“The devil is in the detail”
Proposed clawback regulations for excessive public sector exit payouts are too complicated, employment lawyers have warned.
The government is introducing the draft regulations, which would allow it to reclaim exit payments, in response to concerns that highly-paid public sector executives were walking into new roles within months of receiving five-figure sum exit payments to leave their previous roles. Its proposals are contained in its December 2015 consultation Public Sector exit payment recovery regulations .
According to the Employment Lawyers Association (ELA), however, the draft regulations are “unnecessarily complicated”. For example, the ELA points out that it is unclear what earnings would trigger a “qualifying exit payment”.
The ELA also highlights a lack of clear guidance on when a hiring authority can decide not to take action to initiate an exit payment repayment. It also complains of confusion about the date when an exit payment is deemed to have been paid.
Moreover, lawyers hoping to find a definition of “minimum amount repayable” in the regulations will need to look for it in an entirely separate piece of legislation.
Paul McFarlane, chair of the ELA sub-committee responding to the consultation, said: “As ever, the devil is in the detail.
“The regulations as drafted would create unnecessary confusion which could prove costly to any one of the parties involved and could discredit government efforts to crackdown on a perceived wrong. It also seems unnecessary to make those seeking to comply with the Regulations have to refer to lots of other legislation before being clear about what they need to do.”
