January 18, 1995                                                              PUBLIC ACCOUNTS COMMITTEE


Pursuant to Standing Order 87, Donald Whelan, M.H.A. (Harbour Main) substitutes for John Crane, M.H.A. (Harbour Grace).

The House met at 2:00 p.m. in the House of Assembly.

MR. CHAIRMAN (Windsor): Order, please! I now call the meeting to order.

Let me first of all welcome the witnesses who are here from Treasury Board. I am pleased to have you here. For those of you who have not been here before, let me say first of all that this is an extension of the House of Assembly, a Standing Committee of the House. I think most of you probably have been here, though; I am not sure. Peter, you have been here before?

MR. KENNEDY: Yes.

MR. CHAIRMAN: Still, we operate under the same rules as the House of Assembly. We are neither judge nor jury. We are not here to decide anything, but simply to gather evidence and report subsequently to the House of Assembly, although some of the questions may be - I hope will be, from the members of the Committee - very searching questions. There are some interesting topics that we have before us today.

I ask you to speak clearly into the microphones, and if I fail to identify you, to identify yourself for the benefit of Hansard so that the proceedings can be transcribed accurately.

You will be asked to take the oath. If you have not taken the oath before, you will be asked to take an oath, so evidence is given under oath. We will ask the clerk to do that in a moment.

I don't know if there are any news media present. If there are, they are certainly welcome to be here, and if they wanted some film, I would give them an opportunity to do that.

First of all, I will introduce the members of the committee. I am Neil Windsor, of course, MHA for Mount Pearl, Chairman of the Committee; my co-chair, Mr. Melvin Penney, MHA for Lewisporte; to my left, Mr. Alvin Hewlett, MHA for Green Bay; Mr. Oliver Langdon, MHA for Fortune - Hermitage; Mr. Don Whelan, MHA for Harbour Main; Mr. Doug Oldford, MHA for Trinity North; and Mr. Glenn Tobin, MHA for Burin - Placentia West. At the table, of course, we have our secretary, Ms. Elizabeth Murphy, and Mr. Mark Noseworthy, our research assistant.

I welcome the witnesses and the Auditor General, and perhaps the Auditor General would introduce the staff people she has with her this afternoon.

MS. MARSHALL: Thank you, Mr. Chairman.

To my immediate left is Mr. Wayne Loveys, the Audit Manager responsible for the audit of Treasury Board, and to my far left is Mr. Bill Drover, our Audit Principal with the office.

MR. CHAIRMAN: Thank you very much.

I welcome Mr. Peter Kennedy, the Secretary of Treasury Board, once again, for the second or third time - second or third time, Peter? Second time at least. Perhaps you would like to introduce the witnesses you have with you today.

MR. KENNEDY: Thank you, Mr. Chairman.

To my immediate right is Mr. Bob Smart, the Assistant Secretary of Treasury Board, responsible for human resources matters. To Mr. Smart's right is Noreen Holden, Director of Personnel Policy, and to her right Mr. Albert Meadus, our Director of Classification and Pay. These people should be able to adequately handle whatever inquiries come up under this subject. It is a very broad and far-reaching topic that you are covering today, and preparation and response to it, of course, was done prior to my recent time in Treasury Board but, as you note, Mr. Chairman, I was there previously, as were you; in fact, we were there together.

MR. CHAIRMAN: So you are saying that we are responsible for anything that is built into the system?

MR. KENNEDY: I don't know. I think I am being held more accountable than you are, because I (inaudible) back there.

MR. CHAIRMAN: Thank you, Mr. Kennedy.

Perhaps now the clerk would like to swear in the witnesses. I think there are some that have probably not been sworn in previously.

SWEARING OF WITNESSES:

Peter Kennedy

Robert Smart

Noreen Holden

Albert Meadus

MR. CHAIRMAN: Thank you very much. Perhaps we will begin by asking the Auditor General if she has anything to say by way of opening comments.

MS. MARSHALL: I don't have an opening statement but I do have a few comments, Mr. Chairman.

The audit of Treasury Board focused mainly on human resource issues. We looked at various systems and processes and policies and procedures that were in place within the Board, and made recommendations. Some were accepted and I think others are under further consideration.

The most major issue that I feel in the report relates to the human resource management information system, which is dealt with in the latter part of the report. Salaries in government is government's single largest expenditure. Back as far as 1987 there was a need for a human resource management information system determined to adequately manage government's human resources. This system has been under consideration and under development since that time. I recommended to Treasury Board that they address the delay in getting this system implemented within the various government departments.

MR. CHAIRMAN: Thank you very much.

Mr. Kennedy, do you want to make any opening comments?

MR. KENNEDY: No, I don't think so, Mr. Chairman. I think it might be more appropriate, given the expanse of items covered here, to perhaps deal directly with questions topic by topic as we go through it.

We certainly recognize, if there is one thing I would say, the importance of a good program of human resource management within the public sector, given the large percentage of public funds spent on salaries and salary-related costs. Particularly at a time when the budget is itself continuing to face some pressure. That is why we have an Assistant Deputy Minister in Treasury Board, Mr. Smart, to my right, who is in fact responsible for all human resource management issues. We have other resources in place that indicate a strong commitment or strong sensitivity on our part to the need for sound human resource management. Just on that note, perhaps, we would go into the questioning.

MR. CHAIRMAN: Thank you very much. I should just inform the representatives from Treasury Board that this morning the Committee received some testimony from the Public Service Commission on issues which are somewhat related to matters that are referred to here. In fact, some of the questions that were referred to representatives of the Public Service Commission may well want to be directed to Treasury Board representatives. Particularly as it relates to apparent conflict between the Public Service Commission act and a number of collective agreements as it relates to hiring procedures and whether or not the merit principle should govern, particularly over seniority. There seems to be a conflict here, so I am sure Committee members will want to get into that and pursue that further, and perhaps try to find some consensus as to how this matter might be dealt with.

Mr. Tobin would you like to start out this afternoon, Sir?

MR. TOBIN: Basically, on the same line of questioning as this morning, temporary positions. I am wondering if Treasury Board can inform me as to how many temporary positions are there presently within the public service?

MR. CHAIRMAN: Mr. Kennedy.

MR. KENNEDY: I assume that would be a function in part of how the public service is defined, whether it is narrowly defined as just being departments or whether it encompasses Crown agencies that are fairly close to government and eventually hospitals.

MR. CHAIRMAN: All the school boards and so on.

MR. TOBIN: Well, we will get into the school board aspect of it after. I am talking about government and Crown agencies.

MR. KENNEDY: Well, Mr. Smart has some data so I will ask him to provide that data and explain where the data comes from.

MR. SMART: In terms of temporary employees throughout the whole system, and by the whole system we mean doing a canvas of hospitals, so on and so forth, and not just government departments. Throughout the public service we have according to our latest data approximately 2300 temporary employees. Now, that is the whole public service which includes, as I said, a bunch of agencies not covered by the Public Service Commission, hospitals, for instance. Out of a total of 26,000 employees approximately 2300 would be temporary.

MR. TOBIN: Close to 10 per cent.

MR. SMART: In round numbers, yes.

MR. TOBIN: Do you have a breakdown of how many of those would be in government departments?

MR. SMART: Yes, I do have it. I can pass this to Bert Meadus if you want and he can tally up the numbers. It is not all in one spot here but you can go through, Bert, and figure out that number. We can get it for you very quickly. It is not just one number for government departments. He has to add up several columns there.

MR. TOBIN: Why is it necessary to have temporary employees when you have a Public Service Commission that has being mandated to do the hiring for the government, and is it not in effect a way to circumvent the operations of the Public Service Commission, to get people into the government operations?

MR. CHAIRMAN: Mr. Smart.

MR. SMART: I do not view it as a way to circumvent the operations of the Public Service Commission because the Public Service Commission Act specifically states that it does not apply to the engagement of temporary employees, so there is no circumventing the act. The act in the Public Service Commission was structured with that in mind, that it would not apply to temporary employees. There are any number of reasons, that an employees gets sick, an employees goes on maternity leave, and you need an employee to fill in for three weeks, three months, six months. You need them reasonably quickly, and you can't engage yourself in a process where it might take you four, six or eight weeks to fill the position, when in fact the position was only available for four, six or eight weeks to begin with. There are any number of reasons why you would need someone for a short period.

MR. TOBIN: There would be other reasons, I would think, other than four to six weeks. Wouldn't you have people on the list who extend far beyond four to six weeks, and indeed into the months and years?

MR. SMART: Temporary positions could go up to a period of a year or two years. We have situations for instance in government departments under a number of cost-shared agreements - forestry agreements and so on - whereby the employment of permanent employees will not be cost-shared, but the employment of temporary employees will. There have been people employed under those cost-shared agreements for five, six, seven or eight years. Lengthy temporary positions, yes.

MR. TOBIN: Isn't it also a way for people to come into the public service and then be eligible to compete on competitions?

MR. SMART: By the fact that you are employed in the public service you become eligible to compete. It gets you the opportunity to put in an application on an internal job competition. You then, in order to secure a permanent position, have to go through the Public Service Commission process in applying for jobs and the process they put you through. I guess the fact that you are temporary, yes, it gets you the opportunity to apply. I'm not sure that is a great advantage or not, but....

MR. TOBIN: Right now there is sort of basically a closed shop in terms of applying for a job unless you are within the Public Service Commission. If somebody can bring you into the Public Service Commission through the back door then you have an opportunity to apply in a competition. Wouldn't that be right?

MR. SMART: You get an opportunity to apply by the fact that you are temporary, yes.

MR. TOBIN: The fact that you served in it for a year or so, wouldn't that make you sort of a leading candidate to fill that position in many instances?

MR. SMART: I would think you would have to ask the Public Service Commission what type of emphasis they put on someone being in a job for a year and how much weight they put on that in the recruitment process. That would be a factor that they would -

MR. TOBIN: They've expressed concerns over the fact that there are temporary people in the system. They've expressed their concerns and I think it is fair to say that the Public Service Commission probably has some concerns as to how they are getting in through the back door.

MR. SMART: Just on your previous point. In government departments, with respect to your earlier point, there are approximately 1,600 temporary employees.

MR. TOBIN: Out of how many employees?

MR. SMART: Out of the total complement in government departments and probably 10,000 in round numbers.

MR. TOBIN: So you would be up to 16 per cent within government departments.

MR. SMART: Yes. I think you would have to factor in there -

MR. TOBIN: Do you find that to be somewhat extraordinary, 16 per cent of the public service in this Province is on temporary?

MR. SMART: I don't know that I could put a figure on what would be a reasonable number. Whether it is 10, 15 or 20 per cent or what a standard should be but I don't find it surprising really when you look at the number of cost-shared arrangements and so on that are throughout the government and the people who get employed under those arrangements because they are just that, they are for a one year period, a three year period or a five year cost-shared agreement. It does not surprise me that we would have very large pockets of temporary employees in certain areas.

MR. TOBIN: How many agreements, such as that, would you have under way right now then?

MR. SMART: I don't know. Peter, could you -

MR. CHAIRMAN: Mr. Kennedy.

MR. KENNEDY: The normal cost-shared agreements that help provide services and deliver programming in this Province, there are probably twelve or fifteen.

MR. TOBIN: And all of these employees are temporary employees?

MR. KENNEDY: Some would employ significantly more employees of a temporary nature. The other advantage of a temporary employee in that situation -

MR. TOBIN: Some agreements more so than other agreements?

MR. KENNEDY: More than others, like the forestry agreement would be fairly labour intensive. A lot of employment would be available for silviculture products and so on. Something like the strategic investment agreement might have three or four employees basically hired to administer the agreement only.

MR. TOBIN: Not all the employees of either agreement would be temporary then?

MR. KENNEDY: People paid under the agreement are generally temporary employees because usually there are restrictions in your ability to cost-share the salaries of permanent employees.

MR. TOBIN: You say there are under 16 per cent. How many people have been laid-off in the public service in the past couple of years?

MR. KENNEDY: That would be difficult to determine. How many people would be laid-off including temporary employees who may have been laid-off and then hired back three months later and then laid-off -

MR. TOBIN: No people who have been laid-off, while there are 1,600 temporary employees in this system right now, how many people would have been laid-off during that period?

MR. KENNEDY: I would not be able to put a number on it for you.

MR. TOBIN: But there would have been some?

MR. KENNEDY: Oh there certainly would have been layoffs, yes.

MR. CHAIRMAN: Mr. Tobin.

MR. TOBIN: Yes, Mr. Chairman, the Public Service Commission this morning said that they have expressed concern to the secretary regarding the practice of temporary employees. What have you done to deal with the concern raised by the Public Service Commission?

MR. CHAIRMAN: Mr. Smart.

MR. SMART: We've had some discussions with the Public Service Commission in terms of their concern about the employment of temporaries. There are a lot of good reasons why temporary employees should be employed and they are in fact temporary. Their concern relates to situations, as I understand it, where there is a permanent position, someone is put into that permanent position on a temporary basis and then one, two or three years down the road, when the job is advertised on a permanent basis, that temporary employee has a leg up on everyone else. That seems to be the basis for their concern. I am not sure to what extent that practice is very widespread. My assessment would be that in most cases where temporary employees are employed it is legitimate. They may be employed to fill a permanent position, but it may be because the department has visions of abolishing that position twelve months down the road anyway, so it is only a temporary arrangement.

I'm aware of their concern but I'm not in a position to say how valid the concern is, or how widespread the practice that they seem to be concerned about is in the public service.

MR. TOBIN: Will the Secretariat be addressing it in greater detail? Will you be checking it further, the concerns that have been raised?

MR. SMART: In terms of the latest round of negotiations with NAPE and CUPE, for instance, we agreed with the union that we would jointly look at the whole practice of employing temporary people. Yes, we are going to look at it, and we are going to look at it in a formal way. A representative from the Public Service Commission is involved in that process with us. Yes, it is being looked at.

MR. TOBIN: Mr. Chairman, I pass it to someone else.

MR. CHAIRMAN: Thank you, Mr. Tobin. Mr. Oldford.

MR. OLDFORD: Mr. Smart, these temporaries, the number of temporaries, would they vary throughout the year with the seasons? I'm referring to in the wintertime, obviously Works, Services and Transportation, they hire a winter crew for snow clearing, and they have labourers and that type of thing. In the summertime you have all these tourism jobs in the tourism sites around the Province. Does it vary very much?

MR. SMART: Yes, it varies widely, which is why the question of how many people got laid off is a difficult question. We would lay off a large number of people at the end of the summer period and hire on another bunch in October and lay off another bunch. There are a lot of layoffs and recalls going on all the time, but it is seasonal in a number of areas. Another example would be forest fire suppression, where obviously in the summertime there is a large influx of people to assist with forest fire suppression, but at the end of the forest fire season they are all laid off again. It is very cyclical in a number of areas.

MR. OLDFORD: So they are included in the 1,600?

MR. SMART: Yes.

MR. OLDFORD: Mr. Tobin mentioned something about layoffs in the public service. Obviously with layoffs the duties that these people who are laid off, the duties they were performing, are obviously put on the shoulders of some other civil servant. Usually what happens once this occurs is there is a request for reclassification of the position. The Auditor General identified on page 11 of her report that there were quite long delays in appeals of the decisions made by Classification and Pay. Somewhere between six months and seven months from the time that an appeal is sought to the time that it is finally resolved. I wonder, what is Treasury Board doing to speed up that process? Obviously it seems like a long time to me - is there anything in place now that would change the length of time that it normally takes?

MR. SMART: We've modified the appeal procedures in a couple of areas. We've also appointed a new Classification Appeals Board that has put a considerable effort into clearing up the backlog. We've tried to streamline the process a bit and get rid of the backlog and to improve the turnaround time. In some cases there are, for various reasons - because documentation isn't available and so on -, delays in answering appeals are unavoidable. I think we've taken some reasonable measures to try to expedite that process and speed it up, yes.

MR. OLDFORD: The Board's response to the Auditor General said that: "...Cabinet recently approved a reconstitution of the Classification Appeals Board." Can you explain what that meant and how it changed things?

MR. SMART: The previous Classification Appeals Board that we did have was chaired by someone outside the public service and included a number of people who sat on the Board and were paid a per diem rate. The change we made to the constitution of the Board is we took off all the people who were being paid a per diem rate and we put on in their place a group of public servants who didn't get any extra compensation. It isn't to their advantage to prolong hearings because there is no extra benefit in it. They are paid to be public servants and there is no extra benefit for being a member of the Classification Appeals Board. They probably had a bit more flexibility as to when they could meet, because their obligation was to the public service and it was a public service board they were sitting on. So it was a total change in the membership of the Board, a reduction in the cost of operating the Board of about $200,000, perhaps, because the members were no longer paid.

MR. OLDFORD: The new Board, is that made up of management people or a combination of management and -

MR. SMART: The new board is made up of management people from the Public Service Commission - it is chaired by someone from the Public Service Commission and has another senior member of the Public Service Commission on it - and it includes management representatives from government departments, from various agencies, and from hospitals.

MR. OLDFORD: So Classification and Pay makes the original decision -

MR. SMART: Yes.

MR. OLDFORD: - and they are civil servants, and then the new Board which is civil servants judges whether Classification and Pay is right in their original decision.

MR. SMART: Yes.

MR. OLDFORD: Have you had any complaints from the unions about that?

MR. SMART: Yes. When we changed the constitution of the Board they originally had not a union representative on the board, but an employee who just happened to be a former employee of NAPE. He sat on the Board and was paid a per diem rate to sit on the Board. They originally expressed some concern that when we reconstituted the Board we didn't have any union representation. I would like to think that they've found, since they've been before the Classification Appeals Board, that despite the fact that it is comprised exclusively of management employees that the decisions being made are certainly not all in management's favour, and are in the favour of the employees, and there is not a bias. There may be a perception of one because it is all management but I think the decisions of the Classification Appeals Board would bear out that it is reasonably objective and unbiased and not swayed toward management in any way.

MR. OLDFORD: Thank you, Mr. Chairman.

MR. CHAIRMAN: For the benefit of Hansard I did interrupt Mr. Oldford and Mr. Smart, going back and forth to keep identifying them, but I am sure Hansard can pick that out, I guess, Jack.

Mr. Whelan.

MR. WHELAN: Basically, I just want to get a clarification on something that was mentioned earlier during Mr. Oldford's questions. With regard to employees with the Department of Works, Services and Transportation who work on a seasonal basis, who are hired in the spring and laid off in the fall, or vice versa. Are these considered temporary positions?

MR. SMART: Whether it is seasonal or temporary could depend to a certain extend on the collective agreement you are dealing with. People who are taken on and laid off under the general service agreement would probably be considered temporary, and people taken on and laid off on the same basis under the MOS collective agreement would probably fall under the definition of seasonal. There is a difference in the terminology that is used in the various collective agreements.

MR. WHELAN: Do temporary employees receive benefits similar to, or the same as, those received by the regular civil servant?

MR. SMART: Yes, the same benefits, on a pro rata basis, of course, given that they do not work the full year, but they participate in the pension plan, they participate in the group insurance plan, they accumulate sick and annual leave, and whatever, during the periods they are employed.

MR. WHELAN: So, when they are hired are they told they are hired for a period of three months, six months, or a year, or do they have to get up every morning and wait for a phone call to be called into work? What is the situation?

MR. SMART: In most cases it would be you are hired, your term of employment is for four months. Situations could come up where because of various circumstances the department might say to the employee before the four months is up, sorry, it is not going to last four months, it is only three months, and by the same token situations could happen where the department might say to the employee at the end of four months, we need you for yet another month so you will get five months out of it, but generally speaking they are told when they are hired, within reason. Someone hired for road work in the summertime or forest fire suppression and so on could be told you are good until some time in October. It may not be a specific date but they would have a general idea, yes.

MR. WHELAN: I was trying to get a clarification because I was approached by an individual some time ago with some concerns along those lines.

MR. CHAIRMAN: Mr. Whelan, could you move closer to the microphone, please?

MR. WHELAN: The individual had been working at one of the hospitals for quite a period of time and he, for several years, had to get up every morning and wait for a phone call to find out whether or not he was going to work, or make sure he was in St. John's on the weekend in case he had to work on the weekend. He indicated that he wasn't receiving any pension plan. I had assumed that he was a temporary worker. Maybe there is another classification -

MR. SMART: He could have been a temporary under some of our contracts. If he was a nurse there is a category under the nurses' collective agreement called casual employee, and that is exactly how they operate. They are under no obligation to come if they are called either. It is a different arrangement.

Under a number of our contracts - the hospital support staff, and even the general service for that matter - if you are a new temporary employee, recognizing we've a lot of temporary employees, some of them with a lot of seniority, if you are very low down on the seniority list - if you took for instance a labourer in the Department of Works, Services and Transportation who was hired on last year for the first time doing road work, I wouldn't be surprised that this year when the rehiring started to take place, that he was the type of person who might have to sit by the phone and hope: Today is the day I get the call. Because there is that many ahead of them. That is generally how I would see it happening.

MR. WHELAN: This particular individual, I was a little bit surprised, because he has been going on for years like that.

MR. SMART: I've difficulty understanding that arrangement as well, why that would happen.

MR. WHELAN: I figured it was unfair, unjust and fairly cruel to put an individual through that type of thing. If he was on there as temporary or whatever his category was. It was an unusual set of circumstances to have an individual work under.

MR. SMART: It sounds unusual, which suggests to me that there is something else to that that perhaps we don't know about. But that would be unusual, yes.

MR. WHELAN: Basically I just wanted to get that clarified. Thank you very much.

MR. CHAIRMAN: Thank you, Mr. Whelan. Mr. Langdon.

MR. LANGDON: Thank you, Mr. Chairman. I would like to go back to the discussion we had this morning and to seek some clarification from you people regarding hiring by the Public Service Commission.

Basically I think, if I can state correctly, they were saying that 10 percent possibly of all people that are recommended by the public Service Commission as number one applicant for a job on the matter of merit to work with the government, 10 per cent of these people who are number one get rejected. A number of the rejections were primarily because of the language in the contract of the collective agreements. I was wondering, can you fill us in on that? Do you find that you have some problems with that, or does that occur?

MR. SMART: It certainly does occur. I can't say whether it is 10 per cent or not, but it certainly does occur. It is because of a provision in the general service collective agreement that goes back some time. Basically what that provision says is where the candidates recommended for a position are relatively equal - and generally speaking the Public Service Commission would recommend three people - what the agreement requires is that if those people are considered relatively equal than in order to determine which of the three you should take there has to be a tie-breaker and that tie-breaker would be seniority. You would make the decision then based on seniority. That provision has been in the collective agreements for years.

A few years ago back in the late '80s, perhaps '89, the question came up as to how do you go about determining what is relatively equal? What does that mean? The collective agreement says; `where they are relatively equal seniority shall be the governing factor.' The question was, `how do we determine that?' There was a process negotiated in the collective agreements back then that was called a secondary evaluation process. The intent of that process was to figure out whether in fact candidates are relatively equal and situations can come up. While the Public Service Commission would recommend three candidates for a job, in order one, two, three, it is quite conceivable that those three candidates are identical in terms of qualifications, abilities and merit but they are put forward; one, two, three. So from the unions point of view - and I don't think it was unreasonable at all - they basically said, if you have three people, they are identical and three of them can do the job equally well but one person has twenty years experience and the other person has two years experience, why shouldn't the person with the twenty years experience get the job? And that is how they got to the secondary evaluation.

MR. LANGDON: But that wasn't the impression that was left by the Public Service Commission today. From the line of questioning we did this morning they were saying that there were instances when the number one - when you tally up out of 500 - probably might have gotten 497, the second one would have gotten 450, the next one would have probably gotten 400 but because of seniority rather than merit and because of the unions collective agreements, number two or number three got selected over number one. They are saying that there are a number of instances, I don't know how many, where that person has challenged that in a court through arbitration or what have you. So I was wondering, how do you see that?

MR. SMART: Well there are certainly cases where - let's say the number one candidate had 500 points, the number two candidate had 490 and the number three candidate had 450. There have certainly been cases where someone has made the determination that there is really not that much difference between 490 and 500. I mean these are pretty close, let's go with the fellow with 490, that certainly happens.

There have been situations where in that same case the person who got 450 points and didn't get selected grieved it, went to arbitration, and the arbitrator may have in fact concluded: The fellow with 450 points is relatively equal to the fellow with 500 points; he should get the job based on seniority, or she should get the job based on seniority. We've a number of those that even after the arbitrator's decision we've appealed to the courts and will fight it out in court. There is a whole series of different scenarios.

Generally speaking, I think it is fair to say that evaluations are done. Where other than the number one candidate is selected by a department, I think it is fair to say that if they selected number two it was because number two really wasn't that much different than number one. A difference of a few points and on a 500-point scale, even a spread of say fifty points, 450 versus 500 on a 500-point scale - it goes directly to the question of: Where do you draw this line on relative equality.

MR. LANGDON: From the line of questioning this morning, the feeling that I had was of course that the Public Service Commission is quote unquote unbiased, completely non-political, what have you. I think it probably looks at - I know they do - the Treasury Board Secretariat as being political. I don't know if it sees itself in adversarial roles with you people, in essence, but that is the type of feeling that I got. Obviously that is why I think even with the temporary positions or what have you, that it wants to make sure that quote unquote everything that is done with temporary and full-time would be non-political. That is the feeling I got from the line of questioning this morning.

MR. SMART: I'm not going to comment on the political part. Mr. Kennedy might want to. Just to give you a bit of history on this, to make sure it is not misunderstood. At the time when the secondary evaluation process went into collective agreements, that basically establish a process for figuring out which of the three candidates should be selected, at the time that went in the conventional thinking in the public service, including the Public Service Commission, was that the Public Service Commission recommended three people for a job and that is where its role stopped; and that a deputy minister had the freedom to select any one of the three as far as the Public Service Commission was concerned. It was because of that freedom that the deputy minister had to select any one of the three that the secondary evaluation process was put in the agreement.

It wasn't until last year, or perhaps the year before, that the suggestion was made that you always have to select number one and if you do not take number one you are violating the merit principle. That is a relatively new interpretation of the Public Service Commission Act that did not exist at the time that the secondary evaluation process went in contracts.

MR. LANGDON: And that is the impression they gave this morning, that number one was the person of merit, and other than that they were questioning the selection.

Just one more question if I could? A few years ago the HAY classification system within the civil service, on Page 8 of the report we have here, does that mean that government is now looking at that classification, the HAY system? On Page 8, three quarters of the page down, the boards response, where the Auditor General says "The board should develop formal guidelines in the area of classification reviews. Such guidelines should include - " I will not read the rest of it. Then it says, "In any event", and this is coming from you, I would think, "we are currently in the process of considering introduction of a new classification system, and your comments will be taken into consideration during that process."

MR. CHAIRMAN: Mr. Smart.

MR. SMART: That does not relate to the HAY system as such although the whole classification business is always under review. The HAY system is the classification system used for management employees. The classification system we use for everyone else, which is 85 to 90 per cent of the public service, is a system that has been in effect for twenty-odd years. It is that system that we were referring to here when we said it is under review and we are looking at the possibilities of a new system. It was that twenty-five year old system as opposed to the HAY system which has been around for seven or eight years.

MR. LANGDON: On the HAY system, as such, management, it is certainly the impression of the unionized workers out there that the management people, they set the scale as management dealing with management, rather than in their situation you have union workers working with management, so in a sense the perception is there that there is not so much scrutiny and you can easily get a classification in management quicker than you can with the worker. Is that a fair comment?

MR. SMART: I suggest you ask some of the management people who try to get a reclassification as to how they feel about that. I cannot quote the statistics off the top of my head, although Bert Meadus might, but we did an analysis of how many requests for reclassification do we entertain from management people versus bargaining unit people, and how many of the requests that come from management people get approved compared to how many of the ones that come from the bargaining unit people get approved, and you would be very hard pressed to try to prove that the management people are getting an easier time or more reclassifications than union people. In fact, I suspect, you would probably find the opposite is true.

MR. LANGDON: I will leave it at that for now.

MR. CHAIRMAN: Mr. Hewlett.

MR. HEWLETT: Yes, thank you, Mr. Chairman. Page 6 of our file here, there is a quote. It says: "`Departments are responsible for determining the relevant classifications for temporary non-management positions.'" Treasury Board is supposed to monitor these classifications. I found that somewhat strange, because before my current situation I was an employee of the Crown, I suppose, for fifteen years, in somewhat of a different category, but still an employee. Does that mean that if you have work available in department X for someone who would normally be a Clerk III to do that kind of work, that department X, if they get some sort of approval for a temporary position, can assign that as a Clerk II and can get the same work done at a less cost? Is that what that means, in essence?

MR. SMART: The department has the authority with respect to temporary employees to establish the classification, and there are human resource professionals in departments who can make that determination. I wouldn't be particularly concerned about a department classifying a position at a Clerk II, we will say, when in fact the work to be done was at higher level of Clerk IV, because the person who they would be classifying, who would be in a bargaining unit position, would recognize very quickly: I'm not getting a fair shake. They would come forward and say: I want my position reclassified from Clerk II up to Clerk IV.

MR. HEWLETT: As a temporary employee they would have rights, I guess through their union or whatever, to deal with that situation in terms of once assigned a temporary position if they feel that it is under-classified, that sort of thing, they have recourse in that situation, the temporary employee?

MR. SMART: I would ask Bert Meadus, do they have access to the Classification Appeals Board?

AN HON. MEMBER: Yes.

MR. HEWLETT: Okay. I guess we are getting close to the coffee hour. One quick question. Where does a promotion sit down and a reclassification stand up? What is the difference? I see a piece in our notes here where Treasury Board has a rather - and don't take this offensively - sterile definition of what a promotion is. Then there is the general human concept of what a promotion is in terms of some sort of elevation, not only in money but in position, prestige, and so on and so forth. What is the current view of your system with regard to what is a promotion versus what is a reclassification?

MR. SMART: The issue I guess is - and you can get technical in terms of what definition you want to use. We are discussing that issue with the Public Service Commission. There is certainly a problem there and we don't exactly see eye-to-eye on it.

The distinction that you are drawing is: a promotion would be subject to the concurrence of the Public Service Commission, at least that is the way the Public Service Commission works, that promotion should be based on merit and so on.

The reclassification process is a situation where someone is doing a job and they are doing that job now. They are actually doing the work. They do not feel they are being compensated appropriately for the work so they ask for a review to be done. That review determines that, yes, in fact they are doing work at a higher level, and this could be something as simple as somebody who is classified as Clerk Typist 11 but they are working with a computer and as far as they are concerned they think they should be a word processing equipment operator, given that is the work they are actually doing. They have a review done and that confirms it. Yes, you should be a work processing operator because that is the work you are now doing, and they are reclassified. Now, they get an increase in pay and get an increase in stature, I guess, because it is a higher paying position and so on, and that is what we consider a reclassification.

The difficulty we have with the Public Service Commission, I guess, is if you start to look at that as a promotion, within the context of the Public Service Commission Act and what that defines a promotion to be, do you start saying things like, the person can only move from a clerk typist to a word processing equipment operator if the Public Service Commission agrees with it, and if they concur with it, because they consider a promotion under their act. That is the difficulty we have. The primary difficulty we have is whether we like it or not, as the people running the classification system, and whether the Public Service Commission likes it or not, this person is doing the job now and all they are asking for is to be paid for the work they are doing now.

That is generally what happens and we do have this discussion ongoing with the Public Service Commission. It is a question of where you draw the line. Some of these are very straightforward but then there are others where the change in classification is so significant that you are moving from a person in this sort of career path to a totally different thing in another career path. There is certainly some merit to the suggestion that perhaps that should not be considered a reclassification and that should be considered abolishing this job, creating this one, and go through an advertising process.

I think we will work that out with the Public Service Commission in due course, but it is the different ones and the strange ones that are the problem. Most of it is very straightforward, word processing equipment operator 1 to word processing equipment operator 11.

MR. CHAIRMAN: Mr. Hewlett.

MR. HEWLETT: There is one final point before I yield. In the latter years of my last incarnation I was principal secretary in the Premier's office and during the period I held that role I had two separate chiefs of staff. One left to go to another job and so on. In one particular instance I appointed a chief of staff from outside the office. In another situation I appointed a chief of staff from the ranks of the existing executive assistants to the Premier.

The person getting the position from outside the office, I guess, is that considered filling a job whereas the executive assistant moving up to become the boss over the other executive assistants is considered to be a promotion, or do I have a layman's description of the concept and not a Treasury Board description?

MR. SMART: I am not sure that I understand the question.

MR. HEWLETT: If an executive assistant moves up to be chief of staff, is that a promotion?

MR. SMART: Yes.

MR. HEWLETT: In your concept it is?

MR. SMART: Yes, that is movement from this classification that carries one pay range to a new position, or a different position, which has a different position code number on it, technically, that carries a higher pay range. That is a promotion. I would agree, while those positions are not covered by the Public Service Commission Act, that is clearly the type of promotion that is contemplated by the Public Service Commission Act. When you take that position of executive assistant and change the duties of that position a little bit, and it now becomes, instead of Executive Assistant I it is Executive Assistant II, that is the difference of opinion we have with the Public Service Commission, whether that is a promotion within the context of their act, or whether that is really a reclassification and therefore outside the scope of their act.

MR. HEWLETT: I took care of that problem by calling it senior executive assistant and then, I guess, it is a promotion.

Thank you, Mr. Chairman.

MR. CHAIRMAN: Thank you, Mr. Hewlett. Mr. Penney.

MR. PENNEY: Thank you, Mr. Chairman.

Before we leave that area of promotion, I understand your definition of reclassification, and the distinction you make between reclassification and promotion; I believe I do. I am looking at this now from the perspective of a person who has been in business for over twenty years, and when I gave somebody a promotion within my store it was not a reclassification. It was a promotion, and I understood that and they understood that, and the public understood that; there was no question about that, but I would like to first ask the Auditor General, having heard your replies over the last couple of minutes, if you would care to comment.

MS. MARSHALL: Basically, my concern centred around the second category that Mr. Smart was referring to, and that is that when you would take a position, someone would be in a position, and you would change the duties and responsibilities so significantly that it would become a different job altogether, and that person would automatically be placed in that job rather than it going to competition. For example, you might have a secretarial position with a person in it; you might add new duties to it and it might become a financial analyst position. I would question then whether the incumbent in the secretarial position should remain there when it becomes a financial analyst position. So that is where my concern is centred around. I think that is the type of reclassification or promotion that they are having some discussions with the Public Service Commission on and I think that is the area that has not been resolved yet but that is the area that I am concerned about.

MR. CHAIRMAN: Mr. Smart.

MR. SMART: I agree with the Auditor General, yes that is the area that we are currently having discussions with the Public Service Commission about and I think in due course we will resolve it. I mean there is a happy medium here. Even in those cases there are situations where they are not as straightforward as they may seem.

An example I give, that happened throughout the public service, particularly since government brought in an affirmative action program a number of years ago, is that you have people, females, who occupy traditionally female dominated occupations; like secretaries, and concerted efforts were made to move them from the secretarial positions into some other areas, to give them some financial expertise, administrative or policy expertise or whatever. So they intentionally move away from those female dominated classifications and take on more work.

Now if at the end of this affirmative action cycle of two or three years of taking on additional work and trying to climb the ladder so to speak, if one of the outcomes of that is - we look at you at the end of the day and say you are doing really good on this policy stuff or you are doing really good on this financial analysis stuff, we are going to reclassify you. You evolved beyond the position of Clerk Typist and you are now more of a Financial Technician I and we reclassify them as that. That, from the Public Service Commissions' perspective, could be justified as: this is a complete change in career paths, it is a significant change in their classification and it should be subject to the Public Service Commission. There is some merit in that argument.

On the other hand, there is some merit in the argument that says, why should that person who has put in an extra effort over the past two or three years and has done extra courses, why should they now be put in a position, because of that, that their old position is abolished, their new one is created and they now have to apply for the position because that is the potential end result? So even within the area where we are trying to reach agreement with the Public Service Commission there are those that are strange situations as well, primarily because of that affirmative action program.

MR. PENNEY: I understand your explanation but I think what you have said is the difference between what would happen within Treasury Board or government and what would happen within my business is that I would give the employee the promotion and then tell him what I wanted him to do. You are going to tell the person what you want him to do and after he has been doing it, then you are going to give him the promotion?

MR. SMART: Or they would demand it.

MR. PENNEY: Yes, but you tell them what you want them to do first, and after they have been doing it then you are going to say: This is not a promotion now; this is just a reclassification, whereas when I give the individual this promotion first, it is no question this is a promotion, and now because of the promotion here is what I want you to do.

MR. SMART: Yes.

MR. PENNEY: Okay.

In your reply to the board's response to the Auditor General, it was suggested that the matter would be discussed with the Public Service Commission and necessary revisions would be made to the definitions. Have there been any revisions to the definitions?

MR. SMART: No, no.

MR. PENNEY: Can you give us any changes at all?

MR. SMART: No, we haven't completed the discussion with the Public Service Commission yet. We produced some revised definitions that we have sent to the Public Service Commission. They have had a look at them, and the dialogue is still ongoing, so we would rather complete the dialogue with the Public Service Commission and see if we can't reach a consensus on how to deal with this in the future, and then put forward to Cabinet revised definitions that we both agree on.

As Peter points out, the fact there has been no chairman at the Public Service Commission has sort of delayed the process a bit, and so on, but we are still having that discussion. I think we will resolve it in due course, and at that point in time we will amend the regulations so that we all understand it.

MR. PENNEY: This booklet of information that we have with the Auditor General's Report and the board's response, the section here that is entitled `Classification Review Files', it says there was a review of sixteen classification review files. I notice that the board's response was that a sample size of sixteen is not sufficient, in your opinion, to reach a conclusion. You are saying sixteen out of 23,000.

My question is to the Auditor General, or to one of the members of her staff: When we discussed this type of sampling this morning we were looking at a random sample of twenty out of 216. Now we are looking at sixteen out of 23,000. First of all, could you confirm the figures, and could you tell me how the sixteen were selected, what process was used, and do you consider this to be representative?

MR. CHAIRMAN: (Inaudible).

WITNESS: Thank you, Mr. Chairman.

A little bit of clarification first, the 23,000 relates to individual positions, classified positions within government. Now, not 23,000 were reviewed in any one year. In 1992-'93 there were approximately 1,500 reviewed, and our sample was based on that 1,500. Now even that 1,500 is a little bit - again we have to clarify that - in that 1,500 are some group reviews, so in our case, in our office, if we had Auditor III's reviewed, there may be seven or ten, whatever number, reviewed, and the seven or ten number would be included in the 1,500 but the process would only relate to that one classification. So, within that 1500 there may only be 1000, 800 or 700. There were no numbers available at the review date indicating how many review processes were completed.

MR. PENNEY: So to suggest that it is sixteen out of 23,000 is not in your opinion an accurate assessment?

MR. LOVEYS: Well, our intent was to review the process in place in 1992-93 which related to the 1500 and not the 23,000.

MR. PENNEY: So are you satisfied then that the sixteen were representative?

MR. CHAIRMAN: Mr. Loveys.

MR. LOVEYS: Yes.

MR. CHAIRMAN: Mr. Penney.

MR. PENNEY: That's it for the moment. I am prepared to conclude that the sixteen were representative? Let us go back to Page 9. It says, our review of sixteen classification review files, in two unit files no evidence of any contact, in four bargaining unit files, limited documented analysis, in three bargaining unit files, no current evaluation. Now, if we accept the process of extrapolation you are looking at four with limited documentation analysis, four as a percentage of sixteen is 25 per cent, and then if this is in fact representative then we have 25 per cent of the 1500 that Mr. Loveys referred to that would fit into the same category. Would you care to comment?

MR. KENNEDY: I do not think offhand sixteen is representative unless you know how that was arrived at and whether the survey was scientifically developed and established to be free from bias and so on. I do not think anyone can establish that. I do accept the point which is made here, that there is a significant number of cases where there is not much contact, if any sometimes, with individuals or their supervisors and so on. You have to remember that many of the cases you deal with here are fairly routine in nature.

There is an established classification system for many positions in the clerical or secretarial series. There is quite a normal progression which is available. People who are hired as clerk l eventually may take on more duties and become a clerk 11. A clerk typist may become a word processing operator when they become more proficient with some of the technology which is available today and so on.

The governing document in this process is a revised job description. That is what causes the review to take place. There is an established system of job specifications within the bargaining units and these are available, publicly available, available to all departments and so on, and the reality is that in many cases there is not much need to contact people for elaboration. There are many others that go on for months and months because there is a continuing process of gathering more information and ensuring that we properly understand what is before us and make a sound decision. I am certainly not surprised and would consider it quite normal for there to be a significant number of cases where minimal contact with departments is required.

MR. CHAIRMAN: Mr. Penney.

MR. PENNEY: Okay, I accept that.

Page 14. The Auditor General says: "The Board should monitor adherence to Government personnel policies." We are talking about adhering to personnel policies, section 6(c) of the act. The response from the Board is: "Consideration will be given to development of a monitoring process. This may be an area where the Office of the Auditor General could provide some assistance...." What type of assistance did you have in mind? What exactly could the Auditor General do to assist you?

MR. SMART: What we were referring to basically is the Auditor General in the process of auditing Crown corporations, agencies, school boards, hospital boards and so on is in a position, given that they are in there anyway, to test compliance with certain policies. One of the things they've done recently for instance is that they've tested compliance in some agencies with government's restraint legislation. They've brought issues or situations to our attention as a result of their audits in school boards where school boards are paying mileage rates or meal rates in excess of what the government provides.

On one hand, I guess, the fact that they brought it up is critical of us for not finding it ourselves, but on the other hand it is assistance to us when the Auditor General actually goes in and looks and finds these things and brings them to our attention and then we can take the corrective action. That was basically the point that we were making. When the Auditor General is in a hospital board and is doing an audit, or in a school board, if areas where the school board or the hospital board is not complying with government policy comes to their attention, we would certainly appreciate having it brought to our attention. Then we would be in a position to take the corrective action.

MR. PENNEY: I see the Auditor General nodding as you are replying. I wonder if she would care to comment (inaudible).

MS. MARSHALL: Yes. We do pass the information on to Treasury Board when we do come across personnel issues that we feel it should be aware of. We were also interested in having Treasury Board set up its own systems and procedures, because our audits are not done on an annual basis, and of course most of the work is done on a test basis also. We were interested in seeing it put in some sort of systems and processes, and possibly have its internal audit division go out and do some spot checks also to ensure more thorough coverage.

We do find a notable number of exceptions to the human resource policies, and you are aware of some that we've discovered in the school boards and the hospitals. It would be worthwhile if Treasury Board had those processes in place also.

MR. PENNEY: Thank you. One last question, Mr. Chairman. The human resource management information system, has that system been fully implemented? Are we on target? I noticed here when the Auditor General was doing her report she says on page 16: "At Report date, some six years after the Steering Committee was established, the development of the... project is continuing. Implementation is now scheduled for April 1994...." Could you elaborate?

MS. HOLDEN: The Steering Committee was originally set up to look at human resource management, and in particular we started out to look at leave management. When we got going we realized of course that in government there were not one but three payroll systems operating, and all three of those, while using the same software, weren't at all compatible. There wasn't even a standard record. So instead of leave management it was: Let's get started here with an employee record, for beginners. Back to square one and the development of a standard record, and the functionality for an employee record.

Then of course the next part of the problem we realized was that we didn't have the latest software packages. We were way behind. Bringing the thing up to date was an enormous challenge. Believe me, this thing has taken on a life of its own. To the lay person out there looking at it the question: Why has this taken so long?... is certainly a legitimate one. From my perspective, and the perspective of those of us who have worked long and hard on this, it has been an incredible challenge.

I'm delighted to tell you that in fact as we speak the January 22 payroll will be decentralized to all departments and we will be able to get on with many other pieces of this particular system. Because the human resource management information system is not a system, it is a bunch of subsystems. We have to start with the basics - the employee record and the decentralized payroll, and the position management system - and move it on from there.

We've had all of the departments - or a lot of the departments - involved, and we've had considerable consultation, so this has been a joint process. One that, like everything else, there is a costing, involving and consulting and making sure that people are going in fact to get what they want. At the end of the day I believe we will be really happy with it and light-years ahead of where we were six years ago.

While in the strictest sense of the word - some may call it a delay - quite frankly, I have to tell you it has been an opportunity, and one that has had tremendous challenges. As of January 22 we will be decentralizing, and by the end of this fiscal year phase one will be in and we will be going on from there.

MR. PENNEY: I'm really pleased that I asked that question to have given you the opportunity to make that presentation.

MS. HOLDEN: It is a really exciting project and one that has been a tremendous challenge, I will tell you.

MR. PENNEY: For the record I will say, for the benefit of all my colleagues here, the question was unsolicited. Thank you very much.

MS. HOLDEN: You are welcome.

MR. CHAIRMAN: Finished, Mr. Penney? We are overdue for coffee. Do we have many questions left over here? Do we want to have coffee, or do we want to wrap it up and then have coffee? I know that officials in the Treasury Board have other things they are anxious to get back to. If it isn't worth having a coffee break and coming back....

WITNESS: (Inaudible).

MR. CHAIRMAN: We wouldn't want to be accused of letting them off too easily, but none of us want to waste our time being here if we've satisfied most of our concerns. So we will wrap it up here?

WITNESS: Wrap it up.

MR. CHAIRMAN: Okay. Let me just ask one quick question. There are several things I would have brought in, but they are minor points. You tell us, Mr. Smart, 2,300 are in temporary positions, about 10 per cent of the general public service, I think you said, is it, or 1,600 out of 10,000 in government departments are temporary positions. Those are 1,600 positions that are not filled through the Public Service Commission system. They are not interviewed; they are not screened to the same degree. They don't go through the same rigorous testing, in other words they are appointed by somebody.

MR. SMART: Well, no, I wouldn't say that. The testing and screening, in most of those cases, while not done by the Public Service Commission, I don't think it's fair to say that these people are just appointed without a screening interview and official recruitment process. In fact, our collective agreements, and the primary agreement here in government departments would be the general service agreement, that agreement stipulates that any position that is going to be in excess of twelve weeks duration has to be advertised, and all the people in the bargaining unit have to have an opportunity to apply, and that goes through an interview screening process. The departments would generally use the same type of process and the same type of scoring system that the Public Service Commission would use, so there is a process and there is a significant restriction in terms of the collective agreement on how much of a free hand a department has in appointing people to positions. I guess you could get away with it up to twelve weeks, but after twelve weeks the shop steward is going to be knocking on your door saying: Advertise the position.

MR. CHAIRMAN: Okay, but undoubtedly there is a significant number of these that are less than twelve weeks; they might be a month or two months in duration.

MR. SMART: Sure.

MR. CHAIRMAN: Regardless of that, they are positions that are filled without the normal process of the Public Service Commission. They are open to some sort of abuse, perhaps, if one wished. People can be put into those positions from outside of the public service, without having to go through the normal process. They could be there, then, for up to two months. The position could then be advertised for a permanent position. That person who is there for two months, because they have been there for two months, are now eligible to apply as an internal person. Because they have been there for two months, if we get into this system in the collective bargaining agreements whereby seniority governs, so that person and another person outside who didn't get appointed as a temporary person and therefore couldn't apply internally, even if they could apply, probably wouldn't get the job because the other person would have a two month seniority.

MR. SMART: Conceivably, yes.

MR. CHAIRMAN: Okay.

MR. SMART: Just on a point of clarification, though, in terms of how easy it is to appoint people to positions that are less than twelve weeks, given the restraint and the downsizing we have gone through, before a department ever gets to the point that it can hire someone for less than twelve weeks, they first have to go to the list of laid-off people in that department and if the Department of Education and Training wanted to hire a Clerk Typist I we will say, just for a six-week period, well, they are under no obligation to advertise that because it is less than twelve weeks; they are certainly under a contractual obligation to go to their list of laid-off employees and find out if they, in the past two years have laid off any Clerk Typists I or anyone else who is qualified to be recalled to do that work, so that hurdle has to be gotten over as well; the recall provisions in the collective agreement have to be gotten by as well.

MR. CHAIRMAN: Okay. Thank you very much. Do you have any final statements, Auditor General, anybody have any final statements? That being the case, let me thank all the witnesses from the Treasury Board and from the Auditor General and her staff, members of the Committee and our staff for your diligence, for your searching questions, for your thorough answers, honest answers, detailed answers and we look forward to perhaps having an opportunity on some future occasion having you back again to pursue other areas of Treasury Board. No doubt, there are many areas. Let me ask you one question, I want to check and make sure there are no news media here and I would say it somewhat facetiously, but I want to ask a question of Noreen, whom I always credit as being one of the prime movers and shakers and authors of our affirmative action program: When you train some of these secretaries to get into management positions, do you train some labourers to become secretaries?

MS.HOLDEN: Labourers are not as interested in becoming secretaries as, well, secretaries are in becoming labourers.

MR. CHAIRMAN: Very good. Thank you very much.

MS. HOLDEN: However, we are working to try and change that and we do have some male secretaries in fact, in the public service today, you will be pleased to know, they are a minority but we are working on trying to increase their numbers and of course, once we have 50 per cent women in the public service, we will try to help everyone else.

MR. CHAIRMAN: We have just seen an excellent justification of why the female population should be promoted within the public service. Thank you very much.

The meeting stands adjourned until tomorrow morning at 9:30.