I have spoken to a client who is likely to be made redundant soon. He expects to receive in excess of £16,000 in redundancy pay, the bulk of which will be contractual rather than statutory. He has a mortgage and it appears that he will qualify for ibJSA towards this, since the contractual redundancy pay is ignored for JSA (although not for IS, HB or CTB).

My query is whether the fact that he is on ibJSA will mean that he is automatically passported onto full CTB, despite the fact that his capital for CTB is actually more than £16,000?

Derek

Any passporting benefit (assuming proper and lawful entitlement) will result in all income & cap being disregarded for HB/CTB. To the best of my knowledge, there are no exceptions to this.

I have just spent half an hour trying to find where this provision for JSA is to be found in the regulations as I have never been aware of it. The nearest I have been able to get is the rules about employed earner's earnings when a job ends and over what period any compensation period is to be attributed as earnings preventing a claim to JSA. This can result in part of the payment, if it is not intended to cover PILON, being ignored as income (because it isn't) (reg 95, I think).
But I thought that only helped in CBJSA cases - can't find any reference to disregarding the balance as capital. Does your client's payment include any element for pay in lieu - how does it break down?

Thanks a lot for that. CPAG page 850 (08/09) and Advisernet both suggest that contractual redundancy pay is ignored for JSA. But I will try and clarify this point further.

Don't have a breakdown of the redundancy payment as it has not been confirmed yet. But from conversation with his employer client believes that if he is made redundant he will get a lump sum of jsut over £16,000 the bulk of which will be a contractual payment.

The reference in CPAG p850 refers to Reg 25 of the CTB Regs, in particular Reg 25(1)(c)

"(c) any payment in lieu of notice or any lump sum payment intended as
compensation for the loss of employment but only in so far as it represents loss of income;"

CPAG goes on to say that it is ignored completely for JSA. The relevant Regulation in JSA is Reg 98(1)(b) and Sch 6 paras 1(a) and 2 JSA Regs 1996 as amended

Reg 98(1(b) refers to

(b) where–
(i) the employment has not been terminated, but
(ii) the claimant is not engaged in remunerative work,
any earnings in respect of that employment except earnings to which regulation 98(1)(c) and (d) applies; but this sub-paragraph shall not apply where the claimant has been suspended from his employment.

Sch 6 is headed "Sums to be Disregarded in the Calculation of Earnings" Reg 98 is headed "Earnings of Employed Earners"

The capital disregards for JSA are in Sch 8. I cannot find anything in Sch 8 to disregard a rediudancy payment