Remuneration Committee

Briefing on Voluntary Severance Scheme

January 2011

1 / Purpose of Paper
To brief the Remuneration Committee on progress to date in the design and implementation of NHS Lanarkshire’s Voluntary Severance Scheme.
2. / Background
In the context of the financial challenge facing NHS Lanarkshire in 2011/12 and beyond and in support of proactively managing the workforce implications of the associated Cash Releasing Efficiency Schemes (CRES), NHS Lanarkshire had designed and is in the process of implementing a staff Voluntary Severance Scheme.
The Scheme has been developed in partnership with Staff Side colleagues and decisions in relation to the enactment of Voluntary Severance will also be taken in partnership.
Scottish Government Health Department colleagues have been made aware of NHS Lanarkshire’s plans in this respect.
3. / The Voluntary Severance Scheme
The NHS Terms and Conditions of Service on Redundancy which take account of statutory provisions are set out in PCS (RED) 2006/1, PCS (DD) 2007/1 and Section 16 of the NHS Agenda for Change Terms and Conditions of Service Handbook.
For those staff who are members of the SPPA Superannuation Scheme, Superannuation (Health Service) Circular No.1/2007 will also apply.
A new partnership Severance Group has been established to provide oversight of the arrangements for the effective management and decision making in relation to voluntary severance.
Membership of the group is as follows :
▪Kenneth Small, Director of HR (Interim), Chair
▪Laura Ace, Director of Finance
▪Ian Ross, Director Strategic Planning & Implementation
▪Colin Sloey, Director of CHP (North)
▪Lilian Macer, Employee Director
▪David Boyd, Staff Side Member of Redeployment Panel
The Group have developed clear criteria against which decisions on staff interest in voluntary severance will be made. The Group will also assume responsibility for oversight and decisions in relation to the assessment of voluntary severance circumstances and for the approval of severance payments. A copy of the criteria is attached for information.
NHS Lanarkshire accepts that through the implementation of CRES and service modernisation plans, circumstances will arise where changes or reductions in the workforce will be required in order to deliver the strategic or operational aims.
Where such circumstances result in the need to reduce the workforce in a specific service area or job family, and there is little or no likelihood of the ability to successfully redeploy affected staff from the service area or job family, then it is accepted that staff who volunteer for severance will be regarded as in a voluntary redundancy situation. The Terms of Section 16 of the NHS Agenda for Change Terms and Conditions of Service Handbook will be fully applicable and adhered to in such circumstances.
(It will be the decision of the NHS Lanarkshire Severance Panel to consider and agree cases (individual or group) where the terms of voluntary redundancy should be applied).
From 17th December 2010, letters were issued by the Director of Human Resources (Interim) through line managers to staff employed in departments and services which are subject to CRES.
The letters sought expressions of interest in Voluntary Severance and were accompanied by Frequently Asked Questions and Answers Guidance. A copy of the letter, pro-forma and FAQ documents are attached for information.
Staff were asked to complete and return a standard pro-forma expressing interest in Voluntary Severance by 10th January 2011. 256 expressions of interest in Voluntary Severance have now been received.
Arrangements have been made for staff from the HR Directorate to contact each member of staff who has expressed interest to outline the personal voluntary severance financial arrangement applicable to them.
A dedicated team in HR has been set up for this purpose.
Arrangements have also been made through Directors to seek approval / support for each applicant and confirmation that the funding for each post can be permanently removed from the funded establishment for that service.
The first meeting of the Partnership Severance Group has been arranged on 25th January 2011. The Director of Human Resources (Interim) will provide a verbal report to members of the Remuneration Committee on progress made at this meeting.
4. / Conclusion
The Remuneration Committee is asked to note and support the position on the design and implementation of NHS Lanarkshire’s arrangements for Voluntary Staff Severance.
A further report on progress will follow at the end of March / beginning of April 2011.

Kenneth A Small

Director of Human Resources (Interim) 12th January 2011

1

voluntary severance - morrell - june 2013 - attachment

NHS Lanarkshire Voluntary Severance Arrangements

Criteria for Use in Selection Process

▪Absolute clarity that the post in which the applicant is employed can and will be removed from the funded establishment from the date of severance. Alternatively a member of staff from the Redeployment Register or through internal promotion or transfer can be appointed to the post created by VS and their substantive post removed from the funded establishment. Formal arrangements to enact and monitor the removal of funding from budgets to be established by the Director of Finance.

▪Sufficient non-recurring funding is available within NHS L to support VS for the applicant under consideration.

▪The financial consequences of the application for VS meets the test of NHS Lanarkshire’s consistent approach to payback ie achieve a maximum payback of 2 years. VFM and the recurring financial benefit to NHS Lanarkshire to influence decisions.

▪There is Director, Service / General Manager and local Manager support for the application for VS. Steps will be taken to establish formal sign off of support for each applicant through the relevant Director.

▪As part of the above, the local workforce and workplace implications of the application for VS have been considered by Managers and plans developed and/or implemented to avoid and / or mitigate the impact of the substantive removal of the post.

▪Due weight and recognition to be given to the strategic, operational and service modernisation / change priorities of NHS Lanarkshire.

▪VS decisions to support delivery against SGHD targets.

10th January 2011

Text of Letter

Dear Colleague,

Voluntary Staff Severance

You will be aware through staff briefings that NHS Lanarkshire is facing major financial challenges in 2011/12 and beyond. NHS Boards have been asked to achieve 3% efficiency savings in 2011/12 which for NHS Lanarkshire is £24m.

Our overriding objective is to continue to deliver quality patient care in what is undoubtedly the most challenging financial climate we have ever faced.

The Board has developed a set of Cash Releasing Efficiency Schemes to achieve savings in 2011/12 and beyond. These include withdrawal from leased properties, rationalising office accommodation, introduction of new technology and ways of working, senior management reductions, reviewing administrative and clerical functions and reduction in Corporate Directorate budgets – all designed to reduce costs without impact on clinical care. In all there are 117 such schemes.

(Add the target area / workforce here) has been included as the subject of an efficiency scheme.

The commitment of the Scottish Government and NHS Lanarkshire remains that there will be no compulsory redundancies, however, it is recognised that in many circumstances efficiency schemes will require changes or reductions in the workforce.

We are seeking to build up a fund to support a limited number of voluntary staff severances and as someone working in an area targeted for efficiency and savings you are invited to consider whether this is something in which you are interested.

Reference to Section 16 of the Agenda for Change Handbook will give you an indication of what you may be entitled to. Trade Union representatives have been involved in the development of this approach and staff may choose to contact their representative for advice.

Should you wish to arrange to enter into more detailed discussion on this to help you make an informed decision, please complete and return the attached pro-forma.

I appreciate that this is a serious and life changing decision. This letter has been sent out in advance of the festive period to give you some time to reflect over the holiday period on your circumstances and to discuss this with family and friends.

Completed expressions of interest (without commitment on the part of yourself or NHS Lanarkshire) should be returned no later than 10th January 2011 to John McNeil, Head of Human Resources, NHS Lanarkshire, Law House, Airdrie Road, Carluke ML8 5ER

Thereafter, the opportunity will be quickly arranged for you to enter into a detailed discussion with a member of NHS Lanarkshire’s Human Resources staff on the terms and arrangements for your potential voluntary severance.

Yours sincerely,

Kenneth A Small

Director of Human Resources (Interim)

Encl. Pro-forma

Confirmation of Interest in Voluntary Staff Severance

Name
Job Title
Workplace Address
Contact Telephone Number
Agenda for Change Band / Grade
Payroll Number
Contracted Hours

This expression of interest is submitted without commitment on the part of the above named or NHS Lanarkshire.

This form should be return in a sealed envelope to John McNeil, Head of Human Resources, NHS Lanarkshire, Law House, Airdrie Road, Carluke ML8 5ER

VOLUNTARY STAFF SEVERANCE

Frequently Asked Questions

1. / Eligibility
Q. / How do I become eligible to be considered for a severance package?
A. / The Board has developed Cash Releasing Efficiency Schemes to achieve savings to continue to deliver quality patient care and where your post has been included as the subject of an efficiency scheme you become eligible for consideration. You must also have had 104 weeks continuous full-time or part-time service.
2. / Approval
Q. / Who approves my request after it has been submitted?
A. / A panel consisting of the Director of Human Resources, Director of Finance, 2 other Executive Directors, Employee Director and Staff Side Representative.
3. / Date of Termination of Employment
Q. / If my request is approved when would my employment end?
A. / Given the financial audits currently in place the date would probably be 31st March 2011. However, depending on the needs of the service, taking account of individual’s personal circumstances and appropriate approval by the Severance Package Panel, termination dates may be agreed into April/May 2011.
4. / Payments
Q. / What are the arrangements for severance payments?
A. / The payment will be in line with aspects of Section 16 of the Agenda for Change Terms and Conditions of Service. It is calculated on your reckonable service at the date of termination. This is one month’s pay for each complete year of reckonable service up to a maximum of 24 years service.
Q. / If approved, how is the payment made?
A. / All monies will be paid as per normal salary arrangements, i.e. by direct debit into your account.
5. / Service
Q. / What is reckonable service?
A. / Service up to the date of termination of contract means continuous full time or part time employment with NHS Lanarkshire or any previous NHS employer. An employee’s continuous previous service with any NHS employer counts as reckonable service.
Q. / What if I have worked within a G.P. Surgery or with any other employer providing NHS funded services. Will my service count as reckonable?
A. / Yes – provided these are judged to be relevant to NHS employment. What will not count will be service that has been taken into account for the purposes of a previous redundancy or loss of office payment by an NHS employer or where the employee has previously been given pension benefits. This also applies to staff that may have been subject to any TUPE transfers.
6. / Pension
Q. / What happens to my SPPA pension?
A. / This will be for each individual to choose on the best option available to them dependant on age, length of service etc. Please seek further advice/guidance from John McNeil or any other member of the HR staff within Employee Relations
7. / Employment Reference
Q. / Will I be able to have a reference provided?
A. / Yes
8. / Annual Leave
Q. / Will I be paid for any outstanding annual leave?
A / Yes – however annual leave should, where at all possible, be exhausted prior to your termination date.
9. / Phased Retirement
Q. / Am I entitled to the benefits of the Phased Retiral Policy?
A. / No.
10. / Income Tax
Q. / Is it correct that any severance payment is tax free?
A. / Tax is not payable on the first thirty thousand pounds (£30,000) of the payment. The balance will be paid after deduction of income tax and national insurance in accordance with normal payroll processes.
11. / Future Work
Q. / Can I re-apply to work within NHS Lanarkshire?
A. / If approved you will not be allowed to work within NHS Lanarkshire for the period of your severance payment after your date of termination. You may however apply for employment with any other NHS employer after a break of four weeks.

JMcNeil – 23rdDecember 2010