I
can’t argue with this one. In almost all cases such pay-offs are wildly
inappropriate, and not just in the public sector. It’s just that shareholders
don’t exercise their power appropriately in companies, and here taxpayers have
insufficient control. In an ideal world, we’d also legislate to give
shareholders greater power, and might well ban all such pay-offs. This might
involve requiring well-paid employees to have contracts that allow their
removal without much compensation, just like the rest of us. Companies might
want to do this, but if one company does it alone, it’ll struggle to keep good
employees. We need to make it widespread.
There are some cases in which big pay-offs are appropriate, but as
long as we specify that compensation for, for example, injuries, is not
affected by this rule we won’t prevent genuinely deserving people getting
justice.
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