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

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Key Concepts & Legal Basis

This page was co‑created by interdepartmental employment equity networks. It summarizes Public Service Commission (PSC) guidance and relevant legislation that govern Workforce Adjustment (WFA) and Selection of Employees for Retention or Lay‑off (SERLO). It is written for managers, HR advisors and employees to support compliance and equitable outcomes during workforce reductions.

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, discontinuance of a function, or transfer of work or funds. It confirms that lay-offs are a management right, but the selection of individuals must be merit-based.
  • 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.

Roles and responsibilities

  • Treasury Board Secretariat (TBS) OCHRO: sets WFA policies/directives; provides guidance and monitoring.
  • Public Service Commission (PSC): SERLO regulatory framework and guidance; official languages exclusion approval order; priority entitlements; oversight and monitoring of SERLO and priority application.
  • Deputy Head and departmental management: HR planning; implement WFA (including SERLO, if required); collaborate with TBS and PSC.

The SERLO Process: Steps, Actions and Equity Considerations:

The SERLO process, as described by PSC, has fourteen steps. The table below outlines each step, the purpose, required actions, references, and equity considerations. Note: for a detailed review of equity considerations during SERLO please click here: Detailed Equity Considerations for SERLO / Considérations détaillées en matière d’équité pour le SERLO - wiki.

Step Purpose Required actions and key requirements References Equity considerations
1. Determine the desired current and future state of the organization Establish the organizational context, programs, services and priorities to inform WFA and possible SERLO. Consult departmental and HR plans. Conduct an environmental scan and workforce analysis, including representation rates of Employment Equity designated groups; identify skills gaps for now and the future. Where appropriate, complete a UN Declaration consistency analysis (proportionate to the initiative) using the Justice Interim Guide and retain the record. PSC SERLO guide (Step 1). Use workforce data on representation to inform planning and mitigate adverse impacts on designated groups through evidence‑based decisions.
2. Determine the affected part(s) of the organization Identify the organizational parts where WFA will occur and where SERLO may be required. Define the section, division or directorate; geographical area; program or type of work for each affected part. Clear definition of affected parts supports transparent, consistent application across groups and locations. Apply PSEA s. 64 to confirm when lay‑off and selection apply. Ensure the definition of the affected part is based on organizational structure and function, not on incumbents’ characteristics. PSEA 64(1), 64(2); PSC SERLO guide (Step 2). Clear definition of affected parts supports transparent, consistent application across groups and locations.
3. Identify the positions and affected employees Define the scope of employees included in SERLO. Identify positions of the same occupational group and level performing similar duties within the affected part(s). Include substantive incumbents on acting, assignment, secondment or leave. Exclude unique positions, specified‑term employees, those with accepted job offers or confirmed retirements/resignations, executives on special deployments, and temporary resources. Similar duties must be defined strictly by job content and classification factors—not by performance history, personal circumstances, or perceived potential. PSC SERLO guide (Step 3); Apply inclusion and exclusion criteria consistently to avoid unintended barriers; ensure decisions are based on objective similarity of positions and duties.
4. Notify TBS‑OCHRO, bargaining agents, and employees Ensure early, thorough consultation and formal notification. Notify TBS‑OCHRO in writing and in confidence before announcement, per WFAD. Notify National Heads of the affected bargaining agents in writing and in confidence. Then notify affected employees in writing; clarify roles and responsibilities aligned to HR delegation. Maintain ongoing communication about career transition for executives with TBS‑OCHRO’s Leadership Policies Division. PSC SERLO guide (Step 4). Early consultation with bargaining agents promotes transparency and supports equitable treatment; consistent written notices reduce information barriers.
5. Conduct classification and staffing activities Ensure positions reflect the current/future work; use staffing strategies to minimize affected employees. Update work descriptions and classification. Create new positions if required; abolish vacant positions. Consider staffing new positions first to place affected employees. In appointment processes, organizational needs can include placement of affected employees; request priority clearance per PSEA s. 43 where applicable. PSC SERLO guide (Step 5). Using staffing to reduce the number of affected employees can mitigate disproportionate impacts; ensure fair access by limiting areas of selection appropriately and using organizational need to place affected employees.
6. Establish a voluntary departure program (VDP) Offer voluntary departure where permitted by WFAD/collective agreements to reduce involuntary lay‑offs. Establish and communicate the VDP consistent with applicable directives and appendices; implement before proceeding to SERLO where appropriate. PSC SERLO guide (Step 6). A well‑communicated VDP enhances employee agency and can lessen impacts on equity‑seeking groups when combined with transparent criteria.
7. Determine the qualifications, requirements, and needs Set the most relevant essential and asset qualifications, organizational needs and operational requirements for the work to be performed. Establish essential and asset qualifications, organizational needs, and operational requirements that reflect the remaining work of the retained positions. For bilingual positions, official languages proficiency is an essential qualification that must be met at selection; non‑imperative appointment flexibilities do not apply in SERLO. You may explicitly include Employment Equity (EE) as an organizational need to address representation gaps, if established at this step and applied consistently. Use Attainment Rate (AR) and, where appropriate, documented projections to identify equity gaps. Review operational requirements under the CHRA and the Duty to Accommodate. Do not use assets that replicate systemic barriers (e.g., acting experience, years of service, “Canadian experience,” or department‑specific experience). Prefer transferable skills (e.g., project coordination, team leadership, stakeholder engagement, intercultural competency) that can be demonstrated in multiple contexts. Consider whether Indigenous languages are relevant to the work being retained (e.g., client services or engagement functions involving Indigenous communities) and ensure requirements are job‑related and evidence‑based; document rationale. (Note: non‑imperative staffing does not apply in SERLO.) PSER 22(2); Explicitly leveraging Employment Equity as an organizational need allows SERLO to address representation gaps within the bounds of PSER. Avoid using Canadian experience or specific departmental experience as an asset. These criteria often exclude qualified Indigenous, racialized, or internationally‑trained employees who entered the public service through non‑traditional pathways. Instead, focus on transferable skills.
8. Determine the assessment methods Choose appropriate assessment methods for the established factors. Managers may select appropriate methods (e.g., interviews, tests, simulations, work samples). If assessing second official language proficiency, use the same methods required for appointments. Ensure linguistic profiles reflect real operational needs and are not raised solely due to restructuring. PSER 22(4), 22(6); Select methods that are valid and fair; avoid tools that introduce unnecessary barriers, and align language assessment to appointment standards to protect official languages rights.
9. Identify biases and barriers Evaluate selected assessment methods and how they will be applied to identify and remove or mitigate biases and barriers. Before any assessment, conduct and document a bias and barrier evaluation of all assessment methods (interviews, tests, simulations, work samples) as required by PSER 22(5). Explain identified risks and the mitigations applied, and keep the record for PSC oversight or Federal Public Sector Labour Relations and Employment Board (FPSLREB) proceedings. PSER 22(5); Screen out proxy barriers (e.g., Canadian experience, culture‑bound interview questions, bandwidth‑dependent remote tests). Validate that tools don’t disadvantage Indigenous, racialized, disabled, or 2SLGBTQI+ employees.
10. Inform employees Provide written information to each group of employees participating in SERLO. Inform, in writing, the qualifications, requirements and needs; assessment methods; and the ability and process to request accommodation measures. Consider sharing definitions, selection factors, process timing, and available supports to increase transparency. Include a clear statement on how to request accommodation (who to contact, timelines, examples) and confirm that accommodation decisions are not shared with assessors beyond what is required to administer the measure. PSER 22(3); Explicit notice about accommodations reduces barriers for persons with disabilities and other equity‑seeking groups; transparency supports fairness.
11. Assessment of employees Assess which employees meet the established qualifications, requirements and needs. Ensure retained employees meet established pass marks or ratings. Assess in the employee’s official language of choice, except language proficiency, which must be assessed in the language being evaluated. Use current SLE results where valid for the position; re‑test if the profile or outcome no longer meets requirements. PSER 22(7); Respect the language of choice for assessment and accommodate as required to support equitable participation; maintain consistency in applying pass marks.
12. Selection of employees Choosing who stays and who leaves. Retained employees must meet essential qualifications including official languages; managers may also require asset qualifications, organizational needs and operational requirements. Selections are based only on the factors established for SERLO; keep records of reasons for retention or lay‑off. Decisions can weigh one or multiple elements and may vary across retained positions. PSER 22(8); Selections are based only on the established SERLO factors (essential, assets, organizational needs, operational requirements). Where two employees are equally qualified, managers may use Employment Equity as an Organizational Need as a tie‑breaker, provided it was established in Step 7 and is applied consistently. Document the rationale in the SERLO file.
13. Provide written notice Issue formal notice before any lay‑off and inform retained employees. Before laying off under PSEA 64(2), conduct an intersectional adverse impact analysis (GBA Plus) for the four legal designated groups under the EEA (Women, Indigenous Peoples, Persons with Disabilities, and Members of Visible Minorities). As a best practice, monitor impacts on Black employees and 2SLGBTQI+ communities to prevent disproportionate effects, even though they are not separate legal categories under the EEA.

Provide written notice stating the lay‑off decision, reasons, and the right to complain under PSEA s. 65(1), including the 30‑day time limit to file with the FPSLREB (counted from the date of the lay‑off notice). Confirm the intersectional adverse‑impact (GBA Plus) analysis included distinctions‑based Indigenous impacts and that any mitigations are recorded.

PSER 21(1), 21(2); Clear, complete notices ensure access to recourse and options for all employees, supporting procedural fairness.
14. Record the reasons for the selection Ensure transparency and accountability. Document reasons for selecting or not selecting each employee for lay‑off; records support discussions with employees and any grievances or complaints to FPSLREB and PSC oversight. SERLO files must include explicit documentation of each barrier identified in the bias assessment and the specific mitigation measures applied. PSER 22(10); Robust documentation is an equity safeguard that enables review of decisions, helps detect systemic barriers and supports recourse.

Additional operational guidance

  • SERLO is not an appointment process; managers may rely on previous assessment information where appropriate.
  • When assessing language knowledge/use, conduct the assessment in that language; for other factors, assess in the employee’s official language of choice.
  • The amended PSER permits employees to volunteer for lay‑off. Departments should publish criteria for when and how volunteers are considered, and document each request and outcome, applying the approach consistently to avoid inequity.

Communications to employees

Provide timely, plain‑language written messages that cover: the established qualifications, requirements and needs; the assessment methods selected; and how to request accommodation measures. Ensure assessments are conducted in the official language chosen by the employee and, where second‑language proficiency is assessed, that the method is the same as for appointments. Include timing and supports available such as EAP and ICM services; and formal notices of retention or lay‑off. Before issuing lay‑off notices (Step 13), confirm the intersectional adverse‑impact (GBA Plus) analysis has been completed for the four legal EEA groups, and that mitigation steps (if any) are documented. Keep the how‑to request accommodation instructions (contact, timelines, examples) in all written communications.

Documentation and records

Maintain complete files that demonstrate compliance with PSER, including: planning artifacts; analyses of biases and barriers; assessment results; selection rationale for each employee; and copies of all notices. In addition, ensure the file contains:

  • the bias/barrier evaluation for each assessment method before use (PSER 22(5));
  • the reasons for selection or non‑selection for each employee (PSER 22(10));
  • copies of lay‑off notices and retention notices (PSER 21(1) and 21(2));
  • UN Declaration consistency analysis (if completed) for WFA/SERLO policies, instruments or templates, include the analysis conducted under Justice’s Interim Guide (or a note explaining why it was not applicable).
  • evidence of any adverse impact analysis conducted prior to final decisions;
  • evidence of any GBA Plus or adverse impact analysis conducted before final decisions;
  • confirmation that organizational needs (including employment equity) were applied consistently and documented with current workforce availability or attainment rate data.

These records support transparency, grievances, complaints to FPSLREB, and PSC oversight.

Responsibilities after SERLO

  • Priority entitlements: Where a GRJO is provided and an employee becomes surplus, register and manage priority entitlements promptly and document placement actions.
  • Workforce adjustment or career transition activities: Implement GRJO and surplus priority entitlement or, where no GRJO, provide opting options per WFAD or collective agreement appendices; consider alternation where applicable and ensure alternation opportunities are centralized, transparent, and monitored for equity outcomes.
  • Classification activities: Complete updates to positions, abolitions and creations as required.
  • Recourse. Employees may file a complaint regarding lay‑off under PSEA s. 65(1); ensure the SERLO file is complete to support FPSLREB proceedings and PSC oversight.

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 mandatory and must reflect the duties of the retained positions. Example: Required certification, language proficiency, or technical ability directly tied to the job. Essential qualifications must reflect the duties of the positions that remain after restructuring, not legacy duties.
  • Asset Qualifications: Additional skills or experience that may benefit the organization now or in the future. These are optional “nice‑to‑have” criteria and must not replicate systemic barriers. Avoid assets such as “years of service/seniority” or “recent acting in the role”; these may mirror unequal access to opportunities and can create adverse‑effect discrimination. Prefer transferable skills (teamwork, coordination, problem‑solving), stakeholder engagement, and intercultural competency, demonstrable across varied contexts.
  • 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.

Data Challenges and Success Rates

Workforce Availability (WFA) uses the Census and the Canadian Survey on Disability to estimate labour‑market availability for designated groups. Departments should use 2021 WFA at minimum and supplement it with departmental Attainment Rate (AR) to reduce lag when planning and monitoring SERLO impacts. TBS and the Auditor General have signaled that relying only on lagged WFA can understate under‑representation; using AR helps track progress against availability. In line with Justice’s Interim Guide, use distinctions‑based, disaggregated Indigenous data and qualitative perspectives to detect differential impacts and to design mitigations. Barriers around Work Force Availability have been known for years:

  • TBS Response to the Call to Action: TBS  itself acknowledge issues with its use of WFA data and proposed a additional 5% rate: “TBS is also exploring the use of WFA combined with a Turnover Rate of 5% plus an additional rate of 5% to set meaningful but realistic targets. The additional 5% rate accounts for the time lag in capturing demographic changes (e.g., the growing racialized population in Canada).”
  • Employment Equity in the Public Service of Canada: TBS acknowledged that WFA is not an effective indicator of where organizations are in its Employment Equity Report by stating that “to ensure that we continue to close gaps and sustain progress towards representation, WFA must be regarded as a floor and not a ceiling.”
  • Employment Equity Act Task Force Review: A comprehensive review of the WFA was conducted in the recent Employment Equity Act Task Force Review, “Introduced by the federal public service to take into account the specific requirements under the Public Service Employment Act in determining availability, WFA has become a primary example of how a measurement tool can embed the exclusionary practices that employment equity seeks to uproot. “
  • Auditor General of Canada Audit: Inclusion in the Workplace for Racialized Employees: The issue of barriers arising out of the WFA was observed by the Auditor General in the recent Inclusion in the Workplace for Racialized Employees” audit: “the federal core public administration uses workforce availability data as the benchmark to assess sufficient representation of the 4 designated employment equity groups in its workforce. While this data is based on labour market information obtained through the most recent Statistics Canada Census of Population and Canadian Survey on Disability and is adjusted for factors such as citizenship, location, age, and education, it can lag up to 8 years behind the demographic realities of Canadian society. For a growing racialized population, the risk can be underrepresentation in workforce availability data that in turn leads to understated representation goals.” It also commends Justice for using projections, “The Department of Justice Canada went even further and developed projected representation rates based on existing labour force projections produced by Statistics Canada, Canada’s national statistical agency. These projections were updated to address the lag in the reporting of demographic information. The projections became the new representation benchmarks for the organization in its 2022–25 employment equity plan.” Note that Justice used the Demosim model which was found to not be an effective predictor in the previously mentioned Task Force Report.
  • Standing Senate Committee on Human Rights (40th Parliament) Issues around the WFA were also raised at the Standing Senate Committee on Human Rights in 2009. “Before the 2006 Census, they were using the 2001 Census, which was eight years old. Even eight years later, they were unable to comply with the old requirements. We have proposed to the Privy Council and to the federal departments and agencies a method of forecasting that will save us the pain of waiting for 10 years. As it is, departments do not have to comply because every year we are behind in the calculation of how to meet the WFA targets. If we had a forecasting system, we would know the number for a given future year.”
  • Embracing Change in the Federal Public Service: These barriers were also highlighted in the Embracing Change Report in 2000: “Hence, representation goals must be set higher than the LMA (Labour Market Availability); if not, the government will be faced with an intense game of catch-up by the time the new LMA is calculated. In other words, the LMA measure is a floor on which to build diversity.”

UN Declaration Act (UNDA) — Consistency, Consultation and Evidence

The United Nations Declaration on the Rights of Indigenous Peoples Act (UNDA) requires the Government of Canada to take effective measures to achieve the objectives of the UN Declaration. For legislative and regulatory initiatives, section 5 requires ensuring consistency with the UN Declaration through consultation and cooperation with Indigenous peoples. For non‑legislative initiatives (policies, programs, administrative measures), there is no statutory duty to ensure consistency, but the federal commitment is to integrate UN Declaration considerations early and often, supported by Justice Canada’s Interim Guide for Officials and checklist. In SERLO/WFA, organizations should consider the following:

  • When planning WFA/SERLO policies, tools, and templates, use the Justice Interim Guide to complete a UN Declaration consistency analysis (including an intersectional lens and relevant distinctions‑based evidence). Keep the analysis on file.
  • Where WFA decisions directly or differentially affect First Nations, Inuit or Métis employees or communities, departments should consider proportionate consultation and cooperation with Indigenous partners, consistent with the Guide (distinct from the constitutional duty to consult). Document how perspectives were obtained (e.g., Indigenous employee networks, distinctions‑based partners) and how they informed mitigations.
  • Use disaggregated Indigenous data (by distinctions and, where feasible, relevant identity factors like geography, gender/2SLGBTQI+, language) to identify potential differential impacts and mitigations.

Monitoring and Self-Identification

Monitor SERLO outcomes by group and classification to detect patterns and intervene before final decisions. The legal EEA groups remain four (Women, Indigenous Peoples, Persons with Disabilities, Members of Visible Minorities). Best practice: In line with EEA modernization consultations and the Task Force, disaggregate results for Black and 2SLGBTQI+ employees to detect disproportionate impacts. Self‑identification data used for SERLO monitoring is handled under the Privacy Act and departmental privacy protocols and is reported in aggregate to protect confidentiality.

Structural Barriers and Flexibility

Because SERLO is not an appointment process, non‑imperative bilingual staffing does not apply. For bilingual positions, the language requirement is essential and must be met at the time of SERLO. To avoid unnecessary barriers, departments should provide early language training and supports in workforce plans and, where feasible, plan post‑retention language development for employees who already meet the essential profile. Where assessment methods involve interviews or oral presentations, consider culturally responsive approaches and provide clear, plain‑language expectations in advance.

Employee Rights

  • The right to be assessed in the official language of their choice (English or French) for all factors except second‑language proficiency, which must be assessed in that language.
  • The right to request reasonable accommodation (e.g., extra time, alternative formats, assistive technology) during SERLO assessments.
  • The right to file a lay‑off complaint with the FPSLREB within 30 days of notice, under PSEA s. 65(1).

Recommendations

  • Update WFA Projections: Use formula-based projections when 2021 data is dated.
  • Use Standardized Scoring Sheets: Do not rely on 'gut feeling’ or ‘culture fit’ as these often hide bias and retain records to support recourse rights.
  • Embed EE Needs Explicitly: Where appropriate, establish Employment Equity as an Organizational Need in Step 7, and apply it consistently (including as a tie‑breaker in Step 12 when candidates are otherwise equal).
  • Prioritize Early Language Training: Build language training and coaching into HR plans before WFA/SERLO. Non‑imperative staffing does not apply to SERLO; bilingual essential profiles must be met at selection.
  • Enhance Alternation & Departure Transparency: Use centralized platforms and monitor equity outcomes.
  • Institute Regular Reviews: Provide AR/WFA briefings and track plans.
  • Document for Recourse: Keep complete files (criteria, bias evaluations, mitigations, selection rationales, notices).

Links & Resources

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