Changes to my job
What if I reduce my hours?
You will build up pensionable service more slowly from the date you reduce your hours. There will be no impact on pension benefits you have already built up, as we use a whole time equivalent pensionable pay figure to make calculations
Working part time
If you work part time, we calculate your benefits in the same way as for full time workers, but:
- The total membership is scaled down to the percentage of whole time you work
- The final pay is scaled up to the whole time equivalent rate.
You can use the calculator below to give you an idea of the pensionable service you will accrue for each year of employment:
Will my pension contributions be reduced?
If you simply reduce your hours, but remain on the same whole time equivalent pay the actual amount you pay will also be reduced, however the percentage contribution rate you pay will remain the same.
Reduced or frozen pay
This information is for members of the Local Government Pension Scheme whose rate of pay drops or is frozen.
It does not apply to you if your pay drops or freezes because of
- Reduced hours
- Reaching top of pay scale
- A temporary pay increase that ends
- Flexible retirement
Your Local Government Pension Scheme (LGPS) benefits are based on final pay, or it’s whole-time equivalent if you work part-time. Final pay is usually what you earn in your last 12 months of membership.
This means a drop in your rate of pay can reduce the amount of your pension. However LGPS rules give you some protection:
Best of the last 3 years
The highest pay from any of the three years before you leave the LGPS can be used. This will protect your pension if you leave less than 3 years after a drop in pay. Your employer should automatically assess the best of the last 3 years when you leave the scheme.
Best 3 year average in the last 10 years
Your average pay from any three years, ending 31 March, in your last 10 years of membership can be used. This will help if you leave the LGPS less than 10 years after a drop in pay. The pay must have dropped after 31 March 2008 and during continuous employment.
You can ask for this if, for example
- You moved to a lower paid role because your employer asked or you chose to
- Pay for your role was reduced or frozen
You cannot ask for this if
- Your pay has stayed the same because you have reached the top of your pay scale
- Employees did not receive a pay rise that year – they are not contractual
If the pay used is from a year earlier than your final year, your pension will increase with the cost of living since that earlier year.
Separate retirement benefits
Your employer can allow you to ‘freeze’ your pension as at the day before your drop in pay. You would then receive two separate pensions at retirement,
- One based on your pay and membership before your drop in pay and
- One based on your pay and membership after the drop in pay.
The frozen pension would increase with the cost of living from the date of the pay drop.
If you are allowed to ‘freeze’ your pension
- You can only change your mind if you do so within 12 months of the pay drop, unless your employer has a policy that allows longer.
- Your ‘frozen’ pension will be based on what you were earning before the drop in pay, no matter what your final pay is when you leave.
- A deferred (‘frozen’) pension will usually be paid at your normal retirement date. If you retire early (for example, due to redundancy or ill health ) only pension earned after the drop in pay can be paid early.
- If you satisfy the ‘85-year rule’, only your frozen pension will be protected.
- If you pay Additional Regular Contributions or Additional Voluntary Contributions, they will need to be reviewed. Please contact Pension Services.
If you leave the LGPS the day before a drop in pay, and rejoin while still working for the same employer, you cannot choose to have separate pensions. Pension for both periods will be based on your pay when you leave the LGPS.
Leaving or changing jobs
Been a member for less than 3 months?
If you have been a member for less than three months and have not transferred in other pension benefits, then you may be entitled to a refund of contributions.
Refunds will be paid less 20% tax and the cost of buying you back into the State Second Pension (S2P).
Been a member for more than 3 months?
If you have been a member for more than three months when you leave, your payroll team will provide us with all the information we need to work out your final pension. We will then write to you to confirm what benefits you have accrued in this period of membership.
You will then have two possible options:
- Transfer the value of your benefits to another scheme or arrangement (up to one year before your normal retirement date). You would need to contact your new pension provider to find out how to do this and whether they would accept the transfer.
- Leave your pension in the Scheme (known as 'deferred benefits').
If you re-join the LGPS, you will be able to join the benefits you have accrued in any previous job with those you build up in your new job. This does not happen automatically, you will need to complete a Starter Information and Membership Option form to elect to do this.
In terms of your Local Government pension we treat both voluntary and compulsory redundancies in the same way.
Do you have less than three months membership in the scheme?
You will be given the option to have a refund of your pension contributions, adjusted for tax and national insurance or transfer your rights to another pension scheme (you will need to authorise your new pension provider to contact the Pension Fund on your behalf).
Do you have more than three months membership in the scheme?
When you leave on the grounds of redundancy what happens to your pension will depend on your age on your last day of service:
For members under age 55
Your benefits remain in the scheme - these are called 'Deferred Benefits'.
For members aged 55 and over
You will receive immediate, unreduced payment of your Scheme benefits
What information do you need from me for my pension to be paid?
What happens to any additional contributions I am paying?
What additional benefits will I receive on my pension?