26 September 2023

UNITED KINGDOM: Unions rage over ‘cheap’ redundancies

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United Kingdom unions have reacted with outrage at Government plans to cut Public Service redundancy pay by an estimated 25.9 per cent just weeks after it called for 91,000 jobs to go.

The Public and Commercial Services (PCS) union said the Government was trying to get job cuts done on the cheap.

In reply, a Cabinet Office spokesperson said that in a time of “high national debt and increasing cost pressures” a redundancy scheme must be affordable.

General Secretary of the PCS, Mark Serwotka (pictured) said that coming on top of a “derisory two per cent pay offer and the threat of 91,000 job cuts, these proposed cuts to our members’ redundancy terms add insult to injury”.

The Prospect union said it had “no confidence” that the Government consultation on the plans were being “carried out in good faith”.

The plans to cut redundancy pay, outlined in a Government consultation document, include limiting payments to three weeks’ pay per year of service, down from one month, with payments capped at 18 months’ salary for voluntary redundancy (down from 21) and nine months for compulsory redundancy (down from 12).

Defending the changes, the Cabinet Office spokesperson said reforming the scheme was a longstanding policy and not connected to headcount reductions.

“We will continue our close engagement with unions on these proposals,” the spokesperson said.

The decision on whether to proceed with the changes will be down to the winner of the Conservative leadership ballot for the next Prime Minister, which should be known next month.

Meanwhile, officials who receive large payouts when they leave the public sector could be made to pay them back if they return to the Public Service soon afterwards, a Treasury spokesperson said.

The new ‘recovery agreements’ would come alongside a tightened approval process for large exit payments, which Ministers are hoping to introduce after they were forced to abandon a £95,000 ($A162,000) cap last year.

Under new proposals, payments above the £95,000 limit would also require a business case, which must demonstrate the official’s exit was necessary to their employer; that alternatives had been fully considered; that it provided value for money; and it did not bring about “undue risks”.

London, 18 August 2022

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