His contract had been controversially extended to 2020 just last year, but the council called an extraordinary meeting on Wednesday to set wheels in motion to end it three years early.

In a statement released on Tuesday at 3.01pm, just as the Melbourne Cup was getting under way, the council stated it and Mr Gillard had agreed to part ways.

Under the appointment, Mr Gillard’s initial remuneration package was around $270,000 and The Border Mail understands he was entitled to a 38-week payout.

Mayor Patrick Bourke confirmed negotiations of the contract had concluded, but said the arrangement would remain confidential.

“Federation Council is changing direction and believes a change in management in the position of general manager is appropriate,” he said.

“As councillors, it is our role to provide leadership and establish policy and the strategic direction for the organisation and the future of the council area.

“Council wishes to thank Mr Gillard for his service to council and its communities.”

The statement also included comments from Mr Gillard, who said it had been a great privilege to lead the new council.

“I would like to take this opportunity to highlight the very hard work Federation Council staff undertake for the community,” he said.

“Over the past 18 months the work has been very challenging and each staff member has contributed to building a quality organisation.”

Peter Gall will continue as acting general manager.