Telstra rules breached in rehiring

Telstra chairman Donald McGauchie overruled his chief executive, Ziggy Switkowski, and rehired a former Liberal Party staffer, doubling his former salary to $400,000 a year.

A Senate committee heard yesterday that 10 months after John Short's job as manager of government relations in Canberra was made redundant, Mr McGauchie ordered that he be hired as a consultant on the full sale of Telstra.

Mr Short had received a redundancy payout of between $100,000 and $150,000 but did not have to repay the money despite Telstra's rules about former employees having to hand back such payments if they returned within two years.

Telstra's head of regulatory affairs, Bill Scales, told the committee Mr Short was appointed to advise chief financial officer John Stanhope on Telstra's full privatisation, despite no such job being advertised.

He said Dr Switkowski first suggested rehiring Mr Short last December and again in January this year. Mr Short had worked for Mr Scales until his job was made redundant last July. But Mr Scales rejected the idea, pointing out Telstra's policy on rehiring former employees.

Jason Koutsoukis, The Age May 25, 2005