The Local Government (Early Termination of Employment) (Discretionary Compensation) Regulations (Northern Ireland) 2007

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations provide a new, simplified framework for the payment of discretionary compensation to persons whose local government employment is terminated on or after 1st October 2006 by reason of redundancy or in the interests of the service or where a joint appointment comes to an end because one of the holders leaves. They revoke the Local Government (Early Termination of Employment) (Discretionary Compensation) Regulations (Northern Ireland) 2003 (“the 2003 Regulations”) but the revocation does not affect any person whose termination date is before 1st October 2006 or the rights of any person who is entitled to benefits under those Regulations in consequence of the death of such a person. In relation to such persons the 2003 Regulations continue to apply.

Regulation 3 states to whom the Regulations apply.

Regulation 4 gives a power to increase a redundancy payment made under the Employment Rights (Northern Ireland) Order 1996 (“the 1996 Order”).

Regulation 5 allows an employer to award compensation in the form of a lump sum of an amount that must not exceed 104 weeks’ pay. The regulation sets out the basis for calculating a week’s pay for an individual. Any redundancy payment under the 1996 Order or compensation paid under regulation 4 of these Regulations must be offset against compensation paid under regulation 5.

Regulation 6 requires each Local Government Pension Scheme employer to have and publish a policy that they apply in the exercise of their discretionary powers under regulations 4 and 5.

Regulation 7 deals with how payments are made and any errors dealt with.

Regulation 8 provides that payments made under these Regulations must not be met out of the Local Government Pension Scheme fund.

Regulation 9 contains revocations and a transitional provision, subject to savings. A transitional provision is that a Scheme employer may decide to pay compensation under the 2003 Regulations in respect of a person whose employment commenced before 1st October 2006 and whose termination date is between 1st October 2006 and 31st March 2007 (inclusive). A Scheme employer may also pay additional compensation under these Regulations to a person whose termination date is between 1st October 2006 and the date on which these Regulations came into operation (inclusive) and who has been awarded a lump sum under Part 3 of the 2003 Regulations, as long as the total amount paid does not exceed the maximum payable under these Regulations.

The Regulations take effect from 1st October 2006. Article 19 of the Superannuation (Northern Ireland) Order 1972 provides that regulations made under that Article may have retrospective effect. Regulation 9(5) of these Regulations provides that nothing in these Regulations shall place any individual in a worse position than he would have been if these Regulations had not had retrospective effect.

The Schedule makes savings.

A regulatory impact assessment of the corresponding Statutory Instrument for England and Wales was carried out by the Department for Communities and Local Government and is available on the internet at www.xoq83.dial.pipex.com. The assessment anticipated no increase in Scheme employers’ compensation costs.