Voluntary Redundancy Scheme outline

The University is running a time-limited Voluntary Redundancy Scheme (VRS) for University-funded support and academic-related staff until 31 July 2017.  The overarching aim of VRS is to explore whether the University’s staffing can be reduced through voluntary means by matching the University’s need to reduce costs with the wishes of individual employees to leave their current posts.

Departments are asked to identify whether any activities of their departments could ‘cease or diminish’, such that the university-funded support or academic-related staffing of their department could be reduced by making a post, or posts, redundant. Staff working in posts which are so identified will be offered a voluntary severance package in exchange for voluntary resignation and will be given up to three months within which to consider whether to accept the offer.  Decisions about which posts will be closed under the scheme will be made taking account of the wishes of individuals and the department’s operational needs.

In all cases resignations made through the VRS must be entirely voluntary and also in the management interest of the University. The resignation must result in the permanent closure of a post leading to a saving equivalent to at least the cost of the redundancy payment within two years of the employee’s departure, as well as producing ongoing cost savings over a period of at least five years.  Severance payments will be subject to approval by the University’s Individual Severance Arrangement Panel (ISAP).

Staff whose posts are not identified as potentially eligible to be included in the VRS may nevertheless wish to consider a voluntary resignation through the bump severance scheme.

Where, after consideration, departments decide that they do not wish to use the Voluntary Redundancy Scheme to identify any posts for closure, they should make sure that relevant line managers are familiar with the arrangements for bump severance so that they are prepared to respond to any staff coming forward under these arrangements.

Departments are asked to ensure that any staff who are currently away from the workplace (for example, on sickness or family leave, or secondment) have been advised of the scheme.

It should be noted that this is a one-off scheme and is not contractual.

Relationship between VRS and existing redundancy and other procedures

The VRS supplements, but does not replace, other existing management procedures such as the University’s standard redundancy process, or procedures for managing and ending fixed-term contracts, which continue to apply where appropriate. The scheme requires consideration of departmental activities and requirements: the personal qualities of the individual postholders should not form part of this consideration. Where departments have concerns about performance, capability or attendance of individuals they should consult their HR Business Partner, through the normal routes, about other mechanisms to address such issues.

It is intended that, as far as possible, the principles set out in the University’s standard redundancy process will be followed by the VRS. However, none of the stages of the VRS constitute stages of the standard redundancy process, and a VRS process will not automatically lead to any compulsory redundancies.  

Benefits available under the scheme

The enhanced benefits[1] available under the VRS will follow the formula set out below. 

Qualifying service: 1 year of continuous service

Weekly pay:  Actual week’s pay, basic salary only (pro-rata for part-time)


Voluntary severance payment

Payment for each full year of service, where the employee’s age was:

under 22*

0.88 of a week’s pay

22 – 40*

1.75 weeks’ pay

41 and over*

2.63 weeks’ pay

Maximum no of years’ service


Maximum no of weeks’ pay


*Note: Statutory Redundancy Pay (SRP) is based on the employee’s age and length of service. Government guidance issued following the introduction of the Employment Equality (Age) Regulations 2006 confirmed that this approach is objectively justified and therefore lawful. Employers are therefore permitted to base voluntary severance payments on SRP calculations and to apply a locally determined multiplier.

VRS example severance packages (26kb)

An Excel calculator to help individuals and departments to calculate appropriate VRS payments is available.

No additional benefits are available in this scheme (with an exception relating to a very limited number of USS pension scheme members with transferred-in benefits, see: early retirement, below).

Where permissible, payments of enhanced redundancy pay up to £30,000 will be made as tax-free lump sums: any amount over £30,000 will be taxable.  See also early retirement, below.

A decision will be made in the circumstances of each case as to whether an individual will be required to work their notice period.

The voluntary severance payment may in some circumstances be subject to the individual signing a settlement agreement.

[1] The benefits are enhanced by comparison to the rate of statutory redundancy payments, but are the same as the enhanced voluntary redundancy payments available through the University’s standard voluntary redundancy stage of the redundancy procedure.

Note on continuous service

Continuous employment, for VRS purposes, is defined as the period from the beginning of employment with the Chancellor, Masters and Scholars of the University of Oxford, to the effective date on which that employment will terminate, provided that there has been no break in that employment of one complete week (ending on a Saturday) or longer. If any such break did occur, continuous employment will normally date from the day after the last such break; where there is any dispute, decisions on the calculation of continuous employment will be made by the department’s HR Business Partner.

For the purposes of this scheme the following types of leave will not break continuity and will count in calculating overall years of service: Sabbatical and any other paid leave; agreed unpaid leave; and family leave (maternity, adoption, shared parental or statutory unpaid parental leave).

Funding and payback period

Where a voluntary redundancy has been agreed between department and employee, and authorised by the Division and ISAP[1] before 31 July 2017, the full cost will be met from central funds. 

The aim of the scheme is to create savings and therefore the business case for identifying a post as eligible for inclusion in this scheme must identify how savings equivalent to the cost of the voluntary severance package will be made within two years of the post being closed.  Ongoing savings created by the permanent closure of the post (or closure for a minimum period of five years) will need to be demonstrated.  A pro-forma application is provided which includes a business case template to assist with consideration of applications.

[1] Individual Severance Arrangements Panel formed by the Registrar, the Director of Finance, and the Chair of the Personnel Committee to consider applications.  Applications to be signed off, on behalf of ISAP, by the HR Director.


Eligible to be considered for voluntary redundancy through the VRS:

  • Staff in University-funded support staff posts
  • Staff in University-funded academic-related posts

Not eligible to be considered for voluntary redundancy through the VRS:

  • Academic posts
  • Externally-funded posts (including externally funded open-ended academic-related posts), since the aim of the scheme is to reduce the University’s recurrent staffing costs, not costs covered by external funding;
  • Posts for which a business case cannot be made that demonstrates ongoing savings over a period of at least five years;
  • Staff who have, at the date of introduction of the scheme (24 October 2016), been given notice of dismissal or have already given formal notification of their resignation or retirement will not be eligible to be considered, or to volunteer for ‘Bump Severance’.

Period of availability

The scheme will run from 24 October 2016 with any staff departures under the VRS to have been agreed and approved by 31 July 2017 (actual departure dates may be up to three months after this date of approval).

During Trinity term 2017, PRAC and Personnel Committee will review the success of the scheme thus far, the number of voluntary departures, and the financial position of the University before considering whether the VRS scheme should be extended and/or revised.

Early retirement

Pension scheme members who meet their scheme’s eligibility criteria may wish to explore the option to take early retirement (ie to draw from their pension immediately after ending employment) under their pension scheme's rules.  However, from the perspective of the VRS the departure will be a redundancy/resignation and not early retirement and no additional benefits under the scheme are associated with taking early retirement after voluntary redundancy.

Individuals whose lump sum VRS payment will be over £30,000 may elect to waive any portion over £30,000 and instead ask the University to use it to purchase additional pension benefits (subject to the relevant pension scheme rules).  This option is not available where the VRS payment is £30,000 or below.

Certain USS members between age 50 and age 60 with transferred-in benefits prior to April 2009 may have a retained right to elements of unreduced early retirement benefits in the event that they are made redundant and choose to take early retirement. Such cases will require a Mandatory Employer Payment (MEP) to be paid.  The MEP charge may be significant and impact on the department’s ability to make a financial business case to close the post through the scheme. HR Business Partners have been provided with the names of staff for whom the MEP applies and departments must speak to their HRBP before commencing discussions with individuals.  There are around 400 University staff in this group.

‘Bump Severance’

A Bump Severance arrangement arises where an employee whose post has not been identified as one their department is considering closing through the VRS would nevertheless like to volunteer to leave the University for an enhanced VRS payment (calculated according to the model set out above).  The post they occupy can then be made available to any employee who has been offered voluntary redundancy through VRS, but who wishes to remain in University employment and would consider moving to a new post.  Where a suitable match is identified and agreed to by all parties, including the employing departments, the Bump Severance volunteer resigns from the University in return for a VRS payment and the other employee moves across to their vacant post.  Further guidance on bump severance.


Individuals who agree to resign through the VRS will be eligible to re-apply to work for the University but, in common with the standard arrangements for voluntary redundancy payments, after they leave the University’s employment, they may not normally be re-engaged for a period of three months.

(NB USS members who choose to take early retirement after leaving the University would not be deemed to have retired if they intend to commence another job that is pensionable in USS with the University, or any other employer that participates in USS)


Once a VRS arrangement is agreed between individual and department, approval must be sought and granted by the relevant Division and then by ISAP before a formal agreement is reached. 

Individuals taking voluntary severance may be required to enter into a settlement agreement with the University, documenting the termination of their employment and waiving any claims against the University in order to receive their payment. HR Business Partners will consider this possibility with the department in each case.

Equality impact

The University of Oxford Equality Policy states “In exercising its policies, practices, procedures and other functions, the University will have due regard to its duties under the Equality Act 2010 and to the protected characteristics[1] specified within it, as well as other relevant circumstances including parental or caring responsibilities, contract type, and working hours.” The University has a legal responsibility under the Public Sector Equality Duty to assess the impact of our policies and processes on equality, to avoid unlawful discrimination and to try to mitigate any adverse impact on people in protected groups. Further guidance, including templates to assist with carrying out an equality analysis, is available on the Equality and Diversity Unit website at www.admin.ox.ac.uk/eop/policy/data/analysis/.

Those responsible for reviewing departmental activity must consider equality issues as central to decision-making, equally as important as the University’s other key strategic and financial objectives. Departments should also be mindful of the University’s Strategic Plan commitments regarding diversity, equality of opportunity and developing and supporting staff.

Departments will be expected to pay particular attention to these issues and to record the objective justifications leading to the identification of particular posts for possible inclusion in the scheme, to ensure that decisions are not affected by bias or other unwarranted factors.

The benefits available under the scheme are both age and length of service dependent. The Equality and Diversity team will conduct interim and final equality impact assessments as part of a review of the operation of the first year of the scheme. This will include analysis by protected characteristic (including gender, age, ethnicity, nationality and disability) of the employees whose posts have been put forward to ISAP (including those arising through Bump Severance arrangements), where data are available. Equality analysis of the last voluntary redundancy scheme (OMIS, 2009-10) showed that a higher number of women than men left the University but that this was largely explained by the preponderance of women in the affected staff groups. It is more than likely that this will also be the case in the forthcoming exercise due to the high proportion of women in the relevant staff groups (academics and externally funded academic-related/research staff are excluded) but the numbers will be monitored closely for evidence of disproportionate impact.  

[1] The characteristics protected by the Equality Act 2010 are: age, disability, gender reassignment, marital or civil partnership status (in employment), pregnancy and maternity, race, religion or belief (including lack of belief), sex and sexual orientation