Payment in Arrears
Government of Canada employees are paid in arrears. This means that you are paid for your work during your first 2 week pay period, 2 weeks following, at the end of the second 2 week pay period. Pay periods are 2 week time frames that start on a Thursday and end on the second Wednesday. Visit our Pay Processing Calendar for payment dates and to which work period they correspond.
The government officially moved from issuing current payments to issuing payments in arrears on April 23, 2014. If you were a public servant prior to April 23, 2014, and were paid on a bi-weekly basis under the previous payroll system, you would have received a one-time transition payment equivalent to your regular pay. This one-time transition payment was paid in the same manner as your regular pay, by direct deposit in most cases.
The transition payment ensured that no workers would experience financial hardship because of the transition to payment in arrears. This one-time payment was equal to your regular pay, or basic pay, and was issued on May 7, 2014.
The government will recover this payment when you leave the public service. The recovered amount will include all applicable deductions.
Unlike new employees, employees working at the time of the transition did not have to wait 4 weeks to receive a salary payment. Those employees continued to receive a salary payment every 2 weeks. As a result, when they leave the public service, they will not receive a regular salary payment 2 weeks later. Instead, their final payment will cover only the difference between their salary at departure and the transition payment issued on May 7, 2014.
Pay in arrears... in images!
Image 1: How was pay issued prior to April 24, 2014
Employees receive their pay every two weeks for work completed up to and including that Wednesday (pay day).
The last current pay was issued on May 7, 2014 covering the period from April 24, 2014 to May 7, 2014.
Image 2: Transition Payment
The “Transition Payment” was dated May 21, 2014 to enable the Government to perform the transition from Current Payment to Payment in Arrears and avoid any financial hardship to employees during this transition period.
Image 3: Payment in arrears
The payment of June 4, 2014 was the first payment in arrears. The employee's pay stub reflected the period of May 8 to May 21, 2014 inclusively.
Image 4: New employees
All new employees not on the payroll on April 23, 2014 are automatically placed on payment in arrears; they will receive their first payment, at most, four weeks after their start date.
Example:
An indeterminate employee is hired on April 28, 2014; therefore, the first pay will be issued on May 21, 2014 for a total of 8 working days (April 28, 2014 to May 7, 2014).
Image 5: Termination of employment
After the departure from the public service, a last pay will be issued and an adjustment will be made to take into account the difference between the salary at the time of the transition payment (May 2014) and the salary on departure.
Example:
In May 2014, the employee received a transition payment equivalent to 10 working days.
Then, the employee retires on July 25, 2014. The last payment for the period from July 17 to July 25, 2014 will be for a total of 7 working days which was paid on August 13, 2014.
Since the last pay is less than 10 days salary, the difference in money owing will be taken from first available funds (last salary payment, overtime, etc. or pension). Otherwise, employees must provide a money order or certified cheque payable to the Receiver General for Canada.
Therefore, in this scenario, the employee would owe 3 days salary for the adjustment of the transition payment.
