A continuous controls monitoring program was initiated at the City in 2011. The objective of the program is to develop exception reports to pro-actively identify unusual levels of overtime and other employee expenses on an ongoing basis. This is done through the use of specialized audit software.
In September 2012, the Auditor General issued an interim report on continuous controls monitoring of TTC overtime and other payroll expenses. The report provided information related to costs incurred in 2011 and for the period from January 1, 2012 to June 30, 2012. The report is available at http://www.toronto.ca/audit/2012/ttc-employeeovertime-related-expenses-2012.pdf
The purpose of this report is to provide the results of our analysis of staff overtime and other related costs for 2012 and management’s comments on the analysis. A comparative analysis of 2012 and 2011 staff overtime by TTC divisions is provided in Appendix 1.
Our analysis of TTC’s payroll identified certain areas for follow-up by TTC management. The TTC Chief Executive Officer was requested to report back on whether there were opportunities to better manage and reduce these expenses. As a result of management actions and continuous monitoring, we have noted a reduction in staff overtime and other employee expenses:
- Total staff overtime decreased by approximately 8 per cent or $5.5 million in 2012 to $65.3 million when compared with $70.8 million in 2011.
- The number of staff with unscheduled overtime exceeding 50 per cent of their base pay declined from 143 in 2011 to 74 in 2012, a reduction of almost 50 per cent.
- Staff mileage expenses declined from $492,000 in 2011 to $437,000 in 2012, a
reduction of $55,000.
- Staff meal allowance for 2012 was $248,000, a reduction of $14,500 from 2011.
While the results represent an improvement in the management of overtime, certain management responses to our analysis suggest that further improvements are possible.