Pay Policy Statement 2024-25

Statement of Purpose 

The Aim 

In order to deliver high quality services consistently, Gateshead Council has to attract and retain high quality people.  In some circumstances, such as market forces in the job market, may occasionally require the Council to consider exceptional payments in addition to the "rate for the job" which our internal pay structures would normally indicate.  This policy outlines how the Council will assess whether a recruitment and retention allowance needs to be paid to attract and retain the right person for the job. 

Definition of recruitment and retention allowance/market supplement 

A recruitment and retention allowance is a separately identifiable sum paid in addition to the salary for a post in recognition that current levels of pay within the wider employment market are greater than the salary determined by internal pay structures which has resulted in recruitment and/or retention difficulties. 

Who is covered by this policy 

The policy applies to all employees of the Council, (excluding employees directly employed by schools), who hold posts which have been identified by management and Human Resources as having recruitment and retention difficulties, for example due to skills shortages and/or in comparison with current levels of pay within the wider employment market. 

Additional Information 

Other Council policies and procedures, which are relevant to this policy: 

• Equal Opportunities Policy 

Objective justification for payment of a recruitment and retention allowance 

Where a manager considers there is a case for payment of a recruitment and retention allowance in order to either recruit or retain employees, it will be necessary to submit a portfolio of supporting evidence to their Strategic Director.   

A portfolio of evidence should include the following: 

In cases for recruitment 

• For all posts below Service Director level, details of previous efforts made to fill the post.  This may include advertising in different publications, changing the wording of the advert, redesigning the job etc.  At least two previous attempts must have been made to recruit to the post. 
• Number and quality of applicants. 
• Cost of recruitment where applicable. 
• Details of any offers of employment made and reasons why they were rejected. 

In the case of Strategic Director and Service Director posts, the decision to award a recruitment and retention allowance will be determined by reference to prevailing market rates, alongside the above evidence where available. 

In cases for retention 

• Consideration of other issues that may not relate to pay, for example redesigning the job, job rotation and career development.  This may be appropriate in cases where an employee is considering leaving the Council, for a more "challenging or interesting" role, or a role which would provide better promotional opportunities.  Payment of a recruitment and retention allowance in these circumstances would not necessarily encourage the employee to remain with the Council.  As an alternative, the service may look at ways of making their job more interesting, such as giving them specific responsibility for a project, which would develop skills in different areas.  The service may also look at opportunities for secondment or a transfer to another section or job role. 
• Analysis of exit interview data.  

In all cases 

• A copy of the job profile and structure chart 

• Copies of at least five comparable job adverts from a variety of publications over the last six months including copies of job profiles/job descriptions and person specifications. 

It should be noted that production of several higher paying job adverts which may not be representative of the whole market will not warrant the approval of a supplement. 

The portfolio of supporting evidence should be submitted to the relevant Strategic Director who will assess the evidence to ensure there is objective justification to pay a recruitment and retention allowance. Should the Strategic Director not support the payment of a recruitment and retention allowance, that decision is final.  Where there is justification to pay, the Strategic Director will indicate the monetary value of the recruitment and retention allowance requested and forward the portfolio and their comments to Human Resources. 

Procedure for approval of a request to pay a recruitment and retention allowance 

Human Resources will quality check the information presented and seek any further clarification from the service concerned.  It is the responsibility of the service to ensure that sufficient evidence is provided in each case to warrant the consideration of a payment.   

Human Resources will review the request and: 

a) undertake further research using comparative salary benchmark data where available; and 

b)   consider whether this causes significant recruitment and retention difficulties which are detrimental to operational activities; and ensure that payment of a recruitment and retention allowance is objectively justifiable and proportionate, and will not contravene equal pay legislation and the Council's Equal Opportunities Policy; and,  

c)   check that the relevant service Finance Business Partner has confirmed that there is sufficient funding available to pay the recruitment and retention allowance. 

Where Human Resources support the request, the portfolio of evidence will be referred to the Strategic Director, Corporate Services & Governance who will make a final decision as to whether an allowance can be authorised. Any decision to award a recruitment and retention allowance must be clearly evidenced to ensure that the policy is applied fairly, consistently and is free from any bias. 

In the case of Strategic Director and Service Director posts, any proposal to award a new retention allowance to retain an employee will be referred to Contracts Committee for a decision.  The Strategic Director, Corporate Services and Governance will make a decision as to whether an allowance is offered as part of a recruitment process.     

Value of recruitment and retention allowance 

If the request to pay a recruitment and retention allowance is approved, Human Resources will determine the actual monetary value of the allowance using salary benchmark information and also the portfolio of evidence submitted by the service.   

The recruitment and retention allowance will normally be paid at the equivalent of either the mean market salary or up to 15% of basic pay, whichever is lower.  In very exceptional circumstances, the Strategic Director Corporate Services and Governance may approve a higher percentage. 

Review of recruitment and retention allowance 

To ensure that the payment of an allowance continues to be justified and proportionate, it is necessary to review the position regularly against the criteria that was applied to the initial assessment.  It is essential that the rationale and supporting evidence for payment of a recruitment and retention allowance remains current and a review is documented.  

For this reason, the Strategic Director, Corporate Services & Governance will only approve payment of a recruitment and retention allowance for an initial period of up to two years subject to review.  In exceptional circumstances this may be extended to up to five years in recruitment cases.  Human Resources will assess the need to continue the payment using comparative benchmarking data. The decision to continue the payment rests with the Strategic Director, Corporate Services & Governance. 

Conditions applicable to recruitment and retention allowance 

• The payment will be expressly identified as a separate pay element and will be subject to the usual deductions for tax, national insurance and pension contributions. 
• Employees working part time will receive any payment on a pro rata basis depending on their contracted hours. 
• If a post holder in receipt of a recruitment and retention allowance moves to an alternative post within the Council, which does not attract a recruitment and retention allowance, the allowance shall cease from the date on which the post holder leaves the post which attracts the recruitment and retention allowance. 
• A recruitment and retention allowance paid as a percentage of salary will be adjusted in line with annual pay increases.  
• A recruitment and retention allowance will cease with immediate effect if (a) a recipient is subject to formal capability procedures i.e. formal capability action has been taken and the employee is subject to a capability improvement note or final capability improvement note and (b) where the employee is absent due to long term sickness (absent for 4 weeks or more), except where the employee's absence is directly related to a disability. The recruitment and retention allowance will be reinstated once the employee returns from long term sickness or is no longer subject to formal action under the capability procedure.  

Record keeping 

HR Advice will maintain a central record of any recruitment and retention allowances awarded and all supporting evidence