Martin Ford 12 February 2021

Treasury scraps cap on public sector exit payments

Treasury scraps cap on public sector exit payments image

The Government has dropped its controversial cap on public sector exit payments after admitting it had ‘unintended consequences’.

A limit of £95,000 on payments to council staff leaving their jobs came into force in November in the face of fierce opposition from unions.

The High Court was due to hear a joint legal challenge by Lawyers in Local Government (LLG) and the Association of Local Authority Chief Executives (ALACE) and a second case brought by Unison next month.

But today the Treasury issued new guidance revoking the pay cap following an ‘extensive review’ that ‘concluded that the cap may have had unintended consequences’.

Partner at Greenburgh and Company, Mark Greenburgh, who was due to represent ALACE and LLG, said: ‘We are pleased that the Government has seen sense.’

While he said it was, as yet, unclear what this would mean for the litigation, Mr Greenburgh added: ‘We await the proposals to include costs for our clients.’

LLG and ALACE had argued the cap clashed with local government pension scheme (LGPS) regulations and changed the terms of employment of existing council workers.

Today’s guidance said former employees affected by the cap between November 4 and February 12 should ‘request from your former employer the amount you would have received had the cap not been in place’ and ‘the Treasury’s expectation is that they will do so’.

The Treasury said it would still ‘bring forward proposals at pace’ to tackle ‘unjustified’ exit payments, adding: ‘Employers should always consider whether exit payments are fair and proportionate.'

 

SIGN UP
For your free daily news bulletin
Highways jobs

Town Clerk

Biggleswade Town Council
£74,454 - £89,081
Biggleswade Town Council is looking to appoint a highly motivated and forward-thinking Town Clerk, to drive its services forward. Biggleswade
Recuriter: Biggleswade Town Council

Part Time Enforcement Officer Trading Standards

Essex County Council
£26601.00 - £31295.00 per annum + + 26 Days Leave & Local Gov Pension
Part Time Enforcement Officer Trading Standards (Tobacco and Vapes)Fixed Term - 2.5 years duration, Part Time - 20 to 30 Hours Per Week, Monday to Fri England, Essex, Chelmsford
Recuriter: Essex County Council

Administration Officer (Finance) - Braintree District Council

Essex County Council
Up to £13.7900 per hour
Administration Officer (Finance) £13.79 PAYE / £17.69 Umbrella Braintree, EssexFull-Time, Temporary 3 Months Contract 37 Hours per Week Closing Date
Recuriter: Essex County Council

Enforcement Officer Trading Standards (Tobacco and Vapes)

Essex County Council
£26601.00 - £31295.00 per annum + +26 Days Leave & Local Gov Pension
Enforcement Officer Trading Standards (Tobacco and Vapes)Fixed Term - 2.5 years duration, Full Time - 37 Hours Per Week, Monday to FridayUp to £31,295 England, Essex, Chelmsford
Recuriter: Essex County Council

Community Support Worker - Young People with Disabilities Team

Essex County Council
£25395.00 - £32131.00 per annum + + 26 Days Leave & Local Gov Pension
Community Support Worker - Young People with Disabilities Team - Colchester (North Quadrant)Permanent, Full Time£25,395 to £32,131 Per AnnumLocation
Recuriter: Essex County Council
Linkedin Banner