Politics

WE Charity saw resignations, departures from senior ranks before landing government contract

A charity under scrutiny after receiving a contract to administer a $900 million government program has gone through an organizational upheaval over the past few months, CBC News has learned.

Layoffs and changes to board all linked to COVID-19, said WE

Prime Minister Justin Trudeau arrives on stage for We Day on Parliament Hill in 2017. (Justin Tang/The Canadian Press)

A charity under scrutiny after receiving a contract to administer a $900 million government program has gone through an organizational upheaval over the past few months, CBC News has learned.

The chairs of both the Canadian and U.S. boards of directors for the WE Charity resigned in the spring. The vast majority of the other board members in the two countries have been replaced as well, and staff have been laid off in response to the COVID-19 pandemic.

The flurry of changes began about two months before the federal government announced WE was the only organization in Canada able to administer the multi-million dollar Canada Student Service Grant initiative.

Changes at the top

The reasons for the resignations in WE's upper ranks remain unclear. The former Canadian chair of the board of directors, Michelle Douglas, tweeted that she resigned on March 27 and that "almost all" of those on the Canadian and American boards resigned or were replaced around the same time. She declined to explain why when approached by CBC News.

An earlier tweet from Douglas does hint at a push for more transparency from the organization.

In April, a tweet from Douglas directed at WE co- founders Marc and Craig Kielburger raised questions about work done in Kenya. WE said it had provided "life-saving #COVID19 prevention information" to more than 84,274 people in Narok County.

"Great work @WEMovement. But what are the details? How is it possible to have managed to reach so many? Such a specific number. Wow! How did you do it? Share info on your efforts so they can be replicated by others!"

Many board members approached by CBC News did not respond to a request for comment. A few indicated that their terms on the board had simply come to an end. But filings with the Canada Revenue Agency show all the board members' terms were slated to run until Aug. 31.

The WE Charity's new board chairs say the organization simply sped up planned changes "in order to best position the organization to respond to a predicted multi-year global pandemic."

That statement comes from a letter from the two new chairs — Canadian Greg Rogers and American Jacqueline L. Sanderlin — which WE shared in response to questions from CBC News.

Most board members have been replaced

The letter states that, as WE was approaching its 25th anniversary, many board members had been in place for more than five or 10 years. The letter says the organization decided to undertake a strategic review to focus on future priorities and to "address issues such as diversity, inclusion and range of competencies."

WE maintains separate boards of directors for Canada and the United States, but the two boards meet jointly as a "North American Board of Directors." The letter says that WE reduced the number of spots on its board and replaced the majority of its members. Of the 14 people who made up the North American board, only three remain.

Most of the new board spots "are now filled by persons of colour, including the U.S. Chair," says the letter.

"Any transformation of this kind naturally invites some challenge. Overall, we believe the renewal process has strengthened the two Boards and will help to guide the organization moving forward."

First layoffs, now 'short term' hires

Around the time board members were departing, WE also began to lay off staff.

Two sources with knowledge of the organization describe the number of layoffs as significant. WE did not answer CBC's question about the number of staff who have lost jobs.

WE's operations would have been particularly vulnerable to the effects of the pandemic. One of its most prominent activities is "WE Day" — a series of events that bring together thousands of students to celebrate youth leadership. COVID-19 has made such gatherings impossible.

Charities everywhere have seen donations dry up as individuals and businesses focus on their own financial woes.

ME to WE, the charity's for-profit sister company, sells international travel packages that promise cultural immersion or volunteer experiences — things like helping to build schools abroad. Most of that company's profits are donated to the charity.

"Due to the impact of COVID-19, like many others, we were forced to lay off employees, especially from our global service travel and live events division," WE said in a media statement.

Now that WE is administering the Canada Student Service Grant program, the organization has "invited former staff to apply for open short-term contract positions."

Hundreds of people will be needed to run the grant program and hiring is still underway, the organization says.

The federal government has said it has "currently allocated" $19.5 million to WE to run the Student Service Grant program; $5 million of that sum is intended for other not-for-profits involved in the program.

The precise amount WE receives, however, will depend on how many students participate. The initial goal was to offer 20,000 placements; as of Tuesday the government said it already had received 28,500 applications.

Prime Minister Justin Trudeau has defended the decision to give the contract to WE. He said WE's networks across the country made it the right choice and the organization itself won't make any profit from the contract.

"Quite frankly, when our public servants looked at the potential partners, only the WE organization had the capacity to deliver the ambitious program that young people need for this summer that is so deeply impacted by COVID," he told reporters Monday.

'Insulting to our members'

The Public Service Alliance of Canada, which represents some 140,000 public servants, pushed back against that claim.

"Mr. Trudeau's claim that WE Charity is the 'only one' that can administer the new grant program is not only factually wrong, it's also insulting to our members," said PSAC National President Chris Aylward. "PSAC members have worked hard to support the government's rapidly evolving response to the pandemic and remain committed to continuing doing so."

The Conservatives are now asking Canada's procurement ombudsman to review the $912 million program. They made a similar request of the auditor general.

"Outsourcing a $900 million-dollar program designed to pay students and recent graduates for volunteer work to a third party raises justifiable concerns and a number of questions," said three Conservative MPs in a letter to the ombudsman.

They also pointed to five other sole-source government contracts handed out to WE and asked that those contracts be reviewed.

Sophie Gregoire Trudeau on stage during WE Day UK 2020 on March 04, 2020 in London. (Gareth Cattermole/Getty Images)

The Conservatives note that Trudeau and his family have numerous personal connections with WE. The prime minister has appeared at many WE events, while his wife Sophie Grégoire Trudeau is an "ambassador and ally" of WE and hosts a podcast with the group focused on mental health. Trudeau's mother has also done work with the charity.

WE insists no member of the Trudeau family receives an honorarium for work with the charity, though Grégoire Trudeau has had her travel expenses covered.

Trudeau has not shied away from his connections to WE.

"I have worked with WE in the past," he told reporters Friday, "because I believe strongly in promoting opportunities for young people."

Trudeau said he and his family will continue that work in the future.

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About the Author

Catherine Cullen

Parliamentary Bureau

Catherine Cullen is a senior reporter covering politics and Parliament Hill in Ottawa.

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