Back to the drawing board: Attorney-General's Department Secretary Chris Moraitis acknowledged staff voted down the offer.
A career diplomat has become the newest member of the public service's top tier.
Prime Minister Tony Abbott has named Chris Moraitis, a deputy secretary at the Department of Foreign Affairs and Trade, as the new head of the Attorney-General's Department.
Mr Moraitis, a lawyer who joined DFAT as a graduate trainee 25 years ago, will step into the $700,000-a-year job to replace Roger Wilkins, who retired last month.
Mr Abbott also announced that Immigration Department secretary Martin Bowles would become the new head of the Health Department, following Jane Halton's switch to the Finance Department in June.
Mr Bowles led Immigration for a relatlvely short time, taking the reins from Andrew Metcalfe less than three years ago.
The new Attorney-General's secretary, Mr Moraitis, spent his entire public service career at DFAT, where he became a deputy head in April last year.
However, the 52-year-old has extensive experience in international law. He oversaw the department's legal division, headed the international organisations and legal division and was the department's senior legal adviser from 2002 to 2006.
The diplomat also served as high commissioner to Papua New Guinea and has worked in Australian's missions in Paris, Madrid and Geneva.
He also spent time as an adviser to then Labor foreign minister Gareth Evans in the mid-1990s.
Mr Abbott said he would announce the new head of the Immigration Department in the near future.