Legal threat on CRC salary cuts

Legal threat on CRC salary cuts

Scandal-struck Central Remedial Clinic (CRC) chiefs said they face being sued if they enforce salary cuts on bosses getting top-ups from public donations.

Five well-paid executives at the hospital are getting pay packet boosts, taken from charity funds, worth tens of thousands of euros every year.

Hauled before a parliamentary public spending watchdog, the clinic admitted its former chief executive, a manager of client services, an administrator, an HR manager and an IT manager were all getting top-ups.

The Public Accounts Committee was told the manager of client services, the administrator and HR manager were each on a Health Service Executive-funded salary of €79,000.

But the CRC took cash from a linked company called Friends and Supporters of the Central Remedial Clinic to boost their executive pay packets by €32,357 each.

In the case of the IT manager, who was also on a HSE salary of €79,000, the top-up was €37,84.

Former chief executive Paul Kiely was getting a €116,949 top-up, along with a €19,016 allowance, over and above his €106,900 HSE-sanctioned salary.

The hearing was told he will retire on a pension of around €110,000 a year from a private scheme propped up by donations.

Questions have been asked about a €3m loan taken from the Friends and Supporters of the Central Remedial Clinic to boost the pension fund for 70 staff at the clinic.

Mr Kiely was secretary of both companies at the time of the loan, which has been described by Independent TD Shane Ross as a “gift”.

Acting chief executive of the CRC Jim Nugent told TDs and senators that bosses at the clinic paid more than the public sector pay cap were never asked to take a reduction in their salaries.

“They had employment contracts that we couldn’t break, without being sued, I guess,” he said.

David Martin, a director of the board, told the committee that the CRC was a private company and made its own decisions on salaries.

As a solicitor, he knew they were bound by existing employee contracts and did not need to take outside advice on the issue, he insisted.

“This is a legal minefield for us in this respect,” he said.

Mr Martin said the board could not risk having to pay out substantial funds if legal actions were taken against them.

Meanwhile, the chairman of the PAC, John McGuinness, said the HSE did almost nothing to stop bodies like the Central Remedial Clinic using public fundraising to pay managers.

"You should have take every step possible that the audit was set down properly and protocols were put in place - not to be doing it now. That's why we have this problem," he told HSE representatives.

"It's a problem that was created, yes, by the CRC, and created by the HSE - you did not try to resolve it."

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