Bonuses part of the deal for state staff

By EUGENE BINGHAM and VERNON SMALL

Performance bonuses have become entrenched in the public service, and most workers have contracts that tie pay to results.

A Weekend Herald survey shows bonuses are widespread and have been common for at least 10 years. They were introduced to encourage and reward good performance, and to help recruit and retain civil servants.

Controversies surrounding $2000 payments to Qualifications Authority staff and extra holidays for Housing New Zealand employees appear to be the exception rather than the rule.

But the Herald has uncovered another example of a free day off in recognition of a department's heavy workload last year.

The Director-General of Health, Karen Poutasi, said last night that she had rewarded all full-time Ministry of Health staff with a leave day, to be taken before June 30 at the ministry's convenience.

It was to recognise extra workloads and unpaid work conducted last year when the Government's health reforms were implemented.

Other state sector bonus payments are written into employment contracts or are part of a stated policy to reward individual performance.

This practice is so common that even the holder of the Government's purse-strings, the Treasury, and the state watchdog, the State Services Commission, use them as part of their employment packages.



Figures obtained by the Herald show that in the last financial year, the Treasury paid more than $100,000 to 58 of its 314 staff. Most payments were Y2K-related.

Inland Revenue paid $2.7 million to 2300 staff last year (an average of $1192 each) as performance-based payments agreed to by staff. Contracts also gave all staff the three days between Christmas and New Year as departmental holidays in addition to annual-leave entitlements. This has been done for more than 10 years.

The Department of Labour said it had contractual obligations to consider permanent staff for performance bonuses of up to 10 per cent of their salary.

In the year to June 30 last year, 522 staff received $1.1 million, an average of $2200 a person.

The Department of Work and Income tied its staff salaries to performance targets written into each employment contract.

On top of that, the contracts allowed for a bonus of up to 10 per cent for exceptional work.

Staff at the Ministry of Economic Development also had performance-based pay.

As well, the ministry paid "chief executive achievers' awards" to recognise top work, said a spokeswoman.

This financial year, the ministry recognised 61 people under this category.

Bonuses worth $16,000 (an average of $266 each) were given in the form of dinners, book vouchers and other prizes.

Among recipients were officials in the Companies Office, who had excelled at making certain functions available online.

The Ministry of Transport spent almost $370,000 on bonuses to staff last year - including 15 per cent performance bonuses for some.

Payments, at the discretion of the chief executive, went to 65 employees in the year ended last June.

Child, Youth and Family Services said last week that it paid 800 staff $1.012 million in bonuses, up $155,000 from the previous year.

The Ministry of Maori Development (Te Puni Kokiri) paid an average of $1062 to its staff members.

The bonuses were seen as a tangible reward for outstanding performance.

The Ministry of Health said it paid bonus payments when warranted.

In the last financial year, $407,000 was paid out to fewer than half the staff.

The average bonus was $2177.

The ACC said it, too, paid bonuses and performance pay as covered by employment contracts, although no figures were available.

At the State Services Commission, where staff receive "modest" contractual bonus payments, officials have begun a review of bonuses.

Because the state has 245,000 employees, the review will cover only the core state sector.