Overview
In accordance with Section 12 of Chapter 11 of the Massachusetts General Laws, the Office of the State Auditor (OSA) has conducted a performance audit of certain activities of Office of the Governor (GOV) and the Office of the Comptroller of the Commonwealth (CTR). Pursuant to our governing statute, Section 12 of Chapter 11 of the General Laws, our audit covers multiple entities’ use of state employee settlement agreements. Specifically, Section 12 of Chapter 11 of the General Laws states, “Each entity may be audited separately as a part of a larger organizational entity or as a part of an audit covering multiple entities.” As such, our review of the use of state employee settlement agreements was completed at GOV, CTR, and 21 other state agencies for the period January 1, 2019 through December 31, 2024.
We conducted this performance audit in accordance with Generally Accepted Government Auditing Standards (GAGAS) except Paragraph 8.90, which pertains to obtaining sufficient, appropriate evidence to meet audit objectives. During the audit, we encountered instances where sufficient, appropriate evidence was not provided for the audit period.
Consistent with GAGAS, we have noted this inability to obtain sufficient, appropriate evidence as part of the “Scope Limitation” section below. We believe that, except for areas detailed in the “Scope Limitation,” the evidence we obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.
Below is a list of our audit objectives, indicating each question we intended our audit to answer; the conclusion we reached regarding each objective; and, if applicable, where each objective is discussed in the audit findings.
| Objective | Conclusion |
|---|---|
| No; see Findings 1, 3, 4, and 5 |
| To an insufficient extent; see Finding 2 |
To accomplish our audit objectives, we gained an understanding of the GOV and CTR internal control environment relevant to our objectives by reviewing the Governor’s and Comptroller’s internal control plans, by reviewing the Comptroller’s (and the state agencies under audit’s) applicable policies and procedures, by performing walkthroughs of the processes related to our objectives, and by conducting interviews of management in GOV, CTR, and the agencies under audit. We evaluated the design and implementation of internal controls related to state employee settlement agreements and the use of confidentiality clauses. See Finding 1 for more information.
To obtain sufficient, appropriate evidence to address our audit objectives, we performed the procedures described below.
Scope Limitation
Paragraph 9.12 of the US Government Accountability Office’s Government Auditing Standards states, “Auditors should . . . report any significant constraints imposed on the audit approach by information limitations or scope impairments.”
We experienced the scope limitations listed below while performing the audit.
Constraint
During the course of the audit, certain records we requested were not provided to us. (See Finding 3, Finding 4, and Other Matters).
We initiated our audit by requesting a list of all state employee settlement agreements entered into by the state agencies included in this review. Most agencies did not have a system of record for settlements made with their employees. Agencies made an effort to review their records and compile the list by doing the following: reviewing legal files, reviewing human resources files, and reviewing union grievance files. Agencies also consulted CTR’s Settlement and Judgment fund records for their agencies to determine which activity was related to state employee settlement agreements and should be included on the requested list. The agencies compiled lists after reviewing the state employee settlement agreements identified in this search, and most agencies conducted this due diligence in a sufficient manner.
We requested settlement agreements for the 263 state employee settlement agreements identified during the audit period to review for evidence of confidentiality clauses within the documentation. Three agencies did not provide a total of 39 state employee settlement agreements. As a result, although we feel confident that the conclusions to our audit objectives are correct, if we had been able to examine all requested records, we would have better understood the full magnitude of the issues, and this may have increased the significance of our findings.
From the Massachusetts Port Authority (Massport), we requested confirmation that the list of employee settlement agreements originally provided to us was complete and accurate, including any agreements between the agency and union employees. As we were conducting our Data Reliability Assessment (DRA), Massport, citing Chapter 66A of the General Laws—known as the Fair Information Practices Act (FIPA)—sent notifications to employees and provided them the opportunity to object to allowing access to these personnel records. We disagree with Massport’s assertion regarding the applicability of FIPA and view Massport’s actions to be in violation of our statutory authority to access records in connection with our audits under Section 12 of Chapter 11 of the General Laws. (See Other Matters.) We requested the notices from the 10 employees who purportedly indicated to Massport their objection to our review of their personnel files, but we were only given a list of the individuals and the dates on which the objections were allegedly submitted to Massport. Because Massport did not provide us access to review these 10 personnel files, we cannot determine whether they contained employee settlement agreements that should have been tested as part of the audit objective of reviewing agencies’ use of confidentiality requests within the context of employee settlement agreements. We remain concerned regarding Massport’s assertion that FIPA grants individuals the ability to hide records from our office, which is authorized to review them under statute. This unlawful assertion of FIPA could allow for the purposeful obfuscation from scrutiny the content of these records, which may contain important information that should be accessible to the public. This could allow agency management or other employees with a history of ignoring or perpetrating inappropriate behavior to hide that behavior from oversight.
Massport stated that the list of employee settlements it provided to us was complete and accurate. Based on our review of employee personnel files, however, we determined that it was not. Our office uncovered 7 additional employee settlements that Massport did not disclose to us in the settlement list originally provided to us. We obtained and reviewed copies of these 7 employee settlement agreements identified during our personnel file review, completed during our DRA. There could potentially be more employee settlements that Massport did not self-report to OSA.
We also experienced delays when attempting to perform our review of Massport’s employee personnel files. The initial request was made on April 14, 2025, and we were not granted access until June 25, 2025.
Reporting of Monetary Employee Settlements to CTR
Review for Unreported State Employee Settlement Agreements
We asked CTR to review the lists of 252 of the 263 settlement records from 17 state agencies. The 11 settlement records from Massport were excluded because the agency is not required to report them to CTR. We also provided the associated settlement agreements, if obtained, to CTR for review. Based on the nature of the settlements and awards, CTR confirmed that 173 were monetary settlements that should have been reported for review prior to payment. Of these 173 monetary settlements, 13 were not reported. We asked CTR to search its Settlements and Judgments Access database and records to determine whether it had any evidence that the 13 state employee settlement agreements were submitted to CTR for review. CTR confirmed that 160 of the 173 were reported.
Below is a table breaking down the count of settlements, by agency, that we reviewed.
State Agency Number of Settlements OSA Sent to CTR* Settlements Required to Be Reported to CTR Settlements Not Required to Be Reported to CTR Berkshire Community College 16 12 4 Bridgewater State University 18 8 10 Bunker Hill Community College 20 14 6 Cape Cod Community College 8 5 3 Fitchburg State University 15 12 3 Greenfield Community College 10 7 3 Massachusetts College of Art and Design 17 13 4 Massachusetts College of Liberal Arts 10 6 4 Massachusetts Commission Against Discrimination 2 1 1 Massachusetts Maritime Academy 6 2 4 Middlesex Community College 24 7 17 Office of the Attorney General 10 10 0 Office of the Commissioner of Probation 5 4 1 Office of the Inspector General 1 1 0 Roxbury Community College 63 56 7 Springfield Technical Community College 10 8 2 Worcester State University 17 7 10 Grand Total 252* 173 79 * This table excludes 11 Massport records, which are not required to be reported to CTR.
See Finding 5 for more information on agencies failing to report state employee settlement agreements to CTR.
Review of Documentation for Monetary State Employee Settlements
CTR identified 173 employee settlement records, dated from January 1, 2019 through December 31, 2024, as being required to be reported to CTR. To determine whether the agencies under audit maintained documentation to support settlements reported to CTR, we requested the following documentation for all the records:
- the executed state employee settlement agreements, complete with signatures from authorized parties;
- the “815 CMR 5.00 Non-Tort Settlement/Judgment Payment Authorization Form” submitted to CTR, complete with proper approvals; and
- the email approval for payment of the settlement claim from CTR.
See Finding 3 for issues we identified with state agencies not providing documentation for state employee settlement payments.
Use of Confidentiality Language in State Employee Settlement Agreements
To determine to what extent the 21 state universities and colleges, community colleges, and independent and quasi-state agencies under audit have developed and implemented policies and procedures regarding state employee settlement agreements, including the use of confidentiality language within the context of the agreements, we took the following actions:
- We interviewed management and legal counsel of the agencies to learn about the steps taken when entering into a state employee settlement agreement. During these interviews, we inquired about internal procedural documents for reviewing claims, determining the terms of the settlement, and processing the settlement agreements. It was explained to us that the legal counsel performed an analysis and provided a recommendation on whether to settle a pending claim. This support was considered privileged documentation and was not provided to us.
- We inquired about whether agencies had policies in place regarding the use of confidentiality language within state employee settlement agreements.
- For the entire population of 263 state employee settlement agreements, we requested copies of the settlement agreements and the original claim, complaint, or grievance to gain an understanding of the situation that led to the settlement. The requested settlement agreements were provided to us for 211 records. The associated original claims, complaints, or grievances were provided for only 77 records.
- We reviewed all 211 state employee settlement agreements provided. We found that at least 80 out of the 211 employee settlement agreements included some type of confidentiality language. We inspected these 80 settlement agreements to determine whether they included information that could be considered exempt under public records law. We were informed that agreements are drafted on a case-by-case basis. We requested that agencies explain their rationale or reasoning for the inclusion of confidentiality language in each agreement. We reviewed 2 available statements highlighting the rationale for confidentiality language’s inclusion.
See Finding 2 and Other Matters for issues we identified with the process of how state agencies used confidentiality language in state employee settlement agreements.
Data Reliability Assessment
CTR Settlements and Judgments Access Database
CTR provided us an Excel list of state employee settlement agreements and payments reported during the audit period from its internal Settlements and Judgments Access database. (See Appendix F.) To determine the reliability of the data, we performed validity and integrity testing to ensure that the settlement documentation receipt dates (the date documentation was received by CTR’s legal team) were within the audit period. We also checked that there were no duplicate state employee settlement records.
In addition, we conducted interviews pertaining to CTR’s approval process, which included employee access to the database.
State Employee Settlement Agreement Lists
To determine the reliability of the lists of state employee settlement agreements provided by each agency, we conducted interviews with agency management and legal counsel who were knowledgeable about the process of entering into the settlement agreements and the creation of the lists. We performed validity and integrity testing of the data to ensure that all lists contained settlement records that were executed during the audit period and that there were no duplicate settlement records.
Further, we selected random samples from the agencies with larger counts of state employee settlement agreements. For agencies with counts of 10 or fewer, we reviewed the entire population. These samples combined for 151 state employee settlement agreements from the total population of 263 settlement agreements reported in the lists provided to us for the audit period. We vouched information included in each list (settlement dates, employee names, descriptions of the settlements, and the amounts) to copies of the signed state employee settlement agreements. During our DRA, we did not receive 20 state employee settlement agreements to vouch out of the 151 that were sampled. See Finding 3 for more information on the total population of settlement agreements not received during the course of the audit.
The table below details the sample sizes reviewed for each office.
Agency Number of Settlements Self-Reported in Agency Lists Number of Agreements Requested for Review Number of Requested Agreements Received from Agencies Number of Requested Agreements Not Provided by Agencies Berkshire Community College 16 10 6 4 (40%) Bridgwater State University 18 10 10 0 (0%) Bunker Hill Community College 20 10 10 0 (0%) Cape Cod Community College 7 7 5 2 (29%) Fitchburg State University 15 6 5 1 (17%) Greenfield Community College 10 10 10 0 (0%) Massachusetts College of Art and Design 14 10 7 3 (30%) Massachusetts College of Liberal Arts 10 10 10 0 (0%) Massachusetts Commission Against Discrimination 2 2 2 0 (0%) Massachusetts Maritime Academy 6 6 6 0 (0%) Massachusetts Office for Victim Assistance 0 0 0 0 (0%) Massachusetts Port Authority 4 4 4 0 (0%) Middlesex Community College 24 10 10 0 (0%) Nantucket County Sheriff’s Office 0 0 0 0 (0%) Office of the Attorney General 10 10 10 0 (0%) Office of the Commissioner of Probation 5 5 5 0 (0%) Office of the Inspector General 1 1 1 0 (0%) Roxbury Community College 61 20 10 10 (50%) Springfield Technical Community College 10 10 10 0 (0%) Suffolk County District Attorney’s Office 0 0 0 0 (0%) Worcester State University 17 10 10 0 (0%) Total 250 151 131 20 (13%)
In addition, we obtained from CTR a list of state employee settlement payments reported by the agencies included in this audit and compared the CTR list against the agency lists.
For state employee settlement agreements in the list that were monetary, we vouched the agency name, settlement date, employee name, and the amount to CTR’s Settlements and Judgments Access data. Additionally, we filtered the Settlements and Judgments Access data by agency, confirming that the monetary settlements were included in the state employee settlement agreement lists provided to us by the agencies. We identified 6 records within the data provided by CTR that were excluded from the lists. We found that 5 of the 6 records, totaling $352,769, qualified as settlement agreements. One record was an arbitration award. We sent follow-up inquiries requesting an explanation and that the documentation be sent to us for review. As of the time of this report, we have only received documentation for 1 arbitration. For 1 settlement, the agency reported to us that the Human Resources Compensation Management System ID in CTR’s Settlements and Judgments Access data was not associated with anyone within its payroll system. This issue (along with the Massport issue highlighted below) totals $492,614 of settlements identified during our DRA. See Finding 4 for more information.
Settlements from CTR’s Settlements and Judgments Access Data Excluded from Lists Provided by Agencies
| Agency | Date CTR Received the Settlement Paperwork | Settlement Claim Total Amount | Explanation Provided by the Agency |
|---|---|---|---|
| Massachusetts College of Art and Design | August 16, 2019 | $111,149 | There was no underlying complaint. Payment was due to the terms and conditions of the non-union professional contract. |
| Massachusetts College of Art and Design | October 17, 2021 | $119,385 | There was no underlying complaint. Payment was due to the terms and conditions of the non-union professional contract. |
| Massachusetts College of Art and Design | February 10, 2022 | $56,498 | According to the agency, there was no payment. It is unsure why this record appears within CTR’s data. |
| Roxbury Community College | May 28, 2019 | $737 | Human Resources Compensation Management System ID in CTR’s Settlements and Judgments Access data record was not associated with anyone in Roxbury Community College’s payroll system. |
| Roxbury Community College | December 8, 2023 | $65,000 | No additional information provided. |
We reviewed 111 employee personnel files for a sample of staff members actively employed at Massport and 116 employee personnel files for a sample of staff members actively employed at AGO during the audit period. The purpose of this review was to determine whether files contained settlement documentation that was not provided to us by agencies during their aforementioned searches. This review did reveal an additional 7 Massport employee settlement agreements, totaling $139,845, that Massport did not provide to our office for review.
As a result, while we cannot determine or confirm whether all lists provided by the agencies included in this audit are complete and accurate. We used this data as it was the only source available for our audit purposes. See Finding 3 and Other Matters for more information.
Based on the results of the data reliability procedures described above, we determined that the data was sufficiently reliable for the purposes of our audit.
| Date published: | January 16, 2026 |
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