Breakthrough over ‘cash equivalent’ of lost leave

Tuesday 22nd October 2013

IMPACT has won a substantial breakthrough for public servants at the top of their scale who want to incur a ‘cash deduction’ rather than a temporary loss of leave under the Haddington Road agreement.

Following negotiations, it has been agreed that the cash deduction will be the gross pay value of either the individual’s leave days or half their most recent increment, minus a reduction of 62%.

Under Haddington Road, public servants who earn between €35,000 and €65,000 a year, and who are at the top of their scale, have to temporarily forfeit six days leave over the lifetime of the deal – or the cash equivalent. This is to reflect the fact that staff who are not at the top of scales will incur temporary delays in the payment of increments.

IMPACT insisted that the agreement gave staff the choice of a financial alternative if it suited them better than a temporary loss of leave. The Haddington Road deal gave the option of a cash deduction from salary worth the value of six annual leave days or half their most recent increment, whichever was the lesser. But Revenue problems arose over the implementation of this aspect of the deal.

IMPACT then entered negotiations with the Department of Public Expenditure and Reform. The union has now achieved an outcome that will see staff already at the top of their scale lose the value of six days minus a discount of 62%, which reflects the value of tax and other deductions from gross pay.

Staff who earn between €35,000 and €65,000, and reach the top of the scale following a second increment paid during the lifetime of the agreement, must incur a once-off loss of three days leave or the cash equivalent. They will now be subject to the same formula for calculating the cash equivalent.

The loss of leave or the cash equivalent is not a permanent reduction; it’s a once-off loss of leave spread over the three-year period of the agreement, or the cash equivalent.

A circular just issued by Department of Public Expenditure and Reform also sets out the method for conceding leave, which includes pro-rata arrangements for staff who reach their salary maximum in the period 2013–2016. The full circular is available to download via this link:

GUIDELINES FOR OPERATION OF SECTIONS 2.24 and 2.25 of HADDINGTON ROAD AGREEMEN


FURTHER INFORMATION

Who does this apply to?

Public servants who earn between €35,000 and €65,000 a year, and who were at the top of their scale on 1st July 2013 must forfeit six days leave, or the cash equivalent, over the lifetime of the agreement (ie, before the end of 2016).

AND

Staff who earn between €35,000 and €65,000, and whose second increment takes them to the top of the scale during the lifetime of the agreement. Because they are now at the top of their scale, but have already incurred one three-month increment freeze, they incur a once-off loss of three days annual leave, or the cash equivalent, as the alternative to a second increment freeze.

Is this a permanent reduction in annual leave entitlements?

No. Annual leave entitlements will not change. The staff affected will have a once-off reduction of six days leave, or three days leave if they reach the top of scale during the lifetime of the agreement. It is not a permanent reduction in annual leave entitlement.

How will the cash equivalent to loss of annual leave be calculated?

The cash deduction will be the gross pay value of either the individual’s (six or three) leave days or half their most recent increment, minus a reduction of 62%.

Will my pension be affected if I choose the cash equivalent?

No.

Does the ‘top of the scale’ include or exclude long service increments?

For the purposes of this agreement, ‘top of the scale’ includes long service increments. That’s because the purpose of this measure is to ensure that the value of the ‘increment freeze’ also applies to staff who have no more increments due to them.

What happens to staff awaiting a long service increment?

If you earn between €35,000 and €65,000 and your next increment is your first long service increment you will receive the increment on the normal date, but your next long service increment will be deferred by a period of six months. If you earn between €35,000 and €65,000 and are already on your first long service increment, you will receive your next long service increment on the normal date. The provisions about forfeiting annual leave (or the cash equivalent) on a once-off basis will then apply to you on at a pro-rata basis, with the amount of leave or cash forfeit dependent on when you achieve the long-service increment.

How will the increment changes be applied to job-shares and part-time workers?

Job-sharers and part-time workers at the top of the scale will lose leave days on a pro-rata basis to the equivalent full-time worker.