Executive Pay; AGAIN

The Ontario Government is asking all public servants in the province (I think I read that there are 700,000+ including government, health care, education, etc) to take a 2 year pay freeze.

I personally see nothing wrong with that. Our employer is not doing well, financially. A private sector employer would use the same reasoning. Poor results = pay freezes, or maybe even cuts.

But this commentary is not about that, per se.

I am once again visiting the topic of executive pay.

In a comment to reporters, a union rep said, “Is the CEO really worth 50 times more than the woman providing care?” The CEO they were talking about is head of a health care organization.

In response, Ontario Hospital Association president Tom Closson said, “If you want to run a cost-efficient health-care system, you need good management.”

While I agree that you need good management, are compensation levels for these people really where it should be? Are they really worth 25, 30, 40, 50 times a regular worker’s salary?

Then there is the bonus system, which happens to be exempt from the freeze. If an organization does well, it seems to be assumed it is because of the leader. But that is a seriously flawed assumption. It could be the economy in general. It could be, gasp, the workers!!! Does a nurse get a bonus if their hospital does better than expected?

If the organization that I work for does better than expected (I am a government worker), my management team and their bosses give me a pat on the back. In the meantime, they get a bonus. Actual money. Money to give their family a better life. I get a warm fuzzy feeling to share with my family. That makes them feel oh so good.

Get rid of bonuses. Pay a fair salary. Maybe there should be a salary cap on an organization’s executive team, tied to factors like average worker salaries. The NDP has proposed a law capping public sector salaries at twice the premier’s salary, which was $208,974 last year. Currently, direct government employees do exist under a cap. To get around the cap, the government sometimes hires “stars” through quasi-government agencies, like hospitals, where there is no cap.

The complete Toronto Star article can be read here.

Please comment in the space provided below this post.

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2 Comments

  1. Anon says:

    Isn’t that nice. They will cap the pay of an average government worker and then turn around and hire 4 high priced consultants to fill in the gaps. This is crazy.

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