ANALYSIS: A review of the contracts for Rossland's senior management
As Rossland transitioned to CAO/CFO Cecile Arnott’s new tenure this month, we have fielded several questions about the employment contracts of the city’s senior management and how these compare to other managers’ in the province.
We do not try to answer subjective questions such as whether or not Rossland is getting good value for salaries the city pays its staff, or whether the contracts are fair relative to other municipalities or similar private industry roles. Here, we merely lay out the facts and leave the rest to you.
Below are summaries of the existing contracts for the four senior staff: CAO Arnott, Corporate Officer Tracey Butler, Manager of Operations Darrin Albo, and Manager of Planning and Development Services Mike Maturo.
For comparison, we accessed the public sector salaries of municipalities near Vancouver as published by the Vancouver Sun. We also have BC statistics for the region and province in the 2009 Wage and Salary Survey and the 2010-2011 Labour Force Survey by Statistics Canada.
Background on Rossland’s management
Butler wrote, “Every year, employee earnings are recorded in the SOFI report (Statement of Financial Information) that must be adopted before the end of June each year. This year the SOFI package was in the June 25 Agenda Package.”
She noted that only employees making over $85,000—combining salary, paid out vacation time, expenses, and so on—get reported individually in the SOFI.
The Officers Bylaw contains job descriptions for these positions as required by Community Charter sections 146 to 153, but “a few years ago” there were eight managers and now there are only four, so job duties have changed significantly from what is reported in the Officer’s Bylaw, Butler said.
Butler noted, “The operations manager job description is very out of date and has not been changed since the departure of the city engineer and the reassignment of duties with Jason Ward leaving.” Most of the engineer’s and Ward’s previous duties were reassigned to operations manager Albo, in addition to his public works duties. The exceptions include building inspection, assigned to Parry La Fond, and the role of emergency coordinator, assigned to Butler.
It is important to note that the contracts for Butler, Albo, and Maturo entitle each of them to similar raises each year for cost-of-living adjustments (COLA). In addition, some raises are due to changing job descriptions.
Butler pointed out, “Raises not only reflect COLA but also reflect changing job descriptions, the need for competitive salaries and compensation for increased responsibility and reassigned duties.”
Bowen Island has a population of about 3400 residents, with a summer influx of tourists. In 2010, their CAO earned $103,770, the city planner earned $101,994, the manager of operations took home $84,135, and the corporate officer earned $84,079. They also had a “Community Services Supervisor” and a “Superintendent of Utilities” earning $80,802 and $76,479 respectively. No mention of the financial officer was made in the report we accessed.
Belcarra, BC, has a population just shy of 700 living across an inlet from North Vancouver, but still part of Metro Vancouver. In 2010, they paid their mayor $11,536 and four councillors $5744 each, about the same as Rossland. They had two city staff, a CAO who is paid $97,507 and a supintendent of public works who earned $79,331.
Neighbouring Anmore has a population of 2200. In 2010, their CAO also earned $97,507, and their manager of public works earned $88,699.
On the other end of the spectrum, in a municipality such as White Rock with more than 100,000 residents, salaries go up substantially. In 2010, White Rock’s CAO earned $194,535, their “director” of operations earned $182,883—compared with their “manager” of operations who earned $87,702—and even the director of leisure services took home $152,084.
Integrity BC recently published an article, “White House salaries put to shame by BC municipal paycheques,” in which the author is incredulous that the CAO of Lillooet earns $120,316 to look after 2,322 residents while US President Barack Obama’s Principal Deputy Press Secretary earns about the same, but he “is perpetually a slip of the tongue away from igniting an international incident.”
Finally, to put it all in perspective, consider the CAO of Vancouver who pocketed $324,110 in 2010 to look after the needs of some 600,000 people.
Senior management wage statistics
BC Stats and Statistics Canada last did their Wage and Salary Survey in 2009. At this time, “administrative officers” in the Kootenays—the highest paid of all jobs in the region—earned an average wage of $28.90 and a maximum hourly wage of $35.17, working an average of 38.3 hours per week.
Across the province in 2009, BC Stats reports that “senior managers” in private industry earned between $30 and $75 per hour (usually between $40 and $60, with the highest wages near Vancouver) and worked between 40 and 45 hours per week.
The more recent 2010-2011 Labour Force Survey by Statistics Canada found across BC that “senior managers” in local government earned a median hourly wage of $44.18 and a maximum hourly wage of $61.84.
“Senior management in financial, communications, and other business services,” the Labour Force Survey found, were paid similarly: a median wage of $40.90 per hour and a maximum wage of $69.23.
To put this into a salary perspective, consider a 35 hour week—as Rossland city staff are contracted for—at 52 weeks per year. Even though city managers get between 4 and 8 weeks of vacation per year, salaries and wages are typically converted assuming a full 52 weeks of work.
- $40 per hour = $72,800 per year
- $50 per hour = $91,000 per year
- $60 per hour = $109,200 per year
- $70 per hour = $127,400 per year
Chief Administrative Officer and Chief Financial Officer, Cecile Arnott
Arnott’s starting salary is $160,000, of which she has agreed to “donate” $15,000 to the city each year “for the cost of participating in benefits.”
She is entitled to a raise each year calculated in two parts. $140,000 of her salary will be increased according to the cost of living index or three per cent, whichever is higher. The remaining $20,000 is adjusted by the annual increase in the cost (to the city) of group benefits.
In different terms, $160,000 over 52 weeks at 35 hours per week equates to an hourly wage of $87.90. For comparison, senior management employees in BC at the top of the pay scale from 2009 to 2011 earned between $60 and $75 per hour and worked 40 to 45 hours per week.
Her contract was signed on July 18, took effect on Oct. 1, and will expire on Sept. 30, 2017. The decision to renew the contract for another three years (until 2020) is entirely up to Arnott, a decision she must make before March 2017.
Although a two-thirds vote by council may terminate Arnott’s employment, she is entitled to 24 month’s notice or payment in lieu—”total compensation” includes “salary, group benefits, vehicle allowance, vacation and statutory holidays.”
Arnott must give the city three month’s notice if she chooses to resign.
Arnott is entitled to six weeks paid vacation for the first four years of her service, and eight weeks vacation thereafter. In addition, she will have an unpaid vacation for all of January and February next year.
Furthermore, the contract recognizes that her job will require overtime beyond the official 35 hours per week. Consequently, Arnott is entitled to an additional (maximum of) two-weeks “flex time off in lieu of overtime.”
As with former CAO Victor Kumar’s contract and CO Butler’s contract, Arnott’s contract includes the following clause: “The City shall indemnify the Employee against any claim for damages against the Employee arising out of the performance of her duties and, in addition, pay all legal costs to defend actions in any Court or other proceedings which may arise.”
Furthermore, the city will not sue Arnott except in the case of “gross negligence” or actions “contrary to” the terms of the contract.
Finally, Arnott’s contract gives her the sole discretion to “set the terms, conditions, benefits and remuneration for the employment of all Department Heads, Supervisors, Administrative Assistants and all other non-contract City employees.”
Manager of Operations, Darrin Albo
Albo’s current salary is $105,000. His contract was signed on Feb. 23, 2007 and officially started on Feb. 1, 2007 with a salary of $73,000.
The difference between $73,000 and $105,000 from 2007 to 2012 equates to a 7.5 per cent raise each year for the last five years—or, taken over six years, just more than 6 per cent per year.
He works 35 hours per week and is not entitled to overtime. He accrues 35 days (7 weeks) of vacation leave per year.
Put in different terms, $105,000 over 52 weeks at 35 hours per week equates to an hourly wage of $57.69, up 44 per cent from an hourly wage of $40.11 in 2007.
Over the same period, the Consumer Price Index (CPI, a measure of inflation) has increased by about 13 per cent, and a three per cent raise per year would result in an increase of about 16 per cent. Presumably, his wage has increased by 28 per cent (44 minus 16) over the last five years to compensate for increased responsibilities relative to 2007.
Albo’s contract expires on January 31, 2014, and he is entitled to 24 months notice for dismissal without cause, or payment in lieu.
If we assume both Albo and the city wished to renew his contract, however, negotiations with the city should have started this July—according to his current contract—and should be completed before Oct. 31 of this year, but we have not yet inquired.
Corporate Officer, Tracey Butler
Butler’s current salary is $100,000. Her contract was effective as of Jan. 1, 2010, for a starting salary of $72,000.
The difference between $72,000 and $100,000 from 2010 to 2012 equates to an 18 per cent raise each year for two years—or, taken over three years, about an 11.5 per cent raise per year.
Her wage is calculated for 35 hours per week, and her long service to the city entitles her to 7 weeks vacation per year.
$100,000 over 52 weeks at 35 hours per week equates to an hourly wage of $54.94, up 39 per cent from $39.56 in 2010.
Over the same period, the CPI has increased by about 6.3 per cent, and a three per cent raise per year would result in an increase of about 6.1 per cent. Consequently, it might be assumed that her wage has increased by about 33 per cent over two years (39 minus 6) to compensate for increased responsibilities relative to 2010.
Butler is entitled to an additional week’s vacation in lieu of overtime accrued.
Her contract also includes the same clause as Arnott’s, that the city agrees to pay all of Butler’s legal fees in the case of “damages…arising out of the performance of her duties,” and the city will not sue Butler except in cases of “gross negligence” or a breach of her contract.
Butler’s contract expires on Jan. 1, 2020, and she is entitled to 24 months notice for termination without cause, or payment in lieu. If the city does not give Butler notice of non-renewal by June 30, 2019, then she will be automatically renewed until Jan. 1, 2021.
In the event of “restructuring” that eliminates Butler’s position, she is entitled to either a similar position within the city, or 36 months notice or payment in lieu.
Manager of Planning and Development Services, Mike Maturo
Maturo’s current salary is $97,000. His contract began on May 21, 2007, and was signed that July with a salary of $78,000 that increased to $80,000 after a “probationary period.”
His contract expired on May 18 of this year, but Butler wrote that this contract “is the current one until a new one is negotiated.”
The difference between $80,000 and $97,000 from 2007 to 2012 equates to roughly a four per cent raise each year for five years—or, taken over six years, just more than three per cent per year.
His wage is calculated for 35 hours per week, and he is entitled to 5 weeks vacation per year.
$97,000 over 52 weeks at 35 hours per week equates to an hourly wage of $53.30, up 24 per cent from $42.86 in 2007.
Over the same period, the CPI has increased by about 11 per cent, and a three per cent raise per year would result in an increase of about 16 per cent. Consequently, it might be assumed that council has increased his wage by about 8 per cent over 5 years (24 minus 16) to compensate for increased responsibilities relative to 2007.
Maturo is entitled to 11 months notice for termination without cause, or payment in lieu.