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Conflict of Interest Analysis

07-May-2011 [144]

In the fall of 2009, City management suggested that a part-time Dufferin Grove rink staff was in a conflict of interest. While working on contract the staff member met with senior parks management to suggest ways that rinks could be improved.

City managers have since raised concerns that other staff are in a conflict of interest position. However, none of these concerns have identified the specific actions that cause the conflict of interest. Park staff who also work on improving parks and rinks in their capacity as contract researchers wondered if they were, in fact, in a conflict of interest. CELOS researched basic definitions of conflict of interest, and then looked specifically at the City of Toronto Conflict of Interest policy in light of its purpose and whether or not it applies to park staff in this context, and in the specific case of the park staff seeking rink improvements.

Conflict of interest - definitions

The Canadian Encyclopedia defines conflict of interest as follows

"Conflict of interest may be defined as a situation in which politicians and public servants have an actual or potential interest (usually financial) that may influence or appear to influence the conduct of their official duties (see PATRONAGE; CORRUPTION). Even when this conflict is not illegal, it may create doubts or suspicions concerning the integrity or fairness of decisions made by such officials, and over time recurring conflicts may increase the level of distrust and cynicism toward government. In Canada, conflicts of interest have arisen when, for example, the ownership of land by the family of a provincial Cabinet minister could have influenced the minister's decision to approve a new subdivision or influence other officials to do so; when a senator invested money in a firm that subsequently received a lucrative government contract; and when a former federal Cabinet minister had dealings with his department that may have resulted in favouritism in the government's decision to issue a grant to the minister's new company."

City of Toronto Conflict of Interest Policy

Purpose of the Policy - what harm is the policy meant to avoid?

The policy talks about the need for employees to avoid placing themselves in positions of conflict of interest and of "potential" conflict. The purpose of this policy appears to be twofold. It alerts people in a position of influence - most obviously, senior staff who influence decisions made by their superiors or by Council - that they must not involve themselves in city matters, provide advice or take actions in which they have a personal interest, or in situation in which their friends, associates, family members, etc. stand to benefit. Aside from setting a standard of behaviour within the Corporation, this policy presumably also provides a reference for disciplinary action.

Who does the policy apply to?

"Application This policy applies to all City of Toronto employees. The standards outlined in this policy are particularly relevant to employees who are in a position to make or influence decisions of the organization."

The Application section of the policy seems to have little or no application to any of the park staff, because none of the staff are in a position to make or in any way influence City decisions:

Further on, the policy again emphasizes the particular concerns about conflict for management and professional staff, and employees who work on program policies or budgets.

"Guidelines for Management and Professional Staff Some positions in the organization are more susceptible than others to conflicts of interest. The following two sections are specifically for executives, managers and employees who give professional advice or assistance, or who work on program policies or budgets. These sections also refer to employees in confidential positions working with the above mentioned staff."

Is the City policy intended to apply to part-time casual recreation workers at Dufferin Grove or other local parks? In particular, is the staff member who - while working not as city staff, but on an independent contract basis - met with senior parks management to discuss simple, inexpensive rink improvements in a conflict of interest?

S, one person who works for the park, is a casual parks employee of Local 79. After 5 years of experience, she makes $16.91 per hour, collects no benefits and has no guarantee of work hours. The formal reporting structure for her position is 5 levels below the General Manager (the highest level of Parks staff).

In the course of separate contract work, S met with senior parks management to propose ways of improving rinks, based on her experience and expertise. Parks management suggested that she was in a conflict of interest.

To date, in S's [?] years of work, no one in the corporation has ever sought her considerable experience or opinions about what makes parks and rinks work well for the people who use them. She is, in fact, in no position to influence city decisions in any way at all.

Definition of conflict of interest

The definition of a conflict of interest does not appear to pertain to S in any way:

"Definition A conflict of interest refers to a situation in which private interests or personal considerations may affect an employee's judgement in acting in the best interest of the City of Toronto. It includes using an employee's position, confidential information or corporate time, material or facilities for private gain or advancement or the expectation of private gain or advancement. A conflict may occur when an interest benefits any member of the employee's family, friends or business associates."

To the contrary, the combination of S’s long-time experience as recreation staff gives her a unique vantage point from which to offer suggestions to enhance people's use and enjoyment of their city facilities, and in doing so, furthers the City's interests. In her contract work, S puts forward ideas and suggestions about what makes parks and City facilities work well, in a cost-effective and responsible way.

The City policy contains other categories of prohibitions, none of which appear to apply to S. There is certainly no conflict between S's contract work and her duties as a city employee, as stated above. She has no confidential information; in fact, she is often not even given the information she requests to do her job well and to keep park users informed about park activities such as scheduled rink clearing, picnic permits, etc.

Nor is the use of city of property an issue:

"Using City Property Employees may not use, or permit the use of, items of city property, facilities, equipment, supplies or other resources for activities not associated with their work. Any exceptions to this must be expressly approved by either Council or the Deputy City Manager of the affected division."

Examples of conflict of interest in the policy

The policy offers examples of situations to clarify when a conflict situation does and does not exist. One example below, which does not involve any conflict, is similar to S's position. The square brackets are not included in the policy; they have been added here to describe the facts involving S's work.

Appendix 1: Sample Questions and Answers - Outside Work or Business Activities

Question: "I am a paramedic [casual parks employee] and I have been asked by an accredited institution [CELOS] to teach a course [show city officials how to make rinks more accessible and enjoyable for skaters]on CPR. I will be paid [on a contract basis for my services] a fee for this course. Am I permitted to teach the course?"

Answer: Yes, as long as you are not teaching individuals that you would normally be teaching as part of your job [S does not advise senior parks or recreation staff on the best ways of running rinks] and do not wear a city uniform when teaching the course [representing CELOS in meetings with senior city staff].

The Implementation section of the policy requires that senior management understand the purpose of the policy and how it works. In cases where they are unsure if the policy applies, they must seek clarification and advice from senior management. Managers and supervisors also have a duty to "highlight any of the rules that have particular relevance, given the nature of the employees' work".

"Implementation Managers and supervisors must make the policy available to all employees and must discuss the entire policy with their employees and highlight any of the rules that have particular relevance, given the nature of the employees' work. Managers and supervisors who need assistance interpreting rules and how they apply to specific situations must talk to their division's executive directors, general managers or division heads. Serious consequences may result from the contravention of this policy. Employees should check with management if they need assistance in interpreting whether a situation they have experienced or are confronting puts them in a conflict of interest situation."

The policy is clear that a city employee faces "serious consequences" if s/he breaches the policy. In view of this, it is reasonable to assume that managers are under a duty to proceed carefully, responsibly, and with a clear statement of the actions that constitute a conflict of interest when raising concerns with an employee. Presumably, vague suggestions that a conflict exists would not be enough to establish any breach; if it were, committed employees would be under the constant fear that an alleged but undefined “failure to comply with this Policy” would leave them vulnerable to “disciplinary action up to and including dismissal”.

In view of the the stakes involved, one would assume that city management would do a number of things:

- ensure that senior officials understand the intent and substance of the policies they cite

- focus on addressing those situations that the policy was designed to address

- in cases of possible concern, seek advice from senior management and legal counsel

- in any case in which a conflict is found to exist, notify the employee, in writing, of how s/he is breaching the policy

City policies are designed to make the city run better for citizens and neighbours who live here. Policies that are poorly understood or applied risk exposing the city to time-consuming and costly grievances or other recourse. More importantly, as is the experience at Dufferin, vague suggestions about conflict of interest, together with the potential consequences of a such a breach, lead to the situation in which hard-working, creative, committed staff simply leave their jobs, leaving parks and public spaces the poorer for it.

In summary, the policy seems to have little or no application in the actual "case study" for the following reasons:

- an overall review of the policy suggests that it is designed to prevent potential abuses of position by people in positions of influence; a park staff member is not in a position to influence city policy or decisions

- a park staff person is not in a position to gain potential benefits from her/his contract work

- a park staff member does not use city property to further his/her outside work

- the example of the paramedic given in the Appendix to the city policy seems analogous to the position of S

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