Date published: 4 August, 2025
Date last updated: 4 August, 2025
Finance, NHS payment system, Workforce

NHS England guidance on Mutually Agreed Resignation Schemes (MARS)

For NHS trusts, foundation trusts and integrated care boards.

Introduction

As set out in Agenda for Change (AfC) Section 20 a “Mutually Agreed Resignation Scheme (MARS) is a form of voluntary severance and has been developed with the aim of increasing the flexibility to organisations as they address periods of change and service redesign…” Its key purpose is to create job vacancies which can be filled by redeployment of staff from other jobs or as a suitable alternative for staff at risk of redundancy and in so doing, to minimise the need for any future redundancies during periods of change and service redesign.

NHS England has delegated authority from HM Treasury (confirmed for each financial year via the Department of Health and Social Care (DHSC)) to manage Mutually Agreed Resignation Schemes (MARS) in NHS trusts, NHS foundation trusts and integrated care boards (ICBs). Any proposed MARS in NHS trusts and ICBs therefore first require NHS England approval. NHS foundation trusts only require a review.

Definition

AfC s20.5 describes a MARS as “a scheme under which an individual employee, in agreement with their employer, chooses to leave employment in return for a severance payment. Mutually agreed resignation is not a redundancy or a voluntary redundancy, which would currently be covered by AfC Section 16. Severance payments should not be made where the circumstances entitle an employee to a contractual redundancy payment or redundancy benefits under the NHS Pension Scheme Regulations.”

Criteria for MARS

If an organisation wishes to run a local scheme, terms which mirror, or are no more favourable than the previous national scheme (as set out at Annex 1), are recommended and such a scheme is more likely to secure NHS England approval.

The approval for running MARS in the NHS trusts, foundation trusts and ICBs, is delegated to DHSC, by HM Treasury, annually (for each financial year). Each MARS is required to adhere to national model MARS (see Annex B) which includes the following criteria:

  • each scheme to be appropriately considered and authorised by the respective NHS trust, NHS foundation trust and ICB board
  • each payment must not be greater than £80,000 in respect of any individual
  • each scheme must apply a salary cap of £80,000 (i.e. for staff with total earnings of more than £80,000, the figure used for calculating a MARS payment will be £80,000 (pro rata for part-time workers)
  • each scheme must not operate for more than 3 months in duration
  • only staff with a minimum of 12 months continuous service can be considered

Note: the conditions for delegated authority may be subject to updates following changes to public sector exit payment terms.

Schemes should also include the following criteria:

  • that there is a sound business case for the scheme that demonstrates value for money
  • that the scheme is affordable – no extra money is available and NHS trusts, NHS foundation trusts and ICBs must still reach their agreed planned financial position
  • that the application period is time limited and does not overlap with any redundancy consultation
  • that nobody is allowed to leave under a MARS that potentially puts the NHS Trust, NHS Foundation Trust or ICB at any risk or who should otherwise be managed under the organisation’s performance, capability or disciplinary procedures
  • that the scheme will operate in line with the equal opportunities principles as set out in equality legislation including an Equality Impact Assessment of their MARS and having appropriate monitoring in place
  • that posts vacated by MARS leavers will be ring fenced initially to “at risk” staff

Approval processes for MARS and cases

Organisations wishing to run a MARS should provide advance notice of the scheme to NHS England and note the following approval process:

For NHS trusts and NHS foundation trusts

NHS trusts and NHS foundation trusts should first seek approval of the proposed scheme from the trust board and responsible committee. 

They will also need to provide confirmation that any financial impact will be managed within the organisation and system financial plans.

The following completed documents should then be submitted to the relevant NHS England regional director of workforce for initial support:

  • completed checklist (see Annex A); and
  • copy of the proposed scheme (see Annex B for the terms agreed in the national MARS)

When the scheme has received NHS England regional support, the completed documents should then be submitted to the NHS England’s Trust Governance and Advisory Team at: england.vsmcases@nhs.net who will review the scheme and, if appropriate, send formal approval (NHS trusts) or clearance (NHS foundation trusts) to run the scheme.

NHS trusts and foundation trusts should expect to receive a response to their proposed MARS within 2 weeks of submission of all completed documents.

For ICBs

ICBs should first seek approval of the proposed scheme from the ICB Board and responsible committee.

ICBs should also obtain confirmation of funding for the scheme from their regional director of finance.

The following completed documents should then be submitted to the relevant regional director of workforce:

  • completed checklist (see Annex A)
  • copy of the proposed scheme (see Annex B for the terms agreed in the national MARS)
  • completed paper for Executive HR Group (EHRG) approval (see Annex C)

ICB MARS proposals will then be submitted to NHS England Executive HR Group for approval.         

NHS trusts and NHS foundation trusts working together via an ‘ICB system’ can plan to launch and submit MARS requests together, but for audit purposes each scheme must follow its own due process and would need to be considered individually by NHS England.

Process following scheme closure

Following the scheme’s closure, details of the individual applications to be supported should be added to the MARS applications spreadsheet, Annex D [link] and sent to the relevant NHS England regional director of workforce, (copying to england.vsmcases@nhs.net). This is for regional oversight and will also assist in the completion of the quarterly assurance return made to NHS England for all exit payments.

At the end of the process the organisation will need to ensure that the reason for leaving is noted on ESR (Electronic Staff Record) as “local MARS”. This can then be picked up by the new employer whose responsibility it will be to ensure the appropriate steps are taken for claw back and to ensure that there is no double counting of reckonable service if the individual takes MARS or is made redundant in the future.

Contact for further advice and information

For advice on any aspect of this guidance:

For NHS trusts and NHS foundation trusts MARS, please contact: england.vsmcases@nhs.net

For ICB MARS, please contact your Regional Workforce Training and Education Team (WT&E):

Further information

Further written advice and FAQs are available on NHS Employers website:

For information on Post Employment Notice Pay:

Annex A – MARS checklist

Annex B – MARS template

Annex C – Template paper for EHRG

Annex D – MARS applications template

Annex E – The approval or review process

For NHS trusts and NHS foundation trusts

Image text:

This flowchart outlines the approval and feedback process within the NHS system, divided into three main sections:

  1. Trust
  • The process begins with Trust RemCom (Remuneration Committee).
  1. NHS England (regional approval)
  • An arrow leads from Trust RemCom to the NHS England Regional Workforce, Training and Education Team.
  1. NHS England (National)
  • The process continues to the NHS England Trust Governance and Advisory Team, which is responsible for reviewing and advising.
  • A response is sent back to the Trust via the NHSE Governance and Advisory Team.

Feedback loop

At the bottom of the chart, a dashed, double-headed arrow represents a continuous feedback loop labelled: “Regular informal feedback loop on progress via Trust Governance and Advisory Team.”

For integrated care boards

 Image text:

This flowchart outlines the approval process within the NHS system, divided into three main sections:

  1. Integrated care board
  • The process begins with the ICB RemCom (Remuneration Committee).
  1. NHS England (regional approval)
  • The next step involves the NHSE Regional Workforce Director.
  1. NHS England (national)
  • The process continues to the Executive HR Group (EHRG), which meets monthly and requires a template report to accompany the business case
  • A response is sent back to the NHS England Regional Workforce Director

Publication reference: PRN02120

Date published: 4 August, 2025
Date last updated: 4 August, 2025