SWAMPSCOTT – The Select Board reassured residents of their trust in the town’s administrator and financial team at the meeting on Nov. 3, following the resignation of the human resources director.
Tanya Shallop, who left her position as HR director in September, had suggested in an internal memorandum that there were some major issues with the town’s benefits reconciliations that cost Swampscott taxpayers tens of thousands of dollars and left the town vulnerable to serious liabilities.
“The board believes and trusts Swampscott’s highly-talented town administrator and financial team,” said the statement which was read at the meeting by newly-appointed Chair of the Select Board Polly Titcomb. “We are confident that any outstanding issues are being addressed efficiently and appropriately.”
The statement said that the board had been initially surprised and concerned to hear about the issues with reconciliations. Since receiving the memo, it has engaged in conversations with the town administration to understand the accuracy of the claims and what actions will be taken to remedy any legitimate ongoing issues. As a result of such communication, the board has arrived at a conclusion that the “issues were relatively minor and do not have a material effect on the town’s financial condition.”
Town Administrator Sean Fitzgerald identified numerous significant concerns about the town’s benefits system back in 2018, shortly after he was hired by Swampscott, the statement said. He engaged an independent firm to conduct a complete audit of the benefits system. The results of the audit prompted the town administration to reconcile errors that dated several years back.
Fitzgerald also established new monthly internal-control systems to identify and avoid such errors in the future and, until recently, the systems functioned well, the board statement said. The statement called benefits reconciliation a “notoriously finicky” task due to the large size of the Swampscott’s benefits program and such constantly-changing factors as employees transitions, contract changes and timing of payments.
The town administrator admitted that the change in key town employees and other factors has led to the breakdown of the systems he had established for monthly reconciliations, the statement said.
The Select Board listed a number of steps Fitzgerald and the financial team have recently taken to avoid such errors in the future. They have ensured complete health-insurance coverage and payment for all enrolled town employees. The town administrator has hired a full-time HR generalist to assist the financial team with ongoing benefits reconciliations and to revise the existing reconciliation systems.
Fitzgerald is also in the process of hiring an HR consultant who will conduct assessment of the town’s evolving HR function and assist in the search for the new HR director, the statement said. Swampscotts’ HR director is a member of the town administrator’s leadership team and oversees human resources of both the Swampscott Town Hall and the Swampscott Public Schools.
The town’s latest HR Director Tanya Shallop, a Salem resident, was the third human resources director Swampscott has hired in a little over a year. She has a robust resume, and Fitzgerald called her thoughtful and bright in an interview with the Swampscott Reporter a couple days after her hire.
Shallop, an attorney and a certified HR professional, was previously the assistant town administrator and HR director in Middleton. She also was a senior government-services specialist at the University of Massachusetts, where she performed HR analysis, compensation, and classification plans, and policy reviews, among other responsibilities.
According to the Swampscott Reporter, when she started her new job, Shallop found the HR department in disarray. She found hundreds of unanswered voicemails, an overstuffed mailbox and hundreds of unfilled, toppling-over pieces of paper when she arrived in July, the paper said.
“It was readily apparent within a few days of starting this position that there were major issues that had not been addressed. Mistakes and neglect had accumulated over the past year,” she said. “There was an absence of staff to even assist me in the basics of the Human Resources department.”
Shallop’s memorandum stated that Swampscott continued charging some town employees for benefits they requested and believed they were enrolled in, while the town failed to complete the necessary steps to enroll them or failed to pay for said benefits. For example, Sun Life Financial cancelled illness and accident insurance on Jan. 1, 2021 for nonpayment.
Shallop said that these omissions could lead to town employees “rightly” looking to be compensated for the costs that their insurance would have covered if it was in effect.
She also discovered that the town paid benefits for dozens of former employees for more than 10 months after their departure.
“The total amount of benefit costs absorbed by the town because of a failure to reconcile and cancel benefits in a timely manner is almost $70,000 and counting,” Shallop said.
Fitzgerald responded in a statement to the Swampscott Reporter in late October that the discrepancies that had been found were fixed. He said they do not materially affect the town’s strong financial position.
