Section 151 officers could sue as DIP protections are scrapped

1 May 15

Councils could face breach of contract claims from Section 151 officers after last-minute government changes to the rules on dismissal from top posts, an employment lawyer has warned.

Sarah Lamont, a partner at law firm Bevan Brittan, told Public Finance the Department for Communities and Local Government’s decision to remove the Designated Independent Person provisions could increase costs and the time taken for dismissals.

The coalition government in March passed secondary legislation to remove protections that required local authorities
to appoint a DIP, usually a QC, to review cases before senior officers holding statutory positions are dismissed. Jobs covered were the Section 151 officer post held by the chief finance officer; the head of paid service post usually held
by the chief executive; and the monitoring officer role of the director of legal services.

From May 11, dismissals will have to be approved after a vote of the full council, although the decision will also be considered by independent persons appointed as part of the council’s conduct and standards regime for members.

Local government minister Kris Hopkins said the DIP provisions were costly and often meant council chiefs were offered ‘inflated golden goodbyes’ by town halls keen to avoid legal action.

But Lamont said councils could still face high costs if officers – whose contracts will still contain the previous provisions and will not be automatically superseded by revised standing orders – take action for breach of contract. ‘From a contractual point of view, if you have someone who has a right to certain requirements being complied with – and they feel they might have lost out as the new system doesn’t give them as much protection – then they may consider raising a claim against that.

‘For those who have the protection at the moment, they’re probably going to be well advised to threaten to make a claim. This could well mean additional costs, or a deal being done because the council doesn’t want to be exposed to a fairly self-evident risk of a claim.’

CIPFA chief executive Rob Whiteman said section 151 officers had the DIP protection because of their legal duty to act in the interests of taxpayers.

‘It is worrying that, despite the reasoned concerns expressed by the local government sector at the government’s plan to abolish vital protections of local authority staff, they appear, in the dying days of the parliament, to have carried on regardless.’

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