No. 20

June 1, 1998

QUESTIONS FOLLOW TRIBUNAL ANNOUNCEMENT

The announcement by the Canadian Human Rights Tribunal of a July release date for its decision has sparked a number of questions which this Bulletin will attempt to address.

Q. Do we have a date yet for the release of the decision? Some members were told July 19^th.

A. At the time of writing this Bulletin, no actual release date had been announced. Members calling the Tribunal office have been told July, 1998 which sounded like July 19, '98. July 19 is a Sunday and the decision will not be released on either a weekend or a holiday.

Q. What will be contained in the Tribunal decision.

A. The Tribunal will issue its decision on the following issues:

• the actual methodology to be used to calculate the wage gap;
• the groups and levels eligible to receive adjustments;
• to what date the payments should be retroactive;
• whether simple or compound interest should be paid and what the interest rate should be;
• whether any damages should be paid (the Canadian Human Rights Act has just been amended to allow for up to $20,000 per affected person; it was $5,000 when we made our presentations before the Tribunal); and
• whether any party should receive all or part of their legal costs.

Q. I thought the methodology issue had already been settled when the Tribunal agreed with the Alliance and ruled in 1996 that the results of the joint union/management equal pay study were reliable?

A. The 1996 Tribunal ruling said that the results of the study were reliable and could be used to calculate a wage gap. However, it didn't tell the parties how to do that calculation. There are a variety of ways the calculations can be done. Which method you use affects the amount to be paid. The Canadian Human Rights Commission (CHRC) and the PSAC both proposed variations using all the data in the study. We believe this is appropriate because the equal pay study size was determined assuming all the data would be used.

Treasury Board, on the other hand, has suggested a variety of different methodologies, none of which would use all of the data in the study. In other words, they want to pick and choose which data will suit their purposes. For this reason, we don't believe that any of Treasury Board's proposals can be relied upon.

The PSAC methodology is the one agreed to by the unions and by Treasury Board at the start of the Joint Union/Management Equal Pay Study. (The CHRC was not involved at that point and therefore not a party to that agreement.)

Q. What happens after the decision is released?

A. The Tribunal's decision is binding. Any of the parties (the Alliance, the Treasury Board, the Canadian Human Rights Commission) may appeal the decision if there is an error in fact or in law in the Tribunal's decision. For example, in another case, the Federal Court of Appeal determined that a tribunal had been too stingy in its interpretation of the Canadian Human Rights Act, and had ignored the intent of the law to right historical wrongs. The parties have 30 days in which to appeal.

Even if any of the parties think there are good reasons to appeal the decision, whatever monies the Tribunal has decided should be paid to PSAC members will have to be paid. The appeal process does not stop the Tribunal's decision from being applied unless the Federal Court can be convinced otherwise. However, the Federal Court will not agree to stop any payments just because the government doesn't like the Tribunal's decision.

Once the decision is released, the Alliance and Treasury Board will meet to work out how the decision will be applied and when the cheques will be issued. What details may need to be worked out will depend on the content of the Tribunal's decision. If need be, Tribunal decisions can be enforced by the Federal Court.

Q. What will the union do if Treasury Board tries to appeal the decision?

A. The Alliance will take all appropriate steps to oppose any Treasury Board appeal.

Q. How will members find out what's in the decision?

A. We have been advised that the decision will be over 300 pages long. As soon as the decision is received, it will be reviewed and a summary prepared of the major points of the decision. This summary will be faxed in both languages to every PSAC regional office and every component office and will be posted on our web site as soon as possible.

Q. Can the union tell me how much money I will receive?

A. No. Obviously the Alliance won't know what the Tribunal has decided until they release their decision. Even when the decision is released, the union has no way of calculating what an individual member may be owed because we do not have access to any member's employment history. Only the pay offices have sufficient information to make these calculations.

Q. Will the cheques be issued in 90 days?

A. There is no deadline for the cheques to be issued. Treasury Board has indicated, however, that they believe it will be possible to issue cheques to current employees within 90 days. The first change should be to the regular pay cheques. Once the new rates start being paid, the retroactivity can be calculated. Calculations will be made first for current employees.

Q. How will the government get cheques to people who are entitled to retroactivity but who have either retired or left the government or who are now working in a bargaining unit not affected by the complaint?

A. Anyone who is receiving a federal pension cheque will automatically receive their retroactivity, as well as a recalculation of their monthly pension benefit.

Employees who were in one of the six affected groups but who are now in other bargaining units should also receive retroactive payments automatically.

Employees who are entitled to retroactivity and have left the government but who are not receiving a pension cheque should do one of two things. They can contact the personnel office of their last department. Or, if they're not sure which department they should contact (particularly with the changes which have occurred), they can advise the Human Resources Division, Corporate Services Branch, Treasury Board, 300 Laurier Ave., Ottawa, Ontario K1A 0R5. The telephone number is (613) 992-1996. However, it would be best to put any request for retroactive payments in writing and to keep a copy of this request.

Q. Will there be any time limit for former employees to claim their retroactivity?

A. Past practice has been that former employees have had at least one year to claim their retroactivity.

Q. What can members be doing to minimize the effects of taxes on our pay equity retroactive payments.

A. The Alliance will be working with Treasury Board to ensure that financial counseling and advice sessions will be held in the workplace and that employees have options available such as spreading out their retroactive payments over two to three years to help minimize the impact of taxes.

One of the best options for a tax break is to use up some of the unused RRSP contribution room which you may have. This amount can be found on the Notice of Assessment which you receive from Revenue Canada after you file your income tax return each year.

For example, if your Notice of Assessment from your 1997 return shows that you have $5,000 in unused contributions and you estimate that you will receive $10,000 in retroactive pay, you can shelter $5,000 of the back pay, tax free, in your RRSP. In order to do this, you must submit a "tax waiver at source" form, available from Revenue Canada, to your pay office to be kept on file for the time when the cheques are prepared.

For more information on planning for your retroactive pay, see the article entitled "Plan Now - Save Later" in the spring issue of Alliance magazine. If you didn't receive a copy of the magazine, extra copies are available in every PSAC regional office.