Broader Public Sector Accountability Act Will Release Hospital Exec Benefits

 On January 1, 2012, Bill 122 – An Act to increase the financial accountability of organizations in the broader public sector  came into force, enacting the Broader Public Sector Accountability Act (BPSSA) with a number of consequences for hospital transparency in Ontario (see s. 29(1)).  Of particular interest by the media this week is that hospital executive and CEOs will have disclosure of their benefits.

Salaries over $100,000  before taxes are already disclosed under the Public Sector Salary Disclosure Act (PSDA),

Purpose

1.  The purpose of this Act is to assure the public disclosure of the salary and benefits paid in respect of employment in the public sector to employees who are paid a salary of $100,000 or more in a year.

Employers are relieved from including salary disclosures in annual reports if it is made available on a corporate website or the Ministry of Finance website.   Amendments to O.Reg. 85/96 in January 2010 modifed the timing to disclosure requirements for the fifth business day of March each year.  The number of workers in the Ontario public sector earning over $100,000 increased in 2010 by 11 per cent from the previous year.

Part VIII of the Bill makes a series of amendments to the Freedom of Information and Protection of Privacy Act (FIPPA), including adding “hospitals” to the definitions under s. 2(1).  One of the effect of the amendments is that benefits that would otherwise not be disclosed will be made public, including termination clauses and retirment packages.

On November 23, 2010, Eoin Callan of the Service Employees International Union (SEIU) explained the purpose of the Bill to the Standing Committee on Social Policy,

The act, if passed, will lead to higher accountability standards for hospitals and local health integration networks. The act will expand freedom-of-information legislation to cover hospitals, it will require hospitals and LHINs to post the expenses of senior executives online and it will require hospitals and LHINs to report annually on their use of consultants.

Each of these steps will contribute to greater transparency. They will bring sunlight to the delivery of vital health care services in the management of the hospitals in our health system, and they will help ensure that precious health dollars go to front-line care. Each of these steps will also ensure that Ontarians get more value out of their investments in public services. Together, with some hope, these steps will increase public confidence in our health care system.

Importantly, LHIN and hospital executives will also see reductions in pay if they fail to comply with the requirements under the act. Forcing executives to pay back taxpayers will increase accountability, and it’s vital we make sure that that enforcement is in place, should this act be passed.

The penalty for non-compliance under the BPSAA is directly related to financial compensation,

Reduction in compensation

20. (2)  Despite any employment or other agreement, the board of a hospital or local health integration network, or the superintendent of a private hospital, may, in addition to any other remedy under the agreement or at common law, reduce the compensation of a person employed in a senior management position where the board or superintendent determines that the person has failed to meet a requirement under this Act.

A copy of the 2011 list for hospitals (2010 figures) under the PSDA follows.

Public Sector Salary Disclosure Act – Hospitals

Omar Ha-Redeye is the Principal of Fleet Street Law, a full-service law chambers in Toronto.