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Appendix A7.3

Pay progression buy-out pay offer 2015

1. Introduction

1.1. The harmonised pay Research Councils (AHRC, BBSRC, EPSRC, ESRC and STFC – “the consortium”) have been required by the Department for Business, Energy and Industrial Strategy (BEIS) and HM Treasury to make changes to the harmonised pay arrangements to reflect the Government’s commitment to abolish contractual pay progression across the public sector.

1.2. This offer provides details of the arrangements offered by the consortium to the cross-Council Trade Unions to buy-out the contractual pay progression arrangements from the harmonised pay system.

1.3. These buy-out arrangements constitute the pay offer for 2015/16 and, if accepted, would be effective from the annual pay award date of 1 July 2015.

1.4. From 1 July 2015 the previous contractual pay progression arrangements would no longer apply once the offer had been accepted.

1.5. Following implementation of this buy-out offer, a new pay system will be developed in consultation with the Trade Unions. The new system may include pay movement arrangements; however, in line with Government pay policy, they would no longer be contractually guaranteed.

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2. Summary

2.1. The main points of the buy-out pay offer are:

  • Buy-out of contractual progression: payment of consolidated increases in basic pay and, in some cases, payment of non-consolidated lump sums to buy-out the contractual pay progression entitlements for current employees who were in post on 30 June 2015
  • Value of awards: the buy-out offer will result in an average consolidated basic pay increase of 2.57% and an average non-consolidated payment of 1.71%. However, the amounts payable to an individual will be dependent upon current pay position in the Band and their performance

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3. Pay offer details

3.1. New pay scales

The pay scales have been redesigned. Changes include:

  • Increases to the band minima
  • Removal of Standard Pay (SP)
  • Removal of pay steps below SP
  • Removal of the 105% of SP progression cap
  • Introduction of a Market Pay Point (MPP) which has been informed by benchmarking against external pay data
  • No change to the band maxima to conform with Government pay policy

Transition Point: a Transition Point which is the better of the old Standard Pay (Bands E-G) or the new band minimum (Bands A-D) will be used as the underpinning minimum point to which salaries are assimilated into the new pay scales from 1 July 2015.

Pay scales 2014/15

Pay scales 2014/15 Minimum Standard Pay 105% of SP Max
Band A £14,650 £14,650 £15,382 £16,847
Band B £17,858 £18,222 £19,134 £20,956
Band C £22,972 £23,442 £24,613 £26,958
Band D £28,384 £29,566 £31,044 £34,002
Band E £36,033 £37,534 £39,410 £43,164
Band F £44,670 £47,521 £49,896 £54,649
Band G £56,990 £60,627 £63,659 £69,721

Proposed pay scales effective from 1 July 2015

Buy-out pay scales 2015/16 New minimum Transition point   MPP Max
Band A £15,260 £15,260 (new min) £15,414 £16,847
Band B £18,661 £18,661 (new min) £19,238 £20,956
Band C £24,029 £24,029 (new min) £25,294 £26,958
Band D £29,900 £29,900 (new min) £31,808 £34,002
Band E £37,213 £37,534 (old SP) £40,014 £43,164
Band F £47,361 £47,521 (old SP) £50,926 £54,649
Band G £57,605 £60,627 (old SP) £61,941 £69,721

Pay scale increases

Pay scale increases Increase to minimum Increase from Standard Pay to Market Pay Point Increase to maximum
Band A 4.2% 5.2% 0%
Band B 4.5% 5.6% 0%
Band C 4.6% 7.9% 0%
Band D 5.3% 7.6% 0%
Band E 3.3% 6.6% 0%
Band F 6.0% 7.2% 0%
Band G 1.1% 2.2% 0%

3.2. Buy-out salary increases and lump sum non-consolidated payments

The buy-out salary increases and non-consolidated lump sums are detailed in the table below and consist of the following:

3.2.1. A percentage increase in basic pay based on current pay position in the band.

3.2.2. If the increased salary from 3.2.1 above is below the Transition Point, then an additional increase will be given to move the salary to the Transition Point.

3.2.3. A non-consolidated lump sum dependent on current position in the pay band. This sum will be reduced by any further salary increase made to raise a salary to the Transition Point in 3.2.2. above.

3.2.4. For Exceptional performance there is a further increase in basic pay or a non-consolidated lump sum payment dependent upon current salary position in the pay band.

3.2.5. The consolidated increases in basic pay will not be capped and so, where applicable, an individual’s basic pay will move through the Transition Point, Market Pay Point or band maximum. Following application of the buy-out increases, employees will therefore effectively be on individual salary points within the new pay structure.

3.2.6. A Pay buy-out calculator is provided alongside this pay offer to help individuals understand what pay buy-out they would receive.

By-out increases and payments   Exceptional performance
Full time salary position in current pay band 1. Salary increase 2. If new salary is still below the transition point then an extra increase to the transition point will be made 3. Non-consolidated lump sum payment. N.B. this is reduced by any extra required to move to the transition point 4. Extra salary increase added after stages 1. 2. and 3. are applied 5. Extra non-consolidated lump sum
Below SP 2.5%   2.5% 1.50%  
SP to below 105% SP cap 2.0%   2.0% 1.50%  
105% SP cap to below max 1.5%   1.5% 1.0%  
At or above max 1.0%   1.0%   1.0%

3.3. Promotees

3.3.1. Pay increases for staff promoted between 01.07.14 and 30.06.15 will be based on pay in the higher band and, depending on the timing of promotion, could be based on their performance in their previous or higher band.

3.3.2. The pay on promotion increases of staff promoted on or after 01.07.15 will be reviewed and, where necessary, adjusted in light of the pay award (including, where appropriate, increasing post-promotion pay to the relevant new band minimum).

3.3.3. Where an individual is on temporary promotion on 01.07.15, the pay increase will be applied to the salary in the temporary band and any non-consolidated lump sum will be the higher of the calculation on the salary of the higher or substantive band.

3.4. New Starters joining on or after 1 July 2015

3.4.1. New starters who joined on or after 01.07.15 were appointed on contracts that do not contain an entitlement to contractual pay progression and will not therefore be due any increase or payment as part of the 2015 progression buy-out pay award.

3.4.2. The only exception to this will be new starters who joined on or after 01.07.15 on a pay rate below the new minima in Bands B to G who will have their pay increased to the relevant new minimum from the date of joining (unless they are subject to informal or formal unsatisfactory performance/attendance/conduct measures).

3.5. Leavers

3.5.1. Leavers after 30.06.15 will be eligible for a salary increase and non-consolidated lump sums in accordance with the current progression arrangements. The lump sum will be pro-rated in line with length of service between 1 July 2015 and the leaving date. The buy-out offer is not available to leavers after 30.06.15 (including those who have moved to MRC or NERC).

3.6. Allowances

3.6.1. Allowances that are calculated as a percentage of base salary will go up in line with salary increases.

Arrangements concerning other allowances are separate to the pay consortium harmonised arrangements and will be dealt with separately between individual Research Councils and Local TU representatives.

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Last updated 25/08/16
Amendment 194 – August 2016