Redundancy and efficiency retirements
Please make sure you've asked for figures from us. There are likely to be costs involved and you must take this into account before making a decision to terminate a member's employment.
Pension benefits are due in full from age 55 if you terminate a contract of employment on the grounds of redundancy or efficiency of service.
There'll be an early retirement strain cost to be paid by you, for these members. If you're planning any redundancies or efficiencies, you must contact us in advance for a quote. You can do this by completing the PEN010 form and sending it to us.
What do we need to process a redundancy or efficiency retirement?
- Member to be made a leaver through i-Connect
- Completed leavers form PEN007A
- P45 (if available) – this should be sent for income tax deductions from the pension to be assessed
When is the early retirement strain cost paid?
If you're due to pay a strain cost, you'll receive an invoice for the amount shortly after the member's retirement.
Thinking of getting a quote?
Please note that if a quote is requested at this time it will be created under current legislation and will not take into account any future changes to the LGPS regulations or wider exit payment cap reform. The Exit Payment Cap Directions 2021 have disapplied regulations restricting public service exit payments from 12 February 2021 however we understand the MCHLG still plan to introduce further changes to exit payments and will consult again on further reforms.
Although the Government has not confirmed when the exit cap or further reforms will be looked at, you should be aware that
- An exit cap may be in force later in 2021, and
- MHCLG may introduce further reforms to exit pay when the exit cap is re-introduced
Any further reforms to exit payments and changes to LGPS regulations may change the benefits quoted or your entitlement to these benefits.