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EXCLUSIVE: Echo investigates council gagging orders
COUNCIL staff have been asked to sign gagging orders as part of their redundancy pay-outs.
West Dorset District and Weymouth and Portland Borough councils have paid out more than £665,000 in the last five years on packages which include compromise agreements.
Once signed, these stop former employees from taking further legal action or going to the press.
In some cases, a sum in excess of £40,000 was paid, with one person receiving £54, 545.
This has prompted the question ‘what do these people know that the authorities don’t want made public?’ Concerns have been raised that the agreements are a way to stop ‘serious failings’ coming to light.
Both authorities, which operate under a shared services partnership, have denied that keeping information quiet forms any part of why they use compromise agreements.
But district councillor Alistair Chisholm said the number of agreements and the level of pay outs ‘call in to question’ the transparency of the councils. He added: “You wouldn’t be paying out that money if you were not concerned.
“What do they know that the councils don’t want us to know? That would be anybody’s question.
“This is public money and there’s no reason why the public shouldn’t know what’s going on.
“You have to wonder at the information people have about the way things are done, or have been done in the past, that really makes it worth paying out large amounts of public money and making sure in that contract there is a clause which stops them speaking about it.
“It is very difficult not to think there is something those people could be saying that the authorities don’t want to be made public.”
A total of 28 people have signed the contracts with the two authorities since 2009, the Echo can reveal. This is a legally binding contract on the termination of employment, mainly initiated by employers and waives an employee’s right to legal action – such as a tribunal – which, in most cases, can be reported.
The agreements also contain a confidentiality clause – so once the recipient signs, they can’t go public over what happened.
In a joint statement, Cllr Robert Gould, leader of West Dorset District Council and Cllr Mike Goodman, Weymouth & Portland Borough Council’s briefholder for Corporate Affairs and Continuous Improvement, said: “The use of compromise agreements is standard HR practice, particularly during periods of staff restructuring which have been necessary while the councils have formed a shared services partnership saving more than £3 million to date.
“These are formal legal agreements when employment contracts are brought to an end.
“They protect the councils – and the employee – from any future claim, liability or dispute and are not being used as a way to try and keep public interest information out of the public domain.
“The amount of severance or redundancy payment made in each case is calculated on the basis of salary, age and length of service. The councils have clear laws to operate within, are subject to external audit, and respond appropriately to freedom of information requests.
“We have procedures to protect whistleblowers and take very seriously any complaint of wrongdoing made by staff or the public.”
Cllr Chisholm added: “If compromise agreements are just standard practice, why is it necessary to put in a gagging clause?
“The council should be fully and completely accountable.”
A recent report by the Public Accounts Committee has warned that there needs to be better regulation of these agreements in case important information is being hidden from the public.
A spokesman for West Dorset District Council said: “All compromise agreements (now called settlement agreements) comply with the Advisory, Conciliation and Arbitration Service (Acas) code of practice.
“The employee must obtain independent legal advice from a qualified solicitor and the agreement has to be signed off to that effect.
“Without this, such an agreement is not legally binding and cannot be enforced.
“All payments made under such agreements can only be made in accordance within council policies and statutory regulations.”
Because the councils now operate as a joint authority, it is only possible to tell that the 2009 and 2010 payments, as well as one in 2012, were made by the district council.
2013 – 4 pay outs £41,808 £8,492 £3,990 £10,000
2012 – 14 pay outs £8,544 £33,947 £26,546 £44,234 £28,766 £20,540 £2,168 £8,916 £10,000 £17,364 £15,007 £54,545 £49,578 £12,500
2011 – 7 pay outs £42,446 £36,213 £23,381 £49,775 £43,665 £5,400 £28,793
2010 – 1 pay out £5,662
2009 – 2 pay outs £18,134 £15,210 TOTAL £665, 624
Trade unions can help workers get best deal
THE Echo has spoken to local trade unions about compromise agreements.
They say that there is an allowance for employees to have a solicitor of their choice look over the contract and give advice.
A spokesman who works at county level said they couldn’t comment on the district or borough council individually but said the agreements “can keep things out of the public domain that the council wouldn’t like to be there”.
They added: “By the time people sign them they are so worn down that they just want out and as a trade union, we try to get them the best deal we can.”
Weymouth and Portland and West Dorset District Council’s compromise agreements contain the following phrase: ’The Employee will not at any time disclose or make any announcement regarding the settlement reached or the terms of this Agreement to any person (excepting his spouse or immediate family, his professional legal and financial advisers, HM Revenue and Customs or otherwise as may be required by law) without the consent of the Council.
‘The Council will not at any time disclose or make any announcement regarding the settlement reached or the terms of this Agreement to any person (excepting its professional legal and financial advisers, HM Revenue and Customs or otherwise as may be required by law or as necessary to implement the terms of the Agreement) without the consent of the Employee’.
‘People clearly feel they were gagged’
MP Margaret Hodge, chairman of the Public Accounts Committee, has said that although the agreements aren’t meant to stop ‘legitimate whistleblowing’, people who have been offered or accepted them ‘have clearly felt gagged’.
She said it is ‘vital’ that people are able to speak up but there is ‘no way of knowing’ whether these agreements have been used to gag them.
She added: “We are deeply concerned about the use of compromise agreements and special severance payments to terminate employment in the public sector.
“It is clear that confidentiality clauses may have been used in compromise agreements to cover up failure, and this is simply outrageous.
“We heard evidence of shocking examples of using taxpayers’ money to ‘pay-off’ individuals who have flagged up concerns about patient or child safety.
She added: “The end result here is the risk that public bodies reward failure just to avoid attracting unwelcome publicity.
“No one has taken responsibility for identifying early warnings of service failure, such as organisations with unusually high numbers of agreements, or individuals transferring between departments receiving large severance payments.”
Payments of £28.4m were approved by the Treasury between 2010 and 2013 the PAC said.
But the ‘true number’ of severance payments is not known because the Treasury does not approve payments by local governments, the police and private sector providers of public services. The Cabinet Office is now preparing official guidance on the appropriate use of compromise agreements which will:
- Require public sector organisations to secure approval from the Cabinet Office for all special severance payments and associated compromise agreements where they relate to cases of whistleblowing.
- Set out standard terms and conditions to be used in compromise agreements, including a provision in all compromise agreements stating that nothing within the agreement shall prejudice employees’ rights under the Public Interest Disclosure Act.
- Require public sector organisations to secure approval from the Cabinet Office before departing from these standard terms.