Question: Our Chairperson is also in the financial documents as being a ‘caretaker’ receiving approx $900 per month. How do we stop these payments?
The Chairperson of our body corp made up of 74 units is also in the financial documents as being a ‘caretaker’ receiving approx $900 per month payment from the Body Corporate.
Multiple requests to the Strata manager and the chair/caretaker, in their capacity as chairperson of the BC, for a copy of the job description, hourly rate and hours of employment have been met with silence.
I can’t find any information about this in our portal. There doesn’t seem to be any job contract or job description? This situation may have been going on for ten years. How can I access this information? What avenues do we have to stop these payments?
Answer: One factor to consider is that there is a prohibition on service contractors being voting members of the committee.
It’s a bit of a red flag that there is no explanation for the payment. And, the fact that it is listed for caretaking duties may have some implications for the Chair’s position on the Committee. So, what can you do?
It is worth remembering that it is legal for a body corporate to pay Committee members. Most of people in committee positions do large amounts of work on a volunteer basis, and when they do get paid the amount tends to be considerably lower than the equivalent you would pay a professional. Your scheme may be better off by having the Chair do the work they are paying for than not. Other owners may be happy with the arrangement. This doesn’t mean that you are not entitled to transparent information or that the correct procedures shouldn’t be followed in authorising the expense, but it is something to think about. Equally, from the perspective of the owner receiving the payment, they should want the transaction to be as transparent as possibly so that they don’t have to deal with issues like this.
Any payments to Committee members should be approved by owners at a general meeting, usually the annual general meeting as is when the Chair is also appointed or reappointed. As such, check the last couple of meeting notices and see if there has been any record of the payment. If there was, then maybe you just need to push for more details about the scope of works. If not, then it seems correct procedures are not being followed.
In that case, you have a number of options, but a reasonable start point would be to have the matter reviewed at the next committee meeting. You could write to the Committee about the matter and ask for your correspondence to be tabled so it is recorded in the minutes. You could also submit an owner’s motion to the committee requesting that a scope of works be provided. When you submit an owners motion, the committee have six weeks to vote on the matter or advise you that they need an extension. If they do not, you can raise the matter with the Commissioner’s office.
If you want to propose a motion that the payment stops, you could do that as well. This could be either a Committee motion or you could submit a motion for inclusion on the next general meeting.
One factor to consider is that there is a prohibition on service contractors being voting members of the committee. This only applies if the tenure is for more than twelve months. So, if a Committee member receives an annual payment and this is acknowledged on an annual basis they can still remain a Committee member. However, payments in perpetuity, even if agreed at a previous meeting, do not meet this standard so by implication the Chair could not act as both Chair and ‘caretaker’. You could raise this issue with the Committee and whoever is in-charge of authorising accounts. Bear in mind that a complex and probably unhappy conversation would likely ensue.
A simpler means of resolution would be to propose that regardless of what has happened to date, the best way for the body corporate to proceed would be to have a general meeting at which owners can vote on payments to the Chair based on a scope of works provided. However owners vote the matter can then be closed. That seems a reasonable proposition for all parties and if not agreed to, you can follow up with the Commissioner as required.
This post appears in Strata News #594.
William Marquand
Tower Body Corporate
E: willmarquand@towerbodycorporate.com.au
P: 07 5609 4924
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