Mt Remarkable District Council facing potential $2 million legal bill as former senior executives sue for damages
As a prominent former political candidate takes the reins at trouble-plagued Mt Remarkable District Council, the chief executive he replaced launches legal action and his lawyer says “ratepayers will pick up the tab”.
Upper Spencer Gulf
Don't miss out on the headlines from Upper Spencer Gulf. Followed categories will be added to My News.
- Mt Remarkable District Council dispute sent to mediation
- How to make the most out of your Advertiser subscription
A small regional council has exposed its ratepayers to a potential legal bill of $2 million for forcing the departure of its chief executive, his lawyer has warned.
Mt Remarkable District Council boss Wayne Hart quit last week as it appointed former Port Augusta mayor Sam Johnson as his acting replacement.
Mr Hart, 65, responded by launching legal action in the SA Employment Tribunal (SAET), seeking damages from the council for allegedly breaching the terms of his $220,000-a-year contract.
His lawyer, Greg Griffin, said he would be arguing Mr Hart was the subject of a “constructive dismissal” while his deputy Jessie White and works manager John Hadley would argue they were unfairly made redundant as part of an organisational restructure.
“No small business in South Australia would contemplate effectively terminating the employment of three of its highest-paid employees with long-term contracts in place without very strong evidence to do so, which is not the case here,” he said.
“Council, by pursuing this path, has exposed the ratepayers to claims in the vicinity of $2 million, plus substantial legal costs to defend these proceedings.
“Sadly again, as we have seen all too often in local government recently across the state, it will be the ratepayers of Mount Remarkable who have to pick up the tab for all of this.”
Mr Hart’s future has been uncertain since he, Mrs White and Mr Hadley were suspended following an internal investigation by a human resources consultant into their management of the council.
The engagement of the consultant while Mr Hart was on annual leave prompted one councillor to resign in protest — forcing a by-election next month — while the remaining five elected members held several closed meetings to discuss the termination of his contract.
The council’s most recent meeting received recommendations from consultants about a proposed organisational restructure of its senior management, which were adopted during a discussion which lasted less than two minutes.
Mr Griffin said the decision left Mr Hart, Mrs White and Mr Hadley with no option but to pursue legal action.
“The resolution passed by only four councillors present at the meeting to make redundant all of the key management left Mr Hart with no choice but to accept the repudiation of his contract and to seek damages for the breach of his contract which has over three years left to run,” he said.
“The deputy CEO has also commenced proceedings in the SAET claiming damages because council is obliged to execute her new five-year contract, agreed to in January 2020, which council now claims it is not bound to honour.”
Mr Griffin said Mr Hart had decided not to take a termination payment which he was entitled to receive.
“He did this because he wanted to show solidarity with all the other council staff that have already lost their positions or are about to lose them through council implementing the new structure,” he said.
Mr Johnson – who unsuccessfully sought election to the Legislative Council as part of the Nick Xenophon team at the last state election – said he was looking forward to helping the council get through a difficult time.
“In this interim period, I am looking forward to working with the staff, elected members and the community to explore and unlock opportunities in the council area,” he said.
“Immediate priorities will be to implement the recently completed independent organisational review and building a greater community presence.”
Mayor Phillip Heaslip declined to comment on legal advice.