Remarkable report validates HR (Editor's Notes)

Ombudsman's insights show value of good HR team
|Canadian HR Reporter|Last Updated: 05/20/2014

When you have a minute, download a copy of the ombudsman’s report on HR practices at Toronto Community Housing (TCH). Every HR professional, from Victoria to St. John’s, should have a copy of this remarkable report at her desk.

It’s an outsider’s look into not only a dysfunctional organization but the HR profession as a whole. And it paints a pretty convincing picture to support the implementation and enforcement of solid HR practices — and of the extreme damage a rogue CEO can do to an organization, both to morale and to the bottom line.

The 111-page report details a litany of events from June 2012 to October 2013 that would make the stomachs of most HR professionals churn. A random sample:

•Of 76 promotions handed out, 36 were posted in accordance with TCH policy. There were no competitions for seven of the promotions and no evidence of competitions for the remaining 33. Even in cases where competitions were held, hires were finalized before the closing date.

•In at least four hiring decisions, there were clear conflicts of interest — yet no declarations of conflict were found.

•Employees were hired and promoted into positions that contained no job descriptions.

•Significant changes were made to employment contracts — unilaterally restricting notice periods — with no notice or consideration. And the changes were applied inconsistently.

•41 employees were terminated without cause, 15 of which were at director or higher levels. Performance reviews indicated no problems with the quality of their work. Staff talked about a “climate of fear.”

•Compensation was all over the place. A total of 81 new jobs were created during the period under review but only 11 of them went through a job evaluation to determine the proper salary. Raises were handed out inconsistently — managers earning $100,000 or more per year were given a 12 per cent increase without an evaluation. That was followed up with another 10 per cent increase. Still no evaluation.

Got a headache yet? All of that comes in the first seven pages of the report. It goes on and on. Reference checks not completed. Sloppy performance management practices. Lack of proper oversight from the board.

The report contains “case stories” detailing the ugly details of these incidents. For example, Gene Jones, the new (and now former) CEO, promoted his executive assistant to the newly created position of executive assistant to the CEO and board chair.

No competition was held, no job description was written. And her salary band jumped from Grade 4 or 5 to Grade 7 — a management-level category.

In another story, Jones hired a former city councillor admin for a role he created, without any competition, because “it’s my prerogative when I want to give that position to the best person with experience, internally or externally.”

Even the story of how Anand Maharaj, former vice-president of HR at TCH, got his job was sketchy. Maharaj was director of labour relations but was appointed by Jones — on the new CEO’s second day — to the interim vice-president role.

A month later, it was made permanent, again with no competition. (Maharaj walked out the door shortly after the report was released armed with a $160,000 severance package.)

Jones himself was released with a $200,000 severance package. That’s $360,000 wasted on packages for two senior executives who caused (or didn’t stop) a lot of chaos. How much more time and money were spent in the house-cleaning that resulted in the termination — without cause — of the 41 other fired employees?

The ombudsman’s insights were music to my ears. And they served as a reminder of the very high toll a bully CEO can take on an organization. Morale is in tatters at TCH and it’s going to take a lot of hard work to rebuild it. We all know people are the heart of an organization, and now we have an independent report that shows the damage that comes from poor HR practices.

Get a copy. Read it. Keep it around. In between the lines is very high praise for the human resources profession and everything it stands for.

Download a copy of the report here.

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