Update: Enterprise Act 2016 Puts An End To 6 Figure Exit Payments

Public sector exit payments

The Enterprise Act 2016 became law this month. It aims to promote enterprise and economic growth and covers a wide range of topics.

As well as including provisions on the appointment of a Small Business Commissioner for businesses with less than 50 employees and an obligation on insurers to pay claims within a reasonable time it enables the Treasury and Scottish and Welsh Ministers to introduce a cap on exit payments for public sector employees, currently set at £95,000.

Of all of the provisions, this cap attracted the most controversy as the bill made its way through the parliamentary stages. The cap includes all payments that are made to an individual upon termination of employment with the exception of certain compensatory and bonus payments.