If you thought that we had reached closure on the issue of public sector exit payments when the Government's legislation introducing the cap took effect on 4 November 2020, then you might need to think again.
Last week, the FDA, the union for managers and professionals in public service, announced that it is seeking judicial review of the Government's regulations which restrict public-sector exit payments to £95,000. The FDA warns that the "arbitrary" cap could affect "hundreds of thousands of public servants", with no equality impact assessment having been undertaken. Furthermore, the union has taken issue with the fact that the Government "refused to ensure that the cap is index-linked so that it does not reduce in real terms over time". The cap also includes pension strain payments and settlement agreements, which the FDA argues will affect not just the higher earners.
The FDA accuses the government of targeting the very people who have been performing extraordinary feats this past year keeping our vital public services going. I would make the point that the regulations and proposal for the public-sector exit cap had been in the pipeline for some years. If you read my post last week on the review of the Human Rights Act, you will recall that I referred to the failed judicial review claim based on the legality of Covid-19 lock down regulations. It will be interesting to see whether this judicial review is successful. In the current climate, I think it unlikely.
For a reminder of the issues, the organisations the cap applies to and a summary of what you need to know, check out our e-briefing by my colleague Matthew Gregson.
To listen to a brief discussion on the practicalities and problems of the public sector exit payments, I would encourage you to listen to the podcast recorded by my colleagues Matthew Gregson and Doug Mullen.
The FDA has launched a legal challenge against the imposition by the government of a £95,000 cap on public sector exit payments. The union is seeking, via a Judicial Review, to challenge the government’s 2020 regulations restricting exit payments.