Saturday, April 6, 2013

7.2% raise for 1,000 best paid Ontario public sector employees

The top 1,000 employees with the highest package (salary + taxable benefits) in the Ontario Public Sector Salary Disclosure, the so-called “Sunshine List”, saw an average increase of almost $25,000 in 2012 compared to the previous year, an increase of 7.2%, much higher than the bottom half of the 80,000-strong list which saw an increase of only 2.2%.

Is this cause for alarm? Highly paid CEO's are fully in the public spotlight, and the many many school principals have their pay closely monitored, but what about the highly paid individuals near, but not at the top? The data shows that for them, 2012 was a good year.

Every year since 1996, the Ontario Ministry of Finance has released a list of all public sector employees who earned more than $100,000 in the previous year.


We can all see that “Sunshine List” champion Thomas Mitchell, President & CEO of Ontario Power Generation took a pay cut this year, but with approaching 100,000 names on the list, more sophisticated, data-drive oversight is possible.

Government-friendly observes point out that the average salary on the list has decreased, just like last year, but that is a red herring. Anyone can add over 9,000 people earning just over $100k to a list with an average salary of $129k and bring down the average. As the list continues to grow from the bottom, we can expect the average salary to decline, without this being any indicator of public fiscal discipline.

Opposition partisans will lament the increasing growth of the list, 9,000 more this year and 7,500 the year before. This is again misleading. The pyramid shape of any organisation tells us that there are more people as you move down the salary brackets. With a perfectly reasonable average salary growth at just over 2.5%, 9,600 employees graduated to the “Sunshine List” this year after having earned around $98k last year. Probably more than 9,600 employees, currently earning around $98k will be new additions to the list next year, and more the year after. Inflation and economic growth will ensure that the list grows, and the pyramid shape will ensure that it grows faster.

Top 1,000

So who are these lucky 1,000 who on average made 7.2% more in 2012?

This year the top 1000 best packages on the list included:
  • 583 individuals working in hospitals
    • 176 Pathologists
    • 50 Chief Executive Officers
    • 66 Vice-Presidents (Senior, Executive, etc.)
    • 79 Psychiatrists
  • 86 employees in electricity
    • 56 Vice-Presidents (Senior, Executive, etc.)
  • 144 working at Universities
    • 100 Professors
Big raises

Of the 1,000, 737 can be matched exactly by name and organisation type to last year. 92 of those fortunate souls saw an increase of over 25%! At the top of the pack was Mohamed Abelaziz Elbestawi, Vice-President Research/Professor at McMaster University who was reported as paid salary $266k in 2011 and $506k in 2012! Trung Kien Mai, a Pathologist at The Ottawa Hospital saw his paid salary move from $306k in 2011 to $515k in 2012!

Of those 92 with big raises:
  • 83 work in hospitals
    • 50 are Pathologists
More questions

At this point, this analysis raises more questions than it answers, but that is to be expected from an analysis of this salary disclosure data. The Public Salary Disclosure Act can help us find questions, not answers. What we do know is that:
  • Salaries near the top grew substantially
  • Those salaries grew much more, even on a % basis than those at the bottom
  • Growth was higher than expected given slow economic growth
  • Some individuals can be shown to have experienced extraordinary raises
  • Pathologists do well, and 2012 was a particularly good year for some


Timberland customer care & operations - I approve!

Buying a brand is buying quality - that's especially true for outdoor equipment.

With this belief, I purchased a pair of Timberland hiking boots that said "Waterproof" on a piece of official-looking metal attached to them. I then ended up with wet feet during an 8-day trek in Patagonia where it often rains - that sucked.

With my toes literally swimming in water within the boots, after a soppy wet day of a 19km hike, I was not a happy camper. However, my perception of Timberland took an 180 degree turn for the better.

Having bought the boots in southern Chile in a Bata store, having used them extensively and been disappointed and upset by them, I ran into a Timberland brand store 2,500km away from where I bought them, still in Chile. I went and complained about my disappointment in these supposedly "waterproof" boots, and I was offered the chance to exchange them for a brand new pair that is indeed waterproof, paying only the small price difference between the two pairs.

This is operationally remarkable:

Different stores (Bata vs Timberland)
I bought them in Bata, which is a popular international brand that happens to carry the Timberland boots. However, I was able to exchange them in a Timberland own brand store. Given the receipts I got from the Timberland store says "Bata" on it, I suspect the two are operated by the same company. However, as a western audience, can you imagine buying something in Gap and then returning in Banana Republic (same mother company)?

Different cities and provinces
I don't know how it's like in the US, but in Canada, returns and exchanges wouldn't be possible cross provincial borders. Yet, in this case, it was not a problem.

After the 14-day exchange period without the paper receipt
It was at least 3 weeks after the original purchase date, while the receipt stated a 14-day exchange period. I also didn't keep the paper receipt (trying to be light while travelling), but I had a photo of it on my phone. This I was able to email to them to enable the processing. Again, can you imagine this to happen in a western country? 

"Waterproof"  "Gore-Tex"
Finally, for everyone's learning, apparently, if it only says "waterproof", it's not waterproof. Only if it says "Gore-Tex", then it's actually waterprof.

I went into the Timberland store only to vent my frustration. I was positively flabbergasted when they offered to exchange for a new pair. Not only is the customer care commendable, but operationally that this could happen is something I would never have expected. They basically went against all the rules I know that would make this infeasible in western countries. Yet, the teens that worked at the Timberland store were willing enough to find ways to help me, a foreigner with broken Spanish, so I would have this outstanding experience and be happy with the decently expensive pair of hiking boots. How they keep the books straight on this transaction is beyond me, 'cause surely they are running Bata and Timberland as two separate business entities. 

The result: Timberland now has a new loyal customer. This is an outstanding example of great customer care made possible by some well-integrated and smooth operations.