The FBU’s ‘hush money’ scandal: all you need to know

REGULAR READERS OF this blog will know that there have recently been one or two significant developments in the ongoing ‘hush money’ scandal inside the Fire Brigades Union (FBU). So we thought we’d take this opportunity to explain once again what the scandal is all about, and to answer some of the questions that are most frequently put to us.  

What is the ‘hush money’ scandal?

Over the past couple of years, evidence has steadily emerged to show that a string of employees departed the FBU with secret pay-offs, often after making allegations of mistreatment against senior officials of the union, including against the general secretary, Matt Wrack.

These employees were usually based at the union’s head office in south-west London.

In all cases, the employees were required, in return for the payments, to sign non-disclosure agreements (known as ‘gagging clauses’).

The affair has been covered extensively by this blog and has even reached the pages of Private Eye magazine.

How was the evidence uncovered?

Two whistleblowers contacted this blog separately and provided some initial evidence of what had been going on. Further investigations revealed the extent of the practice.

Which employees were paid off?

Several employees in different types of role received secret pay-offs. These included at least three national officers, who received termination payments totalling almost a quarter of a million pounds (Paul Woolstenholmes £109k, Sean Starbuck £50k and John McGhee £63k). These one-off payments were made outside of any normal contractual or pension entitlement.

Nobody other than those directly involved knows why these termination payments were made, but this blog has obtained evidence showing that all three national officers had, at some point during their employment, made allegations of mistreatment against the general secretary.

There is no suggestion that the three national officers acted improperly in receiving the money, nor that their allegations of mistreatment were without foundation.

Other employees to leave the union with pay-offs and gagging clauses after complaining of mistreatment include the former head of IT, two former heads of communications, and various members of support staff. Again, there is no reason to assume that these individuals had acted improperly in receiving the money, nor that their grievances were unfounded.

Were the payments made from union funds?

Yes, in all cases the secret payments came out of union funds. Ultimately, this was members’ money.

How much money are we talking about?

In total, the payments amounted to hundreds of thousands of pounds (possibly more).

Did the union’s executive council know anything about the pay-offs and gagging clauses?

It appears in all cases that the union’s leadership withheld full details from the executive council (which is the union’s governing body). Only a handful of senior officials at the union’s head office had full knowledge of the payments and non-disclosure agreements.

Even worse, executive council members were expressly told in some cases that it would be inappropriate for them to know about the circumstances of an employee’s departure or any deal that accompanied it. For example, a leaked copy of the minutes of an executive council meeting that took place in February 2015 record that the general secretary informed the executive council of national officer Paul Woolstenholmes’ recent departure, but went on to say that ‘no details or information would be given, as that would be inappropriate’. This was despite (or perhaps because of!) the fact that the general secretary knew that a termination payment of £109k had been authorised.

How has the FBU leadership reacted to the information becoming public?

Very badly. When a member tried to exercise his right under trade union law to inspect the accounting records detailing the secret payment to former national officer John McGhee, the leadership enlisted the help of one of the country’s top (and most expensive) barristers – Oliver Segal KC – in an attempt to block him.

The member subsequently complained to the official trade union watchdog (known as the ‘certification officer’). In correspondence to the certification officer, the leadership tried to argue that McGhee had an ‘expectation of privacy’ because he had signed a non-disclosure agreement. The leadership did this in spite of the fact that the certification officer had made a number of previous rulings in similar cases which emphatically rejected that argument.

Just 48 hours before a public hearing into the member’s complaint was due to take place, the leadership capitulated and handed over the records. But even then the leadership wrote to the member and threatened him with internal disciplinary action if he dared to share the information with anyone else.  

Separately, in July 2023, the executive council member for the London region, David Shek, wrote to the general secretary and requested details of how much money had been spent on the pay-offs and how many employees were involved. Shek had been instructed to obtain the information by his regional committee. In response, the general secretary took the extraordinary step of refusing to provide the information to Shek. This effectively meant that Shek, as an elected member of the ruling executive council, was being prevented from doing his job of holding the union’s full-time officials to account and exercising scrutiny over their actions. It is the equivalent of a chief fire officer refusing to provide information on request to an elected member of the fire authority.     

What are the implications of all this?

The FBU leadership does not accept that it has done anything wrong. In other words, it thinks it should have the right to arrange secret backroom deals involving huge sums of members’ money, and nobody else in the union should have any right to know about it.

That approach represents a serious violation of the normal protocols of internal accountability and transparency. Moreover, it doesn’t take a genius to see that it is also a recipe for corruption. For example, what if a senior official were given, say, a termination payment of £250k, or the gift of a holiday home, or an expensive new car as a retirement present, and the union leadership tried to bury the details of that transaction in a non-disclosure agreement? The logic of the leadership’s argument is that, even in those circumstances, members would have no right to know the details because the non-disclosure agreement gives the official in question an ‘expectation of privacy’ and this trumps the right of members to know how their money is being spent. Such an approach shows an appalling disregard for members’ money and for the principles of internal accountability and transparency.

The circumstances surrounding the departures of the three national officers also raise serious questions about democracy. These officials had been elected by the national membership. In other words, they enjoyed a clear mandate from the membership to represent them at the highest levels of the union. However, all three departed suddenly and in mysterious circumstances, and the gagging clauses meant that no-one in the union was ever allowed to know why they left.

This can only be seen as a serious attack on internal democracy. After all, if the leadership can get away with manoeuvring out senior elected officials whose faces don’t fit and then refusing to provide any information to members about the circumstances of their departure, it means that the will of the membership, as expressed at the ballot box, can be easily frustrated and internal democracy thereby violated.

Isn’t it normal for employees to depart their workplace with termination payments and non-disclosure agreements?

No, it isn’t ‘normal’. The vast majority of employees up and down the country will leave their employer without a termination payment and non-disclosure agreement. Only in exceptional circumstances are these things usually required.

Moreover, the FBU is not like a private company. It is a democratic trade union funded by membership subscriptions. This means that the union’s members have every right to know the details of benefits (such as termination payments) that are awarded to senior officials. Indeed, the law specifically provides for members to have access to this type of information.

What’s more, the trade union movement generally takes a dim view of non-disclosure agreements in the workplace. The Trade Union Congress (TUC) itself recently issued a statement condemning the use of non-disclosure agreements by employers seeking to cover up mistreatment of employees. For these reasons, it is deeply inappropriate for the FBU leadership to have engaged in such practice.

The leadership’s actions in seeking to suppress details of the pay-offs are also arguably both unlawful and a breach of the union’s own internal rules.   

What can members do about this?

Members can raise these matters through the democratic structures of the union. They can move motions at their branches censuring the officials responsible and calling for complete openness and transparency in the whole area of termination payments and non-disclosure agreements.

And if they want to stay informed, they should keep reading this blog.

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