Acting up in Civil Service and returning to lower paid substantive post before retirement

[DingDing]

Hi,

Just looking at a situation for a colleague. The colleague has been operating at a significantly higher grade for a number of years, approx. 5, Covering for a career break. If the colleage was to retire in a couple of years (2) what would be the salary the pension was based on.

Assume 40 years service for simplicity. Say the acting post was 120K and the substantive post was 80K. I think there is an averaging when you get a promotion in the final 3 years (or less). Does it work the other way, say in the last 3 years, my colleague had one year at 120K and the most recent 2 years and final pension were 80K.

In my colleagues situation would they be better to retire on the higher grade, before they are stepped down. and possibly take a couple of years acturial reduction, assume my colleague is 58 and has a minimum retirement age of 60.

Also if they have to give 3 months notice, and it there was not 3 months notice that they were been stepped down, could the employer enforce the notice period and disadvantage the employee.

Just wondering if anyone can give some advice on the situation.

Also if they were buying added years, they would be probably buying them with reference to the higher pay, and get the benefit at the lower pay.

In my organisations, I can see a few people in this situation.

Also would be interesting looking at "constructive dismissal" where they could be leaving the employee with no option but to leave, protecting their pension.

I would be very interested in the discussion of this and similar cases.

 

[ClubMan]

Is this a public/civil service or a private service job/query? I suspect that there may be some key information missing from your post. I find it quite confusing myself.

 

[Mocame]

You need to provide more information on the nature of the employer - is it a civil service post or a commercial or non commercial state agency for instance?

However in view of the fact that your colleague is near retirement s/he is most likely on a final salary pension scheme and if s/he stays on for another two years the final salary will be lower and therefore the pension would be too. Your colleague should ask for advice from the pensions section of HR, but a friend who was in a similar 'acting up' position in the public service was forced to retire early for this reason. If hr had stayed on for an extra year and returned to their 'substantiative post' his pension would have been significantly lower.

IANAL but to my knowledge constructive dismissal is very challenging to prove particularly when the person voluntarily entered an acting up arrangement (and probably signed a contract to formalise this arrangement) knowing it was temporary. So your friend would be well advised to put that idea out of his/her mind.

 

[DingDing]

Thanks for that. The constructive dismissal was just me looking at it. I didn’t mention it to my colleague at all. You are correct but it doesn’t seem fair.

The employer would probably be oblivious to the consequences of returning people to their substantive post and the long term impact on pensions.

When I look across the organisation there are a good number of people in a similar position.

Post 95, pre 04 public servant in the education space.

 

[Ruffian]

I assume your colleague has an acting up allowance:

"What is pensionable remuneration?

Generally, pensionable remuneration is final pay (i.e. salary payable on the last day of
reckonable service), plus the average of the best of three consecutive
years’ pensionable allowances in the final ten years of service. The
benefits may, in some cases be based on an average salary. For
instance, if, within the last 3 years of service, an officer has changed
grade (e.g. been promoted) or received a personal change in pay, an
average pay figure will be used which takes account of the final salary
and the salary of the former grade and the relative periods spent in the
two grades in the last 3 years. Where the person is retiring on grounds
of ill-health, averaging does not apply if the person had the potential for
service to avoid the averaging."

 

[DingDing]

if, within the last 3 years of service, an officer has changed
grade (e.g. been promoted) or received a personal change in pay, an
average pay figure will be used which takes account of the final salary
and the salary of the former grade and the relative periods spent in the
two grades in the last 3 years.

Thanks Ruffian, This is what I was looking for. It looks like if the grade has changed in the final 3 years, The pension will be based on the final 3 years and the pro-rata time on each grade. I would expect if the grade lowered the same would apply as per the statement above.

A downward change in circumstances in the years before your minimum retirement age should be a cause for concern.

 

[Ruffian]

This is what I was looking for. It looks like if the grade has changed in the final 3 years, The pension will be based on the final 3 years and the pro-rata time on each grade. I would expect if the grade lowered the same would apply as per the statement above.

I'm not so sure in the situation you have outlined. Was your colleague not substantially on the same grade but with and acting up allowance to reflect the higher grade for 5 years? He can revert to his old grade (either on his own initiative or his managements' initiative) without being demoted? If so, I suspect his higher grade allowance will fully count towards his pension.

Also, the idea that the employer would force a demotion to disadvantage the employee's pension is on the fanciful side.

 

[AlbacoreA]

I think its a bit farcical to be left acting up for 5 yrs. Because thats doing the job, not acting up at all, they just won't give them the grade.

The concern for me is that is they could be passed over in a competition for the grade. Its no impossible someone might do this vindictively or simply in an re-organisation by someone with no consideration how it effects people. I've seen people left high and dry in public sector "acting" roles before, though not deliberately to effect pension.

I think this is something they'd want to get some detailed pension calculation perhaps internally and maybe independently. I would guess the higher pay would be better. By how much I have no idea.