Determination of level of separation payments

Introductory note. Benefits payable on separation from service include mainly so-called "separation payments", i.e. repatriation grant, commutation of accrued annual leave, death grant and termination indemnities under rules set by the General Assembly, in particular, decision 36/459 of 1981 and resolution 39/69 of 1984. The term "separation payments" has been used by the General Assembly since 1981. Earlier decisions make reference to "terminal payments" (e.g. resolution 31/141 of 1976). Later sections cover respectively repatriation grant (section 5.2), death grant (section 5.3), and termination indemnities (section 5.4). Other benefits payable on separation from service are dealt with in section 5.5. Section 5.6 recalls the existence of the "service benefit", which ceased to exist as of 1 January 1964. The commutation of accrued annual leave is explained in section 3.4, paras. (8)(c) and (18). Determination of level of separation payments

(1) A new scale of pensionable remuneration became applicable on 1 January 1981, with its own adjustment mechanism. At the end of 1981, the General Assembly specified that the determination of separation payments would remain the same as prior to 1981, i.e. gross salary plus WAPA less staff assessment (decision 36/459).

(2) That decision was confirmed by General Assembly resolution 39/69 of 1984.

(3) By letter of 2 April 1986, the Chairman of the Commission requested from the Secretary-General the views of ACC concerning a change in the scale of separation payments, due to an increase in WAPA. The question was referred to CCAQ for study. ACC agreed on the text of a reply, prepared by CCAQ, dated 27 June 1986. (CCAQ/PER/65/CRP.4/Rev.2 or ICSC/24/CRP.14).

(4) The increase of 5 per cent, effective 1 April 1986, was promulgated by the Chairman of the Commission (letter addressed to Executive Heads on 18 July 1986).

(5) At its 24th session (July 1986) the Commission reviewed the computation of WAPA (ACC/1986/10, paras. 93-96 and A/41/30, para. 113). The effect of the freeze of post adjustment at the base city and in other duty stations was taken into account on the occasion of the establishment of a new base on 1 January 1986; on that date, the WAPA index, based on the new calculation, was 93.5. The Commission agreed that the next upward adjustment would take place when the index reached 105.

(6) At its 65th session (July 1986) CCAQ agreed that the introduction of revised rates of staff assessment should not result in an increase of the net separation payments. It agreed to the establishment of a new scale of gross separation payments, based on the reverse application of staff assessment to the existing scale of net separation payments (ACC/1986/10, para. 97). This scale was approved by the General Assembly, effective 1 April 1987 (resolution 41/207, II, 2 and A/41/30, Annex XI).

(7) On basis of its comprehensive review in 1989 of the conditions of service of staff in the Professional and higher categories, ICSC recommended that the existing scale of separation payments be abolished and that all such payments other than the commutation of unused annual leave be calculated using the base/floor amount (A/44/30, vol. II, paras. 73(g), 449-452 and 453(g)). A majority in CCAQ had supported that approach (71st session, July-August 1989: ACC/1989/14, paras. 91 and 92). The General Assembly endorsed the recommendation, with the proviso that, to avoid financial implications, the measure not be implemented until the scale of separation payments reached the level of or exceeded the base/floor scale (resolution 44/198).

(8) At its 72nd session (February-March 1990: ACC/1990/4, paras. 81-82) CCAQ decided to bring to the attention of ICSC the need to find a way to avoid reductions in separation payments from 1 July 1990, resulting from the fact that a new scale that would come into effect in April under the existing methodology would in most cases be higher than the base/floor scale approved by the General Assembly in resolution 44/198 (see (7) above). At its 73rd session (July 1990: ACC/1990/10, para. 119), in response to the wishes of several organizations, it agreed to administrative arrangements affecting the scale of separation payments to staff at the top of their grade at 30 June 1990 who would be separating before the base/floor scale overtook the separation payments scale.

(9) At its seventeenth session, Madrid, March 2009, (CEB/2009/HLCM/HR/27, para.7), the HR Network took note of document ICSC/68/R.5 on separation payments.  It discussed the proposals in the document related to the harmonization across agencies of termination indemnity schedules as well as the introduction of an end-of service grant upon completion of non-renewed fixed-term contracts; Underlined the differences between the concepts of ‘separation’ and ‘termination’.  A separation is an action by which the staff member ceases to be employed by the organization.  Separation can take place for a number of reasons including non-renewal and termination.  Termination, while it is a separation, is an action initiated by the Organization by which an appointment of a staff member is foreshortened by the Organization; i.e. the organization decides to terminate a permanent/continuing/indefinite appointment or to foreshorten a fixed-term appointment before the expiry date set forth in the letter of appointment. In these instances, a termination indemnity would be paid pursuant to the Staff Rules. Separation as the result of the non-renewal of a fixed-term appointment is not regarded as a termination and therefore no termination indemnity is to be paid; Proposed a progressive scale for the end-of-service grant for staff who separate upon expiration of their fixed-term appointment, after completing five years of continuous service with satisfactory performance; Reconfirmed the previous position that the termination indemnity scale and the end-of-service grant scale be de-linked, which is consistent with the principle that there is no expectancy of extension for fixed-term appointments; Agreed that the maximum amount of end-of-service grant cannot exceed the maximum amount of termination indemnity, i.e. 12 months’.

(10) At the same session, the Commission decided to revert to the issue of separation payments at its sixty-ninth session and, in this context, requested its secretariat to present to it a single comprehensive document revising and updating as necessary the information submitted under the present review and reflecting the latest decisions of the General Assembly relating to separation payments and the additional statistics received from the organizations.

(11) At its eighteenth session (CEB/2009/HLCM/HR/46/Rev.1, paras.10-11), the HR Network thanked the ICSC Secretariat for the comprehensive report on separation payments; Agreed to maintain its position as presented at the Commission’s Spring 2009 session that there should be a clear distinction between separation payments and the end-of-service grant; Supported the payment of an end-of-service grant upon separation as a result of the non-renewal of a fixed-term contract and that this grant should start after five years of continuous completed service; Suggested that satisfactory performance certification be removed from the recommendations as performance evaluation should lead to termination if unsatisfactory, no matter how many years of service staff have completed and further supported the harmonization of these provisions across the system.

(12) At the same session, the Commission decided to recommend that the General Assembly:

    (a)    Invite the Governing Bodies of the common system organizations to harmonize their termination indemnity schedules in line with that of the United Nations, as approved in General Assembly resolution 63/271, as shown in annex II of the current ICSC report (A/64/30);
    (b)    Introduce an end-of-service severance pay for fixed-term staff separating from the organization upon the expiration of contract after ten or more years of continuous service in those organizations which have introduced and implemented the new contractual framework, as defined by ICSC in its 2005 annual report (A/60/30, Annex IV), subject to the conditions and schedule provided in annex III of A/64/30;
    (c)    Reaffirm that the repatriation grant should not be payable to staff living in their home country and working abroad or to staff with permanent resident status at the last duty station and reiterate its call to the governing bodies of the common system organizations to align their provisions regarding the repatriation grant eligibility with those applicable in the United Nations; and
    (d)    Reiterate that the death grant should not be payable to secondary dependants and reiterate its call to the governing bodies of the common system organizations to align their provisions regarding the death grant eligibility with those applicable in the United Nations.

(13) At the same session, the Commission also decided to monitor the introduction of end-of-service severance pay as an integral part of the new contractual arrangements.

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