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Northern College Board establishing compensation framework for salaries of senior administrators

College president's pay would be capped at $325,000 per year under a plan put out for public consultation last month

Northern College has completed the public consultation requirement for its compensation framework for determining salary increases for its most  senior administrators including the college president and the vice-presidents according to Board Chair George Kemp.

The 30-day public consultation period was required by a regulation introduced on Sept. 6 2016 by Ontario government, as it lifted its four year salary freeze on executive salaries for senior administrators in the broader public sector

“We published the framework document on Dec. 16 for a 30-Day public comment period which ended on Jan. 16, 2017,” Kemp said. “But we are nowhere near the stage where we are discussing salary increases with our senior administrators.

According to Kemp, Northern College put the notice of the 30-day comment period on its web page with a link for comment rather than host a public consultation meeting because the board of directors believed they would get greater access to concerned members of the public.

“We published the document with a link for public feedback,” said Kemp. “We followed the government regulations and guidelines on how to consult the public on this matter.”

“The college sought the best way to reach the public…instead of having open houses where sometimes few people show up,” added Kemp.

“The compensation framework document is still a draft document and we will include the feedback from the public and then take it to the Board for a vote,” explained Kemp.

Some members of the public became alarmed recently, when media stories reported that colleges could provide as much as 50 per cent increases to its presidents and vice-presidents.

Kemp disagreed with those media stories.

“We are nowhere near the 50 per cent range at Northern College,” Kemp said. “It will be more like 26 per cent, and that establishes the cap at which salaries can be raised, but that doesn’t mean it will be done with one single raise, but rather over the life of the contract.”

“It is wrong to assume that all increases will be to that top level,” he said.

In the public consultation document posted to Northern College's website, the college president's salary maximum is set at $325,000, while 'other senior leadership team member' is capped at $221,000.

The most recent public sector salary disclosure data available shows Northern College's president made $258,663 in 2015. Salary disclosures for 2016 have not yet been released.

Kemp said he cannot speak for the larger community colleges or what they intend to do, but for a small college like Northern College they don’t have the money to provide for 50 per cent targets for future increases.

“Northern does not have the money that other larger colleges have,” said Kemp. “We have been looking at ways to reduce our costs – so a 50 per cent increase is not realistic in our case.”

“But some increase is warranted since salaries have been frozen since March 31, 2012,“ added Kemp. “We also want to build in a capacity so we don’t have to go through salary negotiations every year. “

“When negotiations start with the college’s president and vice- presidents, the actual salary level will be negotiated up to the 26 per cent,” Kemp added.

In developing the framework, the board of Northern College hired consultants that examined salaries of 12 comparable institutions; four hospitals, four universities and four other colleges.

“The consultant’s recommendation was discounted by 27 per cent because of our size,” explained Kemp.

The public consultation noted Kemp was a required in the regulation that promotes public accountability for public institutions as they negotiate salaries with their top administrators.

The compensation framework regulation requires employers to consult with the public when determining executive salaries and to post details to their websites. Employers must submit reports that they comply with the approved. Failure to complete this process could lead to penalties

“Once the governing boards of each institution approve a new framework, the wage freezes set in 2012 no longer apply, but the colleges can negotiate increases only up to the maximum level established by the framework,” said Kemp.

The framework regulation that came into force on September 6, 2016, applies to all designated employers defined under the Broader Public Sector Executive Compensation Act, 2014.

Through the regulation, the compensation framework caps annual and performance-related salaries for executives at no more than the 50th percentile of appropriate comparators and prohibits signing bonuses, retention bonuses and cash housing allowances.

“This balanced approach ensures that broader public sector is accountable for compensation decisions and are able to attract and retain the necessary talent to deliver high quality public services while managing public dollars responsibly,” said President of the Treasury Board, Liz Sandals in September when the new compensation framework regulation was announced.

The Broader Public Sector Executive Compensation Act, 2014 was proclaimed on March 16, 2015 and applies to approximately 340 employers, including hospitals, school boards, universities, colleges, and designated provincial agencies. It covers salary requirements for those earning $100,000 per year, including CEOs, presidents, vice-presidents, directors, and school board supervisors.

Under the Broader Public Sector Accountability Act, 2010, since March 31, 2012 all elements of compensation have been frozen, including base salaries.

When the employer, like Northern College, posts their final executive compensation program to their public website the freeze is lifted.

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Frank Giorno

About the Author: Frank Giorno

Frank Giorno worked as a city hall reporter for the Brandon Sun; freelanced for the Globe and Mail and the Toronto Star. He is the past editor of www.mininglifeonline.com and the newsletter of the Association of Italian Canadian Writers.
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