Employment lawyers have condemned government plans to claw back exit payments from public sector staff as “unclear” and “ill-conceived”.
High-earning staff would have to return exit payments if they got another job in the same part of the public sector within 12 months, under proposed new legislation. According to the government’s consultation Recovery of Public Sector Exit Payments, which closed this week, 17% of 19,000 NHS staff made redundant were rehired, most within a year, and six out of 37 local government chief executives who left by mutual agreement in 2007 and 2008 had been employed by another council within 12 months.
However, the Employment Lawyers Association (ELA) has warned of increased litigation and lower settlements if the law is passed as currently drafted in the Small Business, Enterprise and Employment Bill, scheduled to be implemented by April 2016.
The ELA says it has “serious concerns over the retrospective variation of contracts of employment and in relation to collectively agreed terms and agreements”. It points out that terms such as “statutory payments”, “casual worker” and “sector” lack clarity and could lead to argument and dispute. There may also be unintended discriminatory consequences, it warns.
Maeve Vickery, chair of the ELA sub-committee which examined the proposals in detail, says: “It pains us to say this but the draft legislation is like a poorly-prepared, hastily completed piece of homework—except that it has serious legal implications.
“There’s a failure to distinguish between payments made on voluntary departure versus departures instigated by the employer, and uncertainty over terms such as ‘same sector’ regarding the person’s next role. We can see what government is trying to do here but it risks being in conflict with statutory and contractual rights, compulsory redundancy rights, voluntary exit agreements and settlement agreements, to name but a few, if it presses ahead as things stand.
“The legislation is very poorly framed and will create doubt and uncertainty for public sector employers and employees leading to argument and litigation where none needs to exist.”
