Former CEO claims she was a scapegoat and government didn’t have cause to dismiss her without notice after expense account scandal
The Ontario government is facing a $9 million wrongful dismissal lawsuit after it fired the CEO of the Ontario Lottery and Gaming Corporation (OLG).
Kelly McDougald was hired in 2007 to head OLG after it came under scrutiny for a suspicious amount of lottery wins by those involved with the corporation, such as ticket sellers. During McDougald’s tenure, OLG courted further controversy when it presented 20 foreign cars as prizes at casinos earlier this year while the Ontario government was giving bailouts to homegrown automakers General Motors and Chrysler.
When the Ontario government learned of suspicious expense claims at OLG, such as a $3,800 employee dinner, $8 pen refills and a $30 claim for a car wash without a receipt, it fired McDougald from her $400,000-a-year post. It claimed just cause from the questionable expense claims. McDougald responded by filing a wrongful dismissal suit claiming damages of almost $9 million.
While McDougald conceded in her statement of claim some of the expenses “were indeed inappropriate,” she argued some were incurred before she joined OLG and others were the cost of doing business. She also pointed out OLG’s net profit increased by $73 million last year. In addition, McDougald claimed she was told to fire two senior OLG officers to make it look like something was being done, which she refused to do. McDougald said she offered to resign her post if she received a severance package worth one year’s pay, as stipulated in her contract. Instead, the government claimed just cause and fired her. Her dismissal came just before the expense claim issues were about to be released publicly, because of a freedom of information request by the opposition Conservatives.
The Ontario government recently faced a similar scandal at eHealth Ontario, which resulted in the firing of the electronic health service’s CEO, Sarah Kramer, over suspicious expense claims. However, the government did not fire Kramer with cause and gave her a $317,000 severance package.