ROYAL BERKSHIRE FIRE AUTHORITY

Transcription

1 ROYAL BERKSHIRE FIRE AUTHORITY COMMITTEE MANAGEMENT COMMITTEE DATE OF MEETING 22 OCTOBER 2018 SUBJECT LEAD OFFICER LEAD MEMBER EXEMPT INFORMATION ACTION LOCAL GOVERNMENT PENSION SCHEME (LGPS) EMPLOYEES REDUNDANCY PAY BECCI JEFFERIES, HEAD OF HR&L&D N/A NONE DECISION 1. EXECUTIVE SUMMARY 1.1 The Local Government (Early Termination of Employment) (Discretionary Compensation) (England and Wales) Regulations 2006 give Royal Berkshire Fire Authority (RBFA) the power equivalent to applying an enhanced redundancy multiplier for staff with access to the Local Government Pension Scheme (LGPS). 1.2 The current enhanced redundancy multiplier for staff with access to the LGPS is two times statutory weeks based on actual pay. To note staff with access to Firefighter Pension Schemes (FFPSs) are only entitled to statutory redundancy payments. 1.3 Any changes to the current enhanced redundancy scheme, if agreed by members, would be subject to consultation with Representative Bodies. 1.4 Following a meeting of Senior Leadership Team (SLT) on 12 June 2018, it was agreed that recommendations would be made to the Management Committee to reduce the enhanced redundancy multiplier, for staff with access to the LGPS, from two time to one and a half times statutory weeks based on actual pay. 1.5 This paper only focuses on LGPS as there is no provision in the Firefighter Pension Scheme Regulations to amend for the Fire-fighter Pension Schemes.

2 2. RECOMMENDATION That the Management Committee: 2.1 CONSIDER the proposed changes to the enhanced redundancy scheme for staff with access to the LGPS; and 2.2 AGREE consultation with representative bodies should commence with authority to reduce the current arrangement for staff eligible for LGPS from two times, to one and half times statutory weeks, based on actual pay, in line with an average across Berkshire Local Unitary Authorities; and 2.3 AGREE that protection at two times statutory weeks, based on actual pay is retained for the two members of staff currently on fixed term contracts following organisational change, prior to the proposal, for a period of three years from the date of publication of any amended policy. 3. REPORT 3.1 Current Situation Redundancy Payments RBFRS currently enhances redundancy payments to staff with access to the LGPS in accordance with the powers given to the Authority by the Local Government (Early Termination of Employment) (Discretionary Compensation) (England and Wales) Regulations Following a meeting of the Executive Committee on 19 October 2007, a decision was taken to enhance redundancy payments to two times statutory weeks based on an employee s actual weekly pay for staff with access to the LGPS At a meeting of SLT on 20 February 2018 it was determined that a review of the current redundancy enhancements would be undertaken. The findings of the review were taken to SLT on the 12 June The review considered that due to the relationship of redundancy payments to pension regulations for local government employees, comparators for the LGPS provision should be based on the organisations managed by the Royal County of Berkshire Pension Fund, who administer the LGPS for all Berkshire Unitary Authorities and RBFRS Berkshire Unitary Authorities arrangements as at June 2018.

3 FRS/Local Authority Royal Berkshire Fire and Rescue Service (RBFRS) Reading Borough Bracknell Forest West Berkshire Slough Borough Wokingham Borough Windsor and Maidenhead Multiplier Statutory Pay Cap on Weekly Pay? 2 No 2 No 1.75 (staff with no immediate access to pension) Or Statutory (staff with immediate access to pension) No 1.5 No 1.5 No Statutory Statutory No No Additional Information Paid to a maximum of 30 weeks at the enhanced rate Proposed changes to redundancy provision In the paper taken to SLT on 12 June 2018 a number of options were considered: Continue with current arrangement Reduce the multiplier from two to one and half times (Mid-range of Berkshire Unitary Authorities) Capping actual weekly pay to statutory rate (retaining enhanced multiplier) Offering only statutory redundancy Offering enhanced rates to those who volunteer and statutory for compulsory redundancies. Enhanced terms for those under 55 year of age and statutory redundancy offered to those with immediate access to pension (e.g. over 55) Leaving current arrangement in place but cap overall payment It was agreed that the proposal of reducing the enhanced redundancy payment from two times statutory weeks based on an employee s actual weekly pay to one and half times statutory weeks based on an

4 employee s actual weekly pay, would be put forward as a recommendation to be considered by the Management Committee The rationale for this decision being: Reduced cost of future redundancy payments RBFRS is not an outlier amongst other Local Authorities Reduced risk of payments exceeding the exit cap Consistent application of multiplier with minimal changes to administrative process. Equality Act implications are minimal as the option is based on statutory redundancy calculations Two members of staff in RBFRS were previously employed on permanent contracts but, as a result of an organisational change process, are now on fixed term contracts. It is recommended that the Management Committee agrees that should a reduction in the enhanced redundancy rate be agreed for consultation, access to the current enhanced redundancy payment for these staff is guaranteed for a period of three years from the date of publication of the amended policy. Three years is in line with the protections offered under the Pay and Benefits Protection Agreement. It is not proposed to offer this protection to staff employed on fixed term contracts under business as usual arrangements. 4. CONTRIBUTION TO STRATEGIC COMMITMENTS 4.1 Commitment 5 We will ensure that Royal Berkshire Fire and Rescue Service provides good value for money. 5. FINANCIAL IMPLICATIONS 5.1 Reducing the enhanced redundancy provision to all staff eligible for LGPS would lessen the financial impact of future redundancies 6. LEGAL IMPLICATIONS 6.1 Regulations 5 and 6 of the Local Government (Early Termination of Employment) (Discretionary Compensation) (England and Wales) Regulations 2006 enables authorities to enhance the statutory redundancy payments covered by the Local Government Pension Scheme Regulations 1997 over and above the statutory maximum week s pay prescribed under the Employment Rights Act 1996; and to pay an enhanced severance payment of up to 104 weeks pay (including the statutory redundancy pay). Any change to the Local Agreement for RBFRS would be subject to consultation.

5 6.2 The 2006 Regulations require the Authority to formulate, publish and keep under review the policy that it applies in the exercise of its discretionary powers under regulations 5 and If the Authority decides to change its policy, it must publish a statement of the amended policy and may not give effect to any policy change until one month after the date of publication. 6.4 In formulating and reviewing a policy the Authority must: have regard to the extent to which the exercise of their discretionary powers (in accordance with the policy), unless properly limited, could lead to a serious loss of confidence in the public service; and be satisfied that the policy is workable, affordable and reasonable having regard to the foreseeable costs. 7. EQUALITY AND DIVERSITY IMPLICATIONS 7.1 There are no current implications related to age, in selecting the recommendation 2.2, as the statutory redundancy calculation is used as the basis for redundancy payments. 8. RISK IMPLICATIONS 8.1 There is a risk of possible further changes in relation to redundancy payments as a result of the confirmation to the cap on public sector exit payment reforms 9. CONSISTENCY WITH DUTY TO COLLABORATE 9.1 N/A 10. PRINCIPAL CONSULTATION 10.1 Chief Fire Officer has noted the contents of this report Chief Financial Officer has noted the contents of this report Monitoring Officer has noted the contents of this report. 11. BACKGROUND PAPERS 11.1 Senior Leadership Team Report 12 June Senior Leadership Team Report 20 February The Local Government (Early Termination of Employment) (Discretionary Compensation) (England and Wales) Regulations Executive Committee Review of Compensation Policy 19 October 2007

6 11.5 Royal Berkshire Fire Authority Executive Committee Meeting Minutes 19 March Royal Berkshire Fire Authority Executive Committee Meeting Minutes 9 July Royal Berkshire Fire Authority Executive Committee Meeting Minutes 17 September Royal Berkshire Fire Authority Executive Committee Meeting Minutes 19 November Pay and Benefits Protection Agreement Circular NJC/1/ APPENDICES 12.1 None 13. CONTACT DETAILS 13.1 Lucy Greenway, HR Adviser,