Legal Insights

Major changes in the HR space for Victorian Local Government

By Ross Jackson, Lindy Richardson

• 11 June 2018 • 4 min read
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The Bill will repeal certain long-standing provisions of the current Act about the employment of Council staff

Following extensive consultation with the community, the Local Government Bill 2018 (Vic) was introduced into Parliament on 23 May 2018.

If enacted, the Bill will repeal and replace the Local Government Act 1989 (Vic). The Bill has many implications relating to the employment of Council CEOs and other Council employees. If these reforms are passed, they are expected to commence in January 2019.

Councils should note that, as currently proposed, the Bill will repeal certain long-standing provisions of the current Act about the employment of Council staff. For example, the defined concept of a ‘senior officer’ and the restrictions around the employment of ‘senior officers’ (requiring advertisement and then employment under contracts for a maximum of five years which specify performance measures) will no longer exist - giving Councils greater flexibility in setting the terms and conditions of senior members of staff.

Councils (and CEOs in particular) will have to give careful thought to the interaction between their obligations under their enterprise agreements (federal instruments) and competing and overlapping obligations arising from the Bill, for example regarding consultation and staff discipline. The fact that ‘senior officers’ will no longer exist as a statutory species will also require careful attention in regard to enterprise agreement definitions, scope and obligations (particularly where the Victorian Local Authorities Award 2001 is incorporated in enterprise agreements, e.g. as Part B).

The Bill simplifies the provisions of the current Act relating to CEOs and members of Council staff. Notably:

  • Current requirements that CEOs be employees (and not contractors) appointed on contracts for maximum terms of up to five years are retained, but CEO reappointment provisions are simplified to require only that CEOs be reappointed under new contracts.
  • Councils must appoint acting CEOs if the office of CEO is vacant or the CEO is otherwise unable to perform the duties of the office.
  • Councils must implement a ‘CEO Employment and Remuneration Policy’ which addresses the recruitment, appointment, contractual arrangements, performance monitoring and annual review of the CEO, and is consistent with the remuneration principles contained in the Victorian Government’s Policy on Executive Remuneration in Public Entities.
  • The functions of CEOs are specified. These are two-fold. Firstly, to support the Mayor and Councillors in the performance of their roles. Secondly, to ensure the effective and efficient management of day to day Council operations (which, in turn, requires establishing and maintaining an organisation structure, being responsible for all staffing matters and managing interactions between Council staff and Councillors).
  • CEOs must develop and adopt a ‘Workforce Plan’ which describes the organisational structure of a Council, states projected staffing requirements for at least four years and includes measures designed to ensure gender equity, diversity and inclusiveness.
  • CEOs must adopt and maintain a ‘Recruitment Policy’ which ensures recruitment decisions are based on merit, supports transparency in recruitment processes and the public advertising of positions, and has regard to the gender equity, diversity and inclusiveness measures set out in the ‘Workforce Plan’.
  • CEOs must inform their Councils before implementing organisational restructures that will affect a Council’s capacity to deliver the Council plan and consult members of Council staff affected by a proposed organisational structure before implementing the restructure (which may require consultation of a different type, and at a different point in time, to that required under any applicable industrial instrument such as an enterprise agreement).
  • Provisions about delegations by CEOs are specified and provisions relating to the indemnity of CEOs and Council staff are retained in a similar, but not identical, form to section 76 of the current Act.
  • Councillors cannot be appointed as members of Council staff for two years after ceasing to be Councillors.
  • CEOs must develop and implement Codes of Conduct for members of Council staff. Codes of Conduct must include a gift policy and procedures for dealing with alleged and actual breaches of conflicts of interest and, importantly, provisions for the CEO to take disciplinary action against a member of Council staff.

The CEO Employment and Remuneration Policy, Workforce Plan, Recruitment Policy, Code of Conduct and new delegations must be adopted or developed within six months of the date the sections dealing with those matters commence. Until a new Code of Conduct and delegations are developed, current versions will continue in force.

The Bill also refers to regulations (yet to be released) which will deal with matters such as the CEO’s employment. We anticipate there will also be regulations dealing with transitional matters as guidance material from the Government says that those staff designated as ‘senior officers’ under the current Act will continue on their senior officer contracts until the existing terms of those contracts expire.

Need advice on how these changes will affect your Council?

Contact the Employment, Remuneration & Benefits team.

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