Pay policy statement March 2022

Natural Resources Wales (NRW) recognises the importance of a pay system that is equal to all, appropriate, transparent, provides value for money and rewards staff fairly for the work they perform. This policy statement sets out NRWs approach to pay and the relationship between the employee’s pay and the remuneration of senior management.

This statement has been prepared in accordance with the principles contained in the Welsh Government’s ‘Transparency of senior remuneration in the devolved Welsh public sector’ published in December 2015.

Legislative framework

NRW has the power to appoint staff under the Natural Resources Body for Wales (Establishment) Order 2012; and complies with all relevant employment legislation in determining the pay and remuneration of its staff.

Definitions and the responsibility for pay decisions

The Chief Executive is responsible for recommending to Welsh Government and the Minister for Climate Change, appropriate pay arrangements for NRW staff. Staff are employees within Bands 1 – 11 and include Support, Operational, Technical, and Management and Leadership band grades. This group therefore includes all NRW staff excluding the Executive Directors and the Chief Executive.

The Executive Director for Corporate Strategy and Development is responsible for ensuring Trade Unions are fully engaged in pay negotiations, in the spirit of social partnership, and through a Collective Bargaining Agreement.

Senior management roles are not delegated, and their respective pay arrangements are therefore implemented in accordance with the guidance produced by the Welsh Government, following recommendations from the Chair with respect to the Chief Executive, and from the Chief Executive with respect to Executive Directors.

The NRW People and Remuneration Committee (PaRC) is responsible for determining senior pay decisions and managing the performance, potential and talent of senior staff and making recommendations to the Board for approval. The Committee ensures remuneration is handled in a fair and appropriate way and in line with Welsh Government guidance. PaRC has some flexibility to determine if the level of performance by Executive Directors merits a move to a higher paypoint. The Committee is chaired by a Non-Executive Director. Further information on the Committee, its terms of reference and its membership.

The recommendation of PaRC, with respect to Chief Executive pay, is subject to endorsement by Welsh Government.

Employment terms and conditions of service

The vast majority of employees have terms and conditions of service, including pay, set by the NRW. Following the introduction of our Job Evaluation scheme in 2018 some staff have benefited from pay protection and is reflected in NRW grades, pay scales and headcount below.

Collective bargaining arrangements

NRW is proud of its strong partnership relationship with Trade Union colleagues and works closely with them on pay related matters. Arrangements for the consultation and negotiation of pay are set out within our Partnership Agreement.

Pay awards for staff have historically been negotiated for an annual period of 1 July to 30 June on an annual basis. However, Trade Union colleagues have requested to amend this date to review pay awards in April each year in line with other public sector bodies.  This is being implemented in a phased approach over a 2 year period, with the first year running from 1 July 2021 until 31 May 2022 and the following year from 1 June 2022 until 31 March 2023.  

Pay principles

Together with collective pay bargaining arrangements, NRW adopts the following key pay principles:

• Affordability and value for money – Pay agreements are based around affordability and ensuring the best use of public funds.
• Equal pay – Pay arrangements are inclusive for staff regardless of age, marriage (including equal / same sex marriage) and civil partnership, disability, sex, sexual orientation, pregnancy and maternity, race, religion or belief, or gender identity. A Gender Pay Gap Report is published annually.
• Openness and transparency – Full salary and remuneration details for Board Members are included within the NRW annual account disclosures. In addition, Chief Executive, Executive Director and Director level salaries will be summarised annually alongside this statement.
• Incremental pay – Employees have the opportunity to progress to the top increment of their pay scale within a maximum of four/five years depending on grade.
• A focus on addressing low pay and supporting the Living Wage- All directly employed staff (and apprentices on training contracts) are paid the Living Wage as defined by the Living Wage Foundation. NRW is an accredited Living Wage employer. 
  
  

Pay arrangements

NRW’s current pay band rates are shown at NRW grades, pay scales and headcount. New appointments are normally recruited at the minimum of the relevant pay band. Under exceptional circumstances, for example where evidence exists that recruitment is an issue or a new employee has been on a higher salary with significant experience immediately prior to joining NRW, they may be appointed to a higher increment within the pay grade. 

Salaries are subject to an incremental increase each year until the maximum rate is reached (normally within 3-4 years).  Individuals who are evaluated as underperforming are not eligible for incremental progression. On promotion, starting pay is to the minimum of the pay band for the new grade.  Current and historical staff numbers at all grades can be found at NRW grades, pay scales and headcount respectively.

The remuneration policy for the most senior staff is set using the Senior Civil Service Job Evaluation for Senior Post scheme and a set of benchmark roles in the Welsh public service and to comparable organisations based in the UK. Any increase in pay is subject to a satisfactory performance assessment by the Chief Executive and moderation by PaRC. The Executive Team and CEO salary range, is shown at NRW senior management salaries.

Additional enhancements and payments 

Depending on business requirements, employees may be eligible for the following additional payments and other discretionary enhancement and payments during the course of delivering their role. These include, professional and operational allowances, and reimbursement of travel and expenses or market supplement.

To support organisational change, NRW may, from time to time, elect to run severance exercises. In such circumstances employees will be offered compensation based on the terms associated with their respective Pension Scheme of which there are two. All severance activity is supported by a business case which includes cost benefit analysis.

Pay relativities within Natural Resources Wales

The lowest pay within NRW is the starting rate within Grade 1 (Team Support) salary range (£19,100 to £19,489). NRW is accredited with the Living Wage Foundation and any increase in salaries issued in November are backdated to the previous July.

The Chief Executive is the highest paid member of staff. Pay relativity comparisons relating to the highest paid member of staff (Chief Executive) and the average Executive Director salary are provided in Pay relativities within NRW.

A wider reward and recognition package 

In addition to employee’s salary, NRW offers a comprehensive range of both financial and non-financial workplace benefits. This includes membership of a pension scheme, access to salary sacrifice arrangements, learning and development opportunities including continuing professional development and employee wellbeing schemes. A range of modern flexible working arrangements are also available to support a work life balance.

Reviewing this statement 

This statement will be reviewed and updated on an annual basis or when substantive changes occur. The figures are based on pay arrangements in place on 31 March 2022.

NRW grades, pay scales and headcount

Natural Resources Wales / Pay scales

These figures are based on actual salaries at 31 March 2022.

When NRW implemented Job Evaluation scheme in 2018, staff were given the option to ‘Opt out’ of the scheme and retain their old PayScale. Therefore Opt Out staff have been included on their existing salary ranges not their Job Evaluated grades.

These figures do not include contract and agency staff

NRW senior management salaries 

Additional disclosures for Board members can be found in the NRW annual report and accounts.

The above includes all staff at Chief Executive, Executive Director level at 31 March 2021. 

Pay relativities within NRW 

The lowest pay within NRW is the starting rate in the Team Support salary range (Grade 1). This excludes apprentices who are engaged on training contracts. The highest paid member of staff is currently the Chief Executive Officer (CEO). The figures below are based on full time equivalent salaries as at 31 March 2021.

Ratios of the multiples of salary:

• 1 to 7.33 -- the multiple between the annual salary of the lowest and highest paid employee
• 1 to 5.83 - the multiple between the annual salary of the lowest paid employee and the average Executive Team member
• 1 to 3.88 - the multiple between the median salary in NRW (excluding Executive Team) and the highest paid
• 1 to 3.09 - the multiple between the median salary in NRW (excluding the Executive Team) and the average Executive Director salary
• 1 to 2.99 - he multiple between the average salary in NRW (excluding the Executive Team) and the average Executive Director salary 
• Highest paid – Band of £140K to £144K
• Median remuneration of workforce (excluding Executive Team) £36,058
• Average remuneration of workforce (excluding Executive Team) £37,216
• Median remuneration of Executive Teams (excluding CEO) £115,000
• Average remuneration of Executive Team (excluding CEO) £111,300

Existing off-payroll engagements

 Number of existing engagements as of 31 March 2022: 96

• 17 have existed for less than one year at time of reporting
• 22 have existed for less than two years at time of reporting
• 21 have existed for between two and three years at time of reporting
• 17 have existed for between three and four years at time of reporting
• 19 have existed for more than four years at time of reporting

The details shown above are those earning more than £245 per day and that last for longer than six months as at 31 March 2022.

The majority of the contractors are supporting the ICT team in developing and transforming our ICT systems.

New off-payroll engagements 

New off-payroll engagements, or those that reached six months in duration, between 1 April 2021 and 31 March 2022, for more than £245 per day and that last for longer than six months.

• Number of new engagements, or those that reached six months in duration, between 1 April 2021 and 31 March 2022: 32
• 0 - the number assessed as caught by IR35
• 24 - the number assessed as not caught by IR35
• 0 - the number engaged directly and are on the NRW payroll
• 8 - the number of engagements reassessed for consistency / assurance purposes during the year
• 0 - the number of engagements that saw a change to IR35 status following the consistency review

Board members arrangements