Equity in WFA & SERLO / Équité dans le RE et le SEMPMD

Key Concepts & Legal Basis

The following concepts and legal provisions form the foundation of Workforce Adjustment (WFA) and the Selection of Employees for Retention or Lay-Off (SERLO) process. Understanding these principles can help ensure compliance requirements and equity considerations are met.

Workforce Adjustment (WFA)

WFA is the mechanism by which the federal public service manages workforce reductions. When the Deputy Head determines that the services of "some but not all" employees in a specific unit are no longer required, the SERLO Process is initiated. WFA decisions affect employee rights and organizational integrity. Clear rules prevent arbitrary or inequitable decisions.

SERLO (Selection of Employees for Retention or Lay-Off):

SERLO is the competitive administrative process which occurs during a WFA. It requires using a merit-based selection process governed by the Public Service Employment Regulations (PSER). For Employee Networks and equity-seeking groups, the SERLO process is an important area of concern. If merit criteria are defined too loosely, or if asset criteria are implemented without an equity lens, the process can inadvertently perpetuate systemic barriers.

Why Equity Matters in WFA and SERLO:

Employment equity is a legal and ethical requirement in WFA and SERLO processes. Decisions made during workforce adjustment have a decisive impact on careers and psychological safety. Failure to integrate equity leads to systemic discrimination, human rights complaints, grievances, reputational damage, and increased under-representation of designated groups, particularly Indigenous and racialized employees. Equity obligations do not diminish during budget reductions; they become more critical when job security is at stake. WFA and SERLO must be designed and implemented as equity processes, not treated as separate administrative steps.

Regulatory and Legal Framework:

To ensure SERLO processes do not create barriers for systemically marginalized communities, departments must adhere to the following:

Public Service Employment Act (PSEA) s. 64: The authority to implement a WFA comes from the PSEA. Section 64 allows Deputy Heads to lay off employees due to lack of work, discontinuation of a function or transfer or work or funds. It confirms that layoffs are a management right, but the selection of individuals must be merit-based.

Public Service Employment Regulations (PSER) s. 21: Once a reduction is announced, the PSER dictates how it will occur. Section 21 mandates that the selection of employees for retention be based on merit. It also requires a bias assessment of the selection method before the process begins.

Employment Equity Act (EEA) s. 5: Requires the employer to identify and eliminate employment barriers against the four designated groups. This duty persists during downsizing.

Canadian Human Rights Act (CHRA) s. 7 & 15: Prohibits adverse effect discrimination (where a neutral rule has a disproportionately negative impact on a protected group). This governs the application of operational requirements like availability or mobility.
National Joint Council (NJC) Workforce Adjustment Directive: collective agreement provisions which outlines the roles and responsibilities of the employer and the rights of affected employees.

Defining Merit Criteria:

In a SERLO, merit is defined by the Deputy Head through three components:

Essential Qualifications: The baseline skills, knowledge, and abilities required to perform the duties of the remaining positions. These are non-negotiable and must be met by all employees being considered for retention. Example: Required certification, language proficiency, or technical ability directly tied to the job.

Asset Qualifications: Additional skills or experience that may benefit the organization now or in the future. Asset criteria should be applied carefully to avoid perpetuating systemic barriers. If the asset requires prior experience in tasks typically linked to promotional opportunities, it may disadvantage equity groups historically excluded from such opportunities. Asset qualifications should emphasize transferable skills rather than experience gained solely through acting or developmental assignments. Example: Ability to lead projects (demonstrated through various contexts, not only acting roles).

Organizational Needs: Strategic priorities identified by the organization that can legitimately influence retention decisions. These may include employment equity objectives, official language requirements, or commitments under land claims agreements. Organizational needs must be documented and applied consistently, based on current workforce data and legal obligations, not personal preference. Example: Retaining employees from designated employment equity groups to meet representation goals.

Bias Controls Across the SERLO/WFA Lifecycle:

Once these principles are understood. it becomes essential to identify how they are applied across the SERLO/WFA lifecycle. The following chart illustrates where bias can enter and what corrective actions are required at each stage.

Stage	Official Activity	Where Bias Can Enter	Corrective Actions
Planning	Determine the desired current and future state of the organization; determine the affected part(s); identify positions and affected employees; notify OCHRO/TBS, bargaining agents, and employees.	Defining the affected part(s) at a level that is not functionally justified can isolate specific employees. The 2025 Selection of employees for retention or lay-off: Guide for managers and HR specialists has a dedicated subsection titled: “Organizational need for employment equity, diversity, and inclusion” Canada	Document the functional rationale for the affected part(s) and link to business/HR plans; issue required written notifications to OCHRO/TBS, bargaining agents, and employees per SERLO steps.
Establishing the Merit Criteria	Establish the Statement of Merit Criteria: essential qualifications, asset qualifications, operational requirements, organizational needs.	Over‑tailored asset qualifications or experience statements that function as proxies for tenure can distort merit and exclude already‑qualified employees.	Write qualifications in plain, neutral, assessable language; distinguish essential vs asset; justify operational requirements; define organizational needs aligned to current and future state.
Conducting the Assessment	Determine assessment methods; complete Step 9: Identification of biases and barriers; conduct assessments with qualified assessors and respect duty to accommodate.	Use of subjective factors (e.g., undefined “fit” or “visibility”) introduces affinity bias and undermines fair assessment.	Apply structured tools (structured interviews, structured reference checks, standardized scoring) and accommodation guidance; ensure assessor competency and official language capacity; document the bias/barrier review before assessment.
Administering Alteration	Administer alternation for opting or surplus employees within the core public administration at the same group/level or equivalent, subject to meeting essential qualifications and language requirements; options chosen within 120 days when no GRJO is provided.	Opaque “taps on the shoulder” and informal matching can exclude eligible employees; inconsistent application of equivalency rules creates unfair access.	Centralize and publicize alternation opportunities; apply equivalency criteria consistently; verify the employee meets the position’s essential qualifications and language profile before approving the alternation.
Conducting SERLO	Conduct selection for retention or lay‑off (SERLO); provide written notice; record reasons for selection; then administer Priority Administration for surplus/lay‑off entitlements in the proper order of precedence.	Relying on outdated workforce data to justify that representation meets organizational needs can misalign decisions with current Employment Equity Act obligations.	Use current employment equity workforce availability and representation data to inform organizational needs; ensure compliance with Appointment Policy obligations (employment equity, official languages, duty to accommodate); respect PSC priority entitlements and order of precedence.

Data Challenges and Success Rates

Workforce Availability Estimates are census-based measures of labour market availability for designated groups. Current benchmarks for representation are based on outdated census data from 2016 or 2021. By 2025, these benchmarks underestimate actual labour market availability, particularly for Indigenous and racialized employees, creating a false impression of progress and minimizing real under-representation. The attainment rate (AR) is the preferred metric for equity analysis because it accounts for group size and labour market availability, enabling fair comparisons. Absolute gaps penalize smaller groups and distort priorities. Federal policy and annual employment equity reports emphasize attainment rates as the standard measure of compliance.

Systemic Risks and Discretion

Fettering discretion occurs when decision-makers rigidly apply outdated rules or formulas instead of exercising judgment based on current evidence. In WFA and SERLO, reliance on unadjusted 2016 or 2021 WAE values particularly for Indigenous and racialized groups, despite clear evidence of growth, constitutes fettering and increases legal risk. This practice masks discrimination and undermines compliance. Processes that fail to adjust for demographic changes risk sliding from compliance into systemic discrimination or abuse of authority. Consequences include human rights complaints, abuse-of-authority claims, reputational harm, and financial liability.

Corrective Measures and Projections

Between 2016 and 2021, workforce availability for racialized employees in major federal organizations grew by approximately 24 percent, and this trend is projected to continue through 2026. To reflect this growth, corrective factors should be applied to WAE or attainment rates. If using 2016 data, divide racialized AR values by 1.5 and Indigenous AR values by 1.2. If using 2021 data, divide racialized AR values by 1.25 and Indigenous AR values by 1.10. Two options exist: adjust WAE before calculating AR or correct AR directly. These adjustments ensure decisions align with current demographic realities and legal obligations.

Monitoring and Self-Identification

Monitoring SERLO outcomes by equity group and classification is essential to detect patterns of inequality and intervene before decisions are finalized. Departments should track who is selected, excluded, and retained, and provide clear explanations of how equity and accommodations were considered. Self-identification forms must be modernized to include updated terminology and under-represented subgroups such as Indigenous, Black, racialized, persons with disabilities, and 2SLGBTQI+. Updated forms should be distributed to all SERLO candidates to enable accurate analysis.

Structural Barriers and Flexibility

Neutral rules such as seniority, language profiles, and outdated WAE tables can produce inequitable outcomes if applied without bias checks or updated data. PSER requires managers to identify and remove systemic barriers during SERLO. Rigid application of language requirements disproportionately affects racialized employees who historically had less access to full-time language training. Flexibility exists within current frameworks, including non-imperative bilingual profiles and transitional language pathways. These measures should be used to prevent language from becoming a structural barrier while maintaining compliance with official languages policy.

Alternance and Evaluation Practices

Alternance processes must be transparent and accessible to all affected employees, not limited to those with strong informal networks. Departments should define clear criteria for alternance matches, maintain HR oversight, and monitor outcomes by equity group. Evaluation grids must be documented, bias-resistant, and explainable. They should not penalize employees for lack of access to acting roles, stretch assignments, or language training, nor for accommodations or medical leave. Employment equity should be applied as an organizational need and as a legitimate tie-breaker when candidates are relatively equivalent.

Roles, Next Steps, and Key Questions

Employee networks and unions should monitor WFA and SERLO impacts, highlight systemic patterns, and advocate for trauma-informed processes. HR and LR advisors must ensure compliance with legal obligations, assist managers in designing bias-resistant tools, and apply organizational needs based on equity. Senior leaders should oversee SERLO plans and insist on equity safeguards. Immediate steps include reviewing current plans for equity risks, confirming collaboration with equity networks, and clarifying guidance on language pathways and alternance. Key questions for SERLO planning include how projected WAE and attainment rates will be used, how discretion will be preserved, and how systemic barriers will be mitigated.

Step	Process (official)	Equity Risk	Safeguards	Legal/Policy Requirements
Define the Affected Part of the Organization	• Establish the affected part(s) as part of SERLO planning (current & future state). • Identify positions and affected employees. • Notify OCHRO/TBS, bargaining agents, and employees.	If the affected part(s) are defined too narrowly without functional justification, selections can isolate specific employees or equity groups.	• Document the functional rationale tied to business/HR plans before assessment. • Use structured notifications and records.	“Step 2: Determine the affected part(s) of the organization.” (PSC, Selection of employees for retention or lay‑off: Guide for managers and HR specialists) [ceiu-seic.ca] — “Where the deputy head determines… that some but not all of the employees in any part of the deputy head’s organization will be laid off, the employees to be laid off shall be selected in accordance with the regulations of the Commission.” (PSEA, s.64(2)) [justice.gc.ca] — “Workforce adjustment… when it has been determined that a position is no longer required due to lack of work, discontinuance of a function, relocation, or an alternative delivery initiative.” (Canada.ca WFA overview) [canada.ca]
Establish Merit Criteria (SoMC)	Deputy Head determines qualifications, requirements, and organizational needs for the SERLO: • Essential qualifications (including official language proficiency) • Asset qualifications • Operational requirements • Organizational needs	• Over‑tailored asset qualifications or experience statements that act as proxies for tenure. • Operational requirements that create barriers.	• Write qualifications in plain, neutral, assessable language; distinguish essential vs. asset. • Justify operational requirements and define organizational needs aligned to the current/future state. • Respect duty to accommodate and employment equity obligations.	“The deputy head must determine (a) the essential qualifications… and any additional qualifications… as an asset; and (b) any relevant current or future operational requirements or needs of the organization.” (PSER, s.22(2)) — “Deputy heads must respect the duty to accommodate throughout the appointment process [and] respect employment equity obligations throughout the appointment process.” (PSC Appointment Policy) [syndicatafpc.ca] — “Organizational needs – employment equity, placing employees affected by workforce adjustment, respecting a land claims agreement, when they apply.” (VAC, How to read a job advertisement) — “Employers… have an obligation to adjust rules, policies or practices to enable everyone to participate fully… called the duty to accommodate.” (Canadian Human Rights Commission)
Conduct the Assessment	• Determine assessment methods (e.g., review of past performance, interviews, exams). • Step 9: Identify biases and barriers before applying any method. • Assess employees using structured tools; ensure assessor qualifications and official languages obligations are met.	Use of subjective factors (e.g., undefined “fit” or “visibility”) introduces affinity bias, undermining fair selection among already‑qualified employees.	• Apply structured tools (structured interviews, structured reference checks, standardized scoring). • Document the bias/barrier review prior to assessment. • Provide and implement accommodations; ensure assessor competence and official language capacity.	“The deputy head may… use any assessment method… such as a review of past performance and accomplishments, interviews and examinations.” (PSER, s.22(4)) — “Before using an assessment method, the deputy head must conduct an evaluation to identify whether the assessment method… includes or creates biases or barriers… and make reasonable efforts to remove or mitigate [them].” (PSER, s.22(5)) — “Step 9: Identification of biases and barriers.” (PSC SERLO Guide) [ceiu-seic.ca] — “Ensure that those conducting the assessment have the necessary competencies… to assess the qualifications.” (PSC Appointment Policy) [syndicatafpc.ca]
Determine Organizational Needs (Representation Analysis)	• Establish organizational needs; Employment Equity can be applied when justified. • Perform a representation gap analysis using current availability/representation.	Reliance on outdated 2021 workforce availability can misstate current gaps and embed bias in selections.	• Use current EE data (availability & representation) when defining organizational needs. • Where only older data exist, apply documented projection methodology (internal) to avoid fettering discretion; decisions must still rest on PSER s.22(2) and PSC Appointment Policy obligations.	“The deputy head must determine… operational requirements or needs of the organization.” (PSER, s.22(2)(b)) — “Organizational needs – employment equity… when they apply.” (VAC) — “Deputy heads must… respect employment equity obligations throughout the appointment process.” (PSC Appointment Policy) [syndicatafpc.ca] — “Public service‑wide initiatives on equity… representation and workforce availability reporting to address gaps.” (TBS Employment Equity Annual Report 2023–24) [canada.ca]
Selection and Notification	• Conduct SERLO selection; establish merit list and determine the cut‑off for retention vs. lay‑off. • Provide written notice to laid‑off and retained employees. • Record reasons for selection. • Administer priority entitlements.	A cut‑off line that produces adverse impact on a protected group without mitigation may contravene EE obligations and fairness principles.	• Conduct a GBA Plus/adverse impact review before issuing letters. • Use current EE data to confirm no disproportionate impact. • Issue PSER s.21 compliant notices; record the reasons for the selection (SERLO guide Step 14). • Manage priority entitlements per PSC (order of precedence).	“Provide written notice… Step 13; and record the reasons for the selection… Step 14.” (PSC SERLO Guide) [ceiu-seic.ca] — “A deputy head must, before laying off an employee, provide a written notice… including: (a) statement; (b) reason; (c) right to complaint; (d) date; (e) lay‑off date or later advice.” (PSER, s.21(1)(a)–(e)) [www150.statcan.gc.ca] — “Priority for appointment… shall be given… to a person laid off pursuant to subsection 64(1).” (PSEA, s.41(4)) [psacunion.ca]
Alternation	• Administer alternation for eligible opting or surplus employees within the core public administration. • Verify essential qualifications and official languages for the position to be alternated into; apply equivalency rules.	Opaque or informal matching (“hidden job market”) excludes eligible employees; inconsistent equivalency application produces unfair access.	• Centralize and transparently post alternation opportunities (departmental and GC‑wide forums). • Apply equivalency consistently; verify essential qualifications and official language profile before approval. • Offer meeting to explain denials.	“All departments or organizations must participate in the alternation process.” (NJC WFAD, s.6.3.1) [canada.ca] — “An alternation occurs when an opting employee… exchanges positions with a non‑affected employee… under Part VI.” (NJC WFAD, s.6.3.2) [canada.ca] — “The opting employee moving into the unaffected position must meet the requirements for appointment… including language requirements.” (NJC WFAD, s.6.3.7) [canada.ca] — “Alternation should normally occur at the same group and level… or equivalent (max rate of pay no more than 6% higher).” (NJC WFAD, s.6.3.9) [canada.ca] — “An alternation must occur on a given date… no ‘domino’ or ‘future considerations’.” (NJC WFAD, s.6.3.10) [canada.ca] — “Employees not in receipt of a GRJO have 120 days to consider the three options.” (NJC WFAD, s.6.1.2) [canada.ca]

Intersectionality and GBA Plus Considerations in SERLO/WFA

Designated group / policy lens	Official obligations and risks	Required controls (official)
Persons with Disabilities	Duty to accommodate must be respected throughout assessment; operational requirements (e.g., travel, hours) must be justified as essential; accommodations must not be treated as performance deficits	Apply PSC Guide for Assessing Persons with Disabilities and accommodation processes; review each operational requirement for necessity; ensure accessible assessment methods and assessor competency
Members of racialized groups	The Employment Equity Act obliges employers to identify and correct conditions of disadvantage and maintain proportional representation; using past access to “acting” experience as an asset can reflect past inequities if not tied to duties	Define qualifications by the competency/ability required rather than specific past opportunities; use current workforce availability and representation data when applying organizational needs in SERLO
Indigenous peoples	EE obligations apply; organizational needs may be used to support representation consistent with current availability/representation; assessment must remain fair and consistent with PSC appointment requirements	Align organizational needs to current EE data; apply structured, unbiased assessment methods; respect official languages and duty to accommodate during SERLO
GBA Plus (enterprise lens)	Departments are expected to integrate GBA Plus in planning and operations, including staffing and assessment, to identify and mitigate systemic barriers	Include a documented GBA Plus check in SERLO planning and at Step 9: Identification of biases and barriers; leverage CSPS/PSC guidance and training to strengthen capacity

Key Questions for Managers

What’s the projected AR/WAE by EE group and classification?
Have we embedded documented EE organizational needs in criteria?
What bias checks and barrier mitigations were conducted (PSC Step 9)?
Where can PSOLEAO and language training be used?
Are alternation and voluntary departure options visible and equitable?
Is data tracked to show selection outcomes by EE group?

Recommendations

Update WAE Projections: Use formula-based projections when 2021 data is dated.
Adopt Bias-Resistant Grids: Record all documentation to enable recourse.
Embed EE Needs Explicitly: Where appropriate, EE membership should be a qualification.
Use Non-Imperative Staffing: Include strong language training plans and milestones.
Enhance Alternation & Departure Transparency: Use centralized platforms and monitor equity outcomes.
Institute Regular Reviews: Provide AR/WAE briefings and track plans.
Document for Recourse: Keep records of criteria, mitigations, and compliance measures.