British Columbia Lottery Corporation

British Columbia Lottery Corporation

August 23, 2007 17:38 ET

Media Release: BCLC Board of Directors Announces Severance Agreement for Former CEO

RICHMOND, BRITISH COLUMBIA--(Marketwire - Aug. 23, 2007) - The Board of Directors of the British Columbia Lottery Corporation has reached a severance agreement with the former President and CEO, Mr. Vic Poleschuk. This severance agreement was reached in accordance with BCLC's legal obligations under the Public Sector Employers Act.

"The Ombudsman Report helped set out a very ambitious program of change. The Board did not feel that Mr. Poleschuk was the right person to take the company forward to implement that change," said John McLernon, Chair of the Board of Directors. "It is not uncommon for organizations to change their leadership during periods of transition. From a legal standpoint, Mr. Poleschuk was terminated without cause and that means he is entitled to severance in accordance with the terms of his employment agreement."

Under the terms of Mr. Poleschuk's employment agreement with British Columbia Lottery Corporation dated August 13, 1999, BCLC is obligated to provide a termination allowance equal to one month's compensation for each year of employment with the corporation up to a maximum of 24 month's compensation (Employment Agreement with British Columbia Lottery Corporation, August 13, 1999).

Mr. Poleschuk's severance settlement is based on 18 months as required under Bill 66, enacted in October 21, 2002, which adjusted severance amounts for senior public sector employees to 18 months from 24 months (http://www.leg.bc.ca/37th3rd/3rd_read/gov66-3.htm).

At the time of termination, Mr. Poleschuk's annual salary was $275,000, plus an $1,100/month car allowance and an annual performance bonus of up to 45% of annual salary (Vic Poleschuk Senior Employee Compensation Report Forms, January 2005). For fiscal 2005/2006, Mr. Poleschuk's total compensation was $442,667, including payout of accrued vacation entitlement for fiscal years 2003/2004, 2004/2005 and 2005/2006 (2005/2006 Total Compensation Chart).

At the point of termination, Mr. Poleschuk was paid $132,181.78 for vacation entitlement accrued prior to 2002 and for fiscal 2006/2007.

Note that vehicle allowance was elevated to $1,100 from $800 for fiscal 2006/2007.

BCLC has complied with its legal contractual severance obligations as follows:



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TOTAL SEVERANCE
COMPENSATION DESCRIPTION AMOUNT
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Salary $275,000 per year x 18 months paid by way $412,500.00
of salary continuation
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Performance Bonus During 18-month period of post termination $144,375.00
employment. 35% of base salary x 18 months
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Benefits Will reimburse for expenses incurred for $ 19,044.00
replacing Long Term Disability, Life
Insurance and Accidental Death &
Dismemberment

Will continue Dental, Extended
Health and BC Medical for 18 months $ 7,643.70
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Car Allowance An $1,100/month car allowance will be $ 19,800.00
continued during the post termination
employment period for 18 months
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$603,362.70
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Over 22 years, Mr. Poleschuk earned pension benefits in both the British Columbia Lottery Corporation Pension Plan and the Supplementary Pension Plan for the President of British Columbia Lottery Corporation. During the 18 month salary continuation period, Mr. Poleschuk will remain a member of both pension plans and pension accrual will be on the same terms as before his termination. Mr. Poleschuk has not given consent to release personal information related to the terms and amount of his pension.

The BCLC Board has deferred making a decision on the award of 2006 bonuses to senior management until the results of the Solicitor General's independent audit is complete in the fall of 2007. If Mr. Poleschuk is awarded a bonus, it will not exceed 45% of his base salary. On the basis of his performance Mr. Poleschuk annually received bonuses for achieving financial, strategic and organizational goals.

The severance agreement also includes the provision of outplacement services to a maximum of $10,000.

The severance agreement between BCLC and Mr. Poleschuk, and all documents referenced above, are available at www.BCLC.com.

Contact Information

  • British Columbia Lottery Corporation
    John Paul Fraser
    Board of Directors Media Contact
    Cell: (604) 619-1980
    or
    British Columbia Lottery Corporation
    Michelle Ward
    Board of Directors Media Contact
    Cell: (604) 970-5901
    Website: www.BCLC.com