The purpose of severance packages is to provide assistance to employees while they seek alternate employment, after their employment has been terminated. This is typically done at the expense of the employer. Over the last few years, senior government employees in Alberta were in line for some of the richest and most excessive severance packages found anywhere in Canada.
On Nov. 20, Wildrose Official Opposition finance critic Rob Anderson presented Bill 209 — The Severance and Bonus Limitation Statues Amendment Act — in the Alberta Legislature. The bill would address bloated severance packages, golden handshakes and contracts with all kinds of special perks and bonuses that are currently available to government staffers and AHS executives.
The intent of Bill 209 is to end unrealistic and out-of-line bonuses and severance packages that are currently doled out like treats on Halloween.
A shining example of an excessive severance package was the one awarded to Premier Alison Redford’s chief of staff, Stephen Carter, six months after the April 2012 provincial election. Carter’s severance package after only six months’ employment was reported to be $130,000. The generous severance package equalled one month’s pay for every month he was employed.
Originally, the amount on Carter’s severance was kept from the public despite Freedom of Information requests that were denied by the court. It was finally Carter himself, after heavy media scrutiny, that released the information on social media. However, to date, no documentation has been released that will confirm Carter’s monetary claim or the conditions of his previous employment.
In recent years, Albertans have seen an endless line of health executives and government staffers that have been given severance packages that resemble a lottery windfall. According to Anderson, Bill 209 would cap severance packages and put limitations on bonuses for public-sector executives, managers and all non-unionized employees. Anderson also added that “Bill 209 will put an immediate end to this all-you-can-eat buffet.”
Bill 209 will change the minimum qualifications and institute limits for severance to make them more reflective of reality, while remaining fiscally responsible to Alberta taxpayers. Mandatory minimum employment periods of at least one year will be required to qualify, limits to the amount of severance, and a limit of 15 per cent per year of employment, will also help put a end to the lottery-style packages that have become all too common.
In the bill, bonuses being paid to senior bureaucrats will be limited to a maximum of 15 per cent of an employees yearly salary, bringing an end to arbitrary six-figure golden handshakes. To ensure this process is transparent and accountable to Albertans, all bonuses and severances must be made accessible upon public request under Alberta’s FOIP (Freedom of Information) legislation.
Bill 209 — Severance and Bonus Limitation Statutes Amendment Act, 2013, passed first reading on Nov. 20. The Wildrose Official Opposition will continue to propose legislation that reflects the responsibility the Alberta government should have to the taxpayers.
Rick Strankman of the Wildrose Official Opposition is the MLA for the Drumheller-Stettler riding.