Fears for Cessnock council worker entitlements

Fears for Cessnock council worker entitlements

22 Apr, 2011 04:00 AM Newcastle Herald

EMPLOYEE entitlements at Cessnock City Council could be at risk after they were used to fund a recent internal restructure, a councillor claims.

Councillors voted on Wednesday night to have staff prepare a report on how the restructure had been funded and its total impact on the council’s budget in this fiscal year.

Cr James Ryan, who moved the motion, said councillors had been told in a briefing on next year’s draft budget that several redundancies in senior staff had been drawn from leave entitlement reserves.

Councillors had been told more than $450,000 had been paid in redundancies to at least three senior staff, Cr Ryan said, which could devastate the council’s ability to handle future entitlements.

“A rule of thumb is that you have 25 per cent of those entitlements in reserve in that account, and we’re being told we only had 8 per cent on hand [before those redundancies],” Cr Ryan said.

“A responsible corporation puts that money aside.”

“The only thing we can do [without those funds] is start paying them from another part of the budget, and cut services.”

At Wednesday’s meeting, Cr Ian Olsen said it was important councillors discovered the full cost of the organisational shake-up.

“It was clear to me that it was going to cost us some money to make a restructure of this council but it was never clear exactly how much,” he said.

“This will clarify how much it has cost us to make these changes.”

Cessnock City Council general manager Lea Rosser said yesterday that the redundancies were expected to be in the next fiscal year’s budget.

“At this stage, the source of funding for those payments has not been determined, however there are no plans to fund redundancy payments from the staff leave entitlement fund,” she said.

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