What are Mutually Agreed Resignation Schemes (MARS)?
A mutually agreed resignation scheme (MARS) is a form of voluntary severance, where an employee can agree with their employer to resign from their employment in return for a severance payment.
MAR schemes are often proposed by an employer before a voluntary redundancy scheme is available or where compulsory redundancies are anticipated.
NHS Employers have said that the scheme intends to give employers greater flexibility in managing cost reductions in periods of change and to create vacancies that can be filled by redeployed staff from other jobs or other staff at risk of redundancy.
How MARS affects doctors
NHS staff employed under Agenda for Change terms and conditions of service (TCS) will have national provisions for MARS (outlined in Section 20 of the NHS staff TCS handbook), which offer significantly less favourable terms and conditions than voluntary redundancy rates or compulsory redundancy rates that are set out in Section 16 the NHS staff TCS handbook.
Although the scheme is not featured in doctors’ national contracts, we have heard that an increasing number of employers are rolling out local MAR schemes that can be accessed by medical staff and replicate the principles from the Agenda for Change TCS.A MARS may therefore be offered to you as an alternative to voluntary or compulsory redundancy. You may also consider using MAR schemes if you are about to retire or change jobs.
A MARS may therefore be offered to you as an alternative to voluntary or compulsory redundancy. You may also consider using MAR schemes if you are about to retire or change jobs.
It is worth noting, however, that MARS offer significantly less favourable terms and conditions than voluntary or compulsory redundancy rates.
What are broader concerns regarding MARS?
In addition to the potential impact on the individual, the BMA holds the following concerns regarding MARS:
Lack of national oversight of process
- As these are local schemes, there is no clearly agreed standard for all MAR schemes. This variation between schemes could lead to a lack of transparency, safeguards and consistency.
Lack of clarity over funding sources
- As the schemes are not nationally funded, if there is no additional funding for settlements, running a MARS could result in further cost pressures for an organisation.
The requirement to fill vacated posts
- Although severance schemes are intended to reduce staff whilst retaining the role/function of the staff, we are concerned about how vacated roles will be filled in an environment of extreme financial pressures. Without a clear plan for the future of the post, staffing pressures could pose concern on the remaining members of the service.
Doctors being advised to apply for a MARS is of particular concern during periods of wide-spread health reforms, under which there is a heightened risk of NHS employers responding to insufficient funding. Doctors should therefore proceed with particular caution if wider reforms are occurring at the time of considering whether to apply to a MARS.
What should you do if your employer develops a local MARS?
As an individual, there are a several concerns raised by the use of local MAR schemes:
- Severance payments from MAR schemes will likely be of less value than redundancy payments. The value of redundancy payments form part of national medical TCS, whereas severance payments are not included here, and would need to be agreed at a local level.
- As voluntary resignations (including MAR schemes) are not discussed in national medical TCS, there is no set minimum standard for doctors who would use the scheme. You may be asked to agree to additional terms and conditions to access the severance payment (such as being required to sign a non-disclosure agreement, or waiving rights to future claims for work related injuries).
- If you are offered a MAR scheme due to the fact your service or role is going to be transferred to a new employer, there is also a risk that the existing protections under your terms and conditions and pay under TUPE (Transfer of Undertakings (Protection of Employment)) regulations may be bypassed as you would be leaving the service instead of the service being transferred.
As such, the BMA would advise that doctors proceed with caution over the the use of MAR schemes, especially if:
- The employer has imminent plans for redundancies (meaning you would likely soon have access to a more favourable contractual redundancy payment – please see our guidance on redundancy).
- You are due to transfer employers. In this scenario, TUPE transfers would normally be applicable and ensure the protection of your contract.
We expect that in most cases, a voluntary redundancy would be more favourable than a MARS. However, entering agreements such as MARS is a personal choice, and you may happen to find it beneficial for your circumstances (for example, if you are already planning to resign or you do not have the two years of service necessary to be eligible for a redundancy payment). If this is the case, we would urge you to check with your LNC (or other local BMA) representatives that they have been consulted on the development of this process and seek support from the BMA before signing any final agreement.
If you do have any pressure from an employer regarding agreeing to a MARS or any form of redundancy or retirement measure, please contact the BMA.