Explanatory note

These Regulations amend the Local Government (Compensation for Redundancy) Regulations 1994 (“the 1994 Regulations”) which provide for compensation on loss of local government employment where the termination is by reason of redundancy or in the interests of the efficient exercise of the employer’s functions.

Regulation 2 introduces new definitions of continuous and qualifying employment for the purposes of calculating the amount of compensation payable. To be eligible for compensation a person must, at the date when his employment terminates, be in an employment which entitles him to be a member of the Local Government Pension Scheme.

Qualifying employment is employment in respect of which an occupational pension scheme for local government employees, teachers or persons engaged in health services is or was in operation and which the employee was eligible to join or would have been eligible but for a specified reason.

Continuous employment, which is used for the purpose of calculating entitlement under Part III of the Regulations, which apply to employees of local authorities affected by local government reorganisation, is a period of employment computed in accordance with the provsions of section 151 and Schedule 13 to the Employment Protection (Consolidation) Act 1978 as modified by the Redundancy Payments (Local Government) (Modification) Order 1983.

National Park authorities in Wales are included in the definitions of “employing body” and “relevant body” by regulation 2(c) and (g).

Regulation 2(e) extends the prescribed period in Wales to 30th September 1997.

Regulation 2(h) and (i) replaces the definition of “remuneration” with a reference to a week’s pay as computed for the purposes of the Employment Protection (Consolidation) Act 1978 but without applying the maximum for the purposes of redundancy under Part VI of that Act.

Regulation 3 amends Part II of the 1994 Regulations. It provides that periods of qualifying employment may be used in calculating compensation. It also provides that an employing body may not include in the calculation of compensation under Part II of the 1994 Regulations a period of service which has already been taken into account in calculating a prior award of compensation under these Regulations (except in the case of concurrent employment). Nor may a period used to calculate compensation under Part II be used in the future when calculating compensation payable under regulations made under section 24 of the Superannuation Act 1972, save for concurrent employment. A similar provision is introduced by regulation 4 for Part III.

Regulation 3(a)(ii) introduces a condition that the employee must not be one whose employment terminates only because his fixed term contract has expired without being renewed and who has waived his right to a redundancy payment under Part VI of the Employment Protection (Consolidation) Act 1978 in such circumstances. This condition is also introduced by regulation 4 for the purposes of Part III.

Regulation 4 substitutes a new Part III of the 1994 Regulations which covers the payment of compensation during periods of local government reorganisation. Certain changes are made as follows—

• for mandatory compensation and the fixed discretionary compensation, only continuous employment is used in the calculation of compensation;

• for other discretionary compensation, all periods of qualifying employment may be taken into account subject to the permitted maximum;

• the Schedule, added by regulation 5 of these Regulations, sets out which new Welsh authorities, established by the Local Government (Wales) Act 1994 which take over responsibility for local government administration from the old county and district councils on 1st April 1996, are to be the successor authorities for the purposes of regulation 6(4)(a) of the 1994 Regulations or, as the case may be, the relevant bodies for the purposes of regulations 6(4)(b) and 7 of the 1994 Regulations;

• if the area of an old authority in Wales is divided between two or more new local government areas after 31st March 1996, the consent of all the councils of those new areas is required to any discretionary payment under regulation 7 of the 1994 Regulations by the successor authority.

Regulation 6 adds a condition to the prescribed conditions in Part III of the 1994 Regulations that an employee is not eligible if, before the termination of his employment, he receives from his employer or an associated employer within the meaning of the Redundancy Payments (Local Government) (Modification) Order 1983 an offer to renew his contract or an offer of suitable employment to commence within four weeks of the termination unless his refusal of such offer, or termination of his new contract during a trial period following such offer, is reasonable.

Regulations 2 to 5 have effect from the 28th December 1994, the date on which the 1994 Regulations came into force. There is a saving provision in regulation 7(1) for those who would be put in a worse position than they would have been if the Regulations had only come into effect on the date of their making. Regulation 7(2) preserves the use of the definitions of service and remuneration in the 1994 Regulations in respect of employees to whom written estimates of proposed benefits calculated by reference to those 1994 Regulations definitions have been given prior to the date that these Regulations are made if it would be to the employee’s benefit.