– Intro –
Air Canada Component Trustees’ Audit Report
Audit period: July 1st 2008 – June 30th 2009
Ever year, two audits must be conducted on the Component’s financial books. (We are behind in our audits, and due to last years negotiations, we were unable to catch up and be up-to-date.) One audit is done by professional auditors, who ensure accounting procedures are properly followed. For this period, chartered accountants Finucci Watters did the audit and their report will follow this introduction letter.
The other audit is done by Component Trustees. The role of Component Trustees is to make sure the Component Secretary-Treasurer is complying to the rules and responsibilities set out by the CUPE Constitution, the Airline Division by-laws and the Component by-laws. To be more specific, the most important duty of any Secretary-Treasurer is to ensure all income owed to the local or component is collected and that the local or component’s funds are properly spent.
This means ensuring that:
∙ No one steals any of the local or component’s money.
∙ Funds are spent the way the members intended.
Everyone who is an Air Canada CUPE member pays union dues. There are no exceptions.
Air Canada deducts our union dues (1.5% of gross income) every month from our pay, and hands over the funds to the component. In the year we are auditing, over $4 million was collected in union dues. The component accountant divides these funds into three parts. Each local with more than 2,000 members receives $6 from every member plus $600 every month. For the smaller locals (Montreal, Calgary and Vancouver) the monthly lump sum is $3,250. CUPE National receives $18.09 from every member and the remainder stays at the Component. To illustrate this: if $60 is deducted in union dues from a member, $6 would go to their local, $18,09 would go to CUPE National, and the remainder, approximately $35, would remain at the Component.
Our role as Trustees is to make sure that each local and CUPE National gets their portion of funds, and the dues used by the Component, is spent by the guiding rules of the CUPE Constitution, the by-laws and by the will of the membership.
This report is made so all members can know and understand if their dues are properly spent and if any improvements are needed.
We met from February 13-17, 21st, 23rd , March 2nd, April 16th and May 31st of 2012. We noticed some committees were over budget and we investigated on the reasons why. In this period we are auditing, our component had to contend with lay-offs in Vancouver, two base closures, negotiations, component and local elections. Consulting and legal fees have increased considerably due to these events.
We have made some recommendations which we hope the component officers and the local presidents will consider and adopt. We hope all Air Canada CUPE members will receive this report. And, we encourage all local Presidents to invite us to their next local meeting, so we can present our report directly to the members and answer any of their questions. Thank you.
|Evelyn Bell-Bedard||Sal Occhiuzzi||Marc Roumy|
Dated: May 31st, 2012
– Report –
Air Canada Component Trustees’ Report & Recommendations
Audit Period: July 1st 2008 – June 30th 2009
1) PAY DISPUTE:
On review of the cheques written by the component, a red flag was raised when it was noted that 15 consecutively numbered cheques were paid to one person on the same date. Upon further investigation it was discovered that the secretary-treasurer at that time disagreed with the interpretation of compensation for her position rendered by the component president.
The secretary-treasurer believed “any” company paid release entitled her to full top-up to the highest earner as is the case with the president and the vice-president. The president’s interpretation at that time was that a full-time company paid release was required to be entitled to full top-up. (To be on a full-time company paid release, the secretary-treasurer would have to be a member of a committee, such as the hotel or grievance committee.)
More than a year later, the new component officers chose to “disregard” the previous president’s interpretation, and “advice on an interpretation” was sought from CUPE National President, Paul Moist.
Paul Moist advised that the bylaw “as written”, allowed for the pay top-up combined with “any” company paid release. The officers used his advice to pay the officer involved more than $20,000 retroactively.
In consultation with CUPE National, no evidence was found that an appeal had been filed, no retroactive advice was sought and it was believed the interpretation given by Paul Moist was for the go-forward.
We believe if an appeal had been filed, Paul Moist would have been obligated to review the previous president’s decision.
Our by-laws clearly state that the component president shall:
“7.1(e) Have sole authority to interpret the Component Bylaws, subject to appeal to the National President of CUPE”
The officers involved chose to disregard the previous president’s interpretation and in so doing, disregarded the bylaws pertaining to appeals. The proper process would have been to file an appeal with CUPE National, thus obligating Paul Moist to thoroughly investigate the interpretation, bylaws and past practice in question.
No member is above the bylaws. The bylaws are in place to protect the interests of the membership.
The trustees recommend a forensic audit be done on this retroactive pay.
Any money paid contrary to the bylaws should be repaid to the component.
2) OPEN FLYING BY COMPONENT OFFICERS:
During this audit period, a component officer was open flying while on a full-time
Union release. It is unclear how this officer was paid for the open flying.
The trustees strongly disagree with this practice. Officers on a full-time release are compensated for open flying they could have flown.
The trustees recommend it should be reflected in the bylaws that any officer on full-time release as per the MOS “Memorandum of Settlement” dated March 27, 2007, should not open fly.
As we are unclear as to how this officer was paid for open flying, we recommend the open flying be included in the forensic audit.
3) COMMITTEE AND DELEGATE REPORTS:
The component spends a considerable amount for members to attend as delegates for conferences and conventions and to serve on various committees.
The trustees recommend that those members submit a written report to the component and it be posted on the component website. At a minimum, at least one report should be submitted on an annual basis. This would allow all members to easily access the information collected from component committees and to understand how their union dues are spent.
4) COMPONENT OFFICERS DISPUTE:
A lawsuit was filed by one component officer against another.
A motion was passed by ACCEX to seek an impartial legal opinion to clarify if union dues should be used to cover legal fees for an elected officer. A $9,000 expenditure was incurred for this. The legal opinion was disclosed to ACCEX, excluding the two officers involved.
Since the lawsuit is ongoing, this opinion remains confidential.
It is the trustees understanding that a decision has yet to be made.
Without prejudice, it would be our recommendation that ACCEX make a decision on this outstanding issue. We also recommend that the bylaws be amended to provide legal protection for elected officers in the future.
5) GOING OVER BUDGET:
It is understood a committee can go over budget due to unforeseen expenses.
The trustees recommend that a mechanism be put in place to address when a committee goes over budget during the course of the fiscal year. This could aid in keeping some of the component’s costs down. We suggest the Component Secretary-Treasurer and the committee chair review expenditures when over budget. A brief explanation should be noted and added to the committee’s file.
6) JETZ FLYING:
At the time of our last trustees report, the JETZ reconciliation was still in dispute. In result, the trustees would like to report that the union received a credit of $288,539 for the actual hours flown in addition to the published JETZ blocked time.
7) RECONCILING COMPONENT OFFICER’S EXPENSES:
Some expense claims for the first part of 2009 were filed after June 30th. In agreement with the current component officers, the trustees will revisit expense claims filed after June 30th, 2009 and will report to the membership in the next audit.
8) REWARDS PROGRAMS:
Hotel, car rental (and other costs) which are provided to union members by component, currently allow its members to collect reward program benefits. These benefits should be the property of the component and be incorporated back into the component in order to offset future costs, that is for hotel rooms, meeting rooms, meals, etc.
9) TAXI RECEIPTS:
When reconciling expenses, it was noted that taxi receipts only had a dollar amount showing.
The component trustees recommend they be filled in showing pick-up point and drop-off point, as well as date and amount.
10) MEMORANDUM OF SETTLEMENT “MOS”:
In March 2007, the Union and the Company entered a Memorandum of Settlement outlining the minimum number of company paid hours for union officers.
The trustees recommend that this MOS be made available on the Component website.
In concluding this report, we would like to thank the component, CUPE National representatives and all of the staff at Belfield in assisting us in this audit.
We hope every member will take the time to read this report. We are all available to answer any of your questions or concerns.
We can be contacted by email at email@example.com
|Evelyn Bell-Bedard||Sal Occhiuzzi||Marc Roumy|
Dated: May 31st, 2012
COMPONENT OFFICERS PAY
In light of the pay dispute discussed in this report and in the interest of clarity and
fairness, we would like to recommend that the Bylaws be amended to reflect a set number of hours per month as compensation for all three component officer positions rather than fluctuate with the highest earner in the bargaining unit. This would eliminate any need for interpretation or subjective discretion in regards to an officers pay.
Also, the role of the secretary treasurer should be better defined and compensated accordingly.
Anyone running for the positions would then know exactly what to expect.