New redundancy arrangements were introduced today for NHS staff.
Anyone made redundant from 1 October this year under the new arrangements will receive a redundancy package that no longer depends upon how old they are.
NHS bosses said the arrangements are a result of the new age discrimination legislation, which came into force on 1 October.
The legislation outlaws discrimination on the grounds of age unless covered by an exemption or “objectively justified”.
The existing NHS redundancy and early retirement arrangements had a number of age-related thresholds that gave different benefits to people of different ages.
The new arrangements will see everyone will receive a flat rate of one month’s pay for every year of service with a maximum of 24 months. Staff over the minimum pension age will be able to retire early on redundancy with no reduction in the value of their pension.
Staff will also be able to take early retirement without the value of their pension being reduced.
Transitional protection will be provided for existing staff aged over 50, who were entitled to added years on their pension when they were made redundant. This protection will reduce over a five-year period ending on 30 September 2011.
NHS Employers project manager Tim Sands said: “We accept that at the beginning of the transition, redundancy costs are likely to rise. However, we have to consider the new legal requirement, and there is a greater financial risk to trusts if they don’t comply with this requirement.
“In the long run, once the transitional arrangements are over, on average, trusts who have a redundancy programme with an age profile that reflects the age profile of their workforce should see costs fall by around 20%.”
Mike Jackson, senior national officer for health at Unison, said: “We believe the one month’s pay for each year of employment should cause employers to look at alternatives to redundancy in future.”