Mohawk president’s pay raised during wage freeze
Ontario deputy premier dismayed at hike, highlights loophole for executives who work for foundations
Mohawk College president Ron McKerlie got a pay raise of more than $17,000 from the school’s fundraising foundation during the province’s wage freeze for public sector executives.
“Clearly that is not in the spirit of the compensation freeze,” Deb Matthews, deputy premier and minister of advanced education and skills development, said Friday.
Mohawk College acknowledged Friday that McKerlie received a 19 per cent pay raise in 2016, bringing his second salary as head of the foundation to $108, 694.08.
“Following a successful year of fundraising, the foundation board of directors gave Ron a raise in April,” the college said in a statement.
His secret contract and hidden expenses with the Mohawk College Foundation were also made public after The Spectator revealed an accountability loophole created by naming him president of both the school and the fundraising entity.
The arrangement, which gives McKerlie a combined salary of roughly $369,000, doesn’t break any Ontario rules but the province is questioning the integrity of the arrangement.
“There certainly is the rule of common sense,” Matthews told The Spectator. “There is the rule that we expect people in the broader public sector to actually respect the direction given by government.”
The province continues to investigate whether McKerlie is the only one in Ontario to head both a college and its foundation with separate
contracts and pay.
Ali Ghiassi, who is now the chief of staff to Ontario’s minister of finance, drew up the arrangement when he was Mohawk’s vice-president and general counsel.
“These decisions were made by the Mohawk Foundation’s Board of Directors,” Ghiassi said in an email. “In my former role as Vice President, General Counsel for Mohawk, I drafted the legal contract pursuant to the Direction of the Board.”
The foundation is exempt from the Broader Public Sector Executive Compensation Act and freedom of information requests. As a result, its contract with McKerlie does not have to abide by provincial rules such as the wage freeze or public disclosure of contracts, salary and expenses.
“I was shocked,” said NDP leader and Hamilton Centre MPP Andrea Horwath. “It’s a lack of transparency. It’s just not acceptable. The government sets out parameters. They find a loophole and a way around that.”
McKerlie was a longtime public servant who served as Ontario’s deputy minister of open government before becoming Mohawk’s president in 2014.
He is also chair of the board of directors at Christian-based charity World Vision Canada and on the board of World Vision International.
“Ron is serving as President of the College and Foundation at a transformational time for Mohawk, with significant projects underway for the benefit of both our students and the community,” a joint statement from the foundation and college said last week.
The secret contract dated May 20, 2014 sets out pay of $80,000 a year plus a performance bonus of up to 15 per cent for a maximum salary of $92,000 before the 2016 raise.
McKerlie was paid $91,199.84 in 2015.
The foundation also had an executive director paid in the range of $120,000 to $160,000 until Trevor Clark left suddenly in January.
In addition, the foundation contract gives McKerlie another four per cent of his base salary in lieu of paid vacation. It worked out to $3,200 a year before the raise.
Under his college contract, McKerlie gets 23 days of vacation as of May 2016 with an additional day added every year up to 30 days. On top of that, he gets paid days off between Christmas and New Year’s.
He claimed $776.10 worth of expenses to the foundation from Sept 2014 to January 2017.
His expenses ranged from $1.75 in July 2016 for parking in Burlington to $85.12 for a meal at Milestones. About 91 per cent of the expenses were meals with McKerlie eating most frequently at The Aberdeen Tavern, a restaurant on Aberdeen Avenue near Dundurn Street South. The remaining expenses were all parking receipts.
Horwath called on the governing provincial Liberals to find a way to make the details public when an executive also works for the foundation.
“People deserve to know,” she said. “I would hope the government takes a hard look at these loopholes.”
The co-founder of Democracy Watch says the government accountability advocacy group identified this vulnerability in provincial legislation a decade ago and has been calling for it to be addressed every since.
“It’s a systemic problem and the provincial government’s fault really,” Duff Conacher said. “They should have long ago required every institution that receives public money or serves a public function to be covered by the access to information law and all the other public accountability laws.”
Matthews said she doesn’t plan at this time to create new rules to make sure executives can’t get around the Broader Public Sector Executive Compensation Act.
“I trust that they are going to do the right thing,” Matthews told The Spectator. “I can tell you that I’m watching it closely.”
She went on to say: “I fully expect the leaders in the broader public sector to adhere to both the spirit and the letter of the law.”
Read about other public sector executives with hidden expenses through foundations in Tuesday’s Spectator.
“Clearly that is not in the spirit of the compensation freeze” DEPUTY PREMIER DEB MATTHEWS MINISTER OF ADVANCED EDUCATION AND SKILLS DEVELOPMENT
Ron McKerlie’s pay raised by $17,000 while executive salaries were frozen in Ontario.
Deb Matthews: “Watching it closely.”