Earlier this month, the Public and Commercial Services Union challenged the government's attempts to reduce the level of redundancy pay for civil servants, and won. The case has been hailed as a "major victory", but it may not be the triumph it first appears.

Under the old civil service compensation scheme, employees under 50 (or with less than five years service) received up to three years' pay for compulsory redundancy, and employees over 50 received significantly enhanced pension rights. Not a cheap exercise for a government that has promised £6bn of cuts in "non-frontline services" and a reduction in quangos.

The government had hoped to save £500m over the next three years under a proposed new scheme, which would have seen employees of all ages receiving a lump sum.

But the high court has ruled that the government acted unlawfully in introducing the new scheme without PCS agreement. As a result, all civil service HR directors have been told to revert back to the old CSCS.

For civil servants threatened with redundancy, the decision is undoubtedly a resounding success. But how can this sit with the "new politics", and with public sector cuts promised by the Conservative-Liberal coalition, as well as age discrimination legislation?

Both sides recognise that changes to the CSCS are necessary but, faced with the continued need to make cuts, it is likely that the government will drive a hard bargain when seeking to renegotiate its terms.

One potential outcome is that favourable terms will remain for current civil servants but significantly less favourable terms will be introduced for new employees. This is unlikely to please the FDA, Prospect, POA, GMB and Unite, all of whom had agreed to the government's changes.

The prospect of future civil servants receiving worse redundancy terms is also unlikely to please PCS members when they realise the wider implications of the decision. As has been seen in the equal pay litigation, unions can struggle when they try to please everyone all the time, and may even find themselves the subject of legal action by members who feel they have received a tough deal. As has been seen with the BA strikes, employees also seem prepared to challenge decisions that will negatively affect future employees.

The new CSCS was also more in line with age discrimination legislation by ensuring that employees of all ages benefited from the same terms. The old scheme, introduced under the 1972 Superannuation Act, was clearly at odds with modern-day equalities legislation, not least the 2006 Age Regulations, so the court's decision is a backwards step in this respect.

The matter is not finalised as the government has three months to appeal the decision. The PCS have also recognised that changes to the CSCS "are necessary", so it may be that parties will get back around the negotiating table. But if and when it does so, the PCS is likely to find the parameters have changed and they may be forced to take into account the bigger picture given the inevitable tough times ahead.

Article from The Guardian