Public and Commercial Services Union

PCS is currently pursuing legal action to combat the scheme although while that process is ongoing we need to ensure that the new arrangements are applied in the most beneficial way for members facing redundancy.

The bare bones of the scheme is widely available detail can be found on the Cabinet Office website.

This Guide outlines PCS industrial strategy around the CSCS that informs negotiators about detail about what packages the employer can offer and timetable issues.

General principles

1. PCS does not accept that the new scheme is lawful and therefore will not agree to its terms, nor to their being applied in a compulsory redundancy situation.
2. PCS members will be advised to write protecting the legal position.
3. PCS does not accept that compulsory redundancies are necessary and will seek the full and proper application of the protocols
4. PCS will be campaigning against cuts in jobs and services.
5. PCS will argue for discretion to be used to make available the best possible scheme terms or will consider advising members not to apply.

Aim of this guidance

The purpose of this guidance is to assist Negotiators in bargaining areas with the process of redundancies in their area. It is important to note that the existing CCSU/Cabinet Office protocol still applies.

There are three types of redundancy provided for in the new scheme:

• Voluntary Exits: - This is a first stage where the employer can offer different terms to standard tariff to encourage people to go.
• Voluntary Redundancy: - This is a second stage where the standard tariff (see table below) must be offered.
• Compulsory Redundancy: - Final stage only standard formula with no early pension and a  reduced cap applies.

Proper application of the protocols

The protocols remain unchanged and un-amended. Earlier negotiating guidance from 2008 still applies.

  Protocols handling surplus staff

The new scheme terms do not alter the application or timing of the protocols. However management will seek to speed up or force through schemes without going through the protocol process.

We should insist on their full application; in particular:

1. Voluntary exits

Step One:

Negotiators should discuss with employers pre-redundancy measures prior to meaningful consultation. When it appears that compulsory redundancies are inevitable, the employer can suggest a voluntary exit scheme, in the new arrangements this must happen before compulsory redundancies can be considered. At this stage PCS would be arguing for discretion to be applied in the most beneficial way for PCS members.

Get the employer to spell out each area they intend to use discretion and clarify dates and deadlines for cabinet office clearance and people to apply and go.

Examples of discretion

• Whether to use protection for the lowest paid – i.e. use the “deemed minimum” salary of £23,000 to calculate compensation payment
• There is a two-year service qualifying period for voluntary departure terms – employers have discretion to reduce or remove this qualifying period
• Variation from the standard tariff of 1 month’s salary per year of service (within the maximum cap of 21 months’ salary)
• Early Access to Pension –  The majority of staff within 10 years of pension age would be able to use their compensation payment to buy-out reduction to pension if they opt to take it early and/or buy added pension. This would only apply in a voluntary situation.

Voluntary exits are pre-compulsory redundancy situations where the employer can offer non-standard terms to encourage volunteers, one suggestion is offering 2 months pay for the first 5 years of service. 

The cabinet office need to agree any scheme but in theory varied schemes are allowed as long as caps are not exceeded. Once the scheme is announced the terms cannot be changed. Not volunteering at this stage should not affect rights at step two.

If there is a later round of voluntary redundancies then standard tariff terms must be offered before compulsory redundancies are made. Evidence so far suggests that standard tariff is offered as a norm first.

Step Two:

“When the issue of compulsory notices seems likely” there should be a formal 90 day period of meaningful consultation. At this stage the full tariff voluntary terms should be offered to all staff at risk of redundancy. This will in effect be the redundancy unit – everyone at risk who has been offered the full tariff terms and it is made clear what their options are.

There are two distinct arrangements for the new terms voluntary and compulsory. The full voluntary terms without discretion is known as standard tariff.

Feature of scheme	Compulsory	Voluntary redundancy
Service accumulator	1 months pay for each year’s service	Usually 1 months pay per years service but employers have discretion
Cap on the accumulator for those under 60 (65 in nuvos)	12 months pay (could be less for those with part-time service or close to 60/65) All pay is based on hours worked and full time earnings.	21 months pay (could be less for those with part-time service or close to 60/65 )
Cap for those over pension age	6 months	6 months
Protection for low paid	Underpin of £23,000 for all calculations of anyone earning less this figure must apply.	Underpin of £23,000 for all earning less this figure must apply to calculating their payments.
Over 50s (55 in nuvos)	No early payment of pension unreduced may be permitted	Early payment of pension unreduced must be permitted
Notice period	3 months or more where staff have a right to a longer period	Usually 3 months depending on contract

 

Exercise starts- set up with employer a Q&A email, helpline, if possible financial advice. A calculator must be made available as MyCSP (civil service pensions) will only do estimates for those selected so people need to be able to work out a rough estimate before they apply. There should be a calculator for each group of staff under and over 50 and for those who want early retirement and the people over 50 who want their lump sum compensation and ways that people can compare.

Some employers make the application process almost binding in that people who apply are forced to accept terms if selected unless they are totally different to expectations. Hence the importance of a calculator.  People will still need time to consider.

In the new scheme allowances may not count as pay, only basic pay plus some allowances and the salary is that at final day of service not as previously best of the last 3 years. There are complications about periods of unpaid service so please refer individual cases to the centre (cscsqueries@pcs.org.uk).

Any problems refer to the centre, please get things checked.

 

2. Redundancy situation

Step Three:

Once a “compulsory redundancy situation appears to be inevitable" the employer, should talk to the TUS about when the period of reflection starts. In some cases this may overlap with the voluntary exits. It is important that the timescales are clear.

A period of reflection is when the employer maintains all that is possible to avoid redundancy has been done. There is nothing that states that the period of reflection cannot start or has to finish within 90 day period. This is a matter for negotiation. However, logically, you cannot move to the period of reflection until the measures under Step 2 have concluded. Therefore employers cannot move to compulsory notices until they have been through and completed Step Two.

All efforts should be made to find alternative roles for those in redeployment pools. More detail on this is available in separate protocol guidance. If compulsory redundancies do result then anyone who had previously applied and was turned down will get the higher cap applied.

If the voluntary scheme only applies to certain grades or locations, any ring-fenced areas, then any compulsory redundancies can only apply to those areas. Any members in other areas need to have a chance to apply for voluntary redundancy on at least standard tariff terms first.

Example of timetable

This example gives an idea of the timing of a voluntary redundancy process.

Voluntary Redundancy Scheme

By Activity

• 14.01.11 Scheme Launch
• 28.02.11 Deadline for applications
• 04.03.11 Applications despatched to Pension Service
• 04.03.11 Last day of service for staff opting to leave on 4 March
• 31.03.11 Payment of compensation in lieu of notice for staff leaving on 4 March
• 01.04.11 Pension Service supply formal quotes to employer
• 08.04.11 Formal quotes despatched to staff
• 08.04.11 Last day of service for staff opting to leave on 8 April
• 22.04.11 Members return completed documentation to employer
• 29.04.11 Employer despatches completed forms to Pensions Service
• 30.04.11 Payment of compensation in lieu of notice for staff leaving on 8 April
• 06.05.11 Last day of service for staff opting to leave on 6 May
• 31.05.11 Payment of compensation in lieu of notice for staff leaving on 6 May
• 31.05.11 Final salary payment for staff leaving on 31 May
• 31.05.11 to 30.06.11 Members receive compensation payments

Individuals

As previously we will not be able to advise individuals on personal choice and decisions in relation to applying.  General advice would be that if they apply it must be because they are genuinely prepared to accept the terms on offer.

Despite the legal challenge and any disputes there might be, they have to assume that they will have to accept the terms at some stage unless it is a genuinely voluntary offer.