I've worked for a frontline public service and the civil service. We used to have rules in both of those organisations that if a post came up, even if there was a strong internal candidate there had to be a recruitment process for it (not necessarily external - sometimes from within the organisation).
I know work for a parish council. We have a team leader, a deputy and then 6 'workers' in my team. The deputy left last week and today I've had an email saying the management have looked at everybody's experience and skills and decided to give the deputy's job to a named worker.
THere's no mention of it being acting or temporary - just that this is now her role, but they haven't opened up a recruitment process to anybody else.
Is this allowed? It seems strange to me, as it wouldn't have been in my previous organisations, but it could be ok?