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The Public Service's Post-Employment Regime



B. The philosophy behind the Post-Employment Regime

For those seeking to return as employees

  • Generally speaking, any person who has left under the terms of an incentive package is subject to considerable restrictions if he or she seeks to return to the Public Service as an appointed employee.
  • First, there are the issues of pension suspension and waiver loss. For persons who accept any positions where they become contributors again under the Public Service Superannuation Act, the individual's pension is automatically suspended during the life of this further period of employment. Moreover, these persons lose the benefit of that early retirement waiver upon their subsequent termination of employment unless their second departure is as a result of a surplus situation.
  • Persons who accept appointments that do not require them to become "contributors" continue to receive their pensions. However, the Treasury Board is establishing systems to monitor departmental use of such former employees to identify and eliminate abuses of this flexibility.
  • Second, there is the issue of repayment. Anyone returning within the number of weeks represented by the non-severance pay portion of their lumpsum payment would have to pay back that payment pro rata on a weekbyweek basis. For example, a person whose "cash out" had been 26 weeks and who returned to employment as a term or indeterminate employee 10 weeks later would have to pay back the remaining 16 weeks. However, if re-employment begins after the time equivalency period has expired, no lumpsum money would have to be repaid.
  • Minor differences exist between the various lumpsum based programs. For example, a person taking the payinlieu "cash out" under the Work Force Adjustment Directive is only liable for repayment if the position accepted is with an organization in Schedule I, Part I, of the Public Service Staff Relations Act. Conversely, an EDI recipient accepting a position with any organization in the Public Sector Compensation Act Schedules I or II is liable to repay. The slightly less restrictive treatment of Work Force Adjustment departees is because the Directive clearly stipulates the universe within which they shall be liable whereas the Order in Council establishing the EDI applies to a wider universe.

For those returning in a contractual relationship

  • A Public Service employee resigning under the terms of the Work Force Adjustment Directive (WFAD), the EDI, the ERI, the Executive Employment Transition Policy (EETP), or other termination package programs, will be subject to restrictions if he or she contracts for personal services with the Public Service.
  • Specifically, the former employee will only be permitted to earn up to $5,000 during the "window period" immediately after employment. This "window period" is the number of weeks covered by the lumpsum portion of the departure incentive and the years and service allowance. The lumpsum portion does not include severance pay, accumulated vacation leave, and the like.
  • Under the EDI, the "window period" is actually 39 weeks for any employee with less than 5 years of continuous employment. For those with 5 years or more of continuous employment, this "window period" cannot exceed 58 weeks (52 weeks for the lump sum and a maximum of 6 weeks for the years and service allowance). Under the Work Force Adjustment Directive, it is normally 26 weeks.
  • This is believed to be a reasonable alternative to a total ban in that it permits management some flexibility to meet operational requirements.
  • During the "window period," former Public Service employees will be subject to this $5,000 rule, whether the former employee undertakes a contract as an individual, as a sole proprietorship corporation, as a partnership, or in cases where that individual has a major interest in the contracting entity.
  • Where a former employee goes to work as an employee of, or subcontractor to, an established firm contracting with the government, these restrictions do not apply.
  • The Treasury Board will reinforce instructions to managers about proper conduct when dealing with contracting firms and will require departments to take the appropriate corrective action if problems are identified.
  • After a former employee's "window period" expires, those receiving pensions under the Public Service Superannuation Act will be subject to the Treasury Board's fee abatement (reduction) policy on contracts for personal services for a further 12month period. For this additional period, the reduction applies only to noncompetitive contracts and is established by setting the contract fee so that the former employee's pension payment plus the contract fee cannot exceed her or his former salary.




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