Croydon Council admits they should not have agreed to pay £437,900 settlement in sacking ex-CEO I was.
In a report to the Board’s external auditors to be considered at the December 14 Board plenary meeting, Croydon noted conversations between leaders, oversight officers, former chief executive officers and Section 151 officers. He also acknowledged that he failed to keep proper records of , and the personnel manager in relation to the exit.
The decision to terminate the employment of Chief Executive Officer Jo Negrini and approve the settlement was made by the Council’s Appointment Committee on August 27, 2020.
More than a year later, Grant Thornton, the local government’s external auditor, received an inquiry from an elector about the settlement.
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The auditor then questioned the council about the governance arrangements relating to the settlement as to whether it would be of value to the taxpayer and sought executive advice from the members before reaching a decision on payment. .
In its response, Croydon said it had “serious failure to report officers to the August 2020 Appointment Committee meeting in connection with the approval of the former chief executive’s settlement agreement and the resulting decision-making”. I admitted that there was
The officer’s report failed to reveal the facts that caused the collapse of trust and confidence between the then-leader of the council and the former chief executive, as well as attempts at mediation or dispute resolution.
Croydon’s reply added: “In this connection, the lack of legal advice on the merits and likelihood of success of a potential Employment Court (ET) claim by the former chief executive necessitated notification of the settlement decision.”
Generally, officers reports should provide all relevant information to enable members of the appointment committee to make well-informed and reasonable decisions, the council’s response said.
For example, no advice was given by the officers on the £48,000 ‘payment in lieu of notice’ which formed part of the £437,000 payment. Also, there was no advice based on the payment of compensation.
In addition, the Council has determined that, in the absence of established facts, information about failures or wrongdoings by the Council, and in the absence of legal advice, the former chief executive officer’s position could be sued in the event of ET’s allegations. It said it had a “very optimistic” analysis to offer. Discuss the benefits and potential for success.
The report to the appointment committee also did not say whether efforts to negotiate or secure a smaller financial settlement, or whether the option of seeking negotiations, was considered at all.
“In effect, no information was provided to members as to whether the former chief executive’s departure could have been secured at a lower cost,” the council said.
In addition to this, the Council held that the process of convening meetings of the Appointment Commission (i.e., notification and dispatch of agendas and reports) did not meet constitutional requirements and “may be illegal.” concluded.
The decision to title certain meetings “Governance Matters” was “misleading and a more appropriate title would have been ‘Employee Settlement Agreement’ or ‘Employee Settlement Agreement’,” it said.
Additionally, the Council’s response has raised concerns about how the Appointment Committee was chaired by a former Council leader involved in the situation that sparked the settlement.
how the Council manages potential conflicts of interest, how to ensure that the individual to whom the complaint is filed is not involved in deciding whether the complainant should be resolved by making a ruling; pointed out that it needs to be “seriously considered”. public funds.
According to the council, extensive outside legal advice was provided regarding the terms of the settlement and was “properly reflected” in the report seen by the appointment committee.
In this connection, the Council held that the Appointment Commission’s decision was not unreasonable, but “within the limits of a decision a reasonable local authority could have made on the information provided at the time.” said.
The Council’s response continued: “The decision taken to approve the terms of the settlement at the time (albeit tainted by the poor and inadequate advice in the officers’ report) was lawful. .
“However, for the avoidance of doubt, the Board should not have agreed to pay the Settlement, given the reasons set forth above and the Public Interest Reports for 2020 and 2021,” it concluded.
According to the Council’s response, no proper records were kept of the termination conversation between the leader, the oversight officer, the former chief executive officer, the Section 151 officer, and the head of human resources.
The council later said, “Democratic services must attend closed-door meetings to ensure that proper minutes of deliberations are taken indicating that decisions have been made.”
In light of its conclusions, the response said Croydon should “ensure” that:
- Statutory guidance requirements for special retirement benefits are incorporated into its policies, practices and procedures.
- Appropriate records of potential settlement agreement conversations, discussions, or meetings with employees are maintained.
- Reasonable investigation will be conducted to establish all facts, events and circumstances giving rise to the proposed settlement agreement, including any wrongdoing by the parties concerned.
- Its legal advice will be sought as to the merits and likelihood of success of potential claims against the Council and the amount of damages awarded. This will inform you of any decision regarding the possible settlement payment.
- Governance arrangements related to decision-making regarding settlement payments are adhered to.
- The officers and members involved in the dispute were not involved in any decision-making relating to the proposed Settlement Agreement.
- The Democratic Service will attend both the open and exempt portions of committee meetings for approval of the settlement. Appropriate minutes of meetings are prepared so that the reasons for decisions and deliberations by the committee are understood.
The Appointment Committee’s August 2020 decision came just two months before the Council’s external auditors raised concerns about Croydon’s financial position, and since then the Council has issued three Section 114 notices. Did.
The publication of the Council’s response to the external auditor’s question comes just over two weeks after Croydon issued its Section 114 Section 3 notice announcing it was “financially and operationally unsustainable”. was done later.
A report published last month (30 November) said Croydon could not balance its budget and will have to cut spending by £130m in the next financial year alone. “.
Adam Carey
