Redundancy Scheme

Confidential to members of the University of Nottingham

1. Introduction

Occasionally a post or group of posts may be considered to be redundant by the University. The University would always hope, as far as possible, to achieve such redundancies by voluntary means or by natural wastage. These guidelines outline the redundancy scheme that would apply in cases of redundancy. The University’s policies on redundancy and redeployment, which can be found at: http://hr.nottingham.ac.uk/redundancyandredeployment, outline further details of the redundancy process.

The University values the diversity of its people and is committed to promoting equal opportunities and eliminating discrimination. Therefore staff will apply and operate this policy fairly and in doing so ensure that there is no discrimination on the grounds of gender, race, disability, age, religious or political belief, sexual orientation, trade union membership/activity or marital status.

2. Scope

2.1  The Scheme applies to all employees on full University terms and conditions who are leaving by reason of voluntary or compulsory redundancy and have accrued at least two years’ continuous service with the University of Nottingham as at the date of leaving employment with the University.

2.2  No payments will be made under the Scheme to any member of staff who:

·  leaves before the date of redundancy as agreed by the University;

·  is dismissed from the service of the University for disciplinary reasons, or is the subject of any other disciplinary sanction or investigation concerning an alleged disciplinary offence or a matter relating to conduct or to capability or qualifications for performing work of the kind which the member of staff concerned was appointed or employed to do;

·  turns down an offer of suitable alternative employment within the University.

3. Redundancy Payment

3.1  The HR Department will provide a statement of any redundancy payment for which the postholder is eligible under this Scheme as part of the consultation process. The redundancy payment will be a lump sum payment in accordance with Table 1.

3.2 For staff aged 50 or over, an immediate pension may be available, subject to the rules of the relevant pension scheme[1]. The University will, upon application from the employee, seek a quotation from the Trustees of the Pension Scheme. Should an employee wish to make a contribution out of the enhanced redundancy payment to secure additional pensions, subject to Inland Revenue limits, the University will pursue this option on the employee’s behalf. This application will not result in the University requesting that the Trustees waive any of the rules of that scheme in respect of payments of an immediate pension. Any contribution made into the Scheme for the employee’s benefit must not reduce the cash payment on termination below an amount equal to the statutory redundancy entitlement.

3.3  For those staff under age 50, pensions could either be deferred or transferred to a new employer’s scheme or personal pension or to an insurance policy known as a buy-out policy, which will mature in the future.

3.4 Under the Financial Services Act, the University cannot provide individual financial advice on the options mentioned above. Members of staff should obtain their own independent financial advice.

4 Early Retirement for USS Members

4.1  Where an employee leaves by reason of redundancy and receives an immediate retirement pension, which involves an early retirement funding charge to the University from the pension scheme (e.g. under USS, if aged 50 to 59 with five years’ pensionable service in that scheme), the redundancy payment will be reduced to the greater of:

·  the statutory redundancy payment due;

·  the amount due under this scheme minus the charge incurred by the University.

4.2  In any situation where an individual receives an enhanced redundancy payment and applies directly to the pension scheme for early retirement benefits, at the time of leaving or at a later date, which results in an early retirement funding charge to the University from the pension scheme, the University will require reimbursement from the individual. The calculation of the reimbursement will be such as to have the effect in 4.1 above. The individual will retain at least the equivalent of the statutory redundancy payment due at the point of termination of employment from the University of Nottingham and will not be asked to reimburse an amount greater than the charge made.

5 Redundancy Cash Payments

5.1 For the purposes of calculating an enhanced redundancy payment, ‘salary’ means the annual amount of basic earnings as at the leaving date plus additional contractual payments for shift allowances. Payments for additional hours/shifts above those stated in the contract, bonuses gratuities, NHS merit awards, discretionary payments, or any additional payments or allowances are excluded.

5.2 A schedule showing the appropriate enhanced redundancy payment appears in Table 1. The aggregate of statutory and enhanced redundancy payments will be made without deductions of income tax and National Insurance contributions up to a maximum of £30,000 (subject to continued Inland Revenue clearance).

6 Effect of Enhanced Redundancy Payments on Statutory Redundancy Payments

6.1 Enhanced redundancy payments will be inclusive of statutory redundancy payments.

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Redundancy Scheme 01/05/08

7  Schedule of Payments

7.1 Enhanced redundancy payments are based on 1.95 times the number of weeks’ pay awarded by the UK statutory scheme, see Table 1 below. The University will not apply the statutory limit on a week’s pay for the purposes of enhanced redundancy payments.

Age (years) / Service (years) /
2 / 3 / 4 / 5 / 6 / 7 / 8 / 9 / 10 / 11 / 12 / 13 / 14 / 15 / 16 / 17 / 18 / 19 / 20 /
17 / 1.95
18 / 1.95 / 2.93
19 / 1.95 / 2.93 / 3.90
20 / 1.95 / 2.93 / 3.90 / 4.88
21 / 1.95 / 2.93 / 3.90 / 4.88 / 5.85
22 / 1.95 / 2.93 / 3.90 / 4.88 / 5.85 / 6.83
23 / 2.93 / 3.90 / 4.88 / 5.85 / 6.83 / 7.80 / 8.78
24 / 3.90 / 4.88 / 5.85 / 6.83 / 7.80 / 8.78 / 9.75 / 10.73
25 / 3.90 / 5.85 / 6.83 / 7.80 / 8.78 / 9.75 / 10.73 / 11.70 / 12.68
26 / 3.90 / 5.85 / 7.80 / 8.78 / 9.75 / 10.73 / 11.70 / 12.68 / 13.65 / 14.63
27 / 3.90 / 5.85 / 7.80 / 9.75 / 10.73 / 11.70 / 12.68 / 13.65 / 14.63 / 15.60 / 16.58
28 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 12.68 / 13.65 / 14.63 / 15.60 / 16.58 / 17.55 / 18.53
29 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 14.63 / 15.60 / 16.58 / 17.55 / 18.53 / 19.50 / 20.48
30 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 16.58 / 17.55 / 18.53 / 19.50 / 20.48 / 21.45 / 22.43
31 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 18.53 / 19.50 / 20.48 / 21.45 / 22.43 / 23.40 / 24.38
32 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 20.48 / 21.45 / 22.43 / 23.40 / 24.38 / 25.35 / 26.33
33 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 22.43 / 23.40 / 24.38 / 25.35 / 26.33 / 27.30 / 28.28
34 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 24.38 / 25.35 / 26.33 / 27.30 / 28.28 / 29.25 / 30.23
35 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 26.33 / 27.30 / 28.28 / 29.25 / 30.23 / 31.20 / 32.18
36 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 27.30 / 28.28 / 29.25 / 30.23 / 31.20 / 32.18 / 33.15
37 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 27.30 / 29.25 / 30.23 / 31.20 / 32.18 / 33.15 / 34.13
38 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 27.30 / 29.25 / 31.20 / 32.18 / 33.15 / 34.13 / 35.10
39 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 27.30 / 29.25 / 31.20 / 33.15 / 34.13 / 35.10 / 36.08
40 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 27.30 / 29.25 / 31.20 / 33.15 / 35.10 / 36.08 / 37.05
41 / 3.90 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 27.30 / 29.25 / 31.20 / 33.15 / 35.10 / 37.05 / 38.03
42 / 4.88 / 6.83 / 8.78 / 10.73 / 12.68 / 14.63 / 16.58 / 18.53 / 20.48 / 22.43 / 24.38 / 26.33 / 28.28 / 30.23 / 32.18 / 34.13 / 36.08 / 38.03 / 39.98
43 / 5.85 / 7.80 / 9.75 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 27.30 / 29.25 / 31.20 / 33.15 / 35.10 / 37.05 / 39.00 / 40.95
44 / 5.85 / 8.78 / 10.73 / 12.68 / 14.63 / 16.58 / 18.53 / 20.48 / 22.43 / 24.38 / 26.33 / 28.28 / 30.23 / 32.18 / 34.13 / 36.08 / 38.03 / 39.98 / 41.93
45 / 5.85 / 8.78 / 11.70 / 13.65 / 15.60 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 27.30 / 29.25 / 31.20 / 33.15 / 35.10 / 37.05 / 39.00 / 40.95 / 42.90
46 / 5.85 / 8.78 / 11.70 / 14.63 / 16.58 / 18.53 / 20.48 / 22.43 / 24.38 / 26.33 / 28.28 / 30.23 / 32.18 / 34.13 / 36.08 / 38.03 / 39.98 / 41.93 / 43.88
47 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 19.50 / 21.45 / 23.40 / 25.35 / 27.30 / 29.25 / 31.20 / 33.15 / 35.10 / 37.05 / 39.00 / 40.95 / 42.90 / 44.85
48 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 22.43 / 24.38 / 26.33 / 28.28 / 30.23 / 32.18 / 34.13 / 36.08 / 38.03 / 39.98 / 41.93 / 43.88 / 45.83
49 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 25.35 / 27.30 / 29.25 / 31.20 / 33.15 / 35.10 / 37.05 / 39.00 / 40.95 / 42.90 / 44.85 / 46.80
50 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 28.28 / 30.23 / 32.18 / 34.13 / 36.08 / 38.03 / 39.98 / 41.93 / 43.88 / 45.83 / 47.78
51 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 31.20 / 33.15 / 35.10 / 37.05 / 39.00 / 40.95 / 42.90 / 44.85 / 46.80 / 48.75
52 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 34.13 / 36.08 / 38.03 / 39.98 / 41.93 / 43.88 / 45.83 / 47.78 / 49.73
53 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 35.10 / 37.05 / 39.00 / 40.95 / 42.90 / 44.85 / 46.80 / 48.75 / 50.70
54 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 35.10 / 38.03 / 39.98 / 41.93 / 43.88 / 45.83 / 47.78 / 49.73 / 51.68
55 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 35.10 / 38.03 / 40.95 / 42.90 / 44.85 / 46.80 / 48.75 / 50.70 / 52.65
56 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 35.10 / 38.03 / 40.95 / 43.88 / 45.83 / 47.78 / 49.73 / 51.68 / 53.63
57 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 35.10 / 38.03 / 40.95 / 43.88 / 46.80 / 48.75 / 50.70 / 52.65 / 54.60
58 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 35.10 / 38.03 / 40.95 / 43.88 / 46.80 / 49.73 / 51.68 / 53.63 / 55.58
59 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 35.10 / 38.03 / 40.95 / 43.88 / 46.80 / 49.73 / 52.65 / 54.60 / 56.55
60 / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 35.10 / 38.03 / 40.95 / 43.88 / 46.80 / 49.73 / 52.65 / 55.58 / 57.53
61+ / 5.85 / 8.78 / 11.70 / 14.63 / 17.55 / 20.48 / 23.40 / 26.33 / 29.25 / 32.18 / 35.10 / 38.03 / 40.95 / 43.88 / 46.80 / 49.73 / 52.65 / 55.58 / 58.50

Table 1: Schedule of Payments

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Redundancy Scheme 01/05/08

7.2 Enhanced redundancy payments will not be made where an employee commences employment with an associated company in which the University has a financial stake, within 4 weeks of leaving employment with the University, and the offer of employment is made before the employee’s last day of employment.

7.3 Where an employee returns to work at the University, or an associated company in which the University has a financial stake, within 6 months of leaving, the enhanced part of the redundancy payment may be reclaimed according to Table 2.

Period Between Employment / Repayment
1 month / 90%
3 months / 75%
6 months / 50%

Table 2: Repayment Scale

8 Review

8.1  This policy will be reviewed 12 months following its implementation and thereafter in line with the Equality Impact Assessment process.

8.2  A review of the costs of the scheme will be conducted two years after implementation. Where there is a significant difference in cost compared with the previous scheme, above the budgetary provision already made (11.5%), the schedule of payments may be increased or decreased, following negotiation with trade unions.

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Redundancy Scheme 01/05/08

[1] From 2010, an immediate pension will only be available for staff aged 55 and over.