Public Service Stability Agreement 2013-2018

Labour Relations Commission

Proposals for

Public Service Stability Agreement 2013-2018

[Haddington Road Agreement 2013and Lansdowne Road Agreement 2015]

Frequently Asked Questions Revised June 2015

NOTE: These FAQs relate to the overarching provisions in the Lansdowne Road and Haddington Road Agreements.Queries in relation to the specific sectors, or to individual remuneration, should be directed to the relevant HR Section for that sector or to local management. Queries relating to the Lansdowne Road Agreement are addressed first.

Lansdowne Road Proposals - FAQs

The Lansdowne Road proposals apply to all public servants who are members of Grades accepting the terms of the Lansdowne Road Agreement.The changes are scheduled to take effect from 1st January 2016 unless otherwise specified. Please note:

• Pay measures will require legislative amendments which are scheduled for later this year (subject to acceptance of the proposals);
• Revised Pay Circulars will issue on the passing of the necessary amendments;
• Queries in relation to individual pay changes should be addressed to local HR sections.

Q.1 Do the Haddington Road reform measures still apply under the new agreement?

The proposal by the LRC is for an extension of the Public Service Stability Agreement.to September 2018 under the title of the Lansdowne Road Agreement. The productivity and reform measures provided for under the HRA and previous agreements continue to apply under the Lansdowne Road Agreement.

Q.2What changes does the Lansdowne Road Agreement make to PRD?

The PRD is the ‘Pension Related Deduction’, or pension levy. The lower threshold for PRD is currently €15,000 – below this income level there is no liability for PRD. Income between €15,000 and €20,000 is currently liable to PRD at 2.5%. The Agreement provides that on 1 January 2016 the exemption threshold for payment of Pension Related Deduction (PRD) will increase from €15,000 per annum to €24,750 per annum. The 2.5% rate will be eliminated, and all annual remuneration above the €24,750 threshold will be liable at 10%, or 10.5% above €60,000.

On 1 September the exemption threshold will increase further to €28,750. This means that by the end of 2016 for all public servants, remuneration below €28,750 will no longer be liable to PRD.

Measure / Rates / Bands
1/2014 – 1/2016 / Bands
1/2016 - 9/2016 / Bands
From 9/2016
PRD / Exempt
2.5%
10.0%
10.5% / €0 - €15,000
€15,000 - €20,000
€20,000 - €60,000
Above €60,000 / €0 - €24,750
N/A
€24,750 - €60,000
Above €60,000 / 0 - €28,750
N/A
€28,750 - €60,000
Above €60,000

This increase in the threshold to €28,750 is worth€1,000 euro reduction in PRD in a full year to each public servant (who currently pays PRD in excess of this amount) with the low paid benefiting to a greater extent through the tax code. For those on less than €28,750 the impact on each individual will vary depending on their total remuneration and their current liability for PRD.

[Technical Note: Since PRD is calculated on a cumulative basis, payroll software does not support two changes to the thresholds in a single calendar year. For this reason, the changes set out above will be implemented by way of a single ‘blended rate’ change, calibrated to deliver the same outcome over the year as the two-step process set out in the Lansdowne Road Agreement. A threshold of €26,083.33 ((€24,750 x 2/3) + (€28,750 x 1/3)) will therefore apply with effect from 1 January 2016 out to end 2016. For 2017 and following years the single exemption threshold of €28,750 will apply over the year.]

Q.3What changes does the Lansdowne Road Agreement make to Pay?

For the majority of public servants, in addition to the PRD benefits previously outlined, there is a significant reduction, weighted in favour of the lower paid, of the pay cuts imposed under the 2009 FEMPI legislation. These come in the form of increases in gross pay in 2016 for those on lower pay (up to €31,000) andin 2017 for all on pay up to €65,000.

For any public servant whose annualised salary is below €24,001 there will be an increase in gross pay of 2.5% from 1 January 2016. For those on annualised salaries between €24,001 and €31,000 there will be an increase in gross pay of 1% from 1 January 2016. For all those on annualised salariesup to €65,000 there will be an increase in gross pay of €1,000 from 1 September 2017.

Base Salary / January 2016 / September 2017
Up to €24,000 / 2.5 per cent / €1,000
€24,001 to €31,000 / 1 per cent / €1,000
€31,001 to €65,000 / No change / €1,000

Q.4Whatwill the combined impact ofPay and PRD changes be for those below €65,000?

The PRD measures under the Lansdowne Road Agreement will increase take home salary for all public servants earning in excess of €15,000. The pay measures under the Agreement will increase the gross pay for all public servants earning up to €65,000. This increase is weighted in favour of the lower paid, who receive a significantly higher percentage increase.

The effects of the pay and PRD measures by year for staff earning different ratesare available on the Department of Public Expenditure & Reform website.

Q.5How are the pay cuts for those on higher pay being reversed under the Lansdowne Road Agreement?

The HRA, underpinned by the FEMPI 2013 Act, brought in pay cuts for public servants earning €65,000 and over.Under these proposals, for thosepublic servants on annualised remunerationup to €110,000, restoration will be in two equal phases with the first phase due to take place in April 2017, and the second phase in January 2018. For those onannualised remunerationin excess of €110,000 restoration will be in three equal phases with the first phase due to take place in April 2017 and the two remaining phases in April 2018 and 2019.

Under the Lansdowne Road proposals those earning €65,000 or over will, like other staff, benefit from the PRD measures.

Q.5AMy basic pay is a pay scale that is less than €65,000 but I was subject to a pay cut under the FEMPI Act 13 as I was also in receipt of a fixed permanent and pensionable allowance. How will I be affected by the proposed pay measures?

You will receive restoration of your pay cut under the phased provisions provided for under the Lansdowne Road Agreement proposals and as your basic scale is less than €65,000 you will receive the €1000 increase provided for in September 2017.

Q.6 Are the reductions in overtime rates and allowances being reversed?

The measures provided for under the HRA in respect of overtime and allowances are retained.

Q.7 Will payments under the Supervision & Substitution Scheme be restored?

A gross additional payment equivalent to the 2011 lower payment rate paid for supervision and substitution will be included in the common basic scale for teachers, with half in the school year 2016/2017, and half in the school year 2017/2018.

Q.8 Will the increment and top of scale measures be continued?

The measures that provided for deferral of increments, and for the sacrifice of leave, etc. for those on the top of the scale, will continue in place as before for staff who were in service during the period from July 2013 to June 2016. That is, where a person has incurred a liability to e.g. defer an increment by three months then this will continue to apply even if the deferral actually occurs after June 2016. However, no new liability will arise in respect of these measures after the 1st July 2016.

Q.9 Will the pensions ‘Grace Period’ be extended to September 2018?

The ‘grace period’ within which public servants can retire under the terms and conditions which they held prior to the pay reductions under the FEMPI Act 2013 has been extended twice, and is currently due to expire at the end of June 2016. There is a commitment in the Lansdowne Road Agreement to provide for a ‘grace period’ consistent with the terms of the Agreementand legislation subject to approval by Government will be brought forward to give effect to this proposal.

Q.10Are there any changes to the Public Service Pension Reduction (PSPR)?

In January 2011, as part of the response to the fiscal crisis then faced by the country, an emergency measure to reduce public service pensions (Public Service Pension Reduction- PSPR) in payment was introduced. A further reduction for higher value pensions was introduced in July 2013.

The proposals approved by Government provide for a restoration of pension income subjected to the Public Service Pension Reduction on a phased basis over three years as follows,

• 1 January 2016 – return of €400 to most PSPR-impacted pensioners
• 1 January 2017 – return of €500 to most PSPR-impacted pensioners
• 1 January 2018 – return of €780 to most PSPR-impacted pensioners
  

Haddington Road Agreement– FAQs

The Haddington Road Agreement applies to all public servants who are members of Grades to which a collective agreement accepting the terms of the Agreement is in place. There are particular measures applying to specific sectors of the public service and details of these are found in the appendices in the Haddington Road Agreement for particular groups/grades.

The changes were scheduled to take effect from 1st July 2013 unless otherwise specified.

Further guidance on the pay matters covered in these FAQs is contained in Circular 8/2013: Revision of pay of Civil Servants and Circular 14/14 Overtime in the Civil Service.

PAY AND PRODUCTIVITY MEASURES

The productivity measures set out in the Haddington Road Agreement, have been secured in place by the Lansdowne Road Agreement. However, there are no further changes to individual terms and conditions under the new agreement.

Increase in Hours

Q.11What is the increase to the standard working week?

The standard working hours of public servants will increase as follows:

• Those with a working week of 35 hours or less (net of rest breaks) will increase to a minimum of a 37 hour week. The implementation of these additional hours for specific groups is subject to the arrangements set out in Appendix 9 in the overall document.

• Those with a working week that is greater than 35 hoursbut less than 39 hours (net of rest breaks) will increase to a 39 hour week.

• Working hours of those currently with a net working week of 39 hours or greater will remain the same. However, an hour of overtime worked each week for these grades will be unpaid until 31st March 2014.

The additional hours will be phased in with the first 2 hours 15 minutes implemented from 1st July 2013 and remaining liability will be implemented from 1st July 2015.

Details on the implementation of additional hours for certain grades are set out in Appendix 9 of the Agreement.

Q.12How will the extra hours be used?

The extra hours will be used to best fit the business needs of public service employers. Broad principles of how they will be employed in each Sector are set out at in the proposals. The implementation of the extra hours will require consultation at workplace level.

Allowances

Fixed Periodic Pensionable Allowances under the FEMPI Act 2013

Allowances in the nature of pay are fixed periodic pensionable allowances. A fixed periodic pensionable allowance is an allowance of a fixed amount, which is taxable and pensionable, is not paid in respect of an expense incurred, and is not reliant on the type or amount of the workperformed at for example, weekend or nights. Some examples of a fixed periodic allowance would be a rent allowance or the allowance paid to Principals of Primary and Post-Primary schools.

Q.13What are allowances in the nature of pay?

Allowances in the nature of pay are fixed periodic pensionable allowances, where a fixed periodic pensionable allowance is an allowance of a fixed amount, which is taxable and pensionable, is not paid in respect of an expense incurred, and is not reliant on the type or amount of the work performed at for example, weekend or nights.

Q.14 Is the Allowance Review affected by the proposed Agreement?

There will be full cooperation with follow up to the Government’s Allowances Review, taking account of the recommendations contained in Labour Court Recommendation 20448.

Overtime

There is no proposal in the Lansdowne Road Agreement to change the current rates payable for overtime.

Q.15 How is overtime affected for those earning up to €35,000?

For those on salaries up to €35,000 (including fixed periodic pensionable allowances), overtime will be paid at the rate of time and a half at the first point of the appropriate scale. This will not apply to any scale where the provision would result in overtime being paid at less than time at any point on the scale. In these cases, the formula for overtime at €35,000 or more will apply to that entire scale/grade.

Q.16 How is overtime affected for those earning €35,000 or more?

For those on salaries of €35,000 (inclusive of allowances in the nature of pay) or greater, overtime will be paid at the rate of time and a quarter at the individual’s scale point on the salary scale.

Q.17 How is overtime affected on a Saturday afternoon and Sunday?

Current arrangements will remain in place for payment for overtime worked on a Saturday afternoon and Sunday.

Q.18How will the divisor for overtime be affected?

The divisors for the calculation of overtime will be adjusted to take account of any additional hours. Details on additional hours for certain grades are set out in Appendix 9 of the Agreement.

Q.19 How is overtime affected for those working 39 hours or more a week?

For those currently with a net working week of 39 hours or more, an hour of overtime worked each week will be unpaid until 31st March 2014.

Q.20 Will there be an increase in the hours required for a day off in lieu of overtime?

Where the standard working day is increased under the terms of the proposed Agreement, the hours required for a day off in lieu will also increase. For example in the Civil Service the hours required currently for a day off in lieu are 6 hours 57 minutes, this will increase in line with the hours set out in the proposals (7 hours 24 minutes).

Q.21My working hours have been increased to 35 hours per week. How will my overtime payments be affected?

From 1 July 2013 the divisor for overtime calculations for those will be based on 37 hours and overtime will not be payable until 37 hours are worked and exceeded. The 36th and 37th hour will be required to be worked for free.

Premia

Q.22 Will twilight payments continue?

Twilight payments and any equivalent payments across the sectors will no longer be payable, save where sectoral collective agreements provide otherwise.

Q.23 Will the Sunday premium remain for those who continue to work Sundays?

Yes the Sunday premium will remain however management will actively seek to reduce the overall numbers of staff rostered to work on Sundays in the health service.

Increments and related balancing measures

Measures under the Haddington Road Agreement that provided for deferral of increments, and for the sacrifice of leave, etc. for those on the top of the scale, will expire when existing liabilities under those measures are discharged. No new liabilities under these measures will accrue under the Lansdowne Road Agreement.See also Q 8 in this FAQ.

References to ‘currently’ should be taken as 1 July 2013 – e.g. ‘those currently on the maximum and retiring in 2014’. References to ‘this Agreement’ are to the Haddington Road Agreement.

Q.25How will increments be affected for those earning under €35,000?

For those on salaries below €35,000 (inclusive of allowances in the nature of pay), a 3 month increment freeze will apply during the Agreement. The freeze will take place after the first increment after 30 June 2013 is paid. The following increment will be awarded in 15 rather than 12 months or equivalent if the increment interval is longer.

Q.26How will increments be affected for those earning between €35,000 and €65,000?

For those on salaries between €35,000 and €65,000 (inclusive of allowances in the nature of pay), there will be two 3 month increment freezes. This will take effect after the first increment after 30 June 2013 is paid. For 2 consecutive years there would be a 15 month period between increment dates. If the increment interval is longer than 12 months (e.g. incremental interval of 2 or 3 years), the freeze will be for a single 6 month period.

Q. 27What is the position for those at the top of their incremental scale?

There are provisions for those who are on the final point of their incremental scale and whose salaries (inclusive of fixed periodic pensionable allowances) is between €35,000 and €65,000, apart from those who have annual leave of 23 days or less.

The default option will be a reduction in annual leave over the course of the Agreement, A person may alternatively elect to avail of:

• cash deduction from salary of an equivalent amount to the value of –
• (a) the 6 annual leave days

Or

• (b) a half of the most recent increment,

Contributions will be calculated (in respect of annual leave days and increments) on gross pay rates and reduced by 62%and deducted from net pay.

It should be noted that where an employee reaches the maximum of their scale during the course of the agreement, he/she will have a pro rata liability with reference to the duration of the agreement of the agreement, still to run.

• Those reaching the maximum in 2014 a reduction of 4 days annual leave or a cash deduction from salary of an equivalent amount to the value of 4 days or one third of the most recent increment.
• Those reaching the maximum in 2015 a reduction of 2 days annual leave or a cash deduction from salary of an equivalent amount to the value of 2 days or one quarter of the most recent increment.

Pro Rata arrangements for those currently on the maximum and retiring over the course of the Agreement.

For those currently on maximum and retired after July 2013, a reduction of 2 days annual leave or a cash deduction from salary of an equivalent amount to the value of 2 days or one quarter of the most recent increment.

For those currently on the maximum and retiring in 2014, a reduction of 3 days annual leave or a cash deduction from salary of an equivalent amount to the value of 3 days or one quarter of the most recent increment.

For those currently on the maximum and retiring in 2015, a reduction of 4 days annual leave or a cash deduction from salary of an equivalent amount to the value of 4 days or one third of the most recent increment.

For those currently on the maximum and retiring in 2016, a reduction of 6 days annual leave or a cash deduction from salary of an equivalent amount to the value of 6 days or one half of the most recent increment.

Pro Rata arrangements for those who reach the maximum in 2014 and retiring over the course of the Agreement.

For those who reach the maximum in 2014 and are due to retire in 2014 a reduction of 2 days annual leave or a cash deduction from salary of an equivalent amount to the value of 2 days or one quarter of the most recent increment.