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Editorial: Severance scales

Former Nalcor president and CEO Ed Martin.
Former Nalcor president and CEO Ed Martin.

It will be a very interesting final number to watch for. In late July, BC Hydro’s board of directors fired its president and chief executive officer, Jessica McDonald. She had held the job for two and a half years, and was seen as a strong supporter for the British Columbia government’s Site C hydroelectric project. She was paid $528,342 in salary, benefits and pension in the last fiscal year, and was let go without cause by the utility’s board of directors.

Is any of this sounding familiar yet?

Even though they fired her, the board sounded mysteriously supportive, saying in a statement, “The Board wishes to express its sincere gratitude to Ms. McDonald for her exemplary leadership of and dedicated service to BC Hydro and recognizes the profound impact her vision, innovative thinking and unwavering commitment to excellence has had, and will continue to have, on the company.”

In this province, at the time when former Nalcor president and CEO Ed Martin was being fired without cause by the board of directors, that same board was actually supporting him: “The board didn’t agree with the decision to terminate the CEO. The board had just reviewed Mr. Martin’s employment, reviewed the annual performance,” then-board chair Ken Marshall said.

The board of directors resigned en masse after Martin’s dismissal.

But back to BC Hydro.

McDonald reportedly received a half-million-dollar severance package after her firing —full details aren’t known yet, as the utility has not released the details of her contract.

In this province, we know the severance details for Ed Martin: when the dust cleared, he had been given $6.3 million as a result of the contract he had signed, money that came his way particularly because the board of directors fired him without cause.

His contract was set up the way it was, as was Nalcor itself, to allow the company to act outside the strictures of government, something then-premier Danny Williams said was done on purpose: “Because within government, you’ve got certain salary levels and ranges and everything else. You have to work with them, and you have to live with them. In order for me to get somebody who’s a match for the top negotiator at Hydro-Québec or ExxonMobil or Inco or anywhere else, I’ve got to be able to pay the right salaries to do it.”

At this point, another comparison might be apt.

In its last annual report, BC Hydro reported four million direct residential and commercial customers, $22 billion in assets and $5.7 billion in revenues.

Nalcor, meanwhile, reported $14 billion in assets, $824 million in revenues and 38,000 direct residential and commercial customers.

Both are provincial Crown corporations, but clearly, one of these companies is not like the other.

Let’s see how close the final severance packages end up being.

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