Fired Ontario lottery exec gets $750,000 settlement

Former OLG chief had filed $8.4 million lawsuit, claiming she was a scapegoat for expense scandals
|employmentlawtoday.com|Last Updated: 01/18/2010

Former Ontario Lottery and Gaming Corporation (OLG) Kelly McDougald is getting a hefty payout from the Ontario government after she felt she was made a scapegoat and fired last year.

McDougald was fired in August 2009 after questionable expense account claims in OLG were made public. Though she wasn’t specifically involved with the claims, she admitted at the time the expenses were “inappropriate” but could be explained. However, she said she wasn’t given the opportunity to do so and was fired for refusing to blame other OLG executives.

McDougald filed a wrongful dismissal suit for $8.4 million, claiming there was no cause to fire her and she was being made a scapegoat for a similar scandal at eHealth, Ontario’s electronic health advice service. After that scandal, where $16 million in questionable untendered contracts were given to consultants, eHealth’s CEO Sarah Kramer was allowed to resign with $317,000 in severance pay. McDougald offered to resign with the same deal — one year’s pay for severance — but the government refused and fired her for cause. She claimed she was told the government “does not want to deal with this negative publicity.”

Though the government initially vowed to fight the lawsuit, it decided to offer an out-of-court settlement and announced an agreement with McDougald on Dec. 24 for $747,925.

The settlement raised cries of protest by the opposition parties, since the settlement was significantly more than what taxpayers would have had to pay if the government had accepted McDougald’s initial offer to resign with one year’s severance. Her salary with OLG was $400,000 a year.

Michael Prue, finance critic for the provincial NDP, told the Toronto Star it was a “great Christmas giveaway.”

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