Toronto will announce Tuesday morning the most ambitious employee-buyout plan since amalgamation, when former mayor Mel Lastman tried to shed more than 1,400 jobs.
Virtually all of the 50,000 workers on the city’s payroll will have until Sept. 9 to apply online for a new Voluntary Separation Program, taking a lump sum worth up to six months pay if they agree to leave the city’s employ, according to a city manager’s memo obtained by The Globe and Mail. It’s not clear what percentage of that 50,000 the city would like to see take the buyout.
The memo states union members will be awarded three weeks’ pay for every year they have worked at the city, to a maximum of 26 weeks. Managers will receive four weeks for every year of service.
While the city manager’s office is running the buyout plan independently of Mayor Rob Ford’s controversial core service review, the two form part of a singular goal: to trim city expenses enough to fill a $774-million budget gap.
But some stakeholders contend it is being too stingy in that objective, offering its best and brightest a pittance for their years of loyalty.
“We believe the city should be offering more based on the dedication and long years of service of those employees who may choose to leave,” said Richard Majkot, executive director of the City of Toronto Administrative, Professional and Supervisory Association, which advocates for management and non-union staff at the municipality. “Six months pay is a little light.”
City brass will have final say over who stays and who goes. City councillors will have a chance to debate the program – which applies to all union and non-union workers from garbage collectors to health inspectors to office staff, except those positions belonging to the Toronto Professional Fire Fighters’ Association – at their September meeting.
Until then, City Hall will no doubt echo with rumours of high-ranking personnel opting for the exit door. Mr. Majkot, who has been briefed on the package, says his more than 4,000 members are already buzzing about the package even though details have not gone public. Staff have not faced an offer such as this since 1998, when the newly amalgamated city offered voluntary buyouts to select managers.
One provision in the agreement states that, for every employee lost, the city will delete a permanent position from the bureaucracy. That will ensure the savings of any downsizing remain permanent, but it will also create a complex game of musical chairs for human resources staff, as they struggle to fill positions without hiring new recruits.
The buyout program is separate from the core service review currently rippling through City Hall, but holds the opportunity for substantial cost savings.
Currently, more than $4.6-billion – or 45 per cent of all city operating expenditures – goes directly into employee pockets in the form of salaries and benefits.
“We have to look at our staffing levels,” said budget chief Mike Del Grande. “It is an around-the-clock city. We have to have a work force that is flexible to deal with the activities of the city.”
Council will have a chance to approve the buyouts at its meeting in late September. But some councillors question why a program with such far-reaching implications for staff wasn’t debated openly before being announced.
“It’s unfortunate that it’s been determined that we’re going to cut services, cut staff, contract out – and council has yet to consider those questions,” said Councillor Janet Davis.
Workers could start leaving en masse as soon as October.
After the Sept. 9 application deadline, management will review submissions from Sept. 12 to Sept. 30, weeding out indispensable staff. They will then divvy out departure dates for approved staff between Oct. 1 and Dec. 31.
“It’s important for any organization to keep its key people, people with the knowledge, experience and expertise to run the organization,” said Mr. Majkot. “I certainly hope the city keeps that in mind.”
