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Shell depriving ex-workers of tax breaks on redundancy pay – report

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Written by Mark Lammey – 08/07/2016 11:33 am

Shell (LON: RDSB) will scoop up the tax breaks on redundancy payments that had been available to departing workers, a news report said yesterday.

So-called foreign service relief allows UK workers who have spent parts of their careers abroad to reclaim some of the tax due on severance pay, but Shell has moved to claim the money instead, Reuters reported.

According to the report, which cites internal documents from Shell, the company introduced the policy on April 1.

The move was aimed at ensuring staff members are subject to the tax regimes of their home country regardless of where they are based, the report said.

It comes at a time when Shell has been shedding thousands of jobs due to a combination of low oil prices and its integration of BG Group following a mega-merger between the two firms.

Shell declined to say whether the move would save money, or to reveal the number of people who might be affected, the report said.

A spokesman was cited as saying Shell’s severance packages were “currently among the most generous in the sector,” adding: “The policy is designed to promote equal treatment of employees with the same home country.”

Ude Adigwe, an organiser with the GMB labour union in Scotland, was quoted as saying the measure was not acceptable and of accusing companies of trying to lighten their financial burdens at the expense of workers.

The UK tax authority has declined to comment on the Shell case, the report said.

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