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Statement on Settlement Agreements in the Public Service following data FOI release

Monday, 13 March 2023

The Chair of the Public Services Commission and Minister for the Cabinet Office Kate Lord-Brennan MHK has commented on the published response to a freedom of information request which details the number and the cost of conciliated settlement agreements dating back to 2017. 

“In any large organisation, redundancy, performance or disciplinary issues will inevitably mean that employers seek to terminate the employment relationship.  In some cases this can, and may need, to be achieved by way of a conciliated settlement agreement, meaning that some employees exit the organisation with some financial recompense in order to end the employment and to avoid costly legal claims. 

“Nevertheless, the use of conciliated settlement agreements within the Isle of Man Government, and the figures involved over a number of years, has been a matter of concern for me and so we are reviewing the use of these types of arrangement to ensure they are only used in exceptional circumstances, since the use of settlement agreements shouldn’t replace appropriate management, conciliation or HR practices, or indeed make up for any lack in these areas over a period of time. 

“In order to instil confidence in the full process prior to such agreements being pursued at all, and in the interests of protecting the public purse, we must ensure a consistent and appropriate approach when considering the use of such agreements.  It is also important to ensure that settlement agreements are not utilised where the correct response is to instigate a formal performance management process.  This will ensure that all staff are being treated fairly and appraised correctly. 

“The Public Services Commission is actively working on a policy which will provide guidance to Accounting Officers of Government Departments and the Office of Human Resources, as to the use and approval process required for all conciliated settlement agreements.

 “I will continue to work with the Public Services Commission, Senior Officers in Government and the Council of Ministers to ensure that a number of initiatives, including the creation of an Operational Performance Board to bring more rigour to staffing management across Government.”  

Conciliated settlement agreements are brokered by an Industrial Relations Officer, in accordance with the provision of the Equality Act 2017.  In most cases, a conciliated settlement agreement will contain a payment for notice pay, any contractual payment such as accrued but untaken holiday pay and, fairly typically, a payment for loss of office for the employee. 

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