Agenda for Change Pay Agreement (England) for 2015/16: Frequently Asked Questions

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12 / 3 / 2015 9.16am

The pay offer made by the Government for NHS staff in England has now been accepted by the NHS trade unions. The overall agreement includes changes to pay scales for 2015/16 and revised national redundancy provisions for England. These will be published soon and incorporated in the NHS Terms and Conditions of Service Handbook. 

There are also some ambulance-specific proposals that will be discussed further with employers and unions from the ambulance sector in England. 

Our chart sets out the changes that are being implemented, to help explain them to staff.

These frequently asked questions cover the following main areas:

Pay changes

1. Who will receive a one per cent increase?

All staff on Agenda for Change terms and conditions up to the Band 8B/8C overlap (point 42) will receive at least a 1 per cent consolidated pay increase.  

Staff in Bands 1 and 2 (Band 3 overlap up to point 8) will receive up to a 5.6 per cent consolidated pay increase.  

Staff on Band 8C (point 43 and above), 8D and Band 9 receive no pay increase. 

In addition, staff at the top of Band 7 (point 34) and above will not be eligible for incremental pay progression in the period 1 April 2015 to 31 March 2016.  

2. From what date do these changes apply? 

All of these changes apply from 1 April 2015.

3. What will happen to high cost area supplements? 

The minimum and maximum values of all the high cost area supplements (inner, outer and fringe) are increased by 1 per cent. 

4. What happens to the 1 per cent non-consolidated payments which were given to staff at the top of their pay bands in 2014/15?  

These end on 31 March 2015.  They do not form any part of pay in the period 1 April 2015 to 31 March 2016.

5. What happens to the arrangements for incremental pay progression?  

The provisions for pay progression in Section 1 and Annex W in the handbook continue to apply in the period 1 April 2015 to 31 March 2016.  However, where staff on pay spine points 34 to 54 are assessed locally as meeting the performance criteria for a pay increment, they will not be eligible to receive the increment in this period.  They will become eligible for incremental pay progression again on 1 April 2016. 

Staff in Bands 8C, 8D and 9 who are on re-earnable points who fail to meet their local performance criteria to re-earn these points will still drop down an incremental point where applicable.

Ambulance

6. What new arrangements will be made for pensions for front line ambulance staff?

Under the NHS Pension Scheme Regulations 2015 there are provisions described as early retirement reduction buy-out (ERRBO). These provisions are available to all members of the NHS Pension Scheme. They allow employers and NHS Pension Scheme members to pay extra contributions which allow members to take an unreduced pension up to a maximum of three years before their normal pension age. This is subject to a minimum age of 65. A pension scheme member with a pension age of 68 would be able to leave the service at 65 with an unreduced pension where adequate contributions have been made. Ambulance employers and trade unions will now discuss how these provisions can be used for front-line ambulance staff.  

7. How much extra will employers and employees have to pay in contributions? 

It is too early to confirm the extra contributions ambulance employers and employees will need to pay. Additional contributions will be equally shared between the employer and the employee.   

8. Will new recruitment and retention premiums be given to ambulance staff? 

Ambulance employers and trade unions will work together to examine recruitment and retention issues and how these can be addressed. They will consider whether there is a need to use recruitment or retention premiums or, by using the NHS job evaluation scheme, whether there is a need to develop new national job profiles which reflect emerging roles or, perhaps, by using these measures in combination.  

Changes to contractual redundancy arrangements

9. What changes have been made to the NHS redundancy pay provisions?  

Under the old provisions there was no limit on the salary used to calculate a redundancy payment. The changes will see the introduction of a salary cap of £80k and a floor of £23k for lower paid staff. For staff with total earnings of more than £80K, the figure used for calculating a redundancy payment will be £80K. For staff with total earnings of less than £23k the redundancy pay will be calculated using the £23k figure. 

Changes have also been made that remove the employer ‘top-up’ provisions for those who are made redundant over the age of 50 and chose to retire early. Under the old provisions an employee could choose to use their redundancy payment to fund the actuarial shortfall in their pension of taking it early and the employer was liable for any shortfall. This employer liability has now been removed but an employee can still choose to use their own funds to cover any shortfall at the time of the redundancy. 

10. Are there any further amendments to the redundancy provisions planned? 

Separately, there will be discussions on further changes with a view to reaching agreement on ‘tapering’ for staff nearing normal pension age, and repayment mechanisms for those taking voluntary redundancy who then return to the NHS within six months, sometimes known as ‘claw back’. This will be in return for index linking the £23k floor and £80k ceiling.

11. How will a redundancy payment be calculated for staff earning less than £23,000 per year?

The redundancy payment will be calculated as if the earnings were £23,000, subject to the minimum two-year qualifying period and a maximum of 24 years of reckonable service.

12. How will a redundancy payment be calculated for staff earning more than £80,000 per year? 

The redundancy payment will be calculated as if the earnings were £80,000, subject to the minimum two-year qualifying period and a maximum of 24 years of reckonable service.  

13. How will a redundancy payment be calculated for staff earning more than £23,000 per year but less than £80,000 per year?  

The calculation of the redundancy payment will remain unchanged.  

14. What happens if the formal redundancy consultation starts before 31 March 2015? 

For employees subject to formal redundancy consultation which commenced prior to 1 April 2015, the old redundancy provisions in force prior to 1 April 2015 will apply.

15. What happens if the formal redundancy consultation starts after 31 March 2015? 

For employees subject to formal redundancy consultation which commences after 31 March 2015, the new redundancy provisions will apply.

16. An employee is working part time 18.75 hours per week (0.5 FTE) and earns £50,000 pa.  They have more than 24 years continuous service. What would their redundancy payment be?

The full time equivalent (FTE) earnings is £100,000 and therefore for the purposes of the calculation the cap of £80,000 will be used:

(Annual Earnings/12 months x Number of years’ reckonable service) x Full time equivalent = Redundancy payment.

(£80,000/12 x 24  years’ reckonable service) x 0.5 FTE = £80,000.


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