An audit of Nalcor, the Crown corporation behind the Muskrat Falls project, has found that pay scales were well beyond what is seen in the rest of the provincial government.
The first audit by Auditor General Denise Hanrahan uncovered numerous questionable financial practices and this one reaches similar conclusions.
All 35 management and senior executive positions received significantly higher compensation than a comparable position in the public service—sometimes two-and-a-half times as much. Nalcor paid 100 per cent of the group health plan and 75 per cent of dental benefits for all employees. Government pays 50 per cent of the health benefits for its employees and zero for dental.
Car allowances: $500 every two weeks or a company vehicle for exclusive use with a gas card. The rest of government doesn’t do that.
A Nalcor employee could end up with 108 paid leave days annually, all at company expense. Other government would be 25 to 35 days.
While Nalcor eliminated bonuses a few years ago, it replaced them with incentive pay which actually increased their pensionable earnings considerably.
Hanrahan recommends that Nalcor, which is now part of Newfoundland and Labrador Hydro, restructure its compensation to reflect government scales.
The CEO of Newfoundland and Labrador Hydro notes that the audit covered the period from 2013 to 2018 and that many changes have since been made. As such, many of the observations are no longer reflective of the current organizational structure at Hydro.
Jennifer Williams notes a reduction in the number of executive positions by 50 per cent, the elimination of executive vehicle allowances, reduced travel and other miscellaneous spending and changes to salary scales.
AG Denise Hanrahan agrees that many changes have been made.
What hasn’t changed she says, is that Hydro employees continue to be on higher pay scales than the rest of the public service, they continue to be able to above the top of the scale unlike core government, and they continue to have better group insurance benefits with lower or no premiums to pay for those benefits. The difference in compensation continues to be significant concludes Hanrahan.
The AG also concluded that Nalcor employees could get 108 days of paid sick leave in one year, all on the company dime. Williams says the sick leave time includes short-term disability, which is similar to government’s sick leave, which can be banked over time.
