What redundancy will MPs who lost their seats get

As former Welsh Secretary David TC Davies left the count in Chepstow on Friday morning having lost his Monmouth seat he was asked by ITV Wales’ reporter Guto Llewellyn what was next for him personally.

His replied: “I’m going home for a nice cup of tea and a very long sleep and then I’m going to go surfing. I don’t have to do anything this weekend which is going to be one of the first weekends I haven’t had to do anything for probably a year.”

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But once the weekend is over Mr Davies will need to start on the process of winding up his office and making any staff redundant. It is a job that all MPs whether they lose their seat at an election or announce their decision to stand down before an election must do. The 132 former MPs who chose not to stand again at the General Election will already have started this process.

An October 2023 report by the Constitution Unit of University College London, entitled MPs Staff, the Unsung Heroes, points out that it is difficult to collect data on MPs’ staff as there is no requirement for this to be publicly listed.

However, through a combination of assessing data published by the Independent Parliamentary Standards Authority (IPSA) and freedom of information requests UCL were able to establish that in August 2022 there were 3,622 staff working for MPs.

these 2,229 were on full time contracts and 1,276 part time. This data included 97 interns on IPSA contracts, but did not include 672 volunteers without employment contracts. Whilst the number of employees each MP has varies, with some having none and others up to as many as 11 including part time employees, the staffing budget given to each MP allows for five FTE staff salaries.

Whichever way you voted in the election, the combination of MPs not standing again, and the election results mean that a lot of people are now facing redundancy.

IPSA has a special section on its website for MPs leaving Westminster, The overview states:

“We understand that if you have not been returned following the General Election, this will be a difficult time. We will work with you to navigate the departure process as smoothly as possible.”

The website gives guidance on “winding up” which is the process that non-returned and standing down MPs follow to conclude their affairs with IPSA. MPs are paid by IPSA up to and including Polling Day. There is a winding up payment for the winding up period, equivalent to four months’ salary.

There is a helpful winding down checklist which refers members to the members’ HR service for advice on the redundancy process and template letters to issue to staff.

Staff with two years continuous service with the same MP are entitled to a redundancy payment. Staff on IPSA contracts get twice statutory redundancy, those not on IPSA contracts get only statutory redundancy.

MPs who have held office for a continuous period of at least two years at the point they lose their seat also get a loss of office payment (LOOP) which is twice statutory redundancy.

Those 132 MPs who decided not to run again this election do not get this payment. George Galloway who had only been an MP for four months after winning the Rochdale by election in February but losing it to Labour at this one doesn’t get this payment either and nor will any staff he employed get redundancy pay because they would not have long enough service.

Having been MP for Monmouth since May 2005, David TC Davies’ statutory redundancy (calculated using the gov.uk redundancy calculator) would be £17,500. His LOOP payment at twice statutory is £35,000. However, as he was also Secretary of State for Wales he is entitled to a further payment under the Ministerial and other Pensions and Salaries Act 1991 equivalent to one quarter of his ministerial salary of £159,038 so £39,759. Enough to cover a few more weekends off surfing.

Four other former Tory secretaries of state for Wales also lost their seats at this election. Stephen Crabb, Alun Cairns, Simon Hart and Robert Buckland, who held the position for just over three months between 7 July 2022 and 25 October 2022 prior to the appointment of Mr Davies. All were eligible under the 1991 Act on ceasing to be Secretary of State for Wales to a payment of one quarter of their ministerial salaries.

Labour announced in January 2024 that it will change the rules governing severance payments so that departing ministers will only receive a quarter of their actual earnings over the previous twelve months as a minister, minus any period covered by a previous severance entitlement.

Bethan Darwin is a partner with law firm Thompson Darwin.