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Industrial Action - Pension Implications under the LGPS
- How will my benefits be affected?
- What can I do to re-instate the period of Scheme membership?
- Is there a time limit for me to decide making payment of the 16%?
- What happens if I currently pay additional contributions to up rate pre - 1 April 1972 service for lump sum purposes or have a contract to purchase "added years"?
- What if I decide not to re-instate the period of Scheme membership?
How
will my benefits be affected?
Absence
from duty due to strike action for one or more complete days will not
count as a period of Scheme membership and, consequently, will not be
included in the calculation of your benefits.
What
can I do to re-instate the period of Scheme membership?
You
can re-instate the period of Scheme membership if you make payment of
16% of the pensionable pay that you would otherwise have received during
the period of industrial action. The payment will attract full tax relief
in the same way as normal contributions.
Is
there a time limit for me to decide making payment of the 16%?
You
must give written notice to your employer within 30 days of returning
to work.
However, the Pension Fund is currently liaising with scheme employers and it is our intention to inform member's direct by letter, providing you with details of the amount of strike contributions and the time deadline for replying to the Pension Fund.
The Pension Fund will then inform your employer to deduct your strike contributions from your next available pay.
What
happens if I currently pay additional contributions to up rate pre - 1st
April 1972 service for lump sum purposes or have a contract to purchase
"added years"?
You
must pay additional contributions due under the contract on the pay you
would have received had you not been on strike regardless of whether or
not you opt to pay for the 16% strike contribution.
What
if I decide not to re-instate the period of Scheme membership?
Every
day of membership will count in the calculation of your benefits. It may
be your view that a day lost due to strike action will have little effect
on the final amount of benefits at retirement.
The implications of not opting to pay will for example:
- Extend by one day the date when a member attains 2 years membership, being the period of membership necessary to be entitled to a benefit under the Scheme
- Extend by one day the date when a member attains 5 years membership, being the period of membership necessary to be entitled to an enhanced ill health pension under the Scheme
- In some cases, extend the date the 85 year rule is attained by one day
- Very marginally reduce the eventual benefits due from the Scheme because you will have one day less membership and, if the member leaves within 12 months of the end of the strike period, the pensionable pay used to work out the member's scheme benefits could be slightly less than would otherwise have been the case
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