Sandwell Council (SBC) leader Steve Eling was at the centre of controversy when, after being the subject of an attack by a Tory MP, he told local press in the West Midlands that the council did not use confidentiality agreements with departed staff. The SKWAWKBOX subsequently published a copy of a confidentiality agreement that explicitly linked a financial payment to a requirement on the recipient to maintain confidentiality.
The council subsequently said something different to Mr Eling, telling this blog (emphasis added):
Sandwell Council does not use ‘confidentiality agreements’ in the manner you imply in your article.
The Council has never sought to use any form of legal agreement, or ‘pay off’, to prevent wrongdoing being reported either to the Council or West Midlands Police.
The Council does sometimes enter into settlement contracts with employees to terminate their contracts of employment for a number of different legitimate reasons – these are common practice in Human Resources law.
Some of these settlement contracts may include confidentiality clauses, principally to deal with employees who have been privy to information that is sensitive, personal or commercially confidential. The Council has a duty to ensure this information remains confidential.
There is no link whatsoever between the settlement of liabilities (e.g. pension contributions) and confidentiality clauses in these contracts.
Although the Tory MP, James Morris, had claimed the agreements were used to cover up corruption, the SKWAWKBOX had made no implications about ‘the manner’ in which SBC used them. Steve Eling claimed, according to local press reports, that the council did not use them – and this blog published evidence that it did.
The council’s comment that there is no link between payments (‘settlement of liabilities’) and the confidentiality clauses is misleading, however, as the wording of the agreement very specifically says otherwise:
The council ‘makes the Compensation payment… in consideration of which, the Employee agrees and confirms‘ etc.
‘Consideration’ is a specific contractual term meaning that one party agrees to do, or not do, something in return for something done or given by the other party. In other words, one act (or non-act) is specifically linked to something given in return – and the use of the term in the agreement is a very definite link between ‘compensation’ and ‘confidentiality’.
Such agreements are quite common, so Mr Eling could have told media that the council uses them because they’re a perfectly standard thing when staff – especially senior staff – leave an organisation. According to the local media, he didn’t do that – he told them that the council didn’t use them:
Mr Eling’s comment to the local press is made all the more perplexing by the news that, according to local sources, when Eling was the council’s Cabinet member for Finance, a member of his family was a council employee – and that the relative was subsequently made redundant – and signed a confidentiality agreement.
The SKWAWKBOX wrote to Mr Eling twice to point out that according to local press reports he had said SBC did not use confidentiality agreements but that his family member had signed one on being made redundant and to ask him to comment.
Mr Eling did not respond, but a solicitor for the council subsequently emailed the SKWAWKBOX attempting to prevent publication by claiming to have referred the matter to regulatory authorities.
The regulatory authority in question says it does not accept pre-emptive referrals.
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