EPN190 - Arrangements applying before 1 March 2008 to pensioners who are re-employed immediately upon retirement

Date posted: 01/09/2007

Audience: HR Managers and advisers who deal with recruitment

Action

• Note the arrangements applying before 1 March 2008 which mean that pensioners who are immediately re-employed upon retirement continue to be in the same pension scheme they were in before they retired.
• Make sure everyone who deals with recruitment is aware of this pension flexibility.

Timing Immediate

Background

1. EPN172 (Rev) told you about nuvos and the pension choices new entrants and rejoiners have, depending on their circumstances. A number of employers subsequently made representations that they would like the arrangements which allowed people to retire, be immediately re-employed and remain in the same pension scheme to continue until the introduction of partial retirement from 1 March 2008.
2. As a result of these representations, we have provided for the arrangements to continue for a limited period, and this EPN clarifies the position. We plan to issue guidance about partial retirement in October.
3. If a member retires from CSP employment on or after pension age, or leaves on actuarially reduced or approved early retirement before pension age, and you subsequently re-employ them after a break of more than 28 days, they will have a choice of nuvos or partnership.
4. However, if you re-employ a pensioner before 1 March 2008 and within 28 days of their earlier retirement, they will remain in the scheme they were in before they retired (and will not have a choice of nuvos or partnership), provided the terms of employment meet one of the conditions below:

• the pensioner was in classic, classic plus or premium before retiring and is re-employed at a lower responsibility level (generally at least one grade below that in which they were employed before retiring).
• the pensioner was in classic or classic plus before retiring and is re-employed part-time on no more than 75% of the hours they worked before retirement. The move to reduced hours must be accompanied by a corresponding reduction in pay.
• the pensioner was in classic and is re-employed after “formal retirement” (an option which, with very limited exceptions, was withdrawn some years ago). This flexibility is therefore only open to a very limited number of classic members (and from March 2008, it will only be available to “Pre-Fresh Start” Prison Officers). For more information on formal retirement, see Table 1 ‘Scheme flexibilities’ in Section 3.4 of the Employers’ Pension Guide.

5. In all cases where a pensioner is re-employed, their pension will be abated (reduced or suspended) if their pension plus new annual rate of salary exceeds their pensionable earnings immediately before retiring. Section 4.3 of the EPG contains details of the action you need to take.
6. On final retirement, their pension will be calculated according to the relevant re-employment provisions in their pension scheme.
7. We have added “formal retirement” as a reason for leaving on the Rejoiner Calculator which was issued with EPN172 (Rev) (but not amended the accompanying Rejoiner Questionnaire given the very limited availability of formal retirement). Sections 3 and 4 of the EPG are not currently available online as they are being rewritten to include reference to nuvos. If you want to refer to them and do not have access to a printed version, please contact the Helpdesk (details below).

Reference

This document refers to EPN172 (Rev) and Section 3.4 of the EPG.

Contacts

Enquiries about content, distribution or to receive in a different format

employerhelpdesk@cabinet-office.x.gsi.gov.uk
01256 846414
Employer Helpdesk
Civil Service Pensions
Grosvenor House
Basing View
Basingstoke
RG21 4HG