Departmental Legal Services Unit
Natural Resources Canada
April 2010


3. OBSERVATIONS – MANAGEMENT OF HUMAN, FINANCIAL, AND MATERIEL RESOURCES

TBS has established an extensive framework of policies for managing human, financial, and materiel resources. One of the requirements of these policies is that limited resources are to be managed with prudence and probity.

3.1 Human Resources

The NRCan LSU’s contribution to its Portfolio’s 2008-2009 Human Resources Plan was appropriate.

The LSU provides input to the Business and Regulatory Law Portfolio’s human resources planning process using a template provided by the Portfolio. The quarter of the year in which staffing is scheduled to occur must be identified on the form. There is no requirement to identify staffing requirements beyond one year. The General Counsel and Executive Director told the audit team that succession planning will be required in two to three years given that experienced lawyers will be retiring in five or more years.

The information in the LSU’s completed template for the 2008-09 planning year was consistent with the human resources requirements stemming from the LSU’s key risks that were identified by the General Counsel and Executive Director to the audit team. The Portfolio stated that it was satisfied with the documentation received from the LSU, and that no improvements were required.

It is our opinion that the NRCan LSU’s human resources planning process is satisfactory.

The LSU needs to review its current mix of resources.

From our interviews the audit team determined that there was a widespread sense among management and staff that the LSU may be under resourced:

  • Management in the Business and Regulatory Law Portfolio were uncertain as to whether the LSU had the structure and capacity to both deal with large legal files and respond to the Department of Justice’s corporate management information reporting requirements. They noted that it is a small LSU without many support staff and there is no deputy head.
  • The General Counsel and Executive Director acknowledged that they could use another lawyer and another legal assistant. Commercial law requirements are currently outsourced to another LSU and to regional offices.
  • The lawyers in the LSU identified a need for more junior lawyers, paralegals who could research prior opinions and precedents, and an administrative assistant. The lawyers stated that the ratio of lawyers to support staff was high, requiring them to spend time on administrative tasks, such as photocopying, for which they were overqualified. We concur that this is a poor use of highly trained professional resources.

The approved positions for the NRCan LSU call for four support staff—an Office Manager, a Records Manager, and two legal assistants. According to the Service Plan 2009-2010 with NRCan, which is annexed to the MOU, there is provision in the budget for a third legal assistant. The Service Plan notes that several positions were vacant. The Office Manager supervises the work of the other support staff and also supports the General Counsel and Executive Director’s interactions with NRCan executives and the Department of Justice. These latter interactions include administering financial and human resources, and responding to planned and ad hoc requests for information and reports.

During the on-site examination phase of the audit, one of the NRCan LSU’s two legal assistants was on assignment and could not be replaced. Near the conclusion of this phase, this individual left employment with the LSU. The LSU has initiated staffing for a replacement Legal Assistant. When staffing is completed, the LSU will have 14 lawyers supported by two legal assistants. The audit team is not aware of any plans to fill the third legal assistant position, as identified in the Service Plan 2009-2010. In the audit team’s experience, a ratio of 14 lawyers to two legal assistant is high compared to other recently audited DLSUs, where the ratio of lawyers to legal assistants was usually about four to one. It is the audit team’s opinion that the LSU needs to examine its current mix of resources and determine whether the addition of another Legal Assistant and/or a Paralegal is needed.

The NRCan LSU provides its lawyers with appropriate training opportunities.

The acquisition of skills and knowledge, as well as the development of managerial and leadership expertise, is critical for the effective management of the Public Service. Training needs to be provided to staff to address any identified gaps in the existing skill set.

The NRCan LSU’s General Counsel and Executive Director encourages the LSU’s lawyers to participate in departmental working groups and internal courses offered by the Department of Justice. She also sends lawyers on “train the trainer” sessions so that they can return to train other LSU lawyers. The lawyers told the audit team that access to external courses is available and that these are identified on their individual learning plan. All external training must first be approved by the Department of Justice before anyone can be registered. Roughly 70 percent of the funds available for external training were utilized during 2008-09. As of early March 2010, approximately 80 percent of the funds available for 2009-10 had been used.

It is the audit team’s opinion that the LSU provides counsel with appropriate training opportunities.

The NRCan LSU does not have a formal orientation manual.

There is no formal process for orientating new staff to the NRCan LSU other than orientation provided by the Department of Justice. Each Team Leader or supervisor is responsible for introducing new staff to colleagues in the LSU and contacts within the client’s organization. Additional information is gleaned through a review of files, staff meetings, and discussion with the other lawyers in the LSU. Lawyers stated that everyone was helpful in these discussions and that the current practice for orientating new staff is satisfactory.

It is the audit team’s opinion, however, that an orientation manual should be developed. It would provide background documentation concerning NRCan’s programs and organization, information on the laws and regulations governing these, and key legal opinions if appropriate. Lawyers new to the DLSU could use it to quickly familiarize themselves with the kinds of legal issues they would be called upon to address and later use it as a reference manual when providing advice and opinions. Furthermore, since the General Counsel and Executive Director anticipates that experienced staff will begin retiring from the LSU within five years, an orientation manual would serve as a key depository of the corporate memory within the LSU.

The NRCan LSU should improve its tracking of employees’ professional development.

Section 7.0 of the Department of Justice’s Learning Policy mandates five days of professional development per year per employee. As defined in the policy, professional development encompasses a wide range of activities including classroom training, formal education, conferences, seminars/workshops, practice forums, practice groups, coaching, mentoring, short-term assignments, secondments, job shadowing, job rotation, and reading.

The Learning Policy also requires that all of the Deputy Minister’s direct reports report annually for their organization on the percentage of base salary invested in learning, the percentage of employees receiving a minimum of five days of professional development per year, and the percentage of employees with individual learning plans. The NRCan LSU informs the Business and Regulatory Law Portfolio about the completion of individual learning plans and training costs. However, the LSU does not compile information on the percentage of employees receiving a minimum of five days of professional development per year as required by the policy. As a result, since all professional development as defined by the Learning Policy is not tracked and reported to the Human Resources and Professional Development Directorate (HRPDD), Portfolio-level records indicate that over three-quarters of the LSU lawyers have not received the mandated minimum level of professional development.

In the absence of formal tracking of all professional development encompassed under the Learning Policy, the audit team is of the opinion that the NRCan LSU cannot ensure that its employees are receiving the amount of professional development required.

Formal performance appraisals are only provided for lawyers within the LSU and not for support staff.

Performance appraisals for all DLSU staff should be prepared annually. Appraisals are important tools for setting objectives, providing feedback on performance, and for identifying training requirements.

Performance appraisals for all lawyers in the NRCan LSU are on file, are current, and have learning plans attached. Formal performance appraisals are not provided to support staff, although they do have periodic discussions with their supervisor on their performance. Learning plans are also not prepared for support staff.

While support staff are not Department of Justice employees, the LSU head still has a responsibility to ensure that they have the skills to carry out their responsibilities. As noted on the Web site of the TBS Office of the Chief Human Resources Officer: “Managers at all levels have the responsibility to provide feedback regarding their expectation of their employees’ performance. Employees at all levels deserve to have information that helps them decide on their performance effort.” Footnote 4

It is our opinion that performance appraisals and associated learning plans need to be completed regularly for all NRCan LSU staff including support staff.

Recommendation and Management Response

2. It is recommended that the General Counsel and Executive Director review the lawyer-to-support-staff ratio in the NRCan LSU and determine whether an additional Legal Assistant and/or a Paralegal is required.

I agree. This review is complete and while at least one additional legal assistant is appropriate, staffing depends on the availability of resources from the client department.

Recommendation and Management Response

3. It is recommended that the General Counsel and Executive Director ensure that a basic orientation manual for lawyers is developed.

I agree. The legal practice at NRCan is varied. While tasks are set for incoming counsel to orient them to NRCan and Justice, a more structured orientation process would assist. Electronic and web-based approaches will be considered. Completion date: December 31, 2010.

Recommendation and Management Response

4. It is recommended that the General Counsel and Executive Director implement a process to track and report all professional development that legal staff receive.

I agree. Individual learning plans are developed and approved annually. Implementation of those plans is monitored on a quarterly basis, and reviewed with counsel at year’s end. Reporting mechanisms will be discussed with the Business and Regulatory Law Portfolio. Completion date: September 2010.

Recommendation and Management Response

5. It is recommended that the General Counsel and Executive Director ensure that performance appraisals and learning plans are developed on a regular basis for support staff in the LSU.

I agree. Learning plans for the 2010-11 year will be put in place, and performance appraisals conducted for the 2010-11 performance year. Completion date: April 30, 2011.

3.2 Financial Resources

The NRCan LSU is appropriately adjusting priorities on an ongoing basis so that the cost of legal services to NRCan remains within planned levels.

Like all DLSUs in the Business and Regulatory Law Portfolio, the NRCan LSU is funded via the Department of Justice A-base and cost-recoveries from its client. In addition, funding is provided though specific NRCan initiatives that have been approved by the Treasury Board (e.g. the Mackenzie Gas Pipeline Project).

The General Counsel and Executive Director told the audit team that the combined funding from these sources can fall short of the amount estimated as required to meet projected demand for legal services. We were told that the resulting discrepancy is managed by deferring lower priority requests for legal services, assigning only one lawyer to some files where it might be preferable to assign both a junior and senior lawyer (to provide a learning opportunity), and working longer hours when required.

The NRCan LSU’s lawyers indicated that their workload is high. They pointed out that their client’s budget tripled between 2002-03 and 2007-08 Footnote 5, and that there were ever-increasing demands for legal services. In the same period, the LSU’s professional staff doubled from seven to 14 lawyers. According to the iCase reports examined by the audit team, two of the 14 lawyers in the LSU reported working as much as 45 minutes of overtime daily over a three-month period. Over half of the lawyers in the LSU reported working less than an average of 15 minutes of overtime daily. In our opinion, this level of overtime is not excessive.

While the LSU has been required to focus on those requests for legal services having the greatest priority, a satisfactory level of service has nonetheless been provided. The 2007 SSPM client feedback survey concluded that its results demonstrated a high degree of satisfaction with services. The audit team conducted interviews with a sample of the LSU’s current clients in NRCan, who voiced similar levels of satisfaction.

It is our opinion that the NRCan LSU is appropriately adjusting priorities so that the cost of legal services to NRCan stays within planned levels.

The measures taken to administer the NRCan LSU’s financial resources are satisfactory.

On a monthly and quarterly basis, the NRCan Financial Management Branch sends the LSU financial reports that document expenses, budget, year-to-date commitments, outstanding commitments, and balances. The Office Manager reviews the monthly reports to ensure that the reported information is accurate and consults with a Sector Financial Advisor in NRCan if she has any questions. The General Counsel and Executive Director reviews the quarterly reports to assess year-to-date expenditures and to project whether the LSU will have a surplus or deficit at the end of the fiscal year. Because NRCan’s financial system does not provide reports comparing expenditures to budget, the projection is based on manual calculations done in the LSU. We were told that an initiative to replace NRCan’s financial system is expected to start in 2011-12.

Our review of financial transactions showed that all were supported with the required documentation. NRCan’s Shared Services Office (SSO) processes all procurements except for office supplies, which the LSU acquires with its acquisition card. NRCan also audits the transactions on a sample basis. The audits have not identified any issues with the processes being followed by the LSU.

It is our opinion that the measures taken to administer the LSU’s financial resources are sufficient and reasonable.

3.3 Materiel Resources

Key physical assets are protected in an appropriate manner.

NRCan provides the LSU’s key physical assets. The SSO is responsible for maintaining an inventory of office furnishings and equipment valued at $1,000 or more. We reviewed an asset listing provided by the SSO and noted that it was outdated. It included the names of individuals who no longer work in the DLSU and a colour printer that had been disposed of. NRCan is planning to update the current inventory system in the next few years and will update the inventory list at that time. Most of the assets will become the responsibility of NRCan’s Information Technology SSO and the LSU will be left with responsibility for two shredders and a storage/display unit. There have been no reported losses of inventoried assets in 22 years.

The LSU is housed in NRCan’s Ottawa headquarters. All visitors to the building must present themselves to a reception desk on the ground floor. Reception staff verify the visitor’s identity (a photo ID must be surrendered in exchange for a wearable badge). Reception staff also call the appropriate NRCan LSU staff member to verify the appointment. Visitors are escorted to and from the LSU’s suite of offices. Although the suite is not closed off from other offices on the floor, all lawyers have lockable, enclosed offices. The records room is locked at night, and there is always someone present in the suite during lunch hour.

We are of the opinion that the measures taken by the LSU to protect key physical assets are appropriate.

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