FLA COCK-UP - Agency pays out $8m excess in termination benefits in breach of guidelines
Published:Thursday | January 14, 2021 | 12:21 AMEdmond Campbell/Senior Staff Reporter
The Auditor General’s Department has warned the management of the Firearm Licensing Authority (FLA) that action may be taken against responsible officers for paying out more than $8 million in termination benefits, in excess of the amount due, to five former employees in contravention of the Ministry of Finance guidelines.
Pamela Monroe Ellis, the auditor general, said in her annual report tabled in Parliament on Tuesday that the FLA paid the former workers an additional amount of $8.4 million in termination benefits in breach of the finance ministry’s fixed-term contract officers’ policy guidelines.
She said that payment of termination benefits contrary to the ministry’s guidelines exposed the FLA to increased risk of loss.
The FLA terminated the employment of the former employees in 2017, paid them notice pay ranging from three months to 20 months and gratuity without the requisite performance evaluations.
One officer was also paid three months’ travelling allowance as part of his termination package.
The termination agreements for four of the former employees did not state why they were fired and management did not provide any evidence of the reasons for their dismissal.
The other employee was sent home with immediate effect after tendering his resignation and giving the FLA three months’ notice.
Explaining why the excess sums were paid, the management of the FLA indicated that “in accordance with clause 9(i) of the said policy, the Firearm Licensing Authority entered into mutual agreement (separation agreement) with four employees”.
It said that the “the mutual agreement facilitated changes in the terms and conditions of the existing contracts of the individuals and was done prior to the expiration of their original contracts. It was on this basis that the FLA made payments to these four employees”.
However, Monroe Ellis pointed out that the evidence presented revealed that the referenced agreements were separation agreements, which resulted in the immediate termination of the officers’ employment contracts and did not facilitate changes in employment terms and conditions as intended by clause 9 (i).
Additionally, the FLA did not provide any evidence that the finance ministry had given permission for any material changes to the contracts of the former employees, as required by clause 10 (iii) of Circular No. 15.
The FLA management was reminded that they are required to act in accordance with the guidelines issued by the minister responsible for the public service in all matters relating to emoluments payable to staff in keeping with Section 20 of the Public Bodies Management and Accountability Act.
And the firearm licensing body also came under scrutiny for inadequate controls over fixed assets and inventories.
The audit of the accounting records and financial transactions of the FLA for the 2017-2018 financial year identified weaknesses in the agency’s controls over fixed assets and inventories.
“We were unable to determine the accuracy and completeness of the inventories balance totalling $2.5 million due to the absence of sufficient and appropriate evidence to support this amount in the accounts,” the auditor general noted.
She reported that the FLA management was not able to provide a record of the detailed movement of inventories, as they reported that the relevant records could not be located.