In responding to the motions before General assembly recommending the halting of the redundancy process, it is important that members have access to background information which allows them to take a balanced view of the current position and events leading to it.

In June 1999 the University and the AUT reached agreement on a Code of Practice on Security of Employment for academic and related staff (see Annexe 1 below). This encompassed a commitment on the part of the University to improve job security by reducing the number of fixed term contracts within the University, and an agreement between the AUT and the University on the process to be undertaken should it be necessary in the future to make members of the academic and related staff redundant. A ballot was held of AUT staff in which 86% of those voting voted in favour of the proposals. The University Council approved the agreement in the understanding that the increased financial risk associated with a move away from temporary contracts was mitigated by the acceptance of a redundancy process which could be used in response to financial pressures if all other avenues had been exhausted.

In the period since the conclusion of the agreement a total of 376 staff have been moved from fixed-term to open-ended contracts, resulting in a substantial improvement in the security of employment of large numbers of staff.

In April 2000 Council was facing a total of £1.7M of unbudgeted deficits in 9 academic departments and agreed a process to examine and address the financial problems in those areas. The process was in accordance with the Code of Practice and involved a number of stages by which departments were encouraged either to increase income or decrease costs by measures short of compulsory redundancy. The process included a final stage at which, where all other measures had failed, compulsory redundancies would be sought (see Annex 2). The process as a whole was widely discussed and agreed in a variety of university committees, prior to confirmation by Council.

The exercise itself has been overwhelmingly successful, with all but two of the departments concerned addressing their financial problems by a combination of improved planning, new initiatives and voluntary severance arrangements. A total of 10 staff were redeployed and 21 agreed voluntary severance. In only one case, that of Electrical Engineering, has the process been taken to the final stage where, in the absence of alternatives, a recommendation for the loss of two academic staff by compulsory redundancy has been accepted by Council.

Annexe 1

The Strategic Plan to 2001 identifies the need for a "flexible and highly motivated workforce". The University recognises that this will best be achieved in a climate of maximum possible security of employment. It will do all it can to maintain such a climate but the ever changing financial context of higher education means that both the University and its employees will have to show flexibility and adaptability if this goal is to be reached.

This Code of Practice sets out the approach to flexibility that is required and deals with the difficult issues that may have to be faced in situations where redundancies become inevitable. It applies to all groups of staff in the University. There are particular considerations with regard to Academic Staff laid on the University by Statute XXI (the 'Model Statute') but the Code treats all staff groups equally by applying the redundancy provisions of the Statute to all of them. The first part of the Code deals with employees engaged on open-ended contracts where the expectation may be for employment until retirement. The second part deals with the situation of employees on fixed term contracts.

It is important for employees and managers to recognise that the University is the employer and must have ultimate control over the placement of the workforce. Although many employees can expect to spend all of their career in the area of the University to which they are initially appointed re-deployment from one post or area to another may become necessary to respond to changing priorities and/or to help avoid redundancies. Re-deployment can be authorised only by the Operations Sub-Committee, acting on behalf of and reporting decisions to Council. The circumstances which may lead to a proposal for re-deployment may vary but in all cases a reasoned written proposal must be put to the relevant trades union with at least two weeks allowed for a written response. The proposal and any response will then be considered by the Operations Sub-Committee, and in all cases the following shall apply:

An individuals existing salary and salary expectations in their current grade will not be reduced.

Any re-training will be fully funded by the University (including travel and accommodation costs if necessary).

If a subsequent vacancy occurs in the area from which an employee has been re-deployed that employee will not be denied the opportunity of being considered for that vacancy.

When any re-deployment involves a change of Conditions of Service the employee concerned will retain any more favourable conditions on an individual basis for a transitional period of 12 months.

Individual employees will have the right to use the Grievance Procedure if they feel that re-deployment is inappropriate.

The University commits itself to avoid the use of compulsory redundancy wherever possible and to work with the relevant trades unions to explore all possible alternatives to compulsory redundancy. It is committed to careful forward planning and management of resources in order to seek to ensure security of employment for all its employees and to sharing any financial or staffing information which may be relevant to the employment security of employees with the relevant trades union at the earliest possible opportunity.

The University will not use redundancy as a surrogate for any other, more appropriate, form of action. In particular, the University will not initiate the procedures in this Code where the use of managerial action to improve poor performance or the use of disciplinary procedures would be appropriate.

Redundancy situations can arise through financial pressures, organisational change or advances in technology. Any proposals to declare an individual post or groups of posts redundant must be placed before the Operations Sub-Committee. If the Sub-Committee accepts the proposal it shall arrange for consultations to begin with the relevant trades unions. In the case of an individual post the post holder shall also be consulted at this stage. These consultations shall include a statement of the reasons for declaring the redundancies and the exploration of alternatives to redundancy, which may include early retirement, voluntary redundancy or re-deployment.

If, following these consultations, the Operations Sub-Committee still sees a need for compulsory redundancies it shall make a recommendation to Council for the appointment of a Redundancy Committee. This Committee will be constituted as provided for under Statute XXI Part II but it shall be competent to consider proposals relating to any staff group. During the period when redundancies are being considered there shall be no recruitment of new employees in the relevant staff groups to the areas under discussion.

The Redundancy Committee shall determine the criteria to be used having regard to the principles set out below. It shall then select employees for compulsory redundancy in accordance with the criteria. The individuals so selected shall be consulted and supplied with details of the factors used in the selection process. Following this consultation the Committee will make a recommendation to Council. This recommendation shall include details of the selection criteria that have been used. If Council accepts the recommendation the employees in question will be given six months notice plus a statutory redundancy payment. Copies of the minutes of the Redundancy Committee shall be made available to the relevant trades unions.

Where an individual post has been identified for redundancy the criteria will be met if the Redundancy Committee is satisfied that no other similar post exists in the same area of the University. If it determines that other similar posts do exist the criteria set out below for multiple posts shall apply.

The overall aim of the selection criteria are to be fair to all concerned whilst balancing the need to retain the workforce needed for the future well-being of the University. Precise criteria will be drawn up by the Redundancy Committee in the light of each redundancy situation with the following factors normally taken into account:

Skills and qualifications needed for the future

Standard of work performance

Attendance

Disciplinary record

Length of service

Most weight will be given to the first two factors. Care will be taken to ensure that objective measures, including existing performance indicators, are used wherever possible and that the criteria do not discriminate unfairly. The trades unions will be given an opportunity to comment on the criteria before the Redundancy Committee begins to apply them.

Appeals against the application of the selection criteria can be made under the Grievance Procedures set out in the Conditions of Service or for Academic Staff as provided in Statute XXI.

The University recognises that fixed term contracts are not good models for long-term employment and is committed to reducing their use. It undertakes not to use fixed term contracts for positions that will continue for the foreseeable future. Other than for posts that are directly re-chargeable to outside organisations their use will therefore be restricted to the following:

Cover for maternity/adoptive/other carers' responsibility leave

Cover for external secondment and leave of absence

Cover for other temporary leave i.e. trade union duties, jury service, territorial army service, and other similar agreed public service

Long term sickness

And exceptionally for short-term project work where it has not proved possible to use other existing employees.

In the last case any proposal to offer a fixed term appointment must be subject to approval by the Operations Sub-Committee and rolling contracts will be used wherever appropriate. At the time of the review of any such rolling contract the possibility of the removal of the fixed term limits will be explored.

Each appointment shall be for a duration that is anticipated to cover the whole of the period required.

A significant number of employees, mainly research staff, are engaged on projects with a limited time scale and supported by outside agencies such as the Research Councils or Industry. In many of these cases the only appropriate employment pattern is the use of fixed term contracts which expire when the external funding ceases. The pattern of employment on fixed term projects does however vary considerably with, at one extreme, some employees only engaged for a matter of a few months, and at the other a small number who have spent a significant part of their working life on a succession of projects. The University acknowledges an increasing obligation to employees as the length of their service on fixed term contracts increases.

The Guide to Best Practice produced by the national Research Careers Initiative Working Group on Career Management indicates that a long-term career as a contract researcher within higher education is not possible or desirable for the majority of staff. In contrast to other staff groups, Universities have an obligation to provide training and experience for contract research staff so that they can then meet the needs of other employers in industry and society. Many research staff will form part of this vital flow of people at the end of their first University contract and the vast majority will have moved to other employment within six years. The University is committed to providing training and careers support and guidance to assist with this transition to other employment.

Those research and other staff who remain in employment for six years will have their position reviewed within their department to see if it is appropriate to remove the time limits on their appointment. The requirements which must be met if the time limits are to be removed shall be: a) a guarantee of funding from an outside organisation for at least 12 months beyond the end of the current contract, b) a favourable assessment of the potential funding that will be available after this period and c) the continuing need for the skills of the individual being reviewed. If it is not appropriate at this stage there will be further reviews annually. Individuals who do not have the time limits removed will be able to appeal to the Dean of the Faculty for a review of the department's decision.

The University does not use waiver clauses in respect of claims for redundancy payments or unfair dismissal. Employees whose contracts terminate after more than five years will receive redundancy payments which will not be subject to the statutory limit on weekly earnings.

The University may offer open-ended contracts to core employees in the larger self-funding Institutes/Sections on the understanding that compulsory redundancies would be needed if the financial position in these units worsens. In this context core employees are those whose activities are central to the continued functioning and development of the Institute/Section in question. Proposals to establish this arrangement for any Institute/Section will be subject to approval by the Operations Sub-Committee.

Other means of retaining employees such as the Bridging Fund and the Underwriting Scheme will also be available.

Loughborough University

Council 5th April 2000

The University faces levels of expenditure in certain areas which are substantially in excess of income generated. These currently require unacceptable levels of subsidy from other areas, reducing overall resources for growth, innovation and investment. If unchecked this will lead to serious cumulative deficits for the Faculties and University. The position in these areas may be recovered either by increasing income, particularly sources other than core HEFCE T and R funding, or by reducing costs, in particular staffing.

This document outlines the process by which the University will identify and seek to eliminate these difficulties, and approval is sought to implement this.

All academic areas will be examined by the Operations Sub-Committee and defined as being in structural deficit if

• There is a substantial and continuing operating deficit which can not be attributed to transient or transitional factors and, in the Sub-committee’s judgement, no realistic business plan or forecast exists for recovery, based either on increasing income to cover existing staff numbers or on restructuring.
• A proper evaluation of means of restructuring or increasing income, encompassing research grants and contracts, taught courses and collaborative ventures, has not identified realistic prospects for improvement.

The University requires a means of reducing expenditure in areas of structural deficit where no realistic business plan exists for recovery. This should be a phased approach involving:

• Identification by Deans in conjunction with Operations Sub-Committee of areas of structural deficit.
  
  This will be a two stage process based on the definition above:
  
  A list of areas with a substantial and continuing operating deficit, which can not be attributed to transient or transitional factors, will be compiled.
  
  For each of the areas identified there will then be an evaluation of business plans and options for restructuring or income generation.
• Informing the Heads in these areas that
• the University will require them to reduce expenditure so as to eliminate the deficit, unless additional income can be generated
• the University will be introducing a series of increasingly more stringent measures over the years 2000/2001 and 2001/2002 to drive cost reductions

• Introduction of redeployment scheme (see 2)
• Introduction of targeted early retirement scheme for areas in structural deficit (see 3).

• Where these measures do not prove successful in achieving the necessary savings, or there is no realistic prospect of them doing so, the University will implement further restructuring and a scheme for redundancy (see 5 – Review Stage).

Treatment of Vacancies

Early Retirement Scheme

A proposal should be made to the Council for funding for targeted early retirement scheme in the financial year 2000/2001. This would operate only for staff in targeted areas be on the basis of no replacements and no part-time re-engagement. Retirements would be conditional on the management interest.

The current route (the non-targeted scheme) will remain open for those academic areas which are not in structural deficit and for support areas. This will form the subject of a separate bid for funding for 2000/2001.

27th March 2000

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