St. John’s woman loses her home after Phoenix payments fiasco

Joanne Nemec Osmond, 46, stands outside the Canada Revenue Agency tax center in St. John’s. She says the federal government’s Phoenix payroll system has changed her life. (Ariana Kelland/CBC)

A St. John’s woman says she has lost everything – her home, her livelihood and her stability – after years of trouble with the federal government’s notorious Phoenix payroll system, and still hasn’t received one cent in compensation.

Joanne Nemec Osmond, 46, started working at the Canada Revenue Agency in 2006 as a contract employee. Each year, she was laid off only to be recalled the following season, with the hope that one day she would become a permanent employee.

In 2017, he was offered a better paid position, but at a crippling price that would destroy his home, career and finances.

“They owe me cold, hard money that I earned working, but I’ll never get my credit back, I can never [get back] my house that I had to leave to my children, the change of life,” said Nemec Osmond.

“They took years from my life.”

Nemec Osmond is one of approximately 200,000 federal government employees who have gone unpaid for long periods of time, been paid less than expected or overpaid since the Phoenix system was implemented.

The ailing IBM payroll system was hired by the federal government in 2011 to replace its aging system. It went live in 2016 and there have been countless failures since, costing over $2.4 billion as of April. A replacement system is in preparation.

$0 checks

Shortly after the Phoenix payroll system went live, Nemec Osmond said she began seeing deductions on her pay stubs of varying amounts, ranging from tens of dollars to hundreds. When she called the compensation department to ask why, she said they couldn’t tell her what dates she was overpaid – only that she was and, therefore, had money. money recovered.

After taking a better paying job in 2017, the problem got worse and she started getting $0 paychecks.

Stressed and unable to meet her mortgage payments, Nemec Osmond applied for employment insurance the same year.

She said she was once again despised by the federal government’s flawed system.

“Phoenix issued me a Record of Employment that missed six months of my employment and said I was not eligible for EI,” Nemec Osmond said.

“After my check fell to zero and I said I didn’t qualify, I became a squeaky wheel.”

She then obtained employment insurance benefits after the intervention of her MP’s assistant, the Liberal Seamus O’Regan.

Nemec Osmond received a T4 in the mail this year showing she earned over $1,200 working for the CRA in 2021. However, she says her employment contract ended in 2018. (Radio Canada)

Nemec Osmond returned to work months later, but was still receiving blank paychecks, and no one seemed to know how to help him.

Then, after 12 years of work, the CRA terminated his employment.

“I received a letter from the tax office telling me that I was not meeting the required production rates that we are supposed to review. At that time, I think it was four and a half files per hour that I was passing every two years,” she said.

“I think I was just crushed. At the time, I didn’t know where to turn for help.”

They took me. They are ready to draw the last drops of blood.– Joanne Nemec Osmond

In 2019, after defaulting on her mortgage, the bank foreclosed on the house where she raised her children. Separated from her husband, she and her two daughters now live in subsidized housing. She owes more than $33,000 to First National, her lender, for “losses incurred as a result of [her] default.”

“[We] had the house built in 1996, got married in 1997 and brought my two daughters, born in 2004 and 2010, home to this house,” she said.

“That’s where I had the room on the wall measuring their height as they grew and the memories. And it’s heartbreaking, and I still can’t get over it.”

Dread tax time

But it didn’t stop there.

Since her contract ended in 2018, Nemec Osmond has received two T4s from the CRA – one in 2019 and one in 2021, falsely claiming she had employment income in those years.

In February 2020, the CRA sent her a letter stating that she owed $6,926.38 in overpayments. A few months later, he sent another letter saying the balance “wasn’t correct” and that she actually owed $5,925.88. CBC News reviewed the documentation.

The agency now recovers this balance by deducting it from Nemec Osmond’s annual tax refunds.

Nemec Osmond and her husband built their dream home in 1996. In 2019, after he failed to make mortgage payments, the bank foreclosed on the house. She now lives in subsidized housing. (Submitted by Joanne Nemec Osmond)

“It was pretty overwhelming because I really needed those funds,” she said, adding that days later she received another T4 in the mail showing she had won $1,800. in CRA employment income.

“They take me. They took me. They are taking the last drops of blood.”

Nemec Osmond doesn’t believe the federal government will ever be able to accurately calculate what it is owed due to the complexity of the errors.

And no matter the amount, she said she would never get back what was lost.

A civil servant holds a sign imploring Prime Minister Justin Trudeau to resolve issues with the Phoenix payroll system, during a protest outside the Prime Minister and Privy Council office in Ottawa on October 12, 2017. (Justin Tang/The Canadian Press)

“I don’t think they could restore stability and security to my children’s lives. I can’t walk past my old house. I’m still crying and I’ve never been one for this,” said Nemec Osmond.

“But it changed me and changed our whole family dynamic.”

The federal government promised to provide $2,500 in general damages to eligible employees and announced additional compensation at the end of 2021 for people like Nemec Osmond who endured severe financial and personal hardship.

Nemec Osmond said she had not yet received compensation, but had received an email confirming that her claim for serious damages was being reviewed.

Launch investigation, says union

The union representing many federal employees, the Public Service Alliance of Canada, said tens of thousands of public sector workers are still affected by pay issues. He urges the federal government to convene a national inquiry.

PSAC Atlantic Regional Executive Vice-President Colleen Coffey was unavailable for an interview at the time of publication. .

In a statement, Coffey said Phoenix’s backlog of compensation issues grew during the pandemic, with a total of 137,000 cases beyond normal caseload in March, up from 94,000 two years earlier.

“Furthermore, we know that current pay center staff are simply not capable of handling high and complex volumes of payroll transactions,” Coffey wrote.

“Working in compensation with a broken compensation system is difficult and stressful work, and it has caused hiring and retention issues.”

PSAC members hold a protest in front of the federal Department of Finance offices on Elgin Street in Ottawa on February 28, 2018. (Amanda Pfeffer/CBC)

Nemec Osmond said his attempts to contact his union had failed. However, Coffey said Phoenix’s compensation issues team works daily with public sector workers to “understand how and why this is happening to them.”

In a statement, Shared Services Canada said it was testing a new payroll and HR program using “lessons learned” from Phoenix. A spokesperson for the federal agency said it was a “human-centric, accessible, cloud-based HR and payroll solution.”

As of May 31, more than 96% of the requests received — 27,955 — had been settled, according to the Treasury Board of Canada Secretariat. More than 1,600 of these claims were for serious damage. Some 800 of these claims have been settled.

Public Services and Procurement Canada did not respond to CBC’s questions in time.

“A lot of people think Phoenix is ​​over. I didn’t choose to stop working. I certainly didn’t choose to lose my house and move into subsidized housing,” Nemec Osmond said.

“It needs to be fixed. I need someone to fix it.”

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