On 18 October 2011, the FSA published guidance on the application of the Remuneration Code (Code) which is intended to clarify when "buy out" awards may be paid without breaching the Code. The guidance states that a firm must "not award, pay or provide any guaranteed variable remuneration unless the award is exceptional, occurs in the context of hiring new staff and is limited to the first year of service."
The evidential provisions set out in SYSC 19A.3.41E to SYSC 19A.3.43G should also be considered before paying a "buy out" award.
Click here for the FSA guidance.
Click here for the SYSC handbook.