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City offers voluntary buyouts for 17,000 workers

A voluntary employee buyout program open to 17,000 permanent municipal employees was unveiled at City Hall on Tuesday.

According to city manager Joe Pennachetti, the Voluntary Separation Program offers staff three weeks of severance pay for every year of service up to a maximum of 26 weeks of pay, and managers would get four weeks per year with the same cap.

The city has hired between 7,000 and 8,000 employees over the last decade, Mayor Rob Ford said, and can’t support the current workforce.

“We have to start looking at getting the private sector to deliver some of these services,” Ford said.

“We just can’t afford it anymore. That’s the bottom line. And this is just the tip of the iceberg …We have too many employees down at City Hall. We just can’t carry 53,000 employees.”

Firefighters, police and TTC employees are not eligible for the program. Those participating must apply by Sept. 9 and will leave their jobs between October and the end of the year.

Outstanding payments for vacation, float days and unused lieu time and sick pay are paid out when the employee quits.

“There will be some impacts on services,” Pennachetti said during an afternoon news conference.

“September will be the time that (it) will all come together.”

But some councillors called the plan hasty.

“I think it’s the cart before the horse,” said Coun. Janet Davis. “We don’t know what services will remain. What are our staffing needs?

“It’s not like all these people are sitting around doing nothing. They’re delivering services.”

Councillor Adam Vaughan said city services could be direly affected.

“You could see the entire water cleaning staff retire tomorrow,” he said. “You would notice that, trust me. You could also see everyone involved in street sweeping (gone) tomorrow. You would notice that.”

Others argued that a six-month capped payout structure wasn’t enough.

“(It should be) at least a year,” said Richard Majkot, who represents non-union workers. “Especially for the long term committed employees who have served the city well for a number of years. 

This is the first time the city has put forward a staff buyout plan since 1998 when former mayor Mel Lastman tried to cut costs by trimming city staff.

The city is in the midst of trying to close next year’s $774-million budget shortfall.

The first phase of Ford’s core service review released Monday recommended cuts in four key areas: water, solid waste, transportation and technical services.

The KPMG report said reducing recycling rates, cutting back on snow removal on residential streets and outsourcing more garbage collection could save the city money.

Part two, made public Tuesday, proposed slashing cultural programs, business services, support for business improvement areas and social support.

Councillors will debate and vote on the buyouts at the end of September.