix. The two negotiations are in separate forums, but it’s impossible for outcome of one not to influence the other.

PSAC President Chris Aylward said he expects a “fair deal” that recognizes public servants continued to go to work despite the hardship of more than two years of botched pay.

“We could conclude this (round) very quickly if the government shows respect for the dedication and commitment or our members, who go to work every day not knowing if they are going to be paid. It’s all in their hands,” said Alyward.

With Phoenix as a backdrop, however, bargaining could become protracted — especially if the sides dig in over sorting out and streamlining 80,000 arcane pay rules and allowances.

The groundwork for bargaining is being laid as Public Services and Procurement Canada, the federal paymaster and the department responsible for Phoenix, is struggling to implement collective agreements that were negotiated in the last round. Those contracts, retroactive to 2014, started expiring in June.

As a result of Phoenix, PSAC is asking the government to consult with the union before launching any technological change that eliminate or relocate work. Those consultations would include the right of the union to review any business cases and risk assessments.

It is also wants similar consultations on work the government wants to contract out and provisions that would ensure public servants are hired or trained before contract employees are brought in.

PSAC maintains that if the government had consulted compensation advisors, the experts on pay and its processing whose jobs were eliminated, the Phoenix debacle may never have happened. The government also ignored PSAC’s pleas to delay or stop the Phoenix rollout.

For its part, Treasury Board is making the simplification of pay administration a priority and wants to discuss “options to standardize and simplify certain terms and conditions of employment to lessen the burden on pay administration where the cost is reasonable”

It’s unclear how far the government wants to go in streamlining rules and processes that have accumulated over 60 years of collective bargaining.

Privy Council Clerk Michael Wernick signaled at committee hearings after Auditor-General Michael Ferguson’ latest Phoenix report, that a major cull of pay rules, special allowances and 630 job classifications was needed before a new pay system is built.

The complexity of federal pay is a root cause of the calamities that have dogged Phoenix.

Technology experts argue the number of rules should have be reduced and simplified before the government even started work on Phoenix. Those rules remain the biggest challenge to building a new system.

They cover things like overtime, acting positions, leave, allowances and promotions. Layered on top of that are rules within rules — with arcane language that often has conflicting interpretations.

Unions have argued the easiest way to streamline is to pick the most “beneficial” provision and make it the standard for everyone. Take, for example, the nearly 40 different rules for overtime; pick the most generous of the overtime rules and apply it everyone.

Aylward said PSAC is willing to discuss simplifying rules, such as getting rid of special pay allowances, as long as employees don’t end up with less pay.

“We are open to simplifying collective agreements as long as they are not concessions or detrimental to our employees,” said Aylward. “They want to roll all allowances into base salaries and make them pensionable, we have no problem with that.”

But PSAC has only proposed two rule changes in its bargaining demands. One is paying acting pay to someone from day one instead of waiting three days before it kicks in. The other is having the controversial bilingual bonus kick in from day one rather than five days.

The rules for the bilingual bonus proved very costly for the government when building Phoenix. Phoenix project managers refused to adapt its rules to the software IBM was using to build Phoenix so the software had to be rewritten to handle it.

The proposal tabled by Treasury Board says it wants to discuss the implementation period of contracts as part of pay simplification.

It appears to want an extension of 90-day deadline in existing contracts to implement a new contract. That suggests the government isn’t confident it can make the deadline in implementing contracts it negotiated in this round.

The government missed its November 2017 deadline to implement PSAC’s four contracts and has acknowledged that it could take until June 2019 before it knows who has received their raises and back pay.

The government has promised to work with all unions in building the new pay system it is planning to replace Phoenix. It recently signed an agreement — separate from bargaining — with the Professional Institute of the Public Service of Canada, which represents federal IT workers, to work together on developing options for a new system.