Australia Post paid more than half a million dollars to one staff member to ensure they did not leave the organisation, Senate Estimates has heard.
One executive member and four senior managers were offered the retention payments because they were being lured by other companies.
While Australia Post did not clarify how much was handed across in total, Nick MacDonald said each payment was divided into three and spread out to make sure each employee remained up to at least three years.
"The highest of those payments in aggregate over those three payments was over $500,000 [and] the others were less than that," he said.
Chief executive officer Paul Graham defended the decision to provide additional pay, or retention payments, to entice the five staff members to stay.
"My view very clearly was that it was appropriate to retain those people, these skills are very, very difficult to find both in the Australian market and indeed in the international market," he told senate estimates.
"They were being coaxed away by a major competitor and I felt that the damage that their departure would have been done would have been significant and therefore the board approved the retention payment.
The information was disclosed during a Senate Estimates hearing under questioning by Greens Senator Sarah Hanson-Young, who said she was shocked that level of cash was handed out.
"That's a lot of money, talk about out of touch," she said.
Australia Post and its then-CEO Christine Holgate made headlines in 2020 after she revealed at an estimates hearing that four senior employees were given $3,000 Cartier watches as a thank you for securing a lucrative deal in 2018.
Ms Holgate stood aside as CEO but later said she was bullied out of her role in the federal government-owned company.
The controversy led to a Senate inquiry into how and why Ms Holgate left, which recommended the chair of Australia Post and Prime Minister Scott Morrison formally apologise to her.
When asked if the issues around Ms Holgate's departure had had any impact on being able to attract and retain staff, Mr Graham agreed the events of the past year-and-a-half had made it harder.
"I think it is a further complication," he said.
"It creates some difficulties and challenges but that is the nature of what we are as a Government Business Enterprise."
Questions raised about staff bonuses
Speaking on Tuesday, Australia Post also defended additional cash handed out to staff last financial year, which Labor labelled "staggering".
Estimates heard that 31 staff who earnt between $300,000 and $400,000 last financial year received what Australia Post called a "short term incentive" of on average $168,000.
While 15 workers who had a base salary of between $400,000 and $500,000 got an additional $233,000 on average.
Shadow Communications Minister Michelle Rowland said it showed a lack of respect for taxpayers money.
"At a time when the country is going through a difficult period where people are losing their jobs, forgoing bonuses in the private sector, we have [Australia Post] throwing money around like there's no tomorrow," she told the ABC.
But chair of Australia Post Lucio Di Bartolomeo defended the spend.
"We certainly don't see them as bonuses at all," he said.
"Clearly performance outcomes from year to year may well see different payments being made [and] those packages are set on the basis of what is considered in the marketplace for those sort of positions."
