States paid more than £5m. in compromise deals over decade

The figures from 2012 to 2022 were published in answer to written questions submitted to the committee by Deputy Marc Leadbeater.

A compromise agreement is a legally binding written contract between an employee and their employer, or former employer, in which an employee agrees to release the employer and waive their right to pursue any claims against their employer, usually in exchange for a compensatory sum. In total the States had spent £5,095,916 over the decade to agree termination of contracts. At 2022 values that equates to £6.12m.

The amounts spent year-on-year were relatively consistent and in the response, P&R president Peter Ferbrache said that such agreements were ‘a useful tool to enable an employer and its employee to bring an employment relationship to an end’.

‘While the States of Guernsey is a good and fair employer there are occasions where the best solution for the employer and employee is to end the relationship and a compromise agreement remains an appropriate mechanism to achieve this.’

In a year-by-year breakdown of the figures, 2016 saw the most compromise agreements made, with 21, at a cost of £663,785.

And while there were only six agreements in 2021, the total cost was £582,014.

Deputy Leadbeater also asked for information about enhanced pension contributions, staff being entitled to retain vehicles, among other things, and gardening leave.

The response was that the pension rules had changed in 2015 and ‘enhanced pension’ payments as part of compromise agreements were not possible.

‘I am not aware of any retained vehicles or similar benefits being awarded,’ said Deputy Ferbrache, although on occasions where vehicles were no longer suitable for operational duty, they were disposed of through a sealed bidding process.

Gardening leave was not something that was widely used in the States and there was no date in relation to it, he said.

‘Any absence that could be construed as gardening leave in the context of this question is normally time taken in lieu of working a notice period.

‘There are occasions were some employees serve their notice period away from the organisation or in deployment to other roles, this may be done to protect the interests of the organisation.’