Ombudsman Fiona Crean speaks to reporters, April 22, 2014.
The CEO of the Toronto Community Housing Corporation still has his job Tuesday night despite a damning report from the city ombudsman that raised serious questions about his conduct.
An investigation released Tuesday by ombudsman Fiona Crean determined that CEO Eugene Jones and other senior management ran the housing agency "as though it was their own personal fiefdom" and "repeatedly broke TCH recruitment rules" as they oversaw a massive shakeup of the agency. This led to what Crean described as a "climate of fear" within the city-owned housing provider that is also Toronto's biggest landlord.
The investigation covered the period from June 2012, when Eugene Jones was hired as the agency's CEO, to October of 2013. Crean launched the review after she received complaints from a number of current and former TCH employees.
Jones was brought in to head the TCH following an expense scandal that Mayor Rob Ford used as a rationale to clean house at the agency. In the 18 months after Jones's appointment, there was a 67-per-cent turnover rate among management and non-union staff, according to the report.
Crean determined that during this huge staffing overhaul, Jones and other senior executives ignored TCH policy by: hiring employees to positions for which no job descriptions existed; failing to open up job offers to competition; paying employees wages that were "arbitrarily determined;" altering the severance terms of contracts without sufficient notice to staff; hiring people the executives knew from previous jobs without declaring a potential conflict of interest.
Of the 233 staffing changes during the 18-month period, Crean found there were only files on 119 of them, and most of those appeared to be incomplete.
She also found that the TCH board failed to ensure that appropriate HR practices were being followed, and instead accepted "the rationalizations proffered by the CEO and other executives."
In one instance, Jones appointed senior staffer Graham Leah to the vice president , asset management position without any interview four days before the posted job competition closed. Leah hadn't even applied for the position, but Jones told Crean it was "my prerogative" to hire him.
In another case, Jones hired Lisa-Joan Overholt a former executive assistant Councillor Vince Crisanti to work as a manager with no job posting, no job description, and no competition. A few months later Jones promoted Overholt to senior director, and gave her a raise of $30,000 without conducting a performance review.
In another instance, Jones recategorized the of his executive assistant, Leisin Chan, as a "management" position and bumped her salary up two wage grades with no review or rationale. She collected paid overtime even though as "management" she was ineligible to do so, and in December 2013 her pay hit over $100,000, which meant she would appear on the annual "Sunshine List." In an apparent effort to avoid public embarrassment her salary disclosure would cause, at Jones's insistence some of her overtime pay was reversed and then later paid out in January 2014.
"This is a story about the failure of leadership from the top," Crean said at a press conference on Tuesday morning. "The CEO set the tone, describing every move as his prerogative. He believed that he had no responsibility for knowing the rules."
Crean said she met with Jones on April 15 to share her findings and he said he hadn't thoroughly read the report. The ombudsman said his participation in the meeting was "minimal."
"I am perplexed by his reaction and demeanour," she wrote.
Crean made 12 recommendations to the TCH board, all of which it accepted. They include that the agency follow its own HR policies, train its executives in those policies and expand its conflict of interest policy.
The board held an emergency closed-door meeting at its Rosedale headquarters on Tuesday afternoon and afterwards board chair Bud Purves delivered a statement thanking Crean for her report, which he said raised "issues of leadership, of improper management practices and of insufficient oversight."
"The board acknowledges the need to address these issues," said Purves, announcing that the board would continue its discussions on Friday.
He took no questions from reporters and made no direct mention of Jones, but a spokesperson for the agency said there "was no announcement of any changes" to the CEO's status.
The board voted 12-1 in February to keep Jones when questions about his hiring practices were first raised. Instead they stripped him of his bonus and ordered him to undergo executive management training.
Mayor Ford, who has been Jones's most vocal supporter at City Hall, told reporters Tuesday afternoon that he stood behind the embattled CEO. Although Ford has built his political career on attacking wasteful spending and public sector workers who he claims are overpaid, the mayor said Jones had done "a phenomenal job" and firing him would "do tremendous damage to the city."
Concerns about Jones's leadership remain. Councillor Paula Fletcher suggested that the ombudsman's findings were comparable to the expense scandal that allowed Ford to oust the previous board in 2011.
"A board was fired for $5 boxes of chocolate," Fletcher told reporters. "And now we have a board that has overseen very questionable hiring and firing practices that have left, I believe, a weakened corporation."
The councillor said she was concerned that the wholesale staffing changes have left the agency bereft of institutional knowledge on the complicated housing file. Rosie DaSilva, a tenant activist who has lived in a single-family TCH home since 1981, says the report shows the organization is sadly lacking leadership.
DaSilva says that the controversy around Jones is a distraction from what should be the agency's priorities, like fixing its gargantuan repair backlog, which now sits at $862 million and climbing. She's been waiting for repairs to her home for seven years.
"At the moment he certainly isn't meeting the needs of tenants," she said of Jones.
But among other tenants, there is still support for the CEO's leadership style.
Bonnie Booth, who has lived in social housing for 32 years, claimed things have improved during Jones's tenure.
"The staff is accountable. And they know that if they don't do their jobs Mr. Jones will be out to see," she said.