Following a consultation exercise in 2014, the Government has recently published draft regulations seeking to address public disquiet that some highly-paid public sector executives were walking into new roles within months of receiving five-figure sum exit payments to leave their previous roles. Government is keen to be able to claw back these payments in such circumstances. It is intended that these regulations will come into effect in April 2016.

It is to the Government’s credit that the draft regulations have taken on board some of the concerns the Employment Lawyers Association (ELA) and others raised following the 2014 consultation. For example in the 2014 the Government originally proposed only those who returned to a role in the ‘same sector’ within 12 months of receiving a qualifying payment would be affected. The ELA and others pointed out there would be difficulties properly defining ‘same sector’ in this context. As a consequence, the draft regulations only require the affected employee to return to any part of the public sector. The draft regulations also set out which types of payments will form part of a ‘relevant exit payment’ and which will not. For example statutory redundancy payments do count, whereas statutory holiday pay or pay in lieu of notice will not.