For the majority of people, returning to work in Local Government employment, or an associated body which participates in the Teesside Pension Fund will not affect the pension benefits being paid (apart from adjustments to tax, where personal allowances have been exceeded).

Changes made to the Teesside Pension Fund's abatement policy in August 2009 meant that we will not re-asses re-employed pensioner members if they return to work as we used to.

The rules prior to this change provided that if a person returned to work, we would assess the pension that was in payment, add this to the new salary and see if this value exceeded the pay which the member had been receiving prior to the initial retirement. If it did, we would reduce the pension by the excess.

With the introduction of flexible retirement, where it is perfectly acceptable for this to happen without a reduction, it seemed a little unfair to treat re-employed pensioners differently, this was an influence taken into account when the change was made.

If you were awarded an ill health enhancement or compensatory added years when you retired, starting a new job could result in your pension being reduced on a permanent basis, even if you only go back to work for a short time. 

This is because you are not allowed to be better off than you would have been if you had remained in your previous job.

This generally means that if your new pay plus your pension (including your ill health or  annual compensation enhancement) is more than your old pay, the enhanced part of your pension will be reduced by the difference.

If the difference is bigger than the enhanced element, then the enhancement will be stopped.

You must tell us the name and address of your new employer, your rate of pay and, if you are a member of your new employer's pension scheme, the name of that scheme. We will then be able to tell you if, and how your pension will be affected.

When you leave your new employment

If your added years plus the period of time in your new job is more than the service you could have accrued from your first retirement date to age 65, the added years part of your pension will be reduced permanently.

If you work part-time, we will convert the actual period of time in your new job into its whole-time equivalent length.

  Years
Membership in former employment
20
Compensatory Added Years awarded
10
Period of new employment
8
Total years
38
Membership if you had continued to work in your old job until Age 65
35
Number of years taken from your pension
3

 

In other words the compensation that was originally awarded would be recalculated by reducing the enhanced element from 10 to 7 years.

This would reduce your pension.

If you do not join the LGPS when you start your new job, you will not be able to replace the benefits which you lose.

If you are receiving a pension and considering taking up a new employment, it is always better to check with us how your pension will be affected.