A group of City Hall councillors led by Hamilton Mayor Graeme Outerbridge threatened to sack an administrator unless she wrote them out cheques for thousands of dollars in payment for attending Corporation meetings over the past 18 months, it has been claimed.

And the embattled Team Hamilton administration is now embroiled in a dispute with the union representing the employee, who reportedly refused to give in to the demand.

The incident took place yesterday when Mr Outerbridge, accompanied by Alderman Carlton Simmons and Councillor Keith Davis, marched on the municipality’s administration offices on Church Street and ordered the official to pay out “stipends” — unofficial compensation paid to elected officials for attending the Corporation’s monthly Board and weekly committee meetings. The trio were later joined by Deputy Mayor Donal Smith.

Sources claim that the four elected members became frustrated when the administrator questioned the legality of the demand — and threatened to “pass a resolution” terminating her employment when she refused to comply.

The administrator is understood to have sought advice from the Bermuda Public Service Union after being left “reeling” from the incident.

Last night BPSU executive director Ed Ball could only say that there had been “a situation”, adding that he was attempting to address the matter.

A Corporation source said that administrators were now working with the BPSU and also seeking advice “on the legality of the Board demanding to be paid”.

Yesterday’s incident contradicts earlier reassurances from Hamilton Mayor Graeme Outerbridge that his administration would not steamroller through legislation awarding its members a salary.

Although elected officials of both Corporations of Hamilton and St George’s have never previously been paid for their duties, Team Hamilton has pushed for financial rewards since its election in May, 2012, and earlier this month Board members voted to pay themselves thousands of dollars for attending meetings. Five councillors agreed to award themselves $375 for each monthly Board meeting they attended, along with an additional $175 for every weekly committee meeting that they sat on. The backdated stipend was expected to cost ratepayers up to $150,000 annually and net each Councillor around $20,000 in “back pay”.

That vote came just days before Parliament passed the Municipalities Amendment Act 2013, which for the first time awarded Corporation representatives a $50 payment — equal to payments made to members of Government boards — for attending future municipality meetings.

After the Corporation’s stipend resolution was exposed on October 11, Mayor Outerbridge insisted that it would seek approval from the Ministry of Home Affairs before any payments were made.

“I will state clearly, that as of today, no money has been paid to any members of this Council,” he told The Royal Gazette at the time.

“We look forward to communicating with the Minister on this matter and resolving it quickly. It was the intention of the City of Hamilton Council to discuss with the Minister the Council’s view of the disparity of the effort and responsibility of an appointed Government board versus the responsibilities of the elected members of the City of Hamilton. The recently passed amendment placed them on par.

“This information would have been released to the public after the Minister and the Council had had an opportunity to discuss the resolution. However, the information was released to the media before the discussions could begin.”

A spokeswoman for the Corporation did not respond to questions from The Royal Gazette last night.

But Government did acknowledge that it was aware of the incident — and insisted that any payments to councillors under the recent Municipalities Amendment Act should not be backdated.

A Home Affairs Ministry spokesman said: “The recent amendments provide for the Corporation members to be paid for their attendance at meetings at rates which are comparable to those who serve on Government Boards. To be clear however the payments are not retroactive, meaning compensation is only payable from when the Municipalities Act received assent from the Governor — which was mid-October.”