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Department of Trade and Industry
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GUIDANCE ON LUMP SUM PAYMENTS TO REDUNDANT STEELWORKERS (NEW ISERBS)

The Payment

1. The payment will comprise a single lump sum of £2,480 to assist individuals who have lost their jobs as a result of restructuring in steel companies. The payment scheme is based on the European Coal & Steel Community (ECSC) Treaty and the scheme rules are derived from a Convention with the European Commission (1989).  Payments will be made to eligible workers who lose their jobs in the period from 1 January 2000 to 23 July 2002, when the ECSC Treaty ends.

Eligibility

2. You must have been wholly or mainly employed (at least 50% of your working time) on work connected with the production of steel products defined in annex 1 of the ECSC Treaty (most primary steelmaking processes) or the following additional steel products not covered by the ECSC Treaty - seamless tubes & pipes, welded tubes and pipes, bright bar, drawn wire and cold rolled narrow strip.

In addition you must:-

(a) have been made redundant, or taken early retirement in place of redundancy, because of permanent reduction in manpower as a result of restructuring at a steel works involved in the production of products covered by Annex 1 of the ECSC Treaty or the additional products listed above.

(b) have been in the employment in the United Kingdom of the same company for the 52 weeks immediately preceding redundancy.

(c) be under age 65 at the time of your redundancy.

Payment Procedures

3. We have appointed Aon Managed Services Ltd to make the payments on our behalf. Aon have begun writing to the companies who have notified us of redundancies, requesting the names and addresses of the workers concerned. When this information has been received Aon will send an application form to each individual’s address. Once the form has been returned to Aon they will make payment within six weeks.

4. Aon will begin making payments in late October beginning with those people who lost their jobs first i.e. those who left the industry in 2000. If you don’t receive an application form or have any other query regarding the payments contact the Aon helpline on 0114 203 5490.

Taxation

5. The payment will be made without deduction of income tax but may be subject to tax if, together with other redundancy payments you receive, the total is more than the £30,000 exemption limit. The Inland Revenue will be informed when payments have been made and they will contact individuals to assess tax liability.

Contractors

Individuals employed by companies who provided contract services to steel producers can be eligible for the payment if their work was wholly or mainly involved with the production of the products described. This will be assessed on a case by case basis in accordance with the following criteria:

  • the individual’s work must have been essential to the production of the products described above. (i.e. covered by the ECSC Treaty, or one of the additional products listed in paragraph 2 above).

  • the nature of the work must be such that it could normally be carried out by direct employees of the steel producer as part of their normal business.

  • the work must have been carried out on the premises of the steel producer.

  • there must be a direct link between the individual’s redundancy and the restructuring at the steel plant at which the activity was carried out.

Frequently Asked Questions

Q. Will I be entitled to the payment if I was employed by a steel producer but was not personally involved in the steel-making process?

A. Yes, if your employer/plant was involved solely in the production of products described above. 

Q. What if my employer made some of the products mentioned above but also made other products.

A. You will be entitled to payment if at least 50% of your work was connected with the production of the products described above. 

Q What if I am given a redundancy date after the ECSC Treaty expires on 23 July 2002.

A. The Secretary of States announcement of 3 May 2001 said the scheme would benefit Corus workers made redundant as a result of the company’s announcement of 1 February 2001. Payments will therefore be extended to Corus employees who lose there jobs as a result of that announcement even if they are given a leaving date after the Treaty expires.

DTI
October 2001
DR/V4

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