Former Bluewater Bridge head “misused” public funds for big severance payouts

1 bridgeThe Public Sector Integrity Commissioner says the former CEO of the Bluewater Bridge misused public funds when awarding two severance payouts worth over $650,000.

In a report to the House of Commons, Commission Mario Dion says the investigation into the payouts began nearly a year ago after the commission received a confidential complaint from a whistleblower.

Dion says a former human resources manager, who was being dismissed after a founded harassment complaint, was paid $366,000 including three years of continued wages and benefits.

“(CEO) Mr. (Chuck) Chrapko stated that ‘the Board was adamant that (the HR Manager’s) 31 years of service to our organization did not warrant termination with cause, but rather termination without cause,  and the maximum possible severance package,’” wrote Dion in the report.

“With respect to the Board’s involvement in the severance decision, it can be reasonably considered, based on the evidence, that the Board members did not oppose it. Nonetheless, Mr. Chrapko, as CEO, was ultimately responsible for the management of BWBC’s financial resources; therefore, the board’s tacit endorsement was deemed immaterial with respect to the allegation of a misuse of public funds.”

Dion says the other severance package was awarded to the human resource manager’s former husband, who was working at the bridge as a project manager. He was given a payout of $292,000 which was made up of two-years of continued salary and benefits – Dion estimates that $211,000 should never have been given out.

During the investigation, Chrapko told investigators the payout was justified because the project manager had saved the Bluewater Bridge Authority millions of dollars – an amount which was never substantiated.

Dion added the employee had been well compensated. “The Project Manager was also compensated through yearly merit increases; effectively receiving a 72 percent pay increase over ten years.” The project manager also received merit increases of 8 percent and 7.78 percent in 2007 due to his increased responsibilities because of the bridge reconstruction.

“The awarding of the two excessive severance payouts to the two managers represents a significant departure from generally accepted practices within the federal public sector compared to what most public sector employees would normally have been entitled to under similar circumstances,” says Dion adding the Bluewater Bridge Commission had been warned by Transport Canada about excessive severance buyouts and was told the standard policy.

But Dion says Bluewater Bridge did not have a severance policy at the time. By Feb 2012 , one had been passed by the commission.

“The “business case” presented by Mr. Chrapko, as a justification for both payouts, can be reasonably characterized as unsound and unreasonable … I determined that there was a demonstrated degree of willfulness or recklessness on Mr. Chrapko’s part in awarding the two excessive severance packages to the two managers.”

Chrapko stepped down from his position March 15.

Dion isn’t recommending any changes be made, since the new policy on severance is in place, adding the federal Treasury Board is moving to be involved in salary negotiations between Crown Corporations and their employees.

The Bluewater Bridge Commission has yet to replace Chrapko.

– Heather Wright