Tag Archives: pay

The government has put a cap on the amount you can get if you are made redundant at very short notice and with no meaningful consultation. Most people effected by this will be those who are made redundant who are over the age of 55. It will come into force on 4 November and means from then on, severance packages will not exceed a maximum of £95,000 in value. Although that can seem like a lot, it includes:

• Statutory Redundancy Pay

• Discretionary Severance Pay
• Pension strain costs (see below)

Pension strain costs

Under current regulations a member made redundant or retired on the grounds of efficiency over the age of 55 has to take the pension they have earned in their current LGPS service immediately at the point of redundancy (including any previous LGPS service that a member has combined with the current service). This pension is not reduced by an early retirement factor for early payment as it would be if it was the member retiring voluntarily. The LGPS employer then must pay their LGPS fund the cost of removing the early retirement reduction. The cost is based on the member drawing their pension from their normal pension age. If they draw their pension before their normal retirement age, they are receiving their pension for longer. Depending on how early this can be very expensive and put a strain on the LGPS fund if not paid for. That is why the employer is asked to pay the fund for this cost. This is called the strain cost.

So how will this affect the £95,000 cap?

This strain cost that the employer pays will be included in the £95,000 exit cap. The cap will also include statutory redundancy pay and any other severance payments.

This means that even some low and medium paid staff may hit the cap if they have more than 30 years’ service and made redundant in their mid to late 50’s.

UNISON has consistently and strongly opposed all the above changes since they were first proposed in 2015 and will continue to do so through any means available.

UNISON is responding to the MHCLG consultation arguing that severance should not be eroded and is completely opposed to offsetting the severance payments, including Statutory Redundancy Pay, against payments to remove reductions for pensions for those over 55. This is penal and potentially discriminatory.

What can you do?

In recent email to members, we have attached letters for you to send in as part of the consultation – please do this as soon as possible. And please keep an eye on any further information we send to you in emails.

One of our neighbouring UNISON branches at SOAS (part of London University) has been campaigning against management plans to make almost 90 members of staff redundant at the end of this month, including cleaners, catering staff, admin and library workers.

At the Camden UNISON branch committee meeting in September, we agreed to support their planned strike action against the compulsory redundancies. However, as they were about to start striking, management asked to meet with the UNISON branch. At the meeting, management withdrew the threat of compulsory redundancies.

This is great news for a branch that was one of the first to support our traffic wardens when they were on strike both with donations and by visiting their picket lines. We were really pleased to be able to send a message of support and our Branch Secretary, Liz Wheatley, spoke at their online victory rally.

In the coming weeks, SOAS UNISON will be launching a new Fair Workload campaign to ensure that all SOAS staff have manageable workloads and are appropriately paid for the duties they perform in the new structure.