ST. JOHN'S, N.L. — Nalcor Energy isn’t a rare corporation with the capacity to internally source the people needed to manage a project the size and complexity of the Muskrat Falls Hydroelectric Project.
In order to deliver the development as planned, the corporation has relied on a purpose-built management team. It’s a collection of individuals, brought on as independent contractors rather than hired as Nalcor Energy direct employees.
The contractors on the management team held (and hold) Nalcor-stamped hard hats and Lower Churchill Project email accounts, but they bill the Crown corporation as contractors.
They work through their own corporations. Nalcor Energy contracts with the corporations. In most cases, the project management team member would be the only employee, and directors for the corporation could be the project management team member and a family member.
For example, Scott O’Brien, who was called to the witness stand at the Muskrat Falls Inquiry on Thursday, wasn’t contracted directly by Nalcor. His company, SRO Consulting Services Inc., was contracted. He is specified as the employee for the assigned position. He has testified he is the only employee of the company, and the company directors are he and his wife.
In O’Brien’s case, his company was not created specifically for his work on the Muskrat Falls Project. He said contracting this way is not unique to Muskrat Falls, and he previously worked as an independent contractor for a private oil company.
Contracts for the Muskrat Falls management team were a point of contention beginning before the inquiry, with a dispute over whether or not — given they are not direct employees of Nalcor — the project management team’s compensation should be open to public disclosure.
In May 2016, in response to a request filed under the Access to Information and Protection of Privacy Act (ATIPPA) for the information, project director Paul Harrington wrote to fellow management team member Ron Power, promising to “use all the weapons in our arsenal to resist this using legal levers.”
Harrington called the request “a crappy request for personal info” and asked Power to assure younger members of the management team a fight would be undertaken to protect their rights.
Power replied, saying: “this is a bigger threat to the project than the Astaldi situation,” referencing the key project construction contractor.
As reported, negotiations with Astaldi led to subsequent arrangements for more than $700 million in additional payments beyond the company’s original contract price.
The management team pursued their objections to the release of their pay, taking the issue to the courts. But at the start of the Muskrat Falls Inquiry, Commissioner Richard LeBlanc ruled the information would be subject to review and could be placed into the public evidence at the inquiry.
Throughout May, senior project management team members have been called to the stand, and their available contracts entered into evidence. The documents typically show agreement on flat, day rates, as well as per diems for meals. Travel for the project is reimbursed, but notably the management team do not receive overtime pay, or any shift premiums.
Their contracts are typically considered “evergreen,” with periodic amendments over time to increase the day rates.
The information provided below reflects only those individuals called as witnesses, their corporations, and the information on day rates entered into evidence at the public inquiry.
Scott O’Brien — SRO Consulting Services Inc.
- Starting at a day rate of $1,365 in 2011, the last contract amendment in evidence for the project manager for Muskrat Falls (generation) shows him at a day rate of $1,594.
Lance Clarke — Commercial Project Services Inc.
- A commercial services manager, he is also referred to at times as business services manager or just business manager. Clarke’s day rate was $1,561 as of spring 2014, based on the last contract amendment in evidence.
Jason Kean — Project Solutions Inc
- The deputy general project manager testified during the first phase of the inquiry in November to being paid at a rate of $1,100 to $1,200 a day. A review of documents in evidence this week did not turn up related contract documents.
Ron Power — RJP Services
- The last contract amendment in evidence for the deputy project director (generation) put his day rate at $1,621.
Pat Hussey — SRL Consulting
- A supply chain manager, hired as a “contracts and procurement lead,” Hussey’s day rate was recorded at $1,176 in January 2008. By June 2010, his rate was $1,283. A second individual, Philip Bursey was also hired through his company. Bursey’s day rate in 2008 was $805. By January 2010, his day rate was $900.
Paul Harrington — Erimus Consulting
- At a day rate of $1,500 in 2007, the project director’s day rate was at $1,676 by spring 2010 through 2011. Information entered for Harrington was for his appearance in the first phase of the inquiry. It is expected additional information, to bring his contract information up to date, will be provided when he is recalled to the stand in June.
Twitter: @TeleFitz
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