Golden handshakes: when the legend becomes fact, print the legend.
I suppose one shouldn’t expect much from The Post in its labour relations reporting but the current story “Wellington council’s $200k-plus club quietly keep personal grievance pay” or “Wellington council’s $200k-plus club quietly keep ‘golden handshake’ pay”, depending on which of the two misleading headlines you prefer, pretty much takes the cake.
Pushing this misinformation along is the comment by Taxpayers’ Union executive director Jordan Williams that it was “simply unbelievable” that Prosser (the Council’s CEO) would make a decision “so blatantly against the interests of the organisation and ratepayers” and that “This decision effectively locks in golden handshakes at a time when Wellington City Council know they are overstaffed and lacking competence.”
The text of the story seems to have morphed a bit over the last day (or perhaps my memory is deficient) but it now seems clear that mayor Andrew Little supports the move if, perhaps understandably, upset around the political optics of the decision-making process. Little is quoted as having said “the council was obliged to be a good employer and employees deserved to be treated fairly and have access to due process.” It should also be noted that the change does not apply to the CEO personally.
In fact all that has happened is that the Council’s CEO, who is the legal ‘employer’ of Council staff, has elected, as is allowed by the ER Act amendments, to opt out of the $200k exclusion on the entitlement to bring a personal grievance and restored employment protection rights as they existed prior to van Velden’s attack on that protection. The story also states that there has been no relevant claim by a $200k employer since 2021 – so hardly financial disaster (and the report does not mention any payout/s of the claimed golden handshakes).
As an aside I note that in the recently announced ASMS settlement exactly the same provision was included, presumably with the approval of the Public Service Commission. Senior doctors will rightly continue to be able to raise a personal grievance for unjustified dismissal.
What is particularly upsetting about this story is the bullshit about “golden handshakes” and the implication that the personal grievance provisions provide some sort of undeserved massive financial reward to wayward employees.’ Even now the story does nothing to disabuse that myth. The only way a ‘golden handshake’ might result is if a personal grievance is settled by a negotiated between a worker and their employer – it is not some sort of given and unlikely to be that ‘golden’. And it is nothing to with the personal grievance provisions as such.
Let’s be very clear – if any financial compensation is to be received as a result of raising a personal grievance it must first be established that the employee was unjustifiably dismissed – a not insubstantial barrier.
Even then the maximum amount payable in most cases is three month’s lost remuneration - and such an award is unusual. Against this must be set the legal costs of bringing the grievance, never fully recoverable. The ER Act amendments reducing remedies for contributory conduct add a further litigation risk. Successful grievants rarely come out with a substantial payout after the deduction of legal costs.
A golden handshake? I think not.