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Public sector payment cap challenged by BMA

Legal proceedings have been launched by the British Medical Association (BMA) against the UK Government following proposals earlier in the year to cap exit payments for all public sector workers, including doctors.

Chancellor Rishi Sunak laid the proposed regulations before parliament in July which, if brought into force, would impose a legal duty on public bodies – including NHS trusts – to limit payments to exiting employees to £95,000.

These limits would be in effect in circumstances even whereby doing so would ignore existing contractual obligations, including agreed redundancy rights or where the employer otherwise accepts the worker is owed the sums as agreed compensation for an employer’s unlawful acts.

In response to the regulations proposed, the BMA is to ask the courts for permission to apply for a judicial review, arguing the Government’s intention to seek to override potential payments due to exiting employees is unlawful.

Their argument is based on the grounds that the Government cannot interfere with and override rights agreed in workers’ employment contracts. Doctors’ contracts of employment are nationally negotiated by the BMA and NHS Employers and are the result of lengthy negotiations which take into account the needs of the NHS, NHS Employers and doctors.

As part of the legal challenge, the BMA is also arguing the proposed regulations are contrary to human rights regulations as they put public sector employees at a significant disadvantage in seeking to enforce their rights to peaceful enjoyment of their property, as compared to private sector workers.

The proposed regulations also demand that all doctors, including doctors in training, calculate and notify their employer of all ‘exit payments’ to which they entitled at the time of leaving employment. The BMA will argue that the legislation would effectively ask junior doctors to do the work of NHS trust HR staff – placing them under the obligation to perform complex calculations, likely to be beyond their competence, every time they rotate.

The BMA sent government lawyers a letter before action, as is protocol, on August 17, 2020 setting out the case as to why the proposed regulations would be unlawful.

A response was required to that letter by September 1, 2020 but no response was reportedly received by the BMA. However, the Government Legal Service has confirmed that the proposed regulations are still intended for debate in both Houses of Parliament.

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