NHS Senior Leadership Onboarding and Support

Terms & conditions of an NHS Trust Chair & Non-Executive Director

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NHS Improvement have a specific role in appointing and supporting NHS trust chairs and non-executives which does not apply to foundation trusts. These are public appointments made using powers delegated by the Secretary of State for Health.

Appointment information sets out important information about the terms and conditions under which NHS Improvement’s public appointments are made.

Remuneration and expenses

The level of remuneration paid to the chairs and non-executive directors of NHS trusts is set by the Secretary of State for Health. All NHS trusts are allocated to one of three remuneration bands, dependent on their turnover. The legislation governing the payment of chairs and non-executives means they can only be paid at the standard level. This also includes any work undertaken for the organisation’s committees.  

Current rates of remuneration payable to chairs and non-executive directors

In October 2019 we announced measures to align remuneration for the chairs and non-executive directors of NHS trusts and foundation trusts to address the disparities that had prevailed for some considerable time. For NHS Trusts phasing arrangements have been put in place to achieve full alignment over time, giving earliest prioritisation to non-executive directors who were in receipt of the lowest levels of remuneration. 

For NHS Trust chairs, the earlier stages of alignment seek to only to address the situation for those chairs who were on the lower rates of remuneration, i.e. within the range of £18,621 to £23,600 pa. On this basis, each NHS Trust chair has personal arrangements for staged increases. From April 2022 all NHS Trust chairs remuneration will be in line with the remuneration structure for chairs and non-executive directors of NHS trusts and NHS foundation trusts.

NHS Trust non-executive directors are entitled to receive remuneration of £11,500 per annum. An increase will be applied from 1 April 2021 to £13,000 per annum.  Thereafter NHS Trust non-executive’s remuneration will be in line with the standard rate of remuneration outlined in the remuneration structure for chairs and non-executive directors of NHS trusts and NHS foundation trusts.

Her Majesty’s Revenue and Customs (HMRC) has determined that chairs and non-executives are liable to pay income tax on their remuneration under Schedule E and Class 1National Insurance Contributions (NIC). As a result, any tax liability and NIC will be deducted at source under the PAYE scheme. It isn’t possible for chairs and non-executives to be paid their remuneration gross, unless the HMRC issues a nil tax code. It is for individuals to make any such personal arrangements with HMRC. 

The expenses information sheet outlines useful details on expenses payable to NHS trust chairs and non-executive directors, as set by the Secretary of State for Health.

Indemnity

NHS trusts can indemnify chairs and non-executive directors who have ‘acted honestly and in good faith’ against personal liability incurred whilst carrying out their duties. This indemnity may also be extended to individual members of committees with delegated powers to make decisions or take actions on behalf of the board.

Please see the personal liability of non-executives document for further details.

Resignations

Non-executive directors can resign at any time by giving notice in writing to their chair or NHS Improvement. Where possible, chairs should first liaise with the relevant executive regional managing director within NHS Improvement and non-executive directors to agree a leaving date. It is also helpful for NHS Improvement to understand the reason for the resignation in case there are any issues that should be addressed.

Suspension and removal from office

NHS Improvement have produced a policy setting out the principles and processes that they’ll use to establish whether, and how, a chair or non-executive director of an NHS trust should be suspended or removed from office. The policy incorporates three separate but interconnected pathways: seeking a resignation, suspending the office holder and terminating the appointment.

The full suspension and termination policy can be seen in full here.