Employment news

Big pay out for settlement agreements in top Universities

The top “Russell group” Universities paid out more than £15m for hundreds of settlement agreements in the last academic year, according to a report in People Management. Twelve members of the Russell Group that responded to FOI requests for data in the Academic year 2017-18, reported paying £15,266,846 to 511 staff under settlement agreements. Five further universities gave partial details for this period, indicating they had also made significant payments.

The highest payer was the University of Manchester with £3,547,211 paid to 110 staff, “in the context of voluntary severance arrangements as a consequence of restructures and staffing reductions”.  Cardiff University was next, paying out £2,941,944 to 64 staff, including £2,750,112 under a voluntary severance scheme involving 53 people. The University of Southampton came third, paying out £2,138,631 to 70 staff, again largely the result of a restructuring exercise during that period.

The widespread use of settlement agreements comes at a time when they are under scrutiny for containing non-disclosure agreements (NDAs), or ‘gagging clauses’, potentially preventing staff from speaking out about bullying and harassment. However those advising employers were quick to defend their use pointing out that the raw data may include notice payments, as well as ex gratia payments, and takes no account of the time and expense and disruption that can come with disputes, perhaps involving prolonged disciplinary procedures or, in the event of restructuring exercises, arguments about whether staff should be made redundant. They can also reduce the risk of being taken to an employment tribunal.