The total compensation and other compensation elements, such as severance, for more than 400 executives at post-secondary institutions in Alberta will be capped, the provincial government has announced.
“This helps to bring Alberta’s post-secondary executive compensation in line with other provinces to ensure tax dollars are spent as effectively as possible and benefit all Albertans,” said Charlotte Taillon, press secretary for Alberta Minister of Finance Travis Toews.
The total compensation cap includes salaries and benefits, which can include vehicle allowance, health benefits and retirement benefits.
The compensation framework will apply to the 20 public post-secondary institutions, including Red Deer College.
These amendments apply to about 425 positions at institutions across the province reporting two levels down from the position of president. Tier A leaders report to a president, while those in Tier B are two levels down.
With the cap, Tier A leaders at larger schools, such as University of Calgary and University of Alberta, can earn up to $391,125 a year, while executives in Tier B are limited to a maximum of $312,900.
For smaller institutions, including Olds College, the maximum for Tier A leaders is $205,713 and the maximum for Tier B is $164,570. At RDC, the Tier A maximum is $234,063 and the Tier B maximum is $187,250.
“The new caps provide flexibility for institutions to develop competitive salary and benefit packages for their senior leadership. It also reduces red tape since it eliminates the requirement for contract alignment reviews,” said Taillon.
The changes are anticipated to save about $3.7 million beginning in 2023-24.
The government is also extending the salary restraint for non-union public agency and Alberta Public Services employees to March 31, 2022.
“By doing so, we are taking a responsible approach to protect the province’s financial health and the public sector must be part of the solution,” Taillon said, adding this policy was originally implemented under previous governments.
“It’s more important than ever to deliver core government services cost effectively to ensure they are sustainable into the future. Containing public sector compensation helps to bring spending in line with other provinces and is respectful to the economic reality facing many Albertans who have seen their wages reduced or lost their jobs.”