Melbourne City Council has offered incumbent CEO, David Pitchford only two more years in what is normally a three to five year contract.
The decision of Council was to agree to a limited extension indicating that David Pitchford has effectively been put on notice that he should seek alternative employment. A similar provision was adopted for Michael Malouf whose contract was effectively terminated early with the City Council cutting the term of the contract from five years to three.
There a a number of question of legality still outstanding.
It is understood that David Pithford's current contract expires on September 30 2007. If this is correct then the contract is outside the six months statutory period in which the Council can resolve to extend the contract.
The City Council has not advertised its intention to re-appoint the CEO for a further two years nor has the position been advertised. Given that the decision of the Council is outside the six month period prior to date of expiry of the current contract there is serious concern that the contract may be void under section 94 (7) of the local Government Act.
Melbourne City Councillors have been reassured by Councils in-house legal advisers that the reappointment does comply with the terms of the Local Government Act.
The City Council is due to finalise the arrangements at its meeting scheduled for March 27, 2007 which is still outside the six month statutory period.
Section 94 clause (4) of the Local Government Act requires that the City Council must provide 14 days public notice of its intention to renew the CEO's contract if the decision is made within 6 months of the CEO contract expiring. The council was advised by the Council's in-house legal officers that they did not have to provide public notice as the decision to re-appoint the CEO was outside the six months statutory period.
Section 94 clause (7) of the Local Government Act states that
A contract of employment as Chief Executive Officer between a Council and a person is void if it is made—
(a) in circumstances that are contrary to this section; or
(b) while a current contract of employment as Chief Executive Officer with the person exists and that current contract is not due to expire for at least another 6 months (regardless of whether or not the Chief Executive Officer's position has been readvertised);
David Pitchford and the City Council could be on very thin ice indeed.
UPDATE: We have just been informed that David Pitchfords current contract expires on 22nd September, not Septemeber 30 as we previously thought, in which case the comments about compliance with the Local Government Act do not apply.
However The fact that David Pitcford's contract has been limited to only two years is still an indication of Mr Pitchford's standing in the Council.
David Pitchford has presided over a corrupt administration which resulted in the City Council being investigated by the State Ombudsman whose report found that the Council had acted inappropriately in the management of its traffic services.
The Melbourne City Council's governance department acting on advice on advice by Alison Lyons had actively sought to cover-up and avid the investigation by the Ombudsman Department/ This was not the first time the City of Melbourne Governance department and the Traffic management department have acted in a corrupt questionable manner. (Prior to David Pitchford's appointment)
We continue to ask on what basis has Melbourne's CEO been offered bonus payments given the extent of allegations and the cover-up following the Ombudsman's review.