CBC eliminates bonuses for executives and staff, but will boost salaries to compensate

OTTAWA — CBC/Radio-Canada says it will stop paying its executives and employees millions of dollars in controversial “performance pay” bonuses but will compensate by increasing their salaries instead.

The public broadcaster made the announcement in an unattributed statement Wednesday alongside a four-page memo summarizing a compensation review report conducted by a human resources consulting firm.

“The Board of Directors, with the advice and concurrence of the President and CEO, has decided to discontinue individual performance pay as part of the overall compensation earned by eligible employees of CBC/Radio-Canada,” read the statement.

“In order to keep overall compensation at the current median level, salaries of those affected will be adjusted to reflect the elimination of individual performance pay.”

The public broadcaster offered the bonuses as performance incentives to executives and over 1,000 non-unionized employees yearly.

CBC/Radio-Canada spokesperson Leon Mar would not say if the salaries of employees who were previously eligible for bonuses would be increased by the exact same amount as the lost performance pay.

In an email to National Post, he said that salaries would be “adjusted” to remain in the 50th percentile of compensation “for employees in our peer group of media, private, and public sector organizations.”

“ CBC/Radio-Canada will continue to set individual and corporate objectives and measure performance,” Marr noted, but did not detail what measures the public broadcaster will use to incentivize employees to hit their performance targets

The public broadcaster has repeatedly come under fire from critics, opposition parties and even the Liberal government for doling out millions of dollars in bonuses to executives all the while laying off staff.

Last year, the CBC paid out $18.4 million in bonuses to 1,194 employees — including $3.3 million to 45 executives — after eliminating hundreds of positions, The Canadian Press reported .

At the time, Conservatives said the bonuses were “beyond insulting and frankly sickening” and that the public broadcaster was at the “height of smugness” for paying them at a time of growing affordability issues.

A memo summarizing a compensation review by HR consulting firm Mercer and published by CBC/Radio-Canada says that the Crown corporation’s compensation structure has “faced scrutiny.” But overall, it describes “performance pay” as a “widely adopted strategy” and considered “best practice” within government and Crown corporations.

It also said that overall compensation, including bonuses, offered by the public broadcaster are at the “midpoint” of the market.

Thus, removing the performance pay incentives risked dropping overall compensation below market value and putting CBC/Radio-Canada at a hiring disadvantage against other private and public-sector organizations (not just in media).

“While CBC/Radio-Canada’s incentive targets are generally conservative relative to market, removing incentives altogether would position CBC/Radio-Canada’s compensation below market,” reads the memo.

“CBC/Radio-Canada should be mindful of not falling below market if it wants to retain and recruit the expertise and talent it needs to deliver on the organization’s national mandate.”

If the Crown corporation eliminated bonuses, Mercer suggested that it find other ways to compensate the lost remuneration and implement other ways to “drive and manage performance.”

The memo also argued that the public broadcaster’s executives are underpaid, but other non-unionized employees’ salaries are aligned with the market. It also says the public broadcaster’s defined benefit pension is a “key tool” for attracting and retaining employees.

“When all elements of compensation are considered, all non-unionized employee groups at CBC/Radio-Canada are currently aligned with market,” Mercer wrote in the memo.

Last fall, incoming CBC president Marie-Philippe Bouchard listed compensation as one of her first priorities when she assumed the five-year post on Jan. 3.

“I’m going to be working on making sure that we have a system that’s transparent and that people can trust in our administration and management of public funds, especially in the context of compensation,” she told MPs during a Commons committee meeting in November.

“I’m not tone deaf,” she later added.

National Post

cnardi@postmedia.com

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