December 14, 2011
25.4.150
Background
The employee grieved the department's decision to implement a new methodology pertaining to the calculation of the education allowance.
Bargaining Agent Presentation
The Bargaining Agent representative indicated that the grievor was not treated within the intent of FSD 34 as education allowances for the grievor's two children were not calculated in accordance with the approved methodology in FSD 34 and the grievor was not advised of the unauthorized change in methodology and consequential reduction in allowances until after a cross-posting had been accepted.
The Bargaining Agent representative noted that it is agreed that the Deputy Minister has been authorized to adjust allowances, ceilings and dollar amounts on the recommendation of the appropriate Foreign Services Interdepartmental Coordinating Committee. However, FSD 34.04 and FSD 34.06 specify the methodology to be used in establishing the maximum amounts payable for board and lodging for secondary and post-secondary education in Canada. The FSDs do not provide a methodology to determine a lesser ceiling to recognize situations where dependent children continue to reside in the family residence. The Deputy Minister's delegated authority does not extend to revising the methodology but is limited to revising the maximum amounts/ceilings in accordance with the methodology stipulated in each of the FSDs and to approving individual requests for an Education Allowance, within the approved ceiling. A change in methodology can only be made as a result of cyclical review of the FSDs.
The Bargaining Agent representative further stated that although the grievor was advised that a review of the methodology should take place, the grievor was never advised that a change had been made until after the cross-posting and the children's education allowance proposal was reduced to reflect the amounts resulting from the new methodology. The department had a responsibility to follow up with the grievor when the revised (ad hoc) methodology had been put in place.
As the Deputy Minister does not have the authority to revise the methodologies established under FSD 34.04 and FSD 34.06, nor was the grievor informed of the revised methodology prior to cross-posting, it the Bargaining Agent's position that the grievor was not treated within the intent of the Directive.
Departmental Presentation
The Departmental representative noted that the grievor was treated within the intent of the Directive. Working Group B analyzed previous education allowance submissions from the grievor and determined that the grievor had been in receipt of a duplicate payment. The intent of the FSDs is to provide financial assistance and not for the employee to gain a personal profit. Furthermore, the methodology for this allowance is not meant to cover all the costs of maintaining a principle residence for dependents, nor of replacing rental income which an employee may have received had the principal residence been rented out. Therefore, the department reiterates that the calculations for determining the appropriate amount were modified accordingly, taking into account that employees can claim for more than one child while dependants remain in the employees' principle residence.
The Departmental representative stated that although the grievor had received duplicate payment in previous years, the department decided that it was an administrative error and elected not to recover the overpayment. The submissions grieved were reviewed and analyzed with the correct calculations and payments were made accordingly.
The Departmental representative emphasized that FSD 34 does not contain a description of the methodology to be applied for both article 34.04 and 34.06, but rather it contains an absolute ceiling on what could be approved under the guidelines. The approval process clearly delegates this authority to the Deputy Minister of DFAIT. Furthermore, FSD 34 does not stipulate anywhere a methodology for determining education allowances for dependents that remain in the employee's principle residence while the employee works abroad. As such, Working Group B did not change the methodology, but instead recognized a situation that is not accounted for in the directives.
Therefore, the Department representative believes that the grievor was treated within the intent of the Directive and was compensated correctly for each child for the academic years grieved.
Executive Committee Decision
The Executive Committee considered and agreed with the report of the Foreign Service Directives Committee which concluded that the grievor was treated within the intent of the FSD 34 in part. It was agreed that the grievor was provided with allowances to offset the costs and that the intent of the Directive is not for employees to gain a personal profit, nor to be compensated for lost opportunities.
Furthermore, the Committee noted that until a methodology can be considered in the next cyclical review of the FSDs, an employee should be compensated the greater of the allowance produced by the application of the CMHC data or actual and reasonable costs/expenses for board and lodging which can be supported by evidence satisfactory to the deputy head, up to the ceilings established under FSD 34.04 and FSD 34.06. Costs for lodging (shelter) shall include those for taxes, maintenance and repairs, utilities, insurance, security, etc. but exclude mortgage payments and lost opportunity costs.
The Committee also noted that should the grievor be able to provide evidence of actual and reasonable expenditures of the board and lodging of the two children to the department, which exceeds the allowance established by Working Group B (based on CMHC data), the grievor shall be compensated for the difference.
As such, the grievance was upheld in part to the extent noted above.
**Update February 26, 2014
In light of an ongoing dispute between the parties regarding the settlement of this grievance, it was requested that the Executive Committee's decision letter of January 18, 2012 be clarified.
As such, the Executive Committee considered and agreed with the report of the Foreign Service Directives Committee. It was agreed that the intent of "maintenance and repairs", with specific reference to this grievance, means immediate need of repair such as a leaking roof. It does not include the replacement of appliances or renovations. "Maintenance," for the specific purpose of this grievance, refers to grass-cutting and snow removal. It does not include preventive measures. Furthermore, the Committee specified that with reference to the decision letter of the Executive Committee in January 2012, the intent of "evidence of actual and reasonable expenditures" refers to the requirement of providing receipts.