Rescinded [2009-10-01] - Comptrollership Policy on Pay Administration

To ensure that adequate controls are established and implemented for financial pay transactions, and to ensure the efficiency and effectiveness of the pay process within the framework of departmental financial management.
Date modified: 1997-05-01

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1. Effective date

This document contains the entire text of the revised policy that became effective April 1, 1997. This policy supersedes section 9.15, "Role and Responsibilities of Financial Officers in Pay Administration and Payroll Matters", of the Guide on Financial Administration, consolidated revision, April 1991.

2. Policy objective

To ensure that adequate controls are established and implemented for financial pay transactions, and to ensure the efficiency and effectiveness of the pay process within the framework of departmental financial management.

3. Policy statement

It is government policy to maintain an efficient and effective pay administration in a manner that ensures its probity.

4. Application

This policy applies to all organizations considered to be departments within the meaning of section 2 of the Financial Administration Act (FAA).

5. Policy requirements

Departments must establish policies and procedures to ensure that:

  • adequate financial controls are designed and implemented as part of the departmental pay process;
  • the senior financial officer in conjunction with senior human resources management develops efficient and effective accounting procedures to ensure that all pay input documents meet the requirements of the policy on account verification relating to sections 33 and 34 of the FAA and the requirements of the Payment Requisitioning Regulations;
  • missing or delayed direct pay deposits are handled in accordance with the Direct Deposit Regulations and not by means of emergency salary advances;
  • proper accounting records are maintained and T4-A Supplementary forms are issued for the amounts paid to individuals who are hired locally within Canada and to Canadians who reside outside Canada and perform local services for the government, who are not paid through Public Works and Government Services Canada pay offices;
  • appropriate and accurate records of payments and taxable benefits are maintained for employees in order to meet the reporting requirements of the Income Tax Act and provincial income tax acts; and
  • the elements of the control framework found in Appendix B are adhered to where financial authorities for section 33 of the FAA are delegated to human resources personnel.

6. Monitoring

  1. Departments should conduct periodic reviews and audits of their compliance with this policy.
  2. Treasury Board of Canada, Secretariat will monitor the effectiveness of this policy by reviewing departmental internal audit reports.
  3. Performance indicators should relate primarily to the accuracy, effectiveness and efficiency of the processes for handling and recording pay-related transactions.

7. References

7.1 Legislation

  • Financial Administration Act (R.S.C., 1985, Chapter F-11) sections 32, 33 and 34
  • Payment Requisitioning Regulations, SOR/85-999, as amended by SOR/86-68, 93-258 and 96-135
  • Direct Deposit Regulations, SOR/84-974, as amended by SOR/85-222, 85-1000, 86-732, 93-179 and 94-402
  • Accountable Advance Regulations, SOR/86-438, as amended by SOR/93-258, s. 2(f)

7.2 Treasury Board of Canada, Secretariat Publications

Human Resource Management


  • Additions to Basic Pay
  • Recovery of Amounts Due to the Crown
  • Deductions from Pay
  • Pay Administration - General

Insurance and Related Benefits

  • Workers' Compensation
  • Injury-on-Duty Leave

Employee Entitlements

  • Relocation Directive
  • Special Relocation Authorities


  • Account Verification (Policy)
  • Policy on Receivables Management
  • Policy on Delegation of Authority

The above publications are available in electronic format on the TBS Web site on the Government Enterprise Network (GENet), the federal government internal network, at the following address:

They are also available on the TBS Web site on the Internet at the following address:

8. Enquiries

Enquiries concerning this policy should be directed to your departmental headquarters. For interpretation of this policy, headquarters may contact the following office:

Financial and Contract Management Sector
Deputy Comptroller General Branch
Treasury Board of Canada, Secretariat
Ottawa, Ontario
K1A 0R5
Telephone: (613) 957-7233
Facsimile: (613) 952-9613
Email: Internet:
X400: c=ca; a=govmt.canada; p=gc+TBS.SCT; s=DCG-SCGInformation

For enquiries concerning human resources issues, headquarters may also contact the following office:

Labour Relations and Human Resources Management Division
Human Resources Branch
Treasury Board of Canada, Secretariat
Ottawa, Ontario
K1A 0R5
Telephone: (613) 952-3206
Facsimile: (613) 952-3009

Appendix A - Guidelines on Pay Administration

1. General

Departments should ensure that:

  • control over the custody and distribution of cheques and direct deposit payment statements is performed by a person who does not have signing authority in the areas of staffing, classification, compensation administration, staffing transactions or pay input transactions;
  • the person who is responsible for cheque and direct deposit payment statement distribution must, for this purpose, take functional direction from the senior financial officer;
  • where it is impractical to record commitments for salaries and wages on an individual basis, departmental procedures provide alternative means of taking the impact of these commitments into account (for example, departments may control commitments by using the average salary for a category multiplied by the total number of positions for that category, and adjusting for the effect of major collective bargaining agreements); and
  • the verification of pay input data by the financial organization does not duplicate the work already performed by human resources personnel. It should, however, consist of a thorough verification of those areas within the scope of financial responsibilities and those aspects which are required for financial control.

2. Departure procedures

  1. To minimize the possibility of an employee leaving the federal Public Service owing money or any other material (e.g. outstanding accountable advances such as travel advances, standing advances, emergency salary advances, petty cash funds, change floats, etc.; acquisition cards; travel cards; identity cards; overdrawn leave; and equipment, tools, manuals, etc. on loan), departments should establish a departure report and checklist that would require specific organizations such as human resources, security, materiel management, administration, library and financial services to sign off before the final payment to the employee is released.
  2. Financial organizations should always sign off last to ensure that all other areas have been cleared and that no money is owed to her Majesty: only then should the final payment be released. If authority under section 33 of the FAA has been delegated outside the line authority of the senior financial officer, the organizations to which that authority has been delegated should be the last to sign off.

3. Secondment and interchange agreements

  1. Internal procedures and proper records must be established and maintained for secondment and interchange agreements to ensure that recovery as indicated in respective agreements is carried out.
  2. When an employee is seconded to another government department, the agreement may provide for salary expenses, including the department's share of benefits, to be reimbursed by the host department (since the employee remains on the payroll of the home department). Similarly, non-public servants, or provincial or municipal public servants assigned to the Public Service will continue to be paid by their usual employer. These employers will recover the salary from the department to which the individuals have been assigned. Any difference in salary is the responsibility of the individuals' usual employers.
  3. If the amount that the host organization is prepared to pay is less than the salary being paid to the employee, the home department absorbs the difference.

4. Emergency salary advances

Departments are responsible for taking immediate action to requisition an emergency salary advance whenever a regular salary cheque payment is not available to the employee on the due date. For more information, Pay Administration - General, published by Treasury Board of Canada, Secretariat, and the Accountable Advance Regulations.

5. Garnishment of salaries and wages

  1. Amendments to the Garnishment, Attachment and Pension Diversion Act, were proclaimed on February 19, 1997 and came into effect on May 1, 1997.
  2. Part I of the Garnishment, Attachment and Pension Diversion Act permits creditors and others to garnishee salaries and other remuneration paid to government employees, as well as money owned to individuals employed under contracts for services.
  3. Departments are required to designate positions whose incumbents are the Garnishee Contact as the initial point of contact for all garnishee summons. Upon receipt of a summons, the Garnishee Contact should immediately determine whether:
    • the individual subject to garnishment is an employee of the department, agency or departmental corporation; or
    • the individual is working under contract.
  4. (epartments should ensure that when a Crown debt has been assigned or a power of attorney or garnishment order is in effect, payment is made to the assignee, attorney, or judgement creditor as the case may be.
  5. Departments are required to place garnisheed money in the hands of the court or the office indicated in the garnishee summons:
    • salary (employees), within 15 calendar days after the last day of the pay period in which they are withheld;
    • other remuneration, including fees, honoraria, etc. (contractors), within 15 calendar days after they are garnisheed.
  6. Financial officers should be familiar with procedures for garnishment of salaries. These procedures are contained in Deductions from Pay, published by Treasury Board of Canada, Secretariat.
  7. Financial officers should also be familiar with the procedures to garnish public servants' salaries when the garnishment cannot be accomplished by payroll deduction within the required time frame, or when a one-time payment is involved. In addition, financial officers should be knowledgeable about garnishment of money due to a person hired through a personal services contract, as well as procedures to remit the garnisheed amount to the court. These procedures are contained in the relevant Receiver General Directive.
  8. Individuals involved with the administration of the garnishment legislation should be familiar with the Act, its regulations, and the procedures contained in Deductions from Pay, published by Treasury Board of Canada, Secretariat.

6. T4-A's for Taxable Benefits

  1. Refer to Additions to Basic Pay, published by Treasury Board of Canada, Secretariat, for amounts to be included in T4-A's.
  2. Financial organizations in departments must ensure adequate record-keeping to meet the requirements for the preparation of T4-A's. This includes maintenance of proper accounting records to ensure that a T4-A Supplementary is issued to the employee for taxable benefits on or before the last day of February.

7. Workers' Compensation

  1. Where an employee has been injured and is receiving full salary during the pre-determined period as established by the employer, any other salary replacement from other sources, such as a workers' compensation board, must be repaid to the Receiver General. However, such money does not have to be repaid, when the salary replacement stems from a personal disability policy for which the employee or the employee's agent has paid the premium. Revenue Canada has ruled that employment-injury benefits received from the Workers' Compensation Board to be non-taxable.
  2. For additional information concerning workers' compensation and injury on duty leave departments should consult Workers' Compensation and Injury-on-Duty Leave, published by Treasury Board of Canada, Secretariat.

Appendix B - Delegation of financial authorities to human resources personnel - Elements of a control framework

1. General

  1. The wording of sections 34 and 33 of the FAA allows organizations to delegate these authorities to persons outside the finance organization. As long as the minister designates the person in writing, that person can exercise these authorities on the minister's behalf.
  2. Ministers and deputy heads must delegate and communicate financial authorities in a manner and form that provide controls on the disbursement of public money by adequately enforcing an appropriate division of responsibilities.
  3. Departments must establish policies and procedures to ensure an adequate level of control over delegated authorities exists and that persons with delegated authorities understand their responsibilities.
  4. Only persons to whom these authorities have been formally delegated may exercise such authorities.
  5. The process must ensure that delegated authorities are authenticated before the transaction is processed further.
  6. Authorities must be delegated to the incumbents of positions identified by title, and not to individuals identified by name.
  7. No person may exercise the authorities delegated to a position unless an officer to whom the incumbent of the position reports has properly designated the person to act.
  8. Officers with delegated authority cannot redelegate that authority.

2. Major principles and policy elements - Section 34 of the FAA

  1. All transactions affecting the Consolidated Revenue Fund (i.e., payment transactions) must be verified and certified under section 34 of the FAA.
  2. Primary responsibility for verifying individual accounts rests with officers who have the authority to confirm and certify entitlement under section 34 of the FAA. Persons with this authority are responsible for the correctness of the payment and of the account verification procedures. For pay transactions, under section 34 of the FAA, the person certifies that:
    • the payee is entitled to or eligible for the payment;
    • the payment conforms with relevant contract or agreement terms and conditions;
    • the transaction is accurate and the financial coding has been provided; and
    • the transaction complies with all relevant statutes, regulations, orders in council, and Treasury Board policies, such as overtime policies.
  3. The process for verifying accounts must leave auditable evidence of verification, including the identification of the various individuals involved.

3. Responsibilities - Section 33 of the FAA

  1. Financial officers with payment authority under section 33 of the FAA must ensure that an adequate process is in place to verify accounts under section 34 of the FAA, and that the process is being properly and conscientiously followed.
  2. Section 33 of the FAA authority can be delegated to a person outside the line authority of the senior financial officer (SFO) of the department. In such cases, the SFO, being responsible for the overall quality of financial management, remains entirely responsible for the effectiveness and efficiency of the person exercising that authority.
  3. Therefore, the SFO should establish procedures and, probably, an audit program to ensure that authority under section 33 of the FAA is exercised in accordance with departmental standards and control objectives. As well, the SFO must ensure that proper mechanisms are in place to allow the person with authority under section 33 of the FAA to verify the legality of the payment and the availability of funds.

4. Responsibilities - Section 34 of the FAA

  1. Persons who have been delegated authority under section 34 of the FAA must receive a set of instructions or procedures to ensure that they respect all departmental, legal and regulatory requirements.
  2. Those officers who are delegated payment authority under section 33 of the FAA are responsible for issuing these instructions and for the system for verifying accounts and related financial controls.

5. Other

  1. Two other principles must be observed:
    • no person shall exercise signing authority under both sections 33 and 34 of the FAA with respect to a particular payment; and
    • no person shall exercise spending authority (section 34 of the FAA) with respect to a payment from which he or she personally can benefit, directly or indirectly.
  2. Finally, procedures must be in place to ensure adequate processing of assignments of Crown debts or powers of attorney recognized in force by the Receiver General.
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