Issue - meetings

The Acting Director of Law and Governance provided the following advice to the Committee:

“The report covers the position generally at the present time. It is best not to seek to put a gloss on it. Individual cases will have to be considered in accordance with the circumstances when they arise.

The consequences for the Council in relation to voluntary redundancies include  that they can be postponed until current uncertainties are resolved. However, this is not going to be any time soon. It appears that the LGPS Regulations are not going to be amended until after the Court case. They are likely then to be amended to the detriment of staff and to the financial benefit of the employing authority. The Court case is not being heard until 25/26 March. Judgment is likely to be reserved. There may well be an appeal, etc. There may be complaints in the meantime to the Pensions Ombudsman. The likely but uncertain length of any such  postponement may have massive operational  downsides, not least in the context of restructurings, and financial disadvantages. 

However, if voluntary redundancies are to proceed during the period of non-alignment of the public sector cap and changes to the LGPS Regulations and before the uncertainties are resolved then (1) there are risks for both parties in relation to pension strain in the case of those aged 55 and over, and (2) these risks must not be sought to be removed in an age discriminatory way.

The recommendations in the report seek to minimise and mitigate these risks.”

RESOLVED:

(a) That the current redundancy/efficiency policy be revised so that, where an

employee’s exit payments breach the £95K cap, the staff member may exercise the option of reducing elements of their redundancy package, other than pension strain cost and statutory redundancy payment, in order to bring the total to under £95K and therefore be eligible to claim an unreduced pension.

(b) That, where the pension strain costs are in excess of £95K, an employee

may use their own funds to lower the reductions applied to their LGPS benefits.

(c) That the changes proposed to the redundancy policy and detailed in the report of the Corporate Director of Resoruces apply to all relevant Council employees, including at Islington schools.

(d) That, in instances where the value of paying the pension strain would exceed the cap, an additional discretion to allow exit payments to be

made up to the balance of the £95K cap under Regulation 8 of the Restriction of Public Sector Exit Payment Regulations 2020, be approved.

(e) That it be noted that any significant individual decisions that needed to be made in relation to the enacting of provisions within the change of the policy would be brought for approval to the Audit Committee meeting scheduled for the 16March 2021.