Audit Office role in Employment contract disputes queried

A difference of opinion has erupted between the Director of the Audit Office Paul Allsworth and the CEO of the BTIB Terry Rangi over Audit’s involvement in the matter of the replacement of three female staff with three new line managers as part of what the BTIB CEO says is restructuring.
The details are contained in the fourth quarter report of the Audit Office, Part 2, 1 April 2010 – 30 June 2010, tabled in parliament last Thursday, commencing on page 355.
In March 2010, the contracts of employment for three female employees were not renewed due to restructuring of the office and the employee’s lack of the right skills and experience for the new structure.
Audit Office says the contracts for two of the employees was terminated in March three months before they were due to expire in June 2010. They were kept on until their contracts expired which Audit said was fiscally irresponsible.
Audit Office say the restructuring was not approved by the Minister or the Board and the process was not handled in an ethical manner.
Audit Office also claims the three new employees were offered their positions before any advertising and recruitment process took place.
The BTIB CEO however in his response of 18 may 2010 to the findings of the audit, claimed the report was not fairly balanced, contained factual inaccuracies and statements made without foundation.
The CEO queried Audit Office’s basis for using its statutory powers to investigate complaints which were personal grievances. He said there were remedies in accordance with their employment contracts and the law. Indeed the employees had sought legal advice.
The CEO went on to say there was no requirement for BTIB to renew employment contracts. There was no right of renewal and an employee had no legitimate expectation a contract would be renewed. There was also no requirement under the contract to give any reasons why a contract would not be renewed.
The CEO went further to say that as CEO he handled operational matters including the restructuring and that after he had informed the Minister and the Board, they did not object.
In response to Audit’s recommendation 9.7 (page 9 of the report) that the Board should seriously question the integrity and appropriateness of the CEO hand picking individuals and offering them senior positions (a practice of favouritism and bias tantamount to corrupt practices), the CEO responded that he took exception to the language used claiming it was emotive and represented nothing more than a personal attack.
On 20 May 2010 the Director of Audit responded to the CEO’s letter advising he would be seeking affidavits from persons who would provide the Audit Office with critical and inside information on what transpired in the recruitment process and the handling of the situation by BTIB.
On the matter of whether it was the role of Audit Office to become involved in employment contract issues, the Director is to seek a legal opinion from Crown Law on Audit’s role in reviewing the management and role of public officials when dealing with unusual and unprofessional human resource practices.
The Director assured the CEO the review was not a personal attack on him and that Audit was carrying out its statutory duties.

By Charles Pitt

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