The role and responsibilities of a council Chief Executive Officer are largely set out in relevant sections of the Local Government Act and within individual contracts but the position presents many unique challenges.
Some of the challenges relate specifically to the operation of a local council as a business but whose CEO is directly managed by a democratically elected body of people who form a representative tier of government. A CEO’s responsibilities under the Occupational Health and Safety Act 2004 (OH&S Act) also broaden and add complexity to the role.
Political risk for the role of CEO
One of the key issues across the sector was the political risk inherent in local government politics. It was commonly considered that a CEO is not fairly judged on their performance.
In an academic paper1, Stephen Jones observes that the contractual and performance arrangements established by the elected councillors can considerably impact on a CEO’s ability to successfully undertake their role. Their performance indicators served as the basis for the performance of senior managers and the organisation as a whole.
Victorian CEOs prefer the presence of third parties, primarily legal advisers or HR consultants, throughout the performance assessment process to ensure councils do not make unprecedented or unconfirmed demands.
Jones reported that effective CEOs that are given management discretion with little political interference from councillors led to better performing councils. Poor performing councils, in his opinion, are politically fractious.
The ability for CEOs to separate themselves from electoral politics while remaining politically sensitive is the most common factor contributing to CEOs successfully doing their job. A key challenge for councils is to establish contractual and performance management systems that allow CEOs to achieve their objectives, to deal more effectively with challenges facing communities and contribute to more sustainable local governments.
It is argued that CEOs performance is not the major determinant of success in the role; rather the capacity to engage councillors was identified as the most critical issue in gaining successful outcomes.
The CEO must be policy oriented but not political. Without this balance there can be serious consequences. Several empirical studies have suggested that political disputes can be a significant cause of CEO turnover contributing to resignations prior to contract completion.
Chief Executive Officer responsibilities under workplace safety legislation
Recent events at Melbourne City Council raised the challenges for a CEO in respect to their obligations as an employer under workplace safety legislation and the relationship with councillors. The Melbourne case was made more complex due to the involvement of the Lord Mayor and allegations of sexual harassment.
One of the responsibilities of the CEO, as specified under section 94A(1)(e) of the current Act, is the carrying out of the council’s responsibilities as a deemed employer of councillors. Under this section, they are considered as deemed workers in relation to any matters which arise under or with respect to the Accident Compensation Act 1985 or the Workplace Injury Rehabilitation and Compensation Act 2013.
The Act refers to section 14AA of the Accident Compensation Act (which was repealed in 2013) and clause 15 of Schedule 1 to the Workplace Injury Rehabilitation and Compensation Act.
Under this legislation, the council of which the councillor is a member, while the councillor is carrying out the duties of their role, is deemed to be their employer. In effect those Acts define a councillor as a worker.
Similarly, under the Occupational Health and Safety Act 2004 (OH&S Act), the council as an entity is the employer but it is the CEO as the ‘officer’ who manages and controls the workplace. The CEO has a responsibility, along with employees, to ‘the extent that is reasonably practical’ to ensure that the workplace is safe and without risks to health and safety. The council also has an obligation to persons other than employees under the OH&S Act to ensure they are not exposed to risks to their health and safety. This obligation extends to members of the community, contractors and, in this case, councillors.
Having established the CEO’s responsibilities under workplace safety legislation, it is necessary to understand the practical challenges faced by a CEO in managing issues where there is a potential risk to health and safety as a result of actions by a councillor, who is in effect their employer.
It is important to mention that this does not include allegations of assault, sexual assault or threats of assault, which in all cases ought be directed to Victoria Police who then have mechanisms in appropriate circumstances to intervene. And also, setting aside minor behavioural or conduct matters that councils are expected to resolve through their councillor conduct process, the difficult space for the CEO and councils exists particularly where allegations relate to bullying and harassment including sexual harassment and where health and safety may be at risk.
In the case of a significant allegation such as harassment by a councillor is reported to the CEO, it is incumbent on the CEO to take steps so far as reasonably practicable to ensure the workplace is safe. There are a range of steps a CEO could take in these circumstances and a number of pathways to deal with these allegations under the existing framework in the Local Government Act and other Acts, as well as referring matters to bodies including Worksafe, Victoria Police and the Victorian Equal Opportunity and Human Rights Commission.
However, unlike council employees, the CEO has no powers to direct a councillor to take certain action, not to attend certain places or not to contact certain people. Any of the intervention steps a CEO may take can exacerbate the political risk of their role. This may depend on the political or personal affiliations of the councillors who make up the employer, and the people involved.
In the Inspectorate’s view, this anomaly where the CEO has primacy to a degree over elected councillors raises expectations of the CEO and uncertainty on their part. Acknowledging the complexity of this issue, this is an area where consultation with sector stakeholders will identify opportunities to improve awareness and understanding of workplace safety responsibilities.
1 Jones, Stephen (2011) “Superheroes or Puppets? Local Government Chief Executive Officers in Victoria and Queensland,” Journal of Economic and Social Policy: Vol. 14 : Iss. 2 , Article 6.