Restriction of public sector exit payment regulations 2020 now in force


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The Restriction of Public Sector Exit Payments Regulations 2020 introduce a £95,000 cap on exit payments in the public sector and came into force on 4 November.  

The Treasury has published updated guidance for applying the exit payment cap alongside the Regulations coming into force which explains the Regulations in plain English and provides users with further information on applying the cap.

Exit payments will include any redundancy payment, any payment to reduce or eliminate an actuarial reduction to a pension on early retirement, a payment pursuant to an award of compensation under the Acas arbitration scheme or a settlement agreement (although certain claims such as whistleblowing and discrimination claims may be exempt), any severance or ex gratia payment, any payment in the form of shares or share options, any voluntary exit payment, and a payment in lieu of notice under a contract of employment.

It's worth noting that Registered Providers and ALMOs are excluded from the remit of the Regulations.

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