Time to clip wings of some top earners

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Source: Labour Party – Press Release/Statement:

Headline: Time to clip wings of some top earners

Chief executives and certain other senior staff should be excluded from our personal grievance laws for very good reasons, says Labour’s spokesperson on labour issues Andrew Little.

National MP Paul Goldsmith is sponsoring a member’s Bill which would allow employees earning over $150,000 to contract out  of the right to challenge unjustified action or unjustified dismissal.

“There’s definitely merit in excluding chief executives, and other senior executives in larger organisations. They are in positions in which poor performance can jeopardise the whole business and tend to be on incomes that reflect the risk of instant termination.

“There aren’t too many cases of sacked chief executives going to court because typically the threat of a personal grievance action and the ensuing public embarrassment is enough to get a board to the negotiating table, hence a deal – often a pretty generous ‘golden handshake’ – is done.

“Of course if a board loses confidence in the chief executive it must be able to act quickly otherwise the enterprise is potentially at risk, as are many other jobs.

“We don’t support arbitrary thresholds to exclude employees from the personal grievance jurisdiction, however. It should relate to the person’s place in the organisation and the extent to which they get to control the business or significant parts of it.

“When the personal grievance jurisdiction was introduced in1970 it never applied to management roles. It was intended to provide a quick and effective means for frontline employees to get their dismissal claims sorted because of cost and the outcome of a successful claim was usually insufficient to cover the expense of the legal action.

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“While Labour will look closely at any proposal in relation to this, we are also in the process of developing our own.”

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