Commission on the Reform of Ontario's Public Services

Other areas of school staff compensation must strike a better balance between fair working
conditions and fiscal responsibility. Many collective agreements offer retirement gratuities to
school employees, which allow them to cash out unused sick days accumulated over the
course of a career prior to retirement. Most teachers are eligible for 20 sick days per year and,
depending on the number of sick days accumulated, retirement gratuities can equal a half-year
of salary in some boards. This system offers protection against long-term illnesses. The
<strong>Commission</strong> acknowledges that most of these entitlements were grandfathered years ago for
employees with more seniority. However, even such grandfathered entitlements are difficult to
justify from the perspective of their value to taxpayers, particularly in light of the stable pension
plan for teachers that the government already co-sponsors. Since 1998, some boards have
offered retirement gratuities in the form of RRSP contributions; given the benefits of the
pension plan, this gratuity should also be reconsidered. Total provincial liability from retirement
gratuities as of Aug. 31, 2011, amounted to nearly $1.7 billion. 34
Recommendation 6-22: In the upcoming renewal of collective agreements, school boards
should negotiate the removal of entitlements associated with retirement gratuities to help offset
the costs of future economic adjustments. School boards’ power in the Education Act to offer
retirement gratuities should be removed.
The phasing out of such entitlements would lift an annual Public Sector Accounting Board
(PSAB) accrual requirement in school board budgets.
Delivering Services More Efficiently
Streamlining services to improve outcomes and reduce duplication is a common objective in
all sectors of government, but has emerged as a particular theme in the children’s services
sector. The province has responsibilities related to children’s health, developmental and social
services, and education. It also provides important support to municipalities for services such
as child care. It is important to recognize opportunities for cross-government strategies for
making the delivery of services to children and families more efficient.
34 According to the Ontario Ministry of Education Retirement Gratuities multi-year summary, the retirement gratuity liability as of
Aug. 31, 2011, amounted to $1,684,289,026.
230