‘This is a hefty bill’: Compensation review committee member calls on Richmond Hill council to reduce severance payout

Yorkregion.com
June 30, 2022
Sheila Wang

A Richmond Hill resident spoke up about the need to change the city’s 30-year-old severance policy for council members to strengthen fiscal responsibility.

Yoke Wong, a member of the city’s compensation review committee, took to the public forum to call on council to consider reducing their severance payout at the June 22 council meeting.

“Councillors already got fair compensations, cities are tightening the belts and residents are demanding fiscal responsibility,” the longtime Richmond Hill resident said at her five-minute presentation.

Wong came to the council chambers two weeks after city council approved a compensation policy for the 2022-2026 term without including the committee’s recommendation to change the severance policy at a previous meeting on June 8.

The committee made the recommendation that council should make the city’s severance package eligible only to members of council who leave involuntarily due to a loss in a re-election and not be eligible in all other scenarios.

Currently, Richmond Hill’s severance policy -- enacted in 1991 and amended once in 2001 -- allows severance pay to council members in the events of resignation, retirement and death. The only exclusion from the severance pay is when a council member is charged and convicted with legal wrongdoings.

On June 8, council voted and opted to keep the severance policy unchanged "as it is very similar to all other York Region municipalities," said Regional Coun. Joe DiPaola, who brought forward the proposal.

Seven of the nine York Region local municipalities have severance provisions for council members. The maximum severance payments vary from six months to 24 months, according to the regional report.

Under the current policy, a Richmond Hill council member will get one month of severance for each consecutive year that they have served when they leave the position -- capped at 18 months -- based on their current salary, which could be considerably higher than their previous pay.

In 2021, former mayor Dave Barrow received more than $202,000 from the city in retirement allowance payout after he stepped down in September, according to a city report.

Over the past 30 years, this policy has resulted in 200 months’ worth of payout for 21 departing council members, according to Wong’s presentation at the public forum.

If all nine current council members quit, the city would pay out roughly $560,000, Wong noted.

“This is a hefty bill, a financial liability that can only go higher each year, which the city is obliged to pay,” she said.

The recommended changes would bring the city’s policy in line with the practices in the private sector and some municipalities in Ontario.

Employees in the private sector generally do not receive severance payouts when they retire or resign or due to death. The committee deems the city’s current eligibility criteria of the severance package for council “do not reflect responsible spending of public monies,” the report prepared by the committee reads.

“I understand the rationale. I think there needs to be at some point in time a look at that,” Mayor David West said at the June 8 meeting.

Disappointed at the council decision, Wong said she came to council on June 22 as a resident, not on behalf of the four-member committee, because she didn’t want this issue to go away quietly.

However, she said she found the silence from council “deafening” as no members asked questions or made any comment after her presentation.

She acknowledged it would be a “tough sell” since the decision rests with council “whose members benefit personally and financially from the status quo.”

“Perhaps my words will be cast aside by council but I hope they will resonate loudly and clearly with the residents of Richmond Hill,” Wong said.