City, Norwich Public Utilities negotiated harassment settlement based on insurance policy

Norwich — The city charter and the Board of Public Utilities Commissioners bylaws offered no guidance on how to handle a harassment complaint filed in 2015 against then-commission Chairman James Sullivan, leaving NPU officials to base its investigation and settlement negotiation on liability insurance the utility carries that covers the board.

The Day obtained the settlement agreement in the complaint against then-board Chairman James Sullivan last week through a Freedom of Information Act request and complaint. The name of the female complainant was redacted in all documents.

Her initial complaint was filed to the state Commission on Human Rights and Opportunities on Sept. 16, 2015, and Sullivan resigned three weeks later. The settlement was signed by the complainant May 2, 2016, and called for making two settlement payments of $24,000 and $11,000, a total of $35,000, directly from NPU resources.

The woman named Norwich Public Utilities, Sullivan and the City of Norwich in the complaint, and officials from both NPU and the city confirmed that the allegations and negotiations never were reviewed by the Board of Public Utilities Commissioners or the City Council. The settlement documents were signed by NPU General Manager John Bilda, City Manager John Salomone, Sullivan and the complainant, all on different dates, starting with Sullivan on Feb. 22, 2016, followed by Salomone the next day, Bilda on March 15 and the complainant May 2, 2016.

Salomone, who started working as city manager on Feb. 1, 2016, said he was not involved in the negotiated settlement and “had no input into it at all.” Bilda was in the dual role of utility general manager and acting city manager during the time the complaint was filed and settlement negotiated. Salomone said Bilda asked him to sign it on behalf of the city, and after he confirmed with city Corporation Counsel Michael Driscoll that no city money would be involved in the settlement, Salomone signed the settlement after consulting with Driscoll.

NPU spokesman Chris Riley said last week that the settlement was signed by Bilda and was “an administrative function driven by NPU's insurance company and lawyers and did not require Board approval.”

NPU carries standard directors and operators’ liability insurance with RSUI Insurance based in Atlanta. The policy broker is USI Insurance Services LLC of Meriden. NPU is paying $37,360 this year for the coverage, which has a total deductible of $50,000. Because the settlement payment was below the deductible, NPU paid the settlement money directly.

While indemnification insurance is common and standard for boards and commissions, the city charter chapter governing the utilities commission fails to address how city officials would investigate or cover allegations of wrongdoing by any of the five commission members, who are appointed to five-year terms by the City Council.

The board’s four-page bylaws, which have not been updated in years, also do not describe a process for investigating board members accused of improper conduct. The bylaws make a few references to board conduct and NPU staff.

Among the board’s goals is a “knowledgeable, well-treated staff.” Under board members’ conduct is listed the following: “Commissioners’ actions enhance NPU’s public image and the board’s public image.” And the last item in the bylaws states the NPU general manager “will advise the board if the board is not in compliance with its own policies.”

The bylaws call for the commission to conduct a self-assessment and review its bylaws annually. The bylaws — which are undated — were not posted on the commission’s page on the NPU website until Friday.

The bylaws also do not specify that NPU carry directors and officers’ liability insurance.

“This policy covers wrongful acts, including employment practices; wrongful acts, which can be actual or alleged acts; errors, omissions, misstatements, misleading statements, neglect, or breach of duty,” Riley said in an email response to questions about the insurance coverage and the process used to investigate the harassment complaint.


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