THE SCHOOL OF ORIENTAL AND AFRICAN STUDIES
The SOAS Library & Information Services (LIS) Directorate
Voluntary Severance Scheme
June 2010
Overview
As at June 2010, the School is currently able to contemplate considering applications for voluntary severance from members of staff who work in the Library and Information Services (LIS) Directorate
Proposed scheme
· This Scheme has no contractual force
· A voluntary severance scheme to aid delivery of the Library & Information Services (LIS) Directorate reorganisation proposals will be launched on 17 June 2010
· The voluntary severance scheme is at the discretion of the School and there is no contractual right or guarantee that an employee will have their application accepted, irrespective of whether applications have been accepted from other employees on previous occasions
· The scheme is open to all employees of the School’s Library & Information Services (LIS) Directorate staff. Employees must have at least two years continuous service as at 1 June 2010 (the two years continuous service is in line with the statutory requirements set out in the Employment Rights Act 1996)
· Any LIS member of staff who applies and is accepted for voluntary severance would have their severance package calculated with a leaving date of 30 September 2010
· The scheme would offer voluntary severance payments which would enhance those payable under the statutory redundancy payments rules which would apply in the event of compulsory redundancy. The scheme would award two weeks uncapped weekly pay for each year of continuous service at the School up to a maximum of 20 years service
· The ‘uncapped’ element means there is no limit on the amount of gross weekly pay used in the redundancy calculation (the statutory rules currently impose a weekly maximum of currently £380 per week for these purposes)
· If applicable, a grant of up to £1,000 would be payable to individuals to cover the costs of attending career or outplacement advice, re-training, or the purchase of computer of other future employment related equipment. This grant would be payable on submission of invoices
· Time-off with pay would be allowed to facilitate seeking future employment including attending job interviews at the discretion of the LIS Director
· Repayment of any previously paid training expenses to a LIS member of staff would be waived by the School in the event of redundancy
· Repayment of any relocation expenses incurred by a LIS member of staff when they joined SOAS would be waived in the event of redundancy
· A payment of up to £250 plus VAT would be payable to successful applicants to cover their taking legal advice from an employment law specialist legal advisor regarding the compromise agreement the School would use to terminate an applicant’s employment contract with the School. This payment would be made on receipt of an appropriate signed invoice
· Enhanced Voluntary Severance payment may include payment in lieu of notice, accrued untaken annual leave and any other contractual benefit, however these will be subject to tax and NI contributions and the remainder of the amount will represent compensation for loss of office and as such, the first £30,000 should be treated by HM Revenue & Customs as being free of income tax pursuant to section 401 of the Income Tax (Earnings and Pensions) Act 2003
Application process
· From 17 June 2010, qualifying employees would have up to four working weeks to consider whether they would wish to apply for voluntary severance. The formal application stage would close at 5pm on 15 July 2010
· Up to Friday 9 July 2010 of the application stage, if required upon request, the HR Payroll & Pensions’ Team would calculate the voluntary severance package which could be payable to an applicant and inform that individual in confidence by email or in writing before the closing date
· Applications for voluntary severance would be made using the form at Appendix A
Consideration of applications for voluntary severance
· The overall scheme has to be able to demonstrate a robust business case with value for money for the School with sufficient ‘pay-back’ indentified over a one to two year period
· All applications would be considered by a Panel consisting of the HR Director, the Finance & Planning Director and the Director of Library & Information Services using the criteria set out at Appendix B
· Once the Panel is satisfied with the business case individual-by-individual, final approval would be sought from the School’s Registrar and Secretary
· This is a targeted voluntary severance scheme for Library & Information Services staff only. The School reserves the right to determine who is allowed to be given voluntary severance under this scheme
· There is no appeals process available for this scheme
· The decision of the School Registrar and Secretary is final
· The School hopes to be able to notify individuals of the outcome of their application by Friday 30 July 2010
Consultation with the School recognised trade unions
The Director for Library & Information Services and the HR Manager (Change) briefed the School recognised trade unions on 10 June 2010 as to the details of the voluntary severance scheme.
HR Directorate
SOAS
June 2010
Notes· Under HM Revenue and Customs’ (HMRC) rules, a redundancy payment is treated as compensation provided there is a genuine need for redundancy i.e. diminishment of need for a job role or the role disappears in a restructure
· There are two sorts of redundancy pay:
- Statutory redundancy pay, which is set down by law
- Discretionary enhanced redundancy pay which is payable where an employer has its own discretionary redundancy scheme (compulsory or voluntary) in place, as is the case at SOAS
· Employees cannot be paid less redundancy pay than the amount of statutory pay they are entitled to
· Income tax is payable on a redundancy payment if it is more than £30,000 and is taxed at the appropriate rate when the payment is made
· As mentioned above not all redundancy payments are tax free, and payments that are due to be made to an employee under contract are taxable under section 6 Income Tax (Earnings and Pensions) Act 2003
· However, under section 401-403 ITEPA payments that are paid as compensation on redundancy or termination of employment are not taxable if under the limit of £30,000 and no national insurance is payable. The situation is complicated and you should seek independent financial advice
· An experienced advisor such as at a Citizens’ Advice Bureau can help you get personal income tax advice