Public Sector Exit Payments
The UK Government announced in the 2015 Autumn Statement that it would consult on exit payment terms across the public sector, and a consultation ran from February to May 2016, and the Government has now published their response.
This consultation was separate from the two other recent initiatives to curb spending on public sector exit payment (both yet to come into force): the imposition of a cap of £95,000 on the total aggregate value of most public sector exit payments, and the introduction of a power to require higher earning employees leaving the public sector to repay some or all of their exit payments if they return to public sector employment within 12 months of their departure.
The changes which were the subject of this most recent consultation are likely to affect far more public sector employees than the cap on exit payments and the power to claw back exit payments referred to above. The Government's proposals were to:
- Set a maximum tariff for calculating exit payments at three weeks' pay per year of service;
- Introduce a cap of up to 15 months' salary on all redundancy payments;
- Set a maximum salary for the calculation of exit payments;
- Reduce the amount of any lump sum as an individual gets closer to pensionable age;
- Limit or remove employer-funded early access to pensions.
The Government received around 350 responses, mostly opposed to the proposals for a variety of reasons, including the risk of complicating already-existing workforce-level agreements, and the risk of the system being discriminatory on account of age. The Government has indicated that it is expecting departments to begin work on updating their exit terms immediately, produce proposals for reform that are consistent with the new framework by late 2016, and then consult on the proposals with trade unions with a view to implementing the changes before July 2017. This seems a somewhat ambitious timeframe particularly as there is likely to be significant opposition from the unions.
The government has confirmed that it is to undertake a full consultation on the issue of caste discrimination. Caste is not currently one of the characteristics protected under the Equality Act and there has been a perception, for some time, that a gap has remained in the protections offered by the Act. Although some Tribunals have been willing to engage in creative interpretation in order to close this gap, the position remained unclear until the Enterprise and Regulatory Reform Act 2013 required the UK Government to "amend [the Equality Act] so as to provide for caste to be an aspect of race". The consultation seeks the views of the public on whether additional measures are needed to ensure victims of caste discrimination have appropriate legal protection and effective remedies under the 2010 Equality Act. The consultation is expected to run for 12 weeks, but no firm dates have yet been set.