$1.7M in severance paid to former NB Power CEO David Hay
Hay did not file objection to having amount released
After nearly eight years of keeping the amount secret, NB Power is acknowledging it had to pay its former president David Hay the equivalent of four years pay — just over $1.7 million — following his sudden departure from the utility in January 2010.
"We have come to the conclusion that we will grant disclosure to this information," NB Power's chief legal officer Wanda Harrison wrote in a letter to CBC News last month following a right to information request made about Hay's settlement package in July.
Late Monday, after giving Hay three weeks to file an objection to the information's release — which apparently was not done — Harrison sent a second letter detailing a settlement "range" that Hay received as part of his departure.
According to the letter Hay was paid between $925,000 and $950,000 in 2010 and then between $775,000 and $800,000 in 2011 for a total settlement of between $1.7 million and $1.75 million.
The amount was about four times Hay's annual salary at the time, even though he had 26 months left on a 36-month employment contract.
Harrison said disclosing payments in a range is "consistent" with how employee salaries are presented in the public accounts.
Secret for over 7 years
NB Power has kept amounts it paid to Hay secret since abruptly parting ways with the former president during the controversial attempt to sell the utility to Hydro Quebec by the former government of Shawn Graham.
Hay was the only member of NB Power's board of directors not to endorse the sale in a vote in January 2010. He abstained and then quit.
He had led NB Power for six years and was ten months into a new three-year employment contract when he left on one day's notice.
Hay earned just over $400,000 in 2009 according to the public accounts and although then-Liberal Energy Minister Jack Keir hinted in the Legislature Hay's severance package was significant, the details have never been released.
"The type of severance package that David Hay would have agreed to is the norm within the industry for a CEO at his level," said Keir two days after Hay's resignation.
Keir said Hay's settlement would eventually be reported in the public accounts but it never was.
Two years after the resignation, Keir's replacement, Progressive Conservative Energy Minister Craig Leonard, said he couldn't reveal the size of Hay's severance deal because of secrecy agreements signed by the Graham government.
"His severance package is subject to a confidentiality agreement that was agreed to by the previous government and so obviously, we have to live by that confidentiality agreement," said Leonard.
Court ruling overturns keeping severance secret
However, the province's ability to keep severance packages secret was dealt a blow this summer when Radio-Canada won a lengthy right to information fight to unseal a settlement paid to former Chief Medical Officer of Health Dr. Eilish Cleary.
In the ruling ordering the information to be released, Court of Queen's Bench Justice Zoel Dionne called the payment "public information" that government was wrong to try and suppress.
"It doesn't come from the pockets of negotiators or ministers or managers. It's from the taxpayers of New Brunswick," said Dionne in an oral ruling.
"If (government) is allowed to act in secret that's very dangerous for democracy," he said.
Following that decision CBC News made an application to NB Power to unseal details of Hay's severance.
Hay did not respond to a request for comment Monday, but he had little trouble finding work after leaving NB Power.
In August 2010 he accepted a position as vice-chairman of investment banking with the Canadian Imperial Bank of Commerce in Toronto. He retired in 2015 and currently serves as vice-chairman of the board of directors of Toronto's municipal utility, Toronto Hydro-Electric System Ltd.