What is the X-Factor?

Not to be confused with a certain TV show, the X-Factor is a pensionable addition to pay that recognises the special conditions of service experienced by members of the British Armed Forces compared with civilian employment.

It accounts for a range of potential advantages and disadvantages which cannot be evaluated when assessing pay comparability.

The X-Factor is not intended to compensate for the particular circumstances that Service personnel face at any one time but instead is aimed at reflecting the balance of advantage and disadvantage averaged out across a whole career.

What is the Rationale for the X-Factor?

The X-Factor has been a component of Armed Forces’ pay since the introduction of the military salary in 1970.

At the time X-Factor was introduced, the special conditions of military life (as compared to normal civilian employment) were deemed to include disadvantages such as:

  • The liability to danger;
  • Being subject to discipline;
  • Turbulence; and
  • The other adverse conditions of Service employment.

The advantages included:

  • Breadth of training; and
  • Early responsibility.

These elements were viewed as requiring special, but not specific, compensation. The National Board of Prices and Incomes acknowledged at the time that an ‘element of judgement must inevitably enter into the measurement of them in financial terms’ and that the amount ‘may need to be varied from time to time’.

There is no mathematical formula used to determine the outcome and no fixed weighting is applied.

The X-Factor is currently 14.5%, having risen by 4.5% (absolute level) since 1974.

What are the Components of X-Factor?

From 2014, the components of the X-Factor were reduced from 18 to 13, and currently include:

  1. Turbulence: This is defined as “dislocation to family and social life caused by regular changes to both the type and geographical location of work whose effect is exacerbated when the employee receives short notice about these changes.”
  2. Spousal/Partner Employment: This new component accounts for the fact that “the turbulent nature of life in the Armed Forces may have a varied and detrimental impact on spouse/partner employment.”
  3. Danger: The definition of danger within the X-Factor is “a threat of real or perceived violence; an environment or area which is deemed physically unsafe or uncomfortable for natural, man-made and/or political reasons; danger of death; short or long-term injury to physical or mental health; and injury to oneself or others.”
  4. Separation: This is defined as “being separated from home and/or family and friends for a period of time because of working commitments.”
  5. Job Security: This is defined as “the knowledge, based on past history, that the individual will be able to work within the same organisation, albeit within different divisions, for a significant number of years and enjoy similar or increased levels of remuneration.”
  6. Hours of Work: This component is normally defined within the employment contract and needs to accord with European legislation, although UK companies may request employees to sign an agreement which exempts the individual from restrictions imposed by the hours of work legislation. Armed Forces personnel are also exempt from the working hours legislation, and have a requirement to be available for duty 24 hours a day for 365 days a year.
  7. Stress, Personal Relationships and Impact of the Job: This is defined as “the adverse reaction to excessive pressures or other types of demand placed on individuals at work.”
  8. Leave: This is defined as “the entitlement to a fixed number of working days off from one’s job as defined in the employment contract.”
  9. Training, Education, Adventure Training & Personal Development: This is defined as “the facilitation of learning new skills, or improving existing skills, which enhance the abilities of individuals to do their job or further their career.”
  10. Promotion & Early Responsibility: This is defined as “the endorsement of an individual’s ability in the form of an elevation in both status and responsibility.”
  11. Autonomy, Management Control & Flexibility: This is defined as “the degree of management control exercised over the individual.”
  12. Individual, Trade Union & Collective Rights: This addresses the fact that individual legal rights are enjoyed by UK citizens and by those with a right to remain and work in the UK. The European Union also affords its residents additional rights. The Armed Forces are not subject to much of this legislation.
  13. Travel to Work: This component is divided into travel time, means of conveyance, and the cost of getting to work.

The X-Factor Taper

From the introduction of X-Factor in 1970 until the 2008 review, a taper existed for Officers above Level 5 of the OF-4 (Lieutenant Colonel and equivalents) payscale.

  • OF-4s above this point and OF-5s (Colonel and equivalents) received two-thirds of the cash value received at Level 5 OF-4.
  • OF-6s (Brigadier and equivalents) received one-third of the same cash value, with no payment to Officers above the rank of OF-6.

The 2008 review highlighted the frequency and longer duration of operational deployments for more senior Officers and resulted in a change to their tapering arrangements with:

  • Full X-Factor being paid to all OF-4s;
  • 75% (of the cash value at the top of the OF-4 payscale) at OF-5;
  • 50% (of that same cash value) at OF-6; and
  • OF-7 and OF-8 ranks (covered by the Review Body on Senior Salaries) received X-Factor for the first time, set at 25% of the same cash value.

The 2013 review made no changes to these tapering arrangements.

X-Factor and the Reserve Forces

Reserve Forces currently receive the X-Factor depending on the level and type of commitment:

  • Mobilised Reserves and Full-Commitment Full Time Reserve Service receive full X-Factor;
  • Part-time Volunteer Reserves receive 5% X-Factor for training and duty days.
  • All others receive 0%.

X-Factor and the Military Provost Guard Service

Military Provost Guard Service (MPGS) personnel provide an armed guarding service at defence establishments and receive 5% X-Factor to reflect the less restrictive and local nature of their employment compared with Regular Forces.

X-Factor and the Royal Gibraltar Regiment & RG Reserves

Personnel from the Royal Gibraltar (RG) Regiment receive 6.5% X-Factor (RG Reserves 3.25%) due to the different balance of X-Factor elements and the unique and local nature of their employment.

Reference

AFPRB (Armed Forces’ Pay Review Body). (2018) Armed Forces’ Pay Review Body Forty-Seventh Report 2018. Available from World Wide Web: https://www.gov.uk/government/publications/armed-forces-pay-review-body-forty-seventh-report-2018. [Accessed: 22 January, 2019].

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