Public sector exit cap no longer applies

The Government has withdrawn the legislation that introduced the public sector exit cap.

The exit cap applied to employees leaving public sector employments from 4 November 2020 - it limited the amount of money a public sector employer could pay when an employee left their employment to £95,000.

The Government has confirmed the cap does not apply to exits from 12 February 2021. It also confirmed that employers are obliged to pay any additional sums that would have been paid, if the cap had not applied in respect of any exits between 4 November and 11 February 2021. The additional sums could be payable to you as an employee or to your pension fund to pay towards to the cost of you receiving your pension early. Check with your employer if you think this applies to you.

The Government remains committed to tackling unjustified exit payments and will bring forward proposals to do this shortly. It is likely that the exit cap could be introduced again later this year.

Information about how to complain if you are not happy with a decision made by your employer or pension fund is available on the how to complain page.The page also provides information about other sources of help.

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