WE Charity lays off hundreds after deal with Trudeau government is cancelled

OTTAWA—WE Charity hired 465 people to help administer the federal government’s student volunteer grant program. And then a political scandal hit.

The charity organization laid off 450 contract workers across the country last week and told them not to speak about their work with WE. The charity told the Star that the 15 other new hires were given full-time positions within the organization.

The workers were hired as contractors — some fixed-term, others “independent” — to deliver the Canada Student Service Grant, the Liberal government’s $900-million program to pay students for volunteering during the COVID-19 pandemic. Prime Minister Justin Trudeau initially said WE was selected to run the program because it was the “best and only” organization capable of doing it.

But as the government faced persistent questioning about Trudeau and his family’s personal relationship with WE, and the decision to give the charity $19.5 million to administer the program, the Liberals and WE announced a mutual decision to nix the deal.

Now hundreds of people caught in the middle of the unfolding political scandal are out of work as the global pandemic stretches on.

“While we were hopeful that we might continue to work with a number of these individuals, the circumstances we are facing as a result of the (program) made this impossible,” WE Charity wrote in a statement to the Star on Saturday. “Due to the transition of the (program), we had to make the incredibly difficult decision to end the contracts for those hired in that capacity.”

WE said that, since handing the program back to the government, the charity “did not take any of the funds that were allocated to pay for the work to date or remaining work.

“All sunk costs and remaining payments to staff and vendors are being paid for by WE Charity.”

Two sources told the Star that WE originally indicated it would honour the contracts, most of which were set to end Aug. 31, according to the organization. But on Tuesday, the sources said, WE let them go. The organization told the Star that workers were given additional compensation based on how long they had worked with WE.

Asked about the confusion over WE honouring the full contract, the charity said: “We apologize if any of our communications with these employees felt incomplete.”

One of the clauses of the termination agreement with WE instructed its former contractors not to speak to the media about their work with the charity.

“The clauses in the contracts for fixed term and independent contractors related to intellectual property and maintaining confidentiality are standard across the organization,” WE wrote in a statement.

The WE deal has become a significant political scandal for Trudeau and the Liberals. While questions were immediately raised about the prime minister’s participation in WE-hosted events, and his wife Sophie Grégoire Trudeau’s connections to the charity, it was revealed last week that WE’s for-profit corporation paid Trudeau’s mother and brother a combined $282,000 in speaking fees between 2016 and 2020.

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On Friday, Finance Minister Bill Morneau was drawn into the scandal after his office admitted that his daughter was employed by the charity.

Neither Morneau nor Trudeau recused themselves from cabinet’s decision to award the contract to WE. Trudeau is now facing his third ethics investigation as prime minister, and the opposition NDP is urging ethics commissioner Mario Dion to launch a similar probe into Morneau.