Summary

Like most universities, UCL makes enhanced payments to staff made compulsorily redundant. But in October 2006, UCL management, citing the coming into force of the Employment Equality (Age) Regulations, unilaterally changed the scheme. The changes reduced the total cost of the scheme by around 20%, improved payments to some while cutting the payments to others.

Statutory redundancy pay is paid at a rate roughly proportional to years of service, but is capped at a fixed amount. UCL's previous scheme was based on a variation of a Senate House scheme from 1984 where staff were paid 2 weeks' actual weekly salary per year of service. In 2002 the scheme was extended to fixed term staff but modified, so that one had to perform five years' service to be entitled to the scheme at 1 actual weekly salary per year of service, and ten years' service to be entitled to 2 weeks per year of service. The trade unions, and AUT in particular, were consulted over this change.

However, last year, UCL changed the scheme unilaterally and without consultation. They imposed a scheme calculated as 1.5 times the capped statutory scheme. The result was a classic trade-off: staff on higher salaries and those with longer service would lose out, in a small number of cases, with losses running into the tens of thousands of pounds. Staff made redundant with between two and five years' service would gain slightly.

They insisted that (a) they had to take this action to comply with the Age Regulations, (b) that the change was cost neutral and (c) that staff did not have a contractual right to the scheme. This argument has now been proved to be false in all respects.

Under pressure from the unions, UCL amended the new scheme to introduce a further payment of one third of a year's salary for all those with ten years' service. Although this did not redress the balance completely, it did improve the situation for a small number of staff, e.g. from losing twenty thousand pounds to only losing ten thousand.

We were also able to show, using UCL's data, that the changes to the scheme in fact saved UCL money, although after the second change the overall difference was small.

The final argument, that the scheme was contractual, was defeated in a complicated case at the Central Arbitration Committee. Senate House Unison Branch Secretary Luke Davey uncovered a copy of the original Senate House Agreement dating from 1984, which detailed the scheme and referred to consultation with the unions over it. We provided email evidence showing detailed consultation with AUT (as UCU was) over the changes made in 2002, including the fact that we discussed changes before the Provost was told. And we were able to show that the details of the scheme were widely known by staff and was consistently and regularly applied many hundreds of times.

UCL's lawyers argued that none of these single pieces of evidence proved the contractual nature of the scheme. Citing absences in handbooks, contracts and on HR's website, they claimed that this demonstrated that the scheme was not contractual.

The Central Arbitration Committee rejected UCL's argument as essentially circular. Rather they agreed with the unions that the Senate House papers indeed demonstrated that the scheme had been initiated with consultation. The documentation we provided showed that the scheme had been consulted upon (if not 'negotiated' over), both for permanent members of staff and those on fixed term contracts, and that it had applied widely. Therefore, while it was not necessarily clear at what precise point in time the scheme had acquired contractual status, a custom and practice argument did apply, and by October 2006, the date of the disputed change, it had for all practical purposes, become a contractual right.

Initially UCL HR did not wish to accept the judgment. However at 12.15 on 10 September 2007, nearly one year later, UCL officially conceded defeat, resurrecting the old scheme without detriment to members and accepting that any future changes made would be negotiated with the trade unions.