Bank of Canada dishes out $26.7M in employee bonuses, raises

'Most organizations don't shower employees with bonuses when they have their worst year in four decades'

Bank of Canada dishes out $26.7M in employee bonuses, raises

The Bank of Canada showered its staff with bonuses amounting to more than $20.2 million in 2022 – while the Crown corporation hiked interest rates seven times and inflation reached a 40-year high, according to a non-profit organization.

The average bonus among staff was $11,200, with 80% of the workforce receiving one, according to internal government records obtained by the Canadian Taxpayers Association (CTF) through a series of access-to-information requests.

“Bonuses are for people who do a good job, not people who fail at their one and only job,” said Franco Terrazzano, federal director of the CTF. “Most organizations don’t shower employees with bonuses when they have their worst year in four decades.”

On top of the bonuses, Bank of Canada also gave staff $6.5 million in raises in 2022.

The Bank of Canada’s mandate is to keep inflation low, stable and predictable. This equates to “an inflation target of two per cent inside a control range of one to three per cent,” according to the CTF.

Last year was a financially challenging 12 months for workers and employers alike. 

Late in 2022, the Canadian Federation of Independent Business (CFIB) called on the federal government to hit the pause button on the upcoming 2023 increase in payroll taxes. “Now is not the time to raise taxes and drive more businesses into despair," said Corinne Pohlmann, senior vice-president of national affairs at CFIB. “Give them a break.”

Also, over a third (36%) of employees considered looking for new employment last year, and financial stress was the top motivating factor: 75% of the respondents said high inflation and market volatility have significantly increased their money worries, Mercer noted in a report released in October 2022.

Pandemic bonuses

Last year was not the first time the Bank of Canada handed bonuses to staff while many workers were struggling financially, according to the CTF.

In 2021, the Crown corporation issued over $18.4 million in bonuses and more than $5.17 in increases to staff. In 2020, the numbers were $16.19 million and $5.26 million, respectively. 

Since the onset of the COVID-19 pandemic, the Bank of Canada rubberstamped nearly $72 million in bonuses and pay raises for staff, noted the CTF. Also, not a single Bank of Canada employee had their pay cut in 2020, 2021 or 2022, it said.

In 2020, an average of two in five Canadians can be classified as “financially stressed” (43%) while only one in five are said to be living a financially “comfortable” life despite the downturn (22%), according to a previous report from the Canadian Payroll Association (CPA).

CTF noted that, in 2022, Bank of Canada Governor Tiff Macklem admitted “we got some things wrong” and the deputy governor acknowledged “we haven’t managed to keep inflation at our target,” adding that Canada’s central bankers “should be held accountable.”

“Handing out big bonus cheques is an odd way to hold your organization accountable,” Terrazzano said. “Central bankers shouldn’t get bonuses when Canadians can’t afford groceries, gasoline or homes.”