27 Sep 2023

Auckland Transport spends $6 million on staff redundancies as part of cost-cutting drive

6:24 am on 27 September 2023
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Official Information Act figures show the top 10 Auckland Transport staff payouts total just under $1.2 million - the highest being $196,188. Photo: RNZ / Ziming Li

Auckland Transport has spent $6 million on staff redundancies as part of a drive to cut costs, including paying out some who were offered other jobs within the agency.

The restructure was in response to Auckland Council's directive that gave AT just a few months to make cuts worth $30m.

Among the 147 staff who left their jobs before July are nine people who had been offered redeployment within AT but who decided to take the money instead.

One of the nine said it seemed to go against cost cutting to have been offered redundancy when a job was available.

"I thought at the time that's crazy, it's basically just saying take redundancy if you want it no matter what, and that's exactly what happened. People got job offers but just took redundancy. It was terrible."

They said the restructure appeared to have been badly rolled out.

"I know there were a lot of people who had been there a long time, the redundancy payout would have been quite a lot.

"I didn't see it as a very good cost cutting measure, paying out all these people."

Figures provided to RNZ under the Official Information Act show the top 10 payouts total just under $1.2m - the highest being $196,188.

RNZ has asked AT if any of the nine staff offered jobs were among the top 10 payouts - AT is treating the question as an Official Information Act request which can take weeks to answer.

The agency said staff were told at the beginning of the restructure that if their roles were disestablished they would receive compensation - and it followed through on that commitment, even if a person had been offered an alternative role.

AT chief executive Dean Kimpton said that was deliberate but he did not know how much it cost the organisation to pay out the nine people offered jobs.

"I'm not aware of the particular circumstances, to be fair. The team would've worked through that with the individual people leaders. There'll be a reason for the decisions that were made, I accept those."

Kimpton said the agency was under pressure to cut costs within a short timeframe.

"The pressure on us was to reduce our cost, unfortunately part of that came from our people, through a cost reduction there, and we wanted to land that so that in the new financial year we started with that position disestablished and concluded," he said.

"There was pressure from that perspective and the accepted pressure of doing the right thing by the people that were displaced through that process."

AT said most of the 147 roles affected were in business support areas, with few frontline staff.

Figures provided to RNZ show 19 people in the agency's Human Resources (HR) team were among those made redundant.

AT's $6m redundancy bill is half of the $12m total across Auckland Council and all its arms-length organisations for this year.

Auckland Council said it paid out redundancy for 61 jobs shed in the budget cuts, Tataki Auckland Unlimited paid out for 82 roles, Eke Panuku paid out 11 and Watercare paid out 16.

Its acting chief executive Phil Wilson said AT's big bill was expected.

"It hasn't raised eyebrows because we understand the situation that they've been confronted with," he said.

"They have had a funding squeeze, there's tremendous pressure in terms of transport investment and such like so we totally understand the context in which those decisions are needing to be made."

Employment lawyer Barbara Buckett said it was unusual to offer both a job and a payout.

She said generally when people were offered another job during a restructure, they either accepted it or resigned.

"Was this economically fiscal and a sensible decision because it's basically throwing a lot of money at people for them to just leave."

Auckland Transport said it would save $15m a year from disestablishing 147 roles - greater than the one-off cost of redundancies.

Kimpton said there were no further job cuts planned but he was now redesigning the organisation's structure.

"It's about organising our way in a way that better delivers and better serves Aucklanders."

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