Pay

Work and Pensions written question – answered on 18th April 2013.

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Photo of Priti Patel Priti Patel Conservative, Witham

To ask the Secretary of State for Work and Pensions what criteria are used in (a) his Department and (b) each public body for which he is responsible to determine which officials receive bonus payments.

Photo of Mark Hoban Mark Hoban The Minister of State, Department for Work and Pensions

The information requested is as follows:

Department for Work and Pensions (DWP)

The DWP operates two pay-related employee reward schemes. They comprise end of year non-consolidated payments and in-year non-consolidated payments. The Department uses these payments to motivate and engage employees and ensure added value to business performance.

End of year non-consolidated payments

End of year non-consolidated payments paid to employees from administrative grades to Grade 6 during 2012-13, were made to those receiving a ‘consistently good’ or ‘wholly exceptional’ end of year performance marking.

In the senior civil service the top 25% of senior civil servants (SCS) receive an award, based on the achievement of agreed objectives and how those objectives were achieved, in accordance with Cabinet Office guidance, which is available on:

http://www.civilservice.gov.uk/recruitment/working/pay-and-reward/scs-pay

End of year non-consolidated payments paid in one financial year are based on performance in the previous performance year, e.g. payments made in 2012-13 relate to performance in the 12-month period from April 2011 to March 2012.

In-year non-consolidated payments

DWP employees up to Grade 6 are eligible to be nominated for an in-year performance award. These are one-off payments, made to recognise exceptional achievements and/or contributions to business performance. In-year awards can be made at any time during the performance year and are paid either as retail vouchers between £25 and £50 or cash payments above £50. SCS are not eligible to receive these payments.

The criteria used in DWP's public bodies for officials to receive bonuses are as follows:

Health and Safety Executive (HSE)

SCS performance in HSE is assessed against the civil service wide guidance on performance management issued by Cabinet Office (see link above).

The performance of staff below SCS is assessed annually against agreed work objectives. Top performing staff receive an additional non-consolidated and non-pensionable bonus.

Since HSE's two-year pay freeze was introduced from 1 October 2011, no bonus payments have been made to staff below SCS other than for a small group of staff with reserved rights from their previous Government Department.

Independent Living Fund

For Grade 7 and above, the chief executive officer makes recommendations to the Trustees Remuneration Committee on any bonus payments to be received. Payment will be dependent of performance and achievements throughout the year up to a maximum of 5% of salary.

For grades SEO and below, an organisational discretionary bonus scheme is available. The bonus is based on organisational performance during a financial year, i.e. April to March, To be eligible, employees must meet relevant performance criteria.

National Employment Savings Trust (NEST) Corporation

NEST Corporation operates a robust performance management framework, including competencies which capture the skills and behaviours rewarded as well as measuring achievement against objectives.

A higher percentage award will be made to those with an ‘Outstanding’ end of year rating, than to those ‘Exceeding Expectations’.

Awards are pro-rated by the number of months employed in the reporting year.

Pensions Ombudsman/Pension Protection Fund Ombudsman

The Office of the Pensions Ombudsman pays annual non-consolidated performance bonuses which are awarded according to a performance ranking given at the year ending 31 March. Performance rankings range from ‘6’ being equivalent to outstanding and ‘1’ being equivalent to unsatisfactory. To receive an individual non-consolidated performance bonus staff had to achieve a ranking of ‘4’ or above.

Pension Protection Fund (PPF)

All Pension Protection Fund employees are eligible to be considered for an annual bonus, determined by individual achievement in the previous financial year. Each staff member is assessed against strict criteria set out in their balanced score card for objectives, and in their individual development plans for progress in competency levels.

The Pensions Advisory Service

The Pensions Advisory Service makes performance awards based on the outcome of the annual reviews for the period ending 31 August. The structure of the award is that the team needs to exceed its objectives, and the team member needs to have at least met their personal objectives and contributed to the team exceeding its objectives for the period.

The Pensions Regulator (TPR)

TPR operates an annual discretionary non-consolidated bonus scheme which is designed to reward performance over and above the requirements of the job. Bonuses are a reward for past performance.

Bonus awards fall into two categories: strong and exceptional. A strong performance is considered to significantly exceed expectations for this or similar roles, as detailed in the relevant role description, relevant competencies and achievement of objectives.

An exceptional performance is considered to be exceptional relative to expectations for this or similar roles, as detailed in the role description, relevant competencies and achievement of objectives.

Remploy Ltd

The payment of performance incentive payments to Remploy employees is subject to individuals meeting agreed business and individual targets. The business targets include achieving and improving budgeted Operating Result; job entry targets and achieving costs reductions. Individual targets relate to personal performance set against a number of objectives agreed with managers at the start of the financial year.

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