This is ‘punishment’

For the past five months, the head of Jamaica's primary business development agency has not been paid because of a contract-extension dispute that is grappling with questions about whether the Aubyn Hill-appointed board was pressured into reversing a favourable decision.

The issue stems from the fact that within a five-day period in 2022, the board of the Jamaica Business Development Corporation (JBDC) swung from approving a two-year contract for long-time chief executive officer Valerie Veira, to cutting the time to one year.

What prompted the board chairman and attorney-at-law Stephanie Sterling to call a special meeting just days after the initial decision remains unclear, as both Sterling and the Ministry of Industry, Investment and Commerce say they cannot discuss the issue.

“The ministry cannot discuss personnel matters. However, a formal request can be made under the Access to Information Act,” Sterling told The Sunday Gleaner on Friday when asked about the decision by the board.

The ministry provided a near identical response, declining to speak on why the board revisited its position, what role it may have played, as well as whether Veira has been receiving compensation. She was not paid for five months up to at least March 4.

'NO COMMENT'

Yesterday, Minister Hill disclosed that the ministry was seeking advice from the solicitor general. “So, no comment,” he said, when asked by The Sunday Gleaner whether he retained confidence in the board to handle the issue and if he played any role in the board's deliberations.

Section 6 of the Public Bodies Management and Accountability Act stipulates that a board shall enter into a performance contract with its CEO “on terms approved by the responsible minister and the minister”. The one proposed for Veira is headlined a “contract of employment”.

The JBDC, a limited liability company fully owned by the Government, was established in 2001 as the premier state agency providing support services such as research, product development and capacity building, to micro, small and medium-sized enterprises.

It is projected to spend almost $550 million in the upcoming 2023-2024 fiscal year, according to Budget documents released by the Government last month.

Veira, a University of the West Indies and Harvard University graduate, has been working in the public sector for over 40 years, including being head of JBDC since its inception.

Her contract was due to end on October 4, 2022.

Months before, in July, the board's administration subcommittee concluded that Veira's performance was “commendable” and recommended an extension but left the length of time to the full board.

The board backed the extension at a special meeting on September 28, where it was also decided to offer her a two-year contract instead of the expected three years, a signal of an intent that the board wanted to consider new leadership for the entity.

On the afternoon of September 28, Veira said she met with the chairman who had invited her to a “meal”. At that meeting, the CEO said she was informed of the board's decision to retain her for two more years, which she accepted, according to internal documents obtained by this newspaper.

“As I confirmed, I am in agreement with the offer of a two (2) year contract,” said Veira to Sterling in a letter dated September 29. A signed copy of the contract was reportedly attached for the chairman's signature.

Sterling did not comment on details of the meeting when asked by The Sunday Gleaner last week.

CHANGE OF MIND

However, something changed, as 24 hours after the board meeting, the chairman told the JBDC to organise another special meeting of the board for Monday, October 3, 2022 – a day before Veira's then contract was due to expire. The agency was also asked to provide the chairman with the contact details of the board members over the weekend.

At the virtual meeting, board members who turned up were asked to reconsider their decision of September 28.

After another vote, said to be close, the decision changed and one year was approved.

That decision formed the basis of the impasse, as Veira insisted that she had signed a contract on the alleged authorisation of the chairman and the board's initial decision.

On November 1, the chairman reportedly sent a contract with an addendum to reflect the one-year decision to JBDC's human resource manager for Veira to sign.

She did not.

Instead, she wrote the chairman in a letter dated November 3 recounting the events which did not include any indication that she was formally made aware of the board's new position until she got the revised contract.

She outlined that since the October 3 meeting, she had continued working and even attended an October 24 meeting involving the chairman, without any apparent communication about board's revised position.

The CEO referred to the chairman's “directive” at their September meeting that “I prepare the contract document reflecting the agreed two years, sign and forward same to you for your signature”.

“You were informed on the evening of September 29 by telephone that the document would be sent on the following morning of September 30. This was done,” she continued.

But Veira said the JBDC received a call from the chairman's office on Friday, September 30, stating that “the JBDC should collect all the mail delivered at your office and that you would not be accepting any further documents from the JBDC”.

“As you are aware, you have not discussed with me any issue, including that related to the contract to date,” Veira said, adding that “I have continued to discharge my functions, as a matter of good faith, after the determination of my previous contract, on the strength of the agreement for a new, two-year contract.”

Veira raised four issues, among them was whether it was appropriate for the decision on an alternative contract “with a substantial amendment” to be finalised without discussion and agreement by both parties and that given contract and Jamaica's labour laws, she had started a two-year contract on October 5 “even if you have not signed that contract which you instructed me to prepare”.

It is not clear whether Sterling responded but a contract remains unsigned to date.

BOARD'S BEHAVIOUR 'REQUIRES A THOROUGH AND PUBLIC EXPLANATION'

Two senior officials of the ministry have expressed alarm at the turn of events, arguing that the behaviour of the JBDC board “requires a thorough and public explanation”.

“What or who could have caused the board to change its mind so quickly? Who was not happy? What information was discovered that was not available during the first deliberations?” asked one official, who spoke on condition of anonymity because they were not authorised to comment on the matter.

Another official, with considerable experience in corporate governance in the public sector, said: “It does not matter whether the woman has been there for a long time and a change was considered appropriate. But if the board agreed to two years and then changed, something significant must have happened. Did any board member raise an issue or they all were just happy to flip?”

A board is “free to change its mind”, especially if there is “new information” and an agreement has not been finalised, argued King's Counsel Andre Earle, whose extensive legal career includes dealing with labour law cases.

“However, the issue that arises in this case is that the board, having changed its mind, what then ought to be the position of the CEO?” he added, noting that his views are subject to additional details being disclosed.

Earle said it would have been important for the CEO to know that the board changed its position before the new contract period started on October 5, since Veira said she proceeded on the basis of the September 28 decision.

“I can't see why they would not have notified her and if that is the case, there is a strong argument for saying that there is no concluded contract, even though she went and signed it, and that issue of the length of time has not yet been agreed,” he noted.

Veira has declined a request for comment and directed queries from The Sunday Gleaner to industrial relations consultant Vincent Morrison, who she has retained.

Morrison wrote the chairman in February urging that the contract, on the terms of the September 28 board meeting, be signed because “all the legal elements necessary for the formation of a contract were established, that is to say, offer, acceptance and part-performance”.

He said Veira referred the matter to him because she had not received a response to her November 1 letter but had been working in the position without a salary since October 4, 2022.

“Since the contract has already been prepared, we hereby kindly request that you execute the contract which you offered and which our client agreed to and which our client has appended her signature, as a matter of urgency,” Morrison said in his letter dated February 24, 2023.

INSTRUCTED TO PAY SALARY

The chairman revealed that she was not aware until February 27 that Veira was not being paid, according to a letter she wrote to the JBDC's deputy CEO, Harold Davis, and obtained by this newspaper.

She said the salary issue was not raised by the management or the administration and finance subcommittees of the board.

According to Sterling, a new contract for Veira “is currently being negotiated with [the] board but “in the interim, the CEO should be paid on a monthly basis at the salary under her previous contract”.

“We ask that you facilitate the treatment of this matter as urgent,” she said.

Payment was reportedly being processed last week.

Noting that the board did not give notice it was even intending to vary the terms of the expiring contract before proposing two years, Morrison said the situation raises questions about the JBDC's board.

He described the lack of pay for over four months as “punishment”.

“Having written to the chairman, I am disappointed that up to this time, my letter has not been properly acknowledged. Yes, I got an email from her saying she will revert to my letter. There was no timeline. We don't operate that way in the trade union movement,” he told The Sunday Gleaner.

Morrison added: “I am calling upon the chairman of the Jamaica Business Development Corporation to sit down with the CEO, something that she has not done since last September, and have this matter sorted out. This shouldn't take more than 30 minutes, if it needs such a long time.”

jovan.johnson@gleanerjm.com