Belfast Telegraph

Stephen Farry: Two-year cap on holiday pay would have been 'counter-productive'

Alliance Party deputy leader Stephen Farry
Alliance Party deputy leader Stephen Farry
Andrew Madden

By Andrew Madden

Alliance deputy leader Stephen Farry has defended his decision not to introduce a two-year cap on backdated holiday pay for civil servants, stating it would have been "counter-productive".

Last week, the Court of Appeal ruled police holiday pay dating back 20 years should have taken overtime into account and now the PSNI is facing a £40million claims bill from staff.

In the wake of the ruling, it emerged that the Department of Finance, which sets pay policy for all public sector bodies, is considering how the ruling would affect other workers - potentially leading to hundreds of millions in claims.

The same issue was facing the UK Government back in 2014 following a court ruling similar to that made in Belfast. It led to the introduction of a two-year cap on backdate claims in order to stem the huge costs of the ruling.

Stephen Farry was the Minister for Employment and Learning at the time and therefore responsible for public sector pay policy in Northern Ireland, however he decided not to introduce a two-year cap.

In a lengthy statement, Mr Farry said he requested his officials to draft a consultation paper about introducing a cap, but ultimately decided not to proceed after further discussions.

He said the option to rush through a two-year cap did not apply to Northern Ireland, as there could have been "potential equality implication" and there were indications the cap was "potentially illegal".

"It was unlikely any consultation and subsequent draft legislation would have been cleared by the Executive and then the Assembly. In employment law matters, some political parties were resolute in never acting contrary to the views of the trade union movement," he said.

"At that time, a wider Employment Law Bill had been stalled due to perceived opposition from the trade union movement for many months.

"Even with a fair wind politically, it would have taken three to four months before any legislation would have been passed by the Assembly. That would then be followed by a transitionary period of six months."

The North Down MLA explained there would have been a year-long window for claims to be made, creating an "artificial cliff-edge" and a "stampede to lodge claims", to the detriment of employers.

"For context, tribunal fees as a hurdle to people protecting their rights had been in force in Great Britain for several years at that time. These were declared illegal by the UK Supreme Court in 2017. I had resisted such measures in Northern Ireland. Employment legislation in Great Britain was often rushed and not properly thought through," he said.

"Ultimately, it was my judgement a two-year cap on payments in Northern Ireland was counter-productive."

He said the matter did not go before the Executive as it was decided not to proceed with a consultation.

"It is important not to jump to conclusions on the financial implications within Northern Ireland from the PSNI judgement and make extrapolations across the public sector. I understand the Head of the Civil Service and the Department of Finance are exploring all of these issues," he added.

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