Meeting documents

Pension Fund Committee
Friday, 21 November 2003

PF211103-17

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ITEM PF17
DRAFT

NB. Proposed changes are shown in italics or crossed through.

OXFORDSHIRE COUNTY COUNCIL

PREMATURE RETIREMENT COMPENSATION SCHEME FOR TEACHERS

1. GENERAL NOTES

1.1 This Scheme is designed to be compliant with any provisions of The Teachers (Compensation for Redundancy and Premature Retirement) Regulations current at the time.

1.2 This is a Local Scheme for the use of Premature Retirement Compensation (PRC) by Oxfordshire County Council in cases where the Council wishes to offer and a teacher wishes to take early retirement on the grounds of voluntary redundancy or in the interests of the efficient exercise of the Council’s function. No teacher will be required to accept early retirement under this Scheme against their wishes, except in cases of compulsory redundancy where the Council is unable to offer suitable alternative employment.

1.3 Any proposed use of PRC will be the subject of local consultation between Oxfordshire County Council and Recognised Teacher Organisations. The Council will abide by any requirements of relevant Acts and local and national agreements.

1.4 This Local Scheme applies to all full and part-time teachers over the age of 50 employed by the County Council in the provision of primary, secondary, special and community education. All pensionable service will be taken into account in calculating both the pension to be paid by Teachers Pensions and in calculating any enhancement to be awarded by the Council, provided that there has been no refund of contributions.

1.5 Any request for Premature Retirement which falls outside this Scheme will be considered by the appropriate Committee of the Council, together with a recommendation from the Director for Learning & Culture as to whether or not it should be supported. The financial and other implications of the request will be taken into account.

2. PREMATURE RETIREMENT ON GROUNDS OF REDUNDANCY

2.1 The Council will offer premature retirement by reason of redundancy where they are satisfied that the early retirement of a teacher aged 50 or over and with 2 years or more reckonable service would mean that an educational establishment’s teaching force would thereby be brought closer to its staffing requirements by an actual saving of a post. Enhancement of service will only be available for teachers aged 57 or over.

2.2 The Council will consider offering premature retirement to a teacher aged 50 or over with 2 years or more reckonable service, whose particular teaching specialism is no longer required, and who is redundant within the meaning of the relevant Acts. Enhancement of service will only be available for teachers aged 57 or over.

2.3 Any teacher aged 57 or over being granted PRC on redundancy grounds will be offered the full enhancement appropriate to their age and service, up to a maximum of 3 years enhancement.

2.4 Method of selecting employees

Applicants for premature retirement will be considered in accordance with the Model Redundancy Procedure applicable at the time. At present, in summary:

1.Operational needs of the service for particular types of employees will be considered first;

2. The person with the longest Local Government Service who volunteers for redundancy will be selected. If further volunteers are required, then the volunteer with the next longest service will be selected, and so on.

3. PREMATURE RETIREMENT IN THE INTERESTS OF THE EFFICIENT EXERCISE OF THE COUNCIL’S FUNCTION

3.1 There may be circumstances in which it is in the interests of the Council’s efficient exercise of its functions to offer early retirement under the terms of the PRC regulations to teachers aged 57 or over. These include:-

(a) Teachers with problems of ill health not at present provided for in the Teachers Pension Scheme, i.e. teachers under the age of 60 who are not eligible to retire under the ill health scheme;

(b) A change in the function of an educational establishment;

(c) Teachers whose application is granted by the Authority on compassionate, personal or professional grounds;

(d) Such other circumstances as may be agreed from time to time between the Council and the Teachers’ Associations.

3.2 No enhancement of service will normally be offered. Enhancement may be appropriate where, for example, there is a financial saving to the Directorate (e.g. a teacher on a protected salary) or there is a change in the function of an educational establishment.

3.3 Applications will also be considered from teachers aged 50+ for early retirement without enhancement where they have been refused ill-health retirement by Teachers Pensions but where they have a substantial medical or psychiatric condition and their retirement on health grounds is supported by the Occupational Health Service.

3.4 Applications will also be considered from teachers aged 50+ if they work in a school which has been in "special measures" for a period approaching two years at the proposed retirement date and which seems unlikely to recover before the two-year target date. In these cases, enhancement of pension by up to 0.5 of a year may be offered. This option will not be available to teachers currently subject to professional capability procedures.

3.5 Applications will be considered from teachers aged 55+ working in schools in special measures or serious weaknesses where there is evidence that this would be in the interests of the school concerned. Such cases will be put forward at the discretion of the Director for Learning & Culture. This option will not be available to teachers currently subject to professional capability procedures.

3.6 Applications will also be considered from teachers aged 55+ in cases where there is a national scheme available to subsidise the costs borne by the Council. Each case will be considered on its own merits and the costs to the Council will be taken into account in making a decision.

4. GENERAL INFORMATION



4.1.Teachers may apply, without commitment on either side, to the Council for details of the lump sum, pension and redundancy payments that they would receive if they elected to retire early.

4.2. The Council shall advise the teacher to consult his or her own trade union or professional organisation.

4.3 The normal requirements to give notice will be waived on either side for a teacher who retires early, in accordance with this Scheme.

4.4 Only after a written offer of PRC has been received and accepted by the teacher in writing is the decision to terminate an appointment final. The written offer will make it clear that it applies only if a redundancy situation still exists when the employee leaves.

4.5 Schools who wish to offer either additional enhancement (within the PRC regulations) or to grant premature retirement in cases which are not covered by the usual application of this Scheme will be charged the additional costs involved.

4.6 Any collective dispute between the parties to the Scheme or the use of PRC provision shall be dealt with in accordance with agreed procedures for collective disputes.

4.7 If any teacher is aggrieved by a decision of the Council not to offer premature retirement under this Scheme there shall be a right of appeal under the appropriate Teachers’ Grievance Procedure. There is no right of appeal against the detail of an offer which can, of course, be turned down.

4.8 This Scheme may be revised at any time only after consultation between the parties thereto. It has been agreed to take effect up to 31 December 2001 and a further scheme will then be considered.

PREMATURE RETIREMENT FOR TEACHERS – COSTS

  1. In law, the governing body have the power to determine whether or not an individual should be allowed to retire early i.e. leave our employment between ages 50 and 59 and receive early payment of pension benefits. Oxfordshire County Council are the compensating body in that they pay any costs involved in the early retirement but they have the power to refuse to pay any such costs if the case does not fit their usual criteria for funding early retirement. If they do refuse, the governing body can choose to pay the costs out of school funds if they wish.
  2. The costs which the Directorate incurs consist of a proportion of the pension payable to the teacher for the rest of the teacher’s life plus a proportion of the lump sum which all pensionable employees receive when they retire. The younger the teacher is on retirement, the greater the proportion payable by the Directorate. For example, if the teacher is 50 the Directorate pays 42% of the pension and 28.8% of the lump sum.

    3. "Efficient Exercise of the Authority’s Function"

  3. Early retirements in this category do not result in any pension enhancement (except where the school has been in "special measures" for 2 years; see paragraph 3.4 of the PRC Scheme) but the costs set out in paragraph 2 above do apply.

    4. Redundancy

  4. In addition, if a teacher is made redundant between ages 50 and 59, the Directorate has to make a redundancy payment based on age and length of service.
  5. If the teacher is made redundant between ages 57 and 59, the pension and lump sum will also be enhanced and the Directorate pays the full cost of this enhancement.

    6. Ill Health Retirement

  6. Retirements on medical grounds are determined by Teachers’ Pensions. There is no lower age limit and cases are decided entirely on grounds of ill health. No costs are incurred by the Directorate if the retirement is granted on these grounds.
  7. Under our PRC Scheme, teachers of 50 and above who are refused ill health retirement by Teachers’ Pensions can apply to the LEA for early retirement if our Occupational Health doctors support the case (see para 3.3 of the Scheme). These cases are then dealt with as "efficiency" retirements (see paragraph 3 above).

    8. Standards Fund Support for Early Retirement for Headteachers

  8. During 2001/2 some funding is available to subsidise the retirement of Headteachers aged 55 and above who feel they are unable to carry out necessary changes in their school. The full cost of the early retirement is calculated by the DfEE as a lump sum rather than an annual contribution to the teacher’s pension. The Standards Fund pays 53% of this cost and the LEA must find 47% of it – as a lump sum at the point of retirement. The amount of funding available for the year is unlikely to pay for more than two such retirements.

    9. Actuarially-Reduced Pensions

  9. Teachers can opt to retire at any point between ages 55 and 59 with immediate payment of pension benefits, based on their pensionable service but reduced in accordance with a scale determined by the government’s Actuary. The reduction in pension is more than 25% for a teacher retiring at age 55 and the reduction applies for life. The lump sum is also reduced. In these cases no costs are incurred by the Directorate or the school.

October, 2003

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