Equality impact assessment
School/Directorate: Corporate Services (Human Resources)
Name of person completing the equality impact assessment: John
Hawksworth
Date of completion: October 2009
What is the name of policy / function / practice / criteria you are equality
impact assessing? Voluntary severance scheme
Is the policy:
New
Existing
Screening
What is the aim of this policy / function / practice / criteria? What is it intended
to achieve?
To enable the University to reduce and manage its staffing costs, a process of staff
reductions by voluntary means must be introduced.
Who are the main stakeholders?
Staff
Students
Community
In light of the data and evidence you have collected for this equality impact
assessment, does this policy / function / practice / criteria have any relevance
to, or impact on, equality and diversity in the two areas below?
Possibility for discrimination / adverse impact
Opportunities to promote equal opportunities / good relations
Evidence and data
Please use the space below to discuss the evidence and data you have
collected for this equality impact assessment. This evidence may include
statistics, results of consultations, feedback, external reports etc. There is no set
format for this section; please include any information that is relevant or that you
have collected which you have considered as part of this equality impact assessment.
Discuss how it has enabled you to make your conclusions about any impacts on
equality of what you are assessing.
Please ensure you include feedback where appropriate on the policy / function /
practice / criteria from the three staff forums: Race Equality, Respect Sexual
Orientation, and N-Able Disabled Staff Group. You can obtain further guidance and
details on the staff forums from the Equality Unit.
The potential impact of the scheme and its associated criteria have been modelled
and analysed. Work in this regard continues.
Equality impact
Based on your findings presented in the section above, please tick the
appropriate boxes below and summarise your reasons where appropriate:
Positive impact/
opportunities
Negative /
adverse
impact
No impact
Reasons
and
evidence
Unknown
Race
Applies to
all staff
Gender
Applies to
all staff
Disability
Applies to
all staff
Sexual
orientation
Applies to
all staff
Religion or
belief
Applies to
all staff
Age
Applies to
all staff,
possible
(indirect)
impact
If you have identified any negative or adverse impact, can this be justified?
Yes
No
If you have answered yes, please explain how:
Details of the Scheme:
1.
The University proposes to offer a Voluntary Severance Scheme (“the
Scheme”) with a view
to reducing overall staff numbers by entering into
severance by mutual consent where
appropriate. The Scheme will be open for
applications between [DATE] and [DATE].
2.
Redundancy payments will be calculated by reference to length of service and
age and mirror the statutory redundancy scheme.
3.
Applications will be judged against the criteria of the Scheme:
“Criteria for consideration of application for Voluntary Severance
A voluntary severance payment will only be made where the Remuneration
Committee certifies that the termination is in the managerial interests of the
University. Applications received from the staff under the Voluntary Severance
Scheme will be determined as being in the University’s managerial interest on the
basis of the following criteria. Priority will be given to those cases where more than
one of the criteria are met:
•
The member of staff works in a School or Directorate where savings have
been identified to ensure future financial sustainability. Approval of the case
represents savings in forecasted costs against the post within an 18 month period.
This could include where it has been decided to contract, restructure or close an
area as part of an approved plan. The Managing Staff Reductions procedure will
have been applied;
•
The member of staff has skills/expertise for which there is a reduced
requirement and no replacement post will be made;
•
The member of staff has skills/expertise for which there is a reduced
requirement and has been actively seeking redeployment but it has not been
possible to redeploy the member of staff in an agreed timescale (at least 3 months);
•
The termination will facilitate the redeployment of a member of staff from one
of the areas where staff reductions are targeted**; ie where a member of staff in a
School/Directorate undergoing MSR procedure has transferable skills in another
School/Directorate In the other School/Directorate, a member of staff /is interested
in/ has volunteered for VSS.
•
The termination will be cost effective in relation to the costs and financial
benefits involved.
** The agreement on which School/Directorate pay the costs associated with VSS
should be reached prior to the case being submitted to the Remuneration Committee.
Agreement will be dependent on individual circumstances. The School/Directorate
undergoing MSR would at least contribute towards the cost of VSS up to the
maximum of the VSS costs which would have been associated with the redeployed
member of staff.”
4.
Each application for voluntary severance will be assessed according to the
criteria set out in the Scheme; in each case, the application will be assessed to
determine whether it is appropriate to proceed.
Potential Impact of the Scheme:
5.
The Scheme is an enhanced redundancy scheme which mirrors the statutory
redundancy scheme, but multiplies the minimum number of week’s pay by two.
Successful applicants
will receive:
•
22.
1 week’s pay for each full year of service where age during year is less than
•
2 week’s pay for each full year of service where age during year is 22 or
above, but less than 41.
•
3 week’s pay for each full year of service where age during year is 41 or
above.
It is acknowledged that the effect of this approach results in a more generous
severance payment for successful applicants above age 22 and above age 41
than staff below these
ages, in common with the statutory scheme. It is
recognised, through Regulation 33 of the
Employment Equality (Age)
Regulations 2006, that this approach is permissible.
6.
The University will make a decision about voluntary applications to the
Scheme having considered the criteria. The Scheme includes a criterion that
approval of any case should represent savings in forecasted costs against the post
within an 18 month period. Whilst this will be applicable in all cases, this has a
potential indirect impact for certain staff in the 50-65 age group. This is due to the
costs passed on to the University from the relevant pension schemes in respect of
early retirement benefits. The University is bound by the rules of external pension
schemes, in particular the Universities Superannuation Scheme (“USS”) and the
Local Government Pension Scheme (“LGPS”). The lawful operation of these
schemes may mean that it is difficult for the University to demonstrate savings in
forecasted costs within an 18 month period in some cases where the individual is 50
or over and has a right to automatic early retirement benefits (minimum retirement
changes from 50 to 55 on 1 April 2010 for all members of the LGPS and some
members of the USS). Therefore in order for the voluntary severance or early
retirement of relevant pension scheme members between age 50 and 60 to be
agreed by the University, the cost of the early payment of pension benefits as
provided under the rules of the USS or LGPS (“the Early Retirement Funding
Charge”) plus the voluntary severance scheme payment must be no greater than the
equivalent of 18 months (total) salary costs for the individual. Where the costs
exceed this, the voluntary severance payment must be used either wholly or in part
to meet this cost. Where the cost exceeds the voluntary severance payment
available, it may be that neither early retirement nor voluntary severance can be
agreed. The absence of any such consideration when reviewing cases may result
in a successful application under the scheme resulting in a disproportionate cost to
the University and an unexpected windfall for an applicant. The additional costs
generated by the funding of early retirement benefits could also have an operational
impact upon the University and on the delivery of its services. It could, in some
cases, be so substantial as to result in the University having to take steps to make
further savings by other (non-voluntary) means, and this could in turn impact upon
the employment of other University staff. In addition there may also be a
disproportionate number of losses of highly experienced employees within a
particular age group which may affect the operational needs of the university.
7.
The criteria within the Scheme will apply equally to all staff, but the
requirement that the cost to the University of accepting an application must be saved
in forecasted cost within an 18 month period may have some potential for a
disparate impact and therefore is only acceptable if it is justified.
A return within 18 months is considered to be the right dividing point, given
the actual and predicated finances of the University.
The decision to require a saving within an 18 month period is justified by the fact that:
The University has already been notified of a reduction in HEFCE funding of 3.5%
(minimum) over 2009-10 and 2010-11and the sector is anticipating further cuts for
the period up to 2013-14 to be announced as part of the 2010 Comprehensive
Spending Review. The cuts could range between 5% and 15%. In order to mitigate
the cuts in HEFCE funding the University will have no choice but to reduce staffing
costs. Projected income growth in other areas is not sufficient to replace this lost
funding. The level of staff savings required is significant but the University’s primary
aim is to achieve this through voluntary means.
Funding the cost of VSS requires significant investment from the University’s own
resources and the business case for using resource in this way has to be robust.
There has to be a finite budget for funding the VSS and a clear estimate of the
savings that can be realised. The savings need to materialise in the period that
funding cuts take effect.
It is also believed that the Scheme will:
*
Encourage and reward loyalty
*
Enable the University to manage change whilst reducing the risk that nonvoluntary
means may be required in the future;
*
Maintain good industrial relations and a more motivated workforce;
*
Facilitate a commercially viable institution;
*
Minimise the potential operational impact on the University and its staff
resulting from disproportionately high redundancy costs
*
Prevent any group of staff from receiving an unexpected windfall payment
*
Cushion older workers against market disadvantage
8.
The University will continue to monitor the impact of the Scheme on
employees of all ages, (in addition to analysing the applications from a race, gender
and disability perspective).
What action will you take to reduce the negative or adverse impacts?
Changes to the policy / function / practice / criteria
Changes to the method of implementation
Replacing the policy / function / practice / criteria
Please discuss further:
The University will assess each application against the criteria of the Scheme. The
University will make a decision about applications to the Scheme based on the
criteria set out in the scheme and approve those which are deemed to best serve the
management interest.
Action planning:
Action required
By whom
Date for completion
Publicising and reporting
The Equality Unit will work with you to ensure this equality impact assessment is
adapted for publication on the University website.
Please use the space below to discuss how else you want to make the results
of this equality impact assessment more widely known. This might include
presenting it at School or Directorate forums, committee meetings etc, or sending it
to those who were consulted; you may have your own internal channels of
communication you want to use.
Monitoring and review
When will you review this equality impact assessment?
At any point when the VS scheme is reviewed.
Who will be responsible for the review?
HR/Finance
How will you monitor the policy / function / practice / criteria in the meantime?
This might include collecting periodic feedback, checking statistics periodically etc.
There is no requirement for another full equality impact assessment at this stage.
We will analyse, by equality group, the applications made (and subsequently
approved) in VS process. This data will demonstrate whether there has been any
potentially adverse impact and will help to inform any changes to the scheme, its
criteria or its application that might be deemed appropriate.
Approval
Dean / Director of School / Director signature:
Date:
Date sent to Equality Unit: