FCS Briefing: Revoking of £95k Exit Pay Cap Regulations


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FCS Briefing:

  • Update on Public Sector Exit Pay Cap at £95k
  • HMT direct cap to be disapplied.

13 February 2021

Following a long legislative journey, regulations came into force on 20th November 2020 to limit the maximum amount payable to employees of the public sector on exit e.g. in redundancy situations.


On 12 February 2021 HMT has stated: “After extensive review of the application of the Cap, the Government has concluded that the Cap may have had unintended consequences and the Regulations should be revoked.” Until the regulations can be formally revoked they have issued directions that they should not be applied.


If you were subject to the cap during the period they were applied you should contact your former employer to request payment of the amount you would have received as if the cap had not been in place.


The HMT guidance can be downloaded at: https://www.gov.uk/government/publications/guidance-on-public-sector-exit-payments




M Cornes & G Lester