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A team of psychological consultants hired by the Canada Revenue Agency found that a division responsible for working with multinational firms on global tax enforcement is rife with bullying and harassment and most of the staff feel their unit is ineffective.

Y2 Consulting Psychologists Inc. said in a report that it found concerns about a toxic work climate, including some employees saying they were being spied on. Staff complained about management, while some managers reported “feeling disrespected, continuously challenged or even harassed/bullied by some of their direct reports,” it said.

The consultants surveyed division staff and found 50 per cent said they had been victims of bullying, harassment or intimidation. Slightly less than half of the employees said the division was effective at influencing global taxation standards in Canada’s favour.

The report also found that fewer than 27 per cent of surveyed staff believed senior managers were effective leaders, good role models, made important decisions in a collaborative and timely manner and were responsive to the divisions’ specific needs.

The report is part of thousands of pages of sensitive internal documents that were submitted in Federal Court late last year in relation to workplace harassment complaints at the agency.

The documents also include a report by the CRA’s internal affairs and fraud control division that found a senior agency director, Donna O’Connor, made hiring decisions in contravention of the rules and failed to set an appropriate leadership tone. The investigation report cites comments she made to colleagues during an after-hours get-together at Ottawa’s El Camino restaurant.

“The information gathered in the course of the investigation found that Donna O’Connor, by her own admission, failed to show professionalism and respect when she discussed sensitive information pertaining to two CRA managers in her division,” states the December, 2019, report, which was submitted to then-assistant commissioner Ted Gallivan. The report said Ms. O’Connor referred to the managers using disrespectful language in the presence of other CRA employees and her daughter, who did not work for the agency, at an after-hours celebration on May 31, 2019.

Ms. O’Connor was director of the CRA’s competent authority services division, which is part of the international and large business directorate. The division works with large companies that operate in more than one country to determine how much tax should be paid to the Canadian government. The division is part of the CRA’s effort to prevent tax avoidance.

The CRA did not respond to a request for an update on Ms. O’Connor’s employment status.

The consulting firm’s February, 2021, report was produced after the agency had investigated a range of internal complaints, including those related to Ms. O’Connor.

Ms. O’Connor has represented Canada at international tax conferences, including meetings of the Organization for Economic Development and Co-operation (OECD) in Paris.

Finance Minister Chrystia Freeland has frequently cited Canada’s involvement in OECD tax negotiations as an example of how the federal government is working to increase tax revenue from global companies.

The court documents say that when the CRA’s investigative team contacted Ms. O’Connor after the agency received complaints about her from CRA employees and in anonymous tips, the director made an unsubstantiated reference to corruption in her division.

“When the investigator contacted Donna O’Connor to inform her of the allegations and to arrange an interview with her, she revealed that her ‘division was corrupt,’ and that she may have ‘side-stepped,’ but she was ‘only human.’ She did not elaborate on what she meant by these statements during that conversation; however, when interviewed, she reported that she thought there were some bad practices in her division and that she was trying to clean them up. This represented the extent of her clarification,” the CRA investigation report states.

Ms. O’Connor did not immediately respond to a request for comment via her LinkedIn account.

In September, 2021, two CRA employees asked the Federal Court to review a decision by Public Sector Integrity Commissioner Joe Friday to cease an investigation into their allegations of wrongdoing at the CRA because the commissioner felt the agency was already dealing with the matter.

The commissioner had started an investigation in 2020 and documents related to that work have been tabled in court.

The documents include copies of the complaint forms the two employees filed with the commissioner in which they both accused Ms. O’Connor of misconduct.

In a statement to The Globe, the commissioner’s office says that on April 12 of this year, it was contacted by the Attorney-General of Canada on behalf of the CRA and made aware that some of the documents contained sensitive information.

It said that on April 20, the court ordered that the documents be removed from the public record and a new version transmitted to the court with further redactions.

In an April 19 letter to the Federal Court, the commissioner’s office said it wants to submit revised documents that will redact “irrelevant third party information, including the names of individuals who made allegations to their employer and to other government entities, and the names of the individuals against whom the allegations were made, so far as the information is irrelevant to the application for judicial review.”

The newly redacted versions of the documents have not yet been submitted. The Globe obtained the lightly redacted versions from the Federal Court before they were removed.

CRA spokesperson Sylvie Branch said the agency “takes allegations of employee misconduct seriously. The CRA requires that such allegations be reported, reviewed and, where warranted, investigated using internal or external resources. Should misconduct be discovered, appropriate and immediate measures are taken.”

Conservative MP James Bezan has asked Privacy Commissioner Daniel Therrien to launch an investigation into “revelations of publicly released sensitive whistle-blower information from the Canada Revenue Agency.” Mr. Bezan sent the request after the website Blacklock’s Reporter wrote about the case.

“Alleged breaches such as these undermine the confidence Canadians have in our system,” Mr. Bezan wrote. He also expressed concern that the release of whistleblowers’ names risked exposing them to reprisals.

The Privacy Commissioner’s office said Tuesday that it is reviewing Mr. Bezan’s letter and it has reached out to the integrity commissioner’s office to obtain more information.

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