Island Employment whistleblowers lost jobs, owed more than government appreciation, the commission told

Nova Scotia Labor Department officials found themselves again defending the reaction to the mismanagement and eventual November 2021 termination in November 2021 of an Island Employment Association contract.

“When the agency was closed, why was it not considered to guarantee the jobs of the 30 skilled workers who were laid off due to the fact that an (executive director), a board of directors and the Ministry of Labor mismanaged this file,” Kendra Coombes, the New Democratic MLA for Cape Breton Centre-Whitney Pier, asked Department of State Deputy Secretary Ava Czapalay during a legislative committee on public accounts.

“You are right that they are skilled workers and we took swift action to find solutions that mitigated the impact on these skilled workers,” Czapalay replied.

“One was financial, the 60 days notice, the additional eight weeks of severance pay and most importantly the capacity in Cape Breton was still there, customers still needed the services, so the interim provider needed capacity. . . . They were looking for experienced and skilled employees with the skills that Island Employment employees had.

Coombes wanted to know why the workers who “blew the clock, did the right thing and were not part of the gross mismanagement” were not given guaranteed jobs instead of the opportunity to apply for jobs.

“I have already expressed the department’s appreciation for the individuals who came forward and blew the bell,” said Czapalay.

“It was our job to act quickly and terminate the contract with Island Employment. It was the right decision, the Auditor General confirmed. Then it was our job to mitigate the impact of the employees. It wasn’t me in my office who made these decisions. I have an idea of ​​how many people were eventually employed and I have an idea of ​​their situation. The department went beyond the collective agreement and we went beyond the notice period and we went very, very fast, as fast as we could to place an interim provider who would advertise the same jobs and then a permanent provider.”

Island Employment was part of a network of 16 independent provincial service providers contracted by the Department of Labor to provide job placement services throughout Nova Scotia, including enhancing individuals’ skills and connecting with employers.

The department, acting in response to an investigation and report by the Provincial Ombudsman regarding the alleged misuse of funds by Island Employment management, terminated its agreement with the agency and ceased operations on November 21, 2021. The office of the ombudsman completed his report after concerns were raised by Island Employment staff.

Island Employment closed six Cape Breton locations in Sydney, Port Hawkesbury, Inverness, Cheticamp, St. Peter’s and Arichat.

Island Employment’s mismanagement was highlighted earlier this week in a report by Auditor General Kim Adair, which found gross mismanagement of public funds in excess of $1 million.

Adair identified three major failure points that persisted at the agency for nearly a decade.

“You have certain managers and employees engaged in unethical and unprofessional behavior, a board that mismanagement and a department that has failed to provide effective oversight and oversight of the Island Employment Association, and it has all resulted in blatant mismanagement of public funds ,” said Adair. .

Some Island Employment senior managers engaged in improper business practices that resulted in substantial unapproved payments for additional compensation, overtime, employee bonuses, double immersion and travel claims, the report said.

The audit also revealed financial transactions to fund education and employment programs for family and friends, unreasonable purchases of furniture, equipment and computers, and an alleged kickback scheme involving the executive director.

“It was a perfect storm of mismanagement, which appeared to be deliberate and systematic and designed to benefit certain players at Island Employment,” said Adair.

The Labor Department provided $9.84 million in Nova Scotia Works funding to Island Employment from 2016 to 2021, and the 16 independent service providers received millions of dollars through multi-year funding agreements, including $22.8 million in 2021-22.

The auditor found that the department was failing to meet its responsibilities to protect the public interest and provide effective oversight and oversight. The auditor’s recommendations include the completion of a comprehensive review by the department of how the Nova Scotia Works program is being conducted.

“It is critical that the department properly monitor the 16 other service providers who signed multi-year financing agreements that totaled more than $22 million last year,” said Adair.

Czapalay said she is “deeply concerned” by the Auditor General’s findings that confirmed what the ombudsman’s office found. Czapalay said the initial findings led her and Labor Minister Jill Balser to take action within a few weeks of taking up their new posts in 2021 to end the island’s labor contract and refer the matter to regional police from Cape Breton.

“We strongly condemn the actions of the people who have grossly mismanaged public funds at Island Employment,” Czapalay said, adding that the department accepted all the recommendations of the Auditor General and has already begun implementing them.

Coombes claimed that the workers who were put out of work when the contract was terminated should have been given guaranteed jobs.

“It took six months for some to find permanent jobs and jobs, four employees are still out of work and most of these employees were under the dark cloud of Island Employment, which is hard to get a job in Cape Breton find. everyone knows where you worked,’ Coombes said.

Sandra Mullen, president of the Nova Scotia Government and General Employees Union, told the committee she was pleased to have the opportunity to speak about the 30 Nova Scotians who lost their jobs at Island Employment through no fault of their own.

“Before their jobs were taken away, they were members of our union,” Mullen said.

“The AG report was a confirmation that our former members have done the right thing. And if they hadn’t, how much more public money would have been used inappropriately? How many more millions would disappear from the state coffers? And what did those 30 people get in exchange for showing integrity? They lost their jobs. Instead of protecting the workers and targeting those who were in the wrong, the executive director, the board of directors didn’t even look inward, at their government’s own oversight responsibility, they simply scrapped the program and the jobs that came with it.”

Mullen said in a press release this week Balser had the nerve to thank the former employees for coming.

“Why should working people pay the price for the government’s lack of accountability and oversight?” asked Mullen.

“They got up when they suspected something was wrong. They were right. And they did the right thing.

“Managers must be held accountable without workers putting their own livelihoods on the line. This government owes those workers more than a line in a press release.”