5.9 Changing pension arrangements

• Opting Out
• Changing pension arrangements
• Opting In
• Re-enrolment
• Enrolling employees into alpha

5.9.3 Members have the right to opt out of the CSP arrangements. The member must complete the latest version of the Opt Out form.

If a member has any questions about opting out, they should contact the Scheme Administrator for further information.

Please note: the employer must not ask or force an employee to opt out, or do anything that might suggest that they have. For this reason, it is important that the employer does not give Opt Out forms to employees. The employer must either refer the member to the latest version of the Opt Out form and factsheet, or tell them to contact the Scheme Administrator for a copy of the form or any further information.

5.9.4 The employer is responsible for taking appropriate and timely action to process requests from members to opt out of the CSP arrangements, before copying information to the Scheme Administrator to update their records and take any required pension action..

5.9.5 To Opt Out:

• the member should complete and sign the Opt Out form and return it to their employer;
• the employer (HR/Payroll) must insert a date received in the appropriate box on the Opt Out form as soon as they receive it - see note A below;
• the employer must then complete the rest of the employer section of the form ensuring that information is complete and accurate;
• the employer should complete the employer information at the end of the form which should be signed by an appropriate HR/Payroll representative;
• the employer should then follow the Opt Out process (as explained in Annex 5D);
• the Scheme Administrator will check copies of Opt Out forms received to ensure they have been correctly completed by the member and employer. Any forms that do not have a received date or completed employer section to show that they have been processed by the employer first, will be returned. The Scheme Administrator will process fully completed Opt Out forms received and take any necessary administrative action.

Note A: An opting out period begins from the date that an employee is enrolled into a qualifying scheme or (if later) receives notification from the employer stating that they have been enrolled into a scheme. An Opt Out request is valid from the date the form is received by the employer. Therefore, it is extremely important (particularly for two groups of employees - see note B below), that the employer inserts a date received in the appropriate box of any Opt Out forms they receive on the day they receive them.

Please note: The date that the member is opted out of the scheme is the day after the last day on which contributions are taken. The date the member is opted out of the scheme can either be, at the earliest, the date the form is received (as stated in the appropriate box on the form), or the next available payroll date. Members cannot be opted out of the scheme retrospectively. Therefore, the last day on which contributions are taken cannot be more than 1 day before the exact date the opt out form was received (as stated in the appropriate box).

If the form is not completed correctly, the Scheme Administrator will return the form for correction.

Note B: The 3 month opting out period for new starters who wish to opt out of the PCSPS or alpha and receive a full refund of their contributions, will continue to apply under the scheme rules, irrespective of automatic enrolment legislation. However, since the introduction of automatic enrolment, there are two groups who must opt out within 1 month of being automatically enrolled if they wish to protect their existing pension status:

• employees with fixed protection will need to opt out within one month in order to keep their fixed protection;
• employees with a previous preserved pension in a Civil Service scheme will need to opt out within one month if they wish to receive a refund of contributions made from the automatic enrolment date (depending on whether the previous preserved pension was in the PCSPS or alpha and which scheme they are opting out of – the Scheme Administrator can provide further advice on this).

It is therefore, particularly important that the employees in the above groups complete and submit an Opt Out form quickly and that it is received (and the date received recorded in the appropriate box) by the employer within 1 month of the start of the opting out period.

5.9.6 The process for refunding members contributions and assessing further actions needed was revised following the introduction of automatic enrolment. The current process is detailed in Annex 5D.

Please note: the employer should only give a refund if they have automatically enrolled the employee who is opting out and received the opting out form within 1 month of the start of the opting out period. In all other cases, the employer must follow the process for ‘NO’ on the Opt Out form as advised in Annex 5D.

5.9.8 Employees choosing to opt out no longer accrue pension benefits in the CSP arrangements but they may remain entitled to compensation payments and injury benefits. The Scheme Administrator can tell you more about the treatment of optants out.

5.9.1 Members can switch between partnership, classic, classic plus, premium, nuvos or alpha in either direction but can only switch once within a 12 month period.

You must ask the member to complete a Pension Switch Form and return it to you.

A member opting for partnership within the first month of service and having that choice backdated to day one does not count as a switch. A member opting for partnership after one month but within three months of starting service is treated as a request to switch schemes. The member, however, is not required to complete the switch form in these circumstances.

5.9.2 On receipt of the switch (or Pensions Choices) form you must:

• process the request on your records, checking that the member meets the criteria to allow them to switch;
• follow the partnership application process given in section 4.2 (‘Your responsibilities when staff join partnership’);
  • complete the employer section of the form and forward a copy to the Scheme Administrator to notify them of the instruction. If the switch is as a result of a member choosing partnership after one month but within three months of joining service, send a copy of the Pension Choices form to the Scheme Administrator and notify them of the switch date;
  • the Scheme Administrator will process the request if they are satisfied that the member meets the criteria to allow them to switch.

Timetable for switching

You must ensure that your payroll provider is notified in sufficient time to ensure that the correct contributions are taken from the relevant switching date.

Members choosing to switch back into classic, classic plus, premium or nuvos may be eligible to be moved into alpha, you must ensure you check these members against the eligibility criteria see section 4.1 Your responsibilities when staff join.

5.9.9 Employees who opt out can only choose to opt back in to the section of the scheme that they would have been in if they had not opted out. The member must complete the latest version of the Opt In form. The option will take place from the next available pay period.

5.9.10 Following the introduction of alpha from 1 April 2015, when a member chooses to opt back into the CSP arrangements they may not be able to rejoin their previous scheme. Instead they may only be able to join the alpha scheme. You must check the member against the eligibility criteria see section 4.1 - Your responsibilities when staff join.

The Scheme Administrator will be able to assist you in identifying which section of the CSP arrangements to enrol optants out into.

Please note: Under the automatic enrolment legislation, an employee is allowed to opt back into the CSP arrangements once in any 12 month period.

5.9.11 Under automatic enrolment legislation, departments must re-enrol all workers who are not currently in a pension scheme three years after the initial staging date and at every three year interval following this. This is known as the ‘anniversary date’ (see note below for exceptions). Those who have opted out of the CSP arrangements must normally be re-enrolled in the section of the scheme that they opted out of. However, following the introduction of alpha from 1 April 2015, when a member is re-enrolled back into the CSP arrangements they may not be able to rejoin their previous scheme. Instead they may only be able to join the alpha scheme. You must check the member against the eligibility criteria (see ‘Your responsibilities when staff join’ (section 4.1)).

The Scheme Administrator will be able to assist you in identifying which section of the CSP arrangements to re-enrol optants out into.

Please note: if an employee has opted out within the 12 months prior to the employer’s ‘anniversary date’, they should not normally be re-enrolled until the next ‘anniversary date’.

5.9.12 If an employee opts out of the CSP arrangements after being automatically enrolled on their department’s staging date, whilst below age 22 and earning less than the specified minimum, they must be automatically re-enrolled once these criteria are met, as stated below:

• if an employee opts out of the CSP arrangements (and does not join partnership) below age 22, their employer must automatically enrol them into the CSP arrangements once they reach age 22 – irrespective of when they last opted out;
• similarly if someone opts out (and does not join partnership) whilst earning less than the specified minimum, they must be automatically re-enrolled if their earnings rise up to or above that minimum.

Please see section 4.4 - Automatic enrolment for more information about the employer’s responsibilities under automatic enrolment.

5.9.13 When alpha was introduced on 1 April 2015 a large portion of existing scheme members were moved into the scheme.

There are some members (including some new entrants who joined on or after 1 April 2015) who will move schemes at a later date, based on how close they were to their normal retirement age, and/or their public service pension scheme history.

These members are referred to as having a ‘tapered enrolment date’ and it is the employers responsibility to migrate their employees into alpha on this date.

There are tapered enrolment dates once every two months between 1 April 2015 and February 2022.

There are some members who will not move into alpha (the "fully protected" group). They are those members who passed the presence test in 2012 and 2015, and were within 10 years of their NPA on 1 April 2012.

5.9.14 There are some further exceptions to who will not move into alpha and will remain in their current scheme:

• members employed locally overseas;
• members (or those eligible to be members) of schemes other than the CSP arrangements;
• members of the partnership pension scheme;
• members with an ongoing Ill Health Retirement (IHR) application.

If the member's situation changes, they may no longer be part of the exception group and their eligibility may change.

5.9.15 The Scheme Administrator ran an exercise for existing members during 2014, and will have informed you which of your employees were eligible for a tapered enrolment date.

5.9.16 Employers also have a responsibility to collect information from new employees about their public service pension scheme history. The Pension Questionnaire asks for this information for use in the Joiner Tool. The questionnaire and tool will help you to establish the date a member should move schemes.

5.9.17 Employers must migrate (move) their employees on the correct date, the Scheme Administrator will not prompt you.

If an employee has an IHR application underway at the date they should move into alpha, this will delay the point at which you can move them into alpha.

You must not move these employees into alpha until they receive their final IHR decision. This will be either when they are granted IHR, or it has not been agreed and the employee has exhausted the appeals procedure.

If IHR is granted: the employee will not move into alpha and will receive IHR from their current scheme. You must follow the IHR procedures for the member's current scheme, and notify the Scheme Administrator who will work out the member's IHR pension.

If IHR is not granted: the employee must be moved into alpha on the final decision date. This is the day after the date of the scheme medical adviser's decision that the employee's IHR application is unsuccessful. The member must have used all available appeal options before they move schemes.

More information on migration available

More information on IHR