Government of Jersey

Information about the publication of Ministerial Decisions

A formal published “Ministerial Decision” is required as a record of the decision of a Minister (or an Assistant Minister where they have delegated authority) as they exercise their responsibilities and powers.

Ministers are elected by the States Assembly and have legal responsibilities and powers as “corporation sole” under the States of Jersey Law 2005 by virtue of their office and in their areas of responsibility, including entering into agreements, and under any legislation conferring on them powers.

An accurate record of “Ministerial Decisions” is vital to effective governance, including:

demonstrating that good governance, and clear lines of accountability and authority, are in place around decisions-making – including the reasons and basis on which a decision is made, and the action required to implement a decision
providing a record of decisions and actions that will be available for examination by States Members, and Panels and Committees of the States Assembly; the public, organisations, and the media; and as a historical record and point of reference for the conduct of public affairs

Ministers are individually accountable to the States Assembly, including for the actions of the departments and agencies which discharge their responsibilities.

The Freedom of Information Law (Jersey) Law 2011 is used as a guide when determining what information is be published. While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.

A decision made 6 September 2013:

Decision Reference: MD-S-2013-0083
Decision Summary Title :	Redundancy Pay Make Order		Date of Decision Summary:	2 September 2013
Decision Summary Author:	Policy Principal		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	NA
Written Report Title :	Redundancy Pay Make Order		Date of Written Report:	2 September 2013
Written Report Author:	Policy Principal		Written Report : Public or Exempt?	Public
Subject: Employment (Redundancy – Maximum Weekly Amount) (Amendment) (Jersey) Order 2013
Decision(s): The Minister decided to make the Employment (Redundancy – Maximum Weekly Amount) (Amendment) (Jersey) Order 2013.
Reason(s) for Decision: The maximum value of a week’s pay for the purpose of calculating a redundancy payment is increased from £650 to £660 per week from 1 October 2013. The purpose is to reflect the level of mean weekly earnings that was reported in the June 2013 report on the Index of Average Earnings, published by the States of Jersey Statistics Unit in August 2013.
Resource Implications: There are no manpower implications. The Social Security benefit ‘insolvency benefit’ includes a component to compensate the former employees of insolvent employers for unpaid statutory redundancy pay. The Social Security (Jersey) Law 1974 provides that the redundancy pay component is calculated in accordance with the Employment (Jersey) Law 2003 and so the new maximum of £660 will also apply in respect of the benefit calculation. This is expected to bring a small additional cost of approximately £500 each year to the Social Security Fund.
Action required: Policy Principal to notify the Greffier of the States and the Law Draftsman that the Order has been made so that it may be notified to the States, and forward the signed and sealed Order immediately to the States Greffe for publication and archiving.
Signature:		Position:
Date Signed:		Date of Decision (If different from Date Signed):

Employment (Redundancy - Maximum Weekly Amount) (Amendment) (Jersey) Order 2013

ACCOMPANYING REPORT

Employment (Redundancy – Maximum Weekly Amount) (Amendment) (Jersey) Order 2013

The right to receive a statutory redundancy payment for qualifying employees came into force on 1 January 2011. Article 60C of the Employment (Jersey) Law 2003 (the ‘Employment Law’) provides that the amount of a statutory redundancy payment is calculated as follows:

“60C Amount of redundancy payment

(1) The amount of a redundancy payment shall be calculated by allowing one week’s pay for each year of employment during the period, ending with the effective date of termination, in which the employee has been continuously employed.

(2) For the avoidance of doubt, in this Article ‘year’ means a period of 12 calendar months.

(3) For the purposes of paragraph (1), the amount of one week’s pay shall not exceed the amount specified by Order under paragraph (4), or, if no such Order is in force on the effective date of termination, the most recent figure for the average weekly earnings published by the States of Jersey Statistics Unit at least one month before the effective date of termination (disregarding any more recent figure published less than a month before the effective date of termination).

(4) The Minister may, by Order, specify an amount for the purposes of paragraph (3).”

When Article 60C came into force on 1 January 2011, the ‘default’ position (in the absence of a Ministerial Order) applied and the maximum weekly value of one week’s pay was the June 2010 level of mean weekly earnings - £630 - as published by the States of Statistics Unit in August 2010.

In August 2011, however, the Statistics Unit published two average weekly earnings figures in its June 2011 report on the Index of Average Earnings: the level of mean weekly earnings (£650 per week) - and the level of median weekly earnings (£520 per week).

There must be certainty as to which average earnings figure applies for the purpose of a redundancy pay calculation and so the Minister made an Order to give effect to the policy intent that the level of mean weekly earnings would apply. The Employment (Redundancy – Maximum Weekly Amount) (Jersey) Order, 2011, was made on 30 September 2011.

The latest Statistics Unit report on the Index of Average Earnings for June 2013 [1] published a new level of mean weekly earnings - £660 - and the Order is amended to increase the maximum weekly amount of one week’s pay to match that figure.

The maximum of £660 will apply from 1 October 2013 so that, where an employee’s effective date of termination is 1 October 2013 or later, the maximum week’s pay for the purpose of the redundancy pay calculation will be £660.

The Minister intends that the Employment Law will be amended in 2014 to refer specifically to the level of mean weekly earnings as the average weekly earnings figure for the purpose of Article 60C(3) of the Employment Law.

Financial and Manpower implications

The Social Security benefit ‘insolvency benefit’ includes a component to compensate the former employees of insolvent employers for unpaid statutory redundancy pay. The Social Security (Jersey) Law 1974 provides that the redundancy pay component is calculated in accordance with the Employment (Jersey) Law 2003 and so the new maximum of £660 will also apply in respect of the benefit calculation.

A £10 increase in the maximum weekly amount of redundancy pay is expected to bring a small increase in the cost of Insolvency Benefit payments and therefore a small additional cost to the Social Security Fund.

Based on the insolvency benefit claims paid during the period 1 December 2012 (when the benefit first became available) to 23 August 2013, if the weekly maximum amount of redundancy pay had been £10 higher during that period, seven of the 105 benefit recipients would have been entitled to receive a greater amount of benefit and an additional £394 benefit would have been paid.

The additional cost to the Social Security Fund is therefore estimated to be £500 each year. The actual cost will depend on a number of factors including the number of employer insolvencies, the number of employees entitled to claim benefit, the claimants’ weekly earnings and other amounts that the claimants are owed by their former employers.

[1] http://gov.je/Government/JerseyWorld/StatisticsUnit/EmploymentEarnings/Pages/Earnings.aspx