Agenda item

The Director of People and Development presented a report informing the Authority that in accordance with the provisions of the Localism Act 2011 a pay policy statement for 2018/19 had been prepared.

The pay policy published data on senior salaries and the structure of the workforce and demonstrated the principles of transparency.

The pay policy statement set out the Authority’s policies for the financial year relating to:

-       The remuneration of its chief officers;

-       The remuneration of its lowest paid employees;

-       The relationship between the remuneration of its chief officers and that of other employees who are not chief officers.

The statement included:

-       The level and elements of remuneration for each chief officer;

-       Remuneration range for chief officers on recruitment;

-       Methodology for increases and additions to remuneration for each chief officer;

-       The use of performance-related pay for chief officers;

-       The use of bonuses for chief officers;

-       The approach to the payment of chief officers on their ceasing to hold office under, or be employed by, the authority, and

-       The publication of and access to information relating to the remuneration of chief officers.

It also included the Authority’s policies for the financial year relating to other terms and conditions applying to its chief officers.

The approval of a pay policy statement could not be delegated by the Authority to a Panel and the Authority’s pay statement must be approved by the 31st of March each year. Any decision under powers delegated to the Authority’s Constitution with regard to remuneration to be taken in 2018/19 would be bound by and must comply with the 2018/19 Statement. The Director of People & Development must be consulted prior to any decision impacting on remuneration where there was any question regarding compliance with the Statement.

In general terms the Fire Authority recognised the terms and conditions negotiated nationally by the National Employers with the National Employees’ bodies for 3 distinct staff groups. These were: i) National Joint Council for Brigade Managers (referred to in Lancashire Fire Authority as Principal Officers) of Local Authority Fire and Rescue Services (commonly referred to as ‘Gold Book’); ii) National Joint Council for Local Government Services (commonly referred to as ‘Green Book’); and iii) National Joint Council for Local Authority Fire and Rescue Services (commonly referred to as ‘Grey Book’).

Under the definitions provided for within the Act, the officers included in this pay statement were: the Chief Fire Officer (CFO), Deputy Chief Fire Officer (DCFO), Assistant Chief Fire Officer (ACFO), Director of Corporate Services (DoCS) and Director of People & Development (DoPD). It was noted that the Treasurer’s responsibilities were undertaken by the Director of Corporate Services and the Monitoring Officer’s duties were undertaken by the Clerk to the Authority who was engaged on a contract for services basis. The Fire Authority had delegated responsibility for any local terms and conditions, including remuneration for chief officers to the Appointments Panel/Succession Planning Sub-Committee.

A chosen natural internal benchmark for Chief Officer pay was the percentage rise in firefighters pay. This was the standard for the majority of staff within the Service and had been deemed affordable and proportionate by the National Joint Council (NJC) for Local Authority Fire and Rescue Services. It had previously been agreed that the Chief Fire Officer’s pay with the established linkages for other Executive Board members should rise by the same amount as firefighters when they received their annual award. The linkage was agreed to last for five years and was now due for review.  It was proposed to continue with the current arrangement until an ongoing mechanism was established. 

Any pay rise would be subject to a satisfactory performance evaluation. This would be undertaken with the Chairman of the Authority with regard to the Chief Fire Officer, who would in turn appraise his staff. These appraisals determined increases in basic salary; no bonus payments were made to Executive Board members. Information relating to chief officers pay and benefits in kind could be found in the Fire Authority’s Statement of Accounts and on the Authority’s website.

Objectives of the Policy

The Fire Authority created and sustained a competent, motivated and well led workforce, to meet current and future organisational needs and to be an employer of choice with improved working practices, work life balance, personal development, health and well-being and fair pay. Committed to striving to achieve fairness in pay and reward structures across all occupational groups taking into account all the employment relationships that exist.

Changes from national negotiations generally took place each year, in January (Gold Book), April (Green Book) and July (Grey Book). The Fire Authority’s policy was to implement national agreements, amended as needed to meet local needs. Pay increases in 2017/2018 were: i) 1% for staff covered by the “grey book” (wef 1 July 2017), as an interim payment; ii) The second year of a two-year settlement (1% wef 1 April 2017) for ‘green’ book posts and iii) 1% for Principal Officers (wef 1 July 2017), in accordance with the agreed linkage to “grey book” staff and satisfactory performance. It was noted that the Principal Officers would voluntarily forfeit any increase above 1%.The next anniversary dates for “grey book” and Principal Officers pay was anticipated to be 1 July 2018, whilst the green book pay-award effective date would be April 2018.

In addition to pay, the national agreements covered other terms and conditions such as annual leave and allowances for use of private vehicles on Authority business. The Authority paid car allowances in accordance with these national scales.

There were 4 pension schemes in existence; the Firefighters’ Pension Scheme (which became closed to new entrants in 2006), the New Firefighters’ Pension Scheme (which became closed to new entrants on establishment of the 2015 scheme), the Firefighters’ 2015 Pension scheme and the Local Government Pension Scheme. All employees may join a pension scheme relevant to their occupational group. The operative schemes were statutory schemes with contributions from employers and the employees. The Local Government Pension Scheme provided for flexible retirement for which the Fire Authority had approved a Policy statement.

The Firefighters’ Pension Schemes allowed for re-engagement after retirement. In the unlikely event this was considered, any utilisation of this option was subject to approval by the Authority based on a business case and demonstrated need and would involve abatement.

There were 3 pay grades for Grey Book staff (trainee, in development and competent), a spinal column system for Green Book staff where the policy was to start any appointee on the lowest point of the pay grade, save for where an applicant brought specific skills or experience to a post. In respect of Gold Book staff, they were appointed within a range and progressed by incremental movement subject to performance until the maximum of the range was reached.

The “green book” grading was determined and underpinned by the Local Government Job Evaluation Scheme. The salaries utilised were above the ‘living wage’.

A lease car scheme was available to the Chief Fire Officer, Deputy Chief Fire Officer and Assistant Chief Fire Officer and those Grey Book Managers who were conditioned to the flexible duty system for operational cover. Following changes to the HMRC treatment of the lease care arrangements, the CFA afforded Flexi Officers reimbursement of additional expense incurred up to January 2018 with an opportunity to revise their car lease arrangements during the 2017/18 tax year.  This arrangement included CFO, DCFO and ACFO.  Delegated powers for the payment of honoraria lay with the Chief Fire Officer.

Pay Floor

The definition of the ‘lowest paid employee’ was that postholder receiving the lowest (FTE) annual salary (exclusive of Employer pension contributions). The pay floor level was Green Book Grade 1 posts (Cooks, Receptionists and Gardener/handypersons) who were on a scale of £15,115 to £15,807 pa. £15,115 equated to £8.00 per hour. The minimum a current employee was receiving was £15,807.

The Chief Fire Officer’s earnings ratio was 1: 10.43 using the minima of pay grade 1.  The government statement was a recommendation that this ratio should not exceed 1:25.  As a further comparison, the ratio between a competent firefighter with CPD and the maximum salary for the Chief Fire Officer is 1: 5.15.

RESOLVED: - That the Authority approved the Pay Policy Statement.