June 19, 2002

The phrase ‘golden handshake’ has become a misnomer. It is particularly misleading when used in the context of payments made to public sector workers over the last three years as referred to in media reports, PSA national secretary Richard Wagstaff said today.

“These are legitimate payments made as part of employment settlements, for example in severance, redundancy, or personal grievance cases. The Auditor-General’s report on Severance Payments in the Public Sector made clear that in some cases a severance agreement may be the most appropriate, fair and cost-effective means of terminating an employment relationship. The report also set out strict processes to be followed when payments are necessary.”

“The report says that when settlements in the public sector are inevitable, it is important that they are: made for the right reasons; structured appropriately; and as transparent as possible.”

Richard Wagstaff said the amount of $4 million paid out to 330 workers equals approximately $12,000 each which is not a significant amount, particularly when redundancy payments are taken into account.

“Public servants are as entitled to fair treatment in terms of losing their job as any other worker.”

“The PSA agrees with the Auditor-General that excessive payments have been made too frequently in the past but in our experience it has tightened up considerably over recent years.”

[ends]

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