Whangarei District Council has chosen not to suspend its chief executive over his dealings with two staff who became involved in council elections.
It has set up a committee to review the employment matters involved, and report back to council.
CEO Mark Simpson sacked his personal assistant Jan Walters last week, for signing a nomination form for a mayoral candidate, Stan Semenoff.
But he gave his approval for his executive assistant to work on promotional material for another mayoral candidate - the council's finance chair, Warwick Syers.
Councillor Crichton Christie, who's also running for mayor, says councillors didn't know that, and they're not happy.
"I think most of them are pretty shocked about it. I immediately would call for suspension of the CEO because I think it puts a lot of issues on about his credibility and the integrity of this council."
Mr Christie said the chief executive had exposed the council to suspicion that management was supporting one candidate behind the scenes and appeared to have flouted the council's own election protocols, which required staff to be seen to be politically neutral.
Acting mayor Phil Halse says the review will investigate whether Mr Simpson followed correct processes, and the chair - who's yet to be found - will be independent.
"The chair will be an outside person with a background in, obviously, employment law, and a high calibre person (so) that people recognise that an independent inquiry has been undertaken."
Mr Halse says he's one of the three councillors on the review team but he wouldn't name the other two.