PUBLIC SECTOR PENSIONS ACT 2011 INTERIM COMPENSATION SCHEME 2012

Transcription

1 Statutory Document No. 0138/2012 PUBLIC SECTOR PENSIONS ACT 2011 INTERIM COMPENSATION SCHEME 2012 Approved by Tynwald 17 th April 2012 Coming into operation in accordance with paragraph 2 The Public Sector Pensions Authority, after consulting the proposed members of this scheme, their representatives, their employers and the Treasury, makes this scheme under section 6(1) of the Public Sector Pensions Act Title This scheme is the Interim Compensation Scheme Commencement (1) This scheme comes into operation on 1 April 2012 in accordance with Section 15 (1) of the Public Sector Pensions Act Maintenance and administration of this scheme The PSPA must ensure that this scheme is properly maintained and administered in accordance with the Rules of the Interim Compensation Scheme 2012 as set out in the Schedules to this Scheme. MADE 15 th March 2012 Jeremy Carter Chairman of the Public Sector Pensions Authority

2 SCHEDULE (Paragraph 3) INTERIM COMPENSATION SCHEME 2012 Arrangement of Paragraphs SECTION PAGE NUMBER 1 DEFINITIONS AND INTERPRETATION COMPULSORY RETIREMENT AND REDUNDANCY CATEGORY - (SECTION 2 (FORMER CLASSIC) MEMBERS OF GUS) Early Retirement For Public Servants In Post On Or Before 31 March Early Severance (Or Leaving With Less Than 5 Years' Service) - 8 Early Severance For Optants Out - 8 Early severance for new entrants - 9 Compulsory retirement benefits for Public Servants who have reached Age 60-9 Flexible Early Retirement - 9 Flexible Early severance (or leaving with less than 5 years' service) - 10 Early severance for optants out - 10 Approved Early Retirement A COMPULSORY RETIREMENT AND REDUNDANCY - 11 CATEGORY - (SECTION 2 (FORMER MANUAL WORKERS 1977 AND NATIONAL TRANSPORT MEMBERS) Application COMPULSORY AND REDUNDANCY CATEGORY (SECTION (FORMER CLASSIC PLUS, PREMIUM AND NUVOS) MEMBERS Application 12 Interpretation - 12 Compulsory Early Retirement Eligibility for redundancy or compulsory early retirement benefits - 13

3 Compulsory early retirement benefits - 13 Calculation of compulsory early retirement benefits - 14 Compulsory retirement benefits for Public Servants who have reached age 60 Compulsory Early Severance Eligibility for compulsory early severance benefit Calculation of compulsory early severance benefit - 18 Flexible Early Retirement Eligibility for flexible early retirement benefits - 19 Flexible early retirement benefits - 19 Calculation of flexible early retirement benefits - 19 Flexible Early Severance Eligibility for flexible early severance benefit - 19 Calculation of flexible early severance benefit FURTHER PROVISIONS - 20 Part-time service - 20 Widows' and dependants' benefits RE-EMPLOYMENT FIXED OR LIMITED TERM APPOINTMENTS PAYMENT ON TERMINATION OF EMPLOYMENT WITHOUT NOTICE PERSONAL INJURY COMPENSATION - 26 Application of section - 26 Qualifying conditions - 27 Benefits - 27 Exceptions DISMISSAL FOR INEFFICIENCY COMPULSORY REDUNDANCY - (SECTION 2 (FORMER NHS 2007) AND SECTION 4 MEMBERS

4 Interpretation - 30 Qualification and Calculation for a redundancy payment - 31 Early retirement on grounds of redundancy for employees entitled to pension benefits Early retirement pension (MHO Status and Special Class Members) Contributions Payable by employing authorities for members becoming entitled to pensions under regulation Treatment of concurrent pensionable employment - 34 Exclusion from eligibility - 35 Early release of redundant employees - 35 Retrospective pay awards - 35 APPENDIX 1 - FORMER SCHEMES

5 1 DEFENITIONS AND INTERPRETATION 1.1 References to `rules' shall be to the rules of this scheme unless otherwise specified; 1.2 In this scheme, unless otherwise specified: The terms used in this scheme shall have the same meaning as in the Isle of Man Government Unified Scheme; Early Retirement means retirement before age 60 for those members who are Sections 2 members of GUS for the categories of early retirement or early severance referred to in this Scheme and age 65 for section 3 and 4 of Gus; GUS means the Isle of Man Government Unified Scheme 2011; Limited Term Appointment means an appointment the maximum period of which is fixed at the time of the appointment, and references to a limited term appointment in this scheme shall include: contracts for an initial fixed or limited Term which may be extended for a further specified period at the employing authority's option both after a specified portion of the limited term has expired and subsequently at fixed intervals; and contracts for an initial fixed or limited Term which have been automatically and continuously renewed until notice of non renewal is given by the employing authority; New Entrant means any person who on or after 1 April 2012 takes up employment or is re employed in the Public Service on a full time or part time basis except the following: staff employed on a fee paid or sessional basis or on a fixed term appointment; staff employed locally overseas; staff who are covered for their service in the Public Service by other compensation arrangements arising out of their employment; (d) staff whose terms of appointment are to the effect that they are not entitled to benefits under section 2 or section 3 of this scheme; Pension Benefits means benefits awarded under the Isle Of Man Government Unified Pension Scheme but shall not include annual compensation payments. Public Service Injury Benefits Scheme means the Public Service Injury Benefits Scheme

6 PSPA means the Public Sector Pensions Authority as established under the Public Sector Pensions Act 2011; Scheme Actuary means the actuary appointed by the PSPA from time to time to provide a consulting service on a range of actuarial matters relevant to the Isle of Man Government Unified Pension Scheme and compensation arrangements; Except as otherwise provided in this scheme, "current pensionable service" shall have the same meaning in relation to a person as pensionable service", except that: it shall not include any pensionable service which is attributable to service prior to the current period of continuous service unless the prior service ended on resignation for the purpose of taking up a permanent appointment with a relevant body as defined by the PSPA and that appointment continued until re employment in the current period of continuous service in the Public Service; it shall not include any pensionable service which results from a purchase of added years under rule 27 of GUS or from a grant of added years. 1.3 Except as otherwise provided in this scheme, current qualifying service shall have the same meaning as qualifying service except that qualifying service prior to the commencement of current pensionable service shall not be current qualifying service. 1.4 Any benefits preserved solely by virtue of service in the former pension scheme will not be enhanced under this scheme. 1.5 Compensation payments for early retirement or severance under this scheme and for personal injury under section 8 of this scheme will be paid at the discretion of the PSPA, and nothing in this scheme will extend or be construed to extend to give any person an absolute right to them. 1.6 Subject to the provisions of this rule, the PSPA will have power to withhold benefits payable under this scheme where a person serving in the public service, eligible for benefits under this scheme, or a person who formerly served in the public service is convicted: of one or more offences under the Official Secrets Acts 1911 to 1989 for which the person concerned has been sentenced to a term of imprisonment of at least 10 years or has been sentenced on the same occasion to two or more consecutive terms amounting in the aggregate to at least 10 years; or of an offence in connection with any employment to which this scheme applies, being an offence which is certified by a PSPA either to have 2

7 been gravely injurious to the Isle of Man or to be liable to lead to serious loss of confidence in the public service. 1.7 Before benefits may be forfeited under this rule, the person concerned will be entitled to appeal against the forfeiture to an independent body nominated by the PSPA; and where an appeal is made, the PSPA will accept the board's judgement on whether or not the appellant s compensation benefits should be forfeited. 1.8 Any question under this scheme shall be determined by the PSPA, whose decision on it shall be final. 1.9 In all cases of persons serving in full-time or part-time employment in the Public Service retired on the grounds of redundancy, or in consequence of an agreement made or notice of dismissal, the amount of lump sum compensation payable on the grounds of redundancy under either rules 2.4, 2.9, 2.10, 2.11, 3.7 and 3.27 of this scheme or any other compensation scheme by which persons are covered for their service in the Public Service shall, if it is less in value than the redundancy payment which would, but for section 14 of the Redundancy Payments Act 1990, have been payable under that Act, be made up to that value. If no lump sum compensation of the type referred to above is payable to a person serving in the Public Service who is retired on grounds of redundancy, or in consequence of an agreement made or notice of dismissal an amount equal to the statutory redundancy payment shall be paid to him. This rule will apply to persons serving on Limited Term appointments Where a person, who is receiving payment of a pension and/or lump sum under partial retirement benefits from a previous Isle of Man Public Service Pension Scheme, subsequently becomes entitled to benefits under this scheme: any pensionable service used to calculate that pension and/or lump sum will not be included when calculating the person s pensionable service or current pensionable service for the purposes of this scheme, and the person s partial retirement will have no effect on the length of his qualifying service or current qualifying service The maximum aggregate level of pension payable under these Rules before a pension has been commuted under Rule 41 of GUS is 75% of the Member s Final Pensionable Pay If it appears to the PSPA that a Member has been incorrectly notified of, including, but not limited to 3

8 the benefits to which the Member or a Beneficiary is entitled under this scheme; or the value of pension benefits to which the Member is entitled to under this scheme; 1.13 The PSPA must write to the affected Member setting out the extent and nature of the error or errors and the steps the PSPA proposes to take to correct the error If the PSPA has notified a Member of an error in accordance with Rule 1.28 of GUS it may take such steps as it considers appropriate If any contributions in relation to GUS are owed by a Member, the amount outstanding becomes payable by the Member immediately and if the Member does not repay the amount owed, the PSPA may reduce his or her benefits from this scheme to a value of not less than the level of accrued benefits appropriate to the contributions paid Unless otherwise required to do so under the Public Sector Pensions Act 2011, the PSPA when making a decision or when giving or withholding its agreement or consent or when exercising or not exercising a power in relation to this Scheme must do so at its absolute and uncontrolled discretion The decision of the PSPA is final on all questions that are left to its determination or decision in relation to this Scheme and on all matters relating to the management and administration of this Scheme where these Rules are silent Nothing in these Rules restricts the right of an Employing Authority to terminate the employment of an Employee with the Employing Authority; or may be used in aggravation of damages or compensation in proceedings brought by the Employee against an Employing Authority in respect of the termination of his or her employment If the PSPA reduces or varies the benefits under this Scheme relating to a Member with the Member s agreement, the Member s agreement binds any other Beneficiary whose benefits under this Scheme relate to that Member. 2 COMPULSORY RETIREMENT AND REDUNDANCY CATEGORY - (SECTION 2 (FORMER CLASSIC) MEMBERS OF GUS) 2.1 This Section applies to a public servant who was a member of, or eligible to be a member of, the former Classic Section of the Schemes listed in Part 1 of Appendix 1 to this Scheme and who is compulsorily retired early on 4

9 grounds of redundancy will receive the benefits as described in rules 2.3 to A person shall not be regarded as retired early for the purposes of this section on ceasing to be in the Public Service if the person is reemployed in the Public Service after not more than 28 days. Early retirement for Public Servants in post on or before 31 March This rule applies where a Public Servant: was in post on or before 31 March 2012; (d) (e) (f) is retired early on or after 1 April 2012 under rule 2.1 above; is aged 50 or over; has five or more years qualifying service; has not opted out of the Government Unified Scheme; and has not opted in accordance with rule 2.5 of this scheme to be treated under section 3. The Public Servant will be eligible for a pension and lump sum which will be calculated in accordance with 2.3.1, but with pensionable service increased by up to 6 2/3 years and the benefits being brought into payment immediately. This is subject to rules to and rules 2.5 and A Public Servant who retires under 2.3 above shall be paid the following benefits: an annual pension calculated as follows PS x FPP Where: PS is Pensionable Service FPP is the percentage of Final Pensionable Pay at Age 60 for Section 2 Members (as set out in Rule 31.7 of GUS) a public servant may commute part of his or her pension, in accordance with rule 41 of GUS, for a lump sum. The maximum aggregate level of pension payable under these Rules before a pension has been commuted under rule 41 of GUS is 75% of the Member s Final Pensionable Pay, and no period after the day before a person s 75th birthday shall count as pensionable service Where the Public Servant is already in receipt of a partial retirement pension the pensionable service used to calculate his full retirement 5

10 pension will be adjusted, with effect from the day after the relevant last day prior to partial retirement, by subtracting the Public Servant s partial pensionable service from his total pensionable service up to and including the relevant last day, to determine the Public Servant s remaining pensionable service The Public Servant s remaining pensionable service, together with any pensionable service accrued after the relevant last day, will be used to calculate the benefits due to the Public Servant on full retirement The pension and lump sum that would result from the increased pensionable service are subject to the limit that they may not exceed the benefits that would have been earned (assuming no increase in the elements that make up final pensionable pay, apart from incremental increases which were due in the then current grade under pay arrangements which are no longer applicable) if he had stayed in service in a full-time capacity until age 60. For the purpose of calculating this limit: no account shall be taken of any added years or contributed pension, which would have been bought in the relevant period; no account shall be taken of any increase in the elements that make up final pensionable pay except: (i) any incremental increases which were due under the then current grade within any formerly applicable scale maximum; (ii) any increase in excess of the no longer applicable scale maximum (or where appropriate, the single pay point for the grade) in the pay range for the then current grade which is already in payment at the time of early retirement; (iii) any increase which would have been due under assimilation arrangements, provided that such arrangements have been promulgated at the date of the early retirement; and (iv) any increase in the elements that make up pensionable pay, which has been promulgated at the time of the early retirement, not-withstanding that it is not due to be brought into payment at that time; Where a Pre-Fresh Start Prison Officer retires early on or after 1 April 2012 under a scheme of early retirement, pensionable service shall be eligible for doubling in accordance with rule 6.3 of GUS, up to a maximum of 6⅔ years. If such a prison officer so retires with less than 20 years of actual service as a prison officer, he or she shall be deemed to have completed such 20 years of actual service In all cases, however, pensionable service may not be increased by more than its length, or in the case of new entrants, by more than current 6

11 pensionable service and benefits cannot be less than those which would have been paid under rule 31 of GUS For the purpose of this rule `current grade' includes a grade held on temporary promotion or a grade in which a Public Servant was substituting or deputising for an absentee if the employing authority in which the Public Servant was so employed is of the opinion that had he or she not been retired early it would have expected such temporary promotion, substitution or deputising to have continued until the Public Servant reached age 60 or until a date within the last three years of pensionable service before age A Public Servant may also be paid a lump sum compensation payment of 6 months' final pensionable pay. 2.5 A Public Servant who meets criteria to (d) of rule 2.3 or rule 2.6 may opt to be treated under section 3. The option may only be exercised by notice in writing in such form as the PSPA requires. 2.6 A Public Servant aged 50 or over with five or more years pensionable service who moves from service in a higher grade to service in a lower substantive grade before age 60 who is retired early under the Compulsory and Redundancy categories referred to in this scheme will be treated in one of the following ways: The Member may seek to have their pension calculated in accordance with rule 2.3 of this scheme; or The member will be deemed to have resigned on the day before he or she changed grades, and be awarded a deferred pension and be reemployed the first day he or she takes up their post at the lower grade rejoining the scheme as a Section 1 Member, with service after the move to a lower grade reckoning to a second pension award, irrespective of the length of service, with pensionable service before the move to the lower grade being counted as qualifying service for this purpose. Upon Compulsory Retirement or redundancy the Member s pensionable service: (i) (ii) before the move to the lower grade may be enhanced up to the maximum allowable under rule 2.3 of this Scheme; and after the move to the lower grade will be reduced by the amount (if any) by which his pensionable service had been enhanced under above. The deferred Pension in will be revalued in accordance with rule 22.4 of GUS. 7

12 2.7 Where a Public Servant is retired early with benefits payable under this scheme, any preserved pension in respect of service before the move to the lower grade or designation will be brought into payment when the Public Servant retires. Early severance (or leaving with less than 5 years' service) 2.8 Where the Public Servant has less than five years' qualifying service or is under age 50, he or she is entitled to the same benefits (if any) under Rule 22 of GUS as in the event of a voluntary resignation. 2.9 In addition, provided the Public Servant has at least one year's qualifying service, a Public Servant to whom rule 2.8 applies, may be paid a compensation payment calculated as follows: one month's final pensionable pay multiplied by the length of the Public Servant's pensionable service; plus one month's final pensionable pay multiplied by the length of the pensionable service given after the later of: (i) (ii) the date on which five years' qualifying service is completed, and the Public Servant's 30th birthday; plus one month's final pensionable pay multiplied by the length of the pensionable service given after the 35th birthday; up to a maximum of three years' final pensionable pay. Subject to Rule 4.2, where pensionable service includes earlier service which has been aggregated with the final period of service, the total pensionable service shall be treated as if it were a period of continuous service which ended on the last day of the final period of service. Early severance for optants out 2.10 This rule applies where a person: has at any time opted out of GUS; is compulsorily retired early on grounds of structure or limited efficiency or is retired early on grounds of redundancy; and has less than five years service that would have been qualifying service if he had not opted out of GUS or is under age 50. The person to whom this rule applies will receive a lump sum compensation calculated under rule 2.9 with all service treated as service as a Public Servant. 8

13 Early severance for new entrants 2.11 This rule applies to a new entrant who join GUS on or after 1 April 2012 and who is compulsorily retired early on grounds of structure or limited efficiency or is retired early on grounds of redundancy, such members will receive a lump sum compensation calculated under rule 2.9. Compulsory retirement benefits for Public Servants who have reached Age If a Public Servant (d) (e) is, after 31st March 2012, compulsorily retired on grounds of structure or limited efficiency or on grounds of redundancy; has reached age 60 on the date of compulsory retirement; has five or more years qualifying service; has not opted out of GUS; and has not opted in accordance with rule 2.5 to be treated under section 3, the Public Servant may be paid a lump sum compensation payment of 6 months final pensionable pay A person shall not be regarded as compulsorily retired for the purposes of rule 2.12 on ceasing to be in the Public Service if the person is reemployed in the Public Service after not more than 28 days. Flexible Early Retirement 2.14 A person shall not be regarded as retired early for the purposes of this section on ceasing to be in the Public Service if the person is reemployed in the Public Service after not more than 28 days This rule applies where a Public servant: was in post on or before 31 March 2012; (d) (e) is retired early on or after 1 April 2012 under the Flexible category; is aged 50 or over; has five or more years qualifying service; has not opted out of GUS; and (f) has not opted in accordance with rule 2.5 of this scheme to be treated under section The public servant will be eligible for a pension and lump sum payable under GUS on the terms described in rule

14 2.17 A Public Servant aged 50 or over with five or more years pensionable service who moves from service in a higher grade to service in a lower substantive grade before age 60 who is retired early under Flexible Early Retirement will in accordance with rule 2.6 Flexible Early severance (or leaving with less than 5 years' service) 2.18 Subject to rule 2.19, where a public servant who is retired early under the Flexible category has less than five years' qualifying service or asunder the age of 50, he or she is eligible for benefits under rule 2.7. In addition, and provided the public servant has at least one year s qualifying service, a compensation payment may be paid, calculated as follows: two weeks' final pensionable pay for each year of reckonable service during the first five years of qualifying service; plus three weeks' final pensionable pay for each year of reckonable service during the next five years of qualifying service'; plus four weeks' final pensionable pay for each year of reckonable service after the first ten years of qualifying service; plus (d) two weeks' final pensionable pay for each year of reckonable service after the fortieth birthday; up to a maximum of two years' final pensionable pay. Flexible Early severance for optants out 2.19 This rule applies where a person: has at any time opted out of GUS; is retired early under the Flexible category; and has less than five years service that would have been qualifying service if he had not opted out of GUS or is under age 50. The person to whom this rule applies will receive a lump sum compensation payment calculated under rule 2.18 with all service treated as service as a public servant A public servant who: was in post on or before 31 March 2012; leave office early on or after 1 April 2012 under the Flexible category; is aged 50 or over; (d) has five or more years qualifying service; (e) has not opted out of GUS; may opt to be treated under the Flexible category of Section 3. The option may only be exercised by notice in writing in such form as the PSPA requires. 10

15 Approved Early Retirement A public servant aged 50 or over with five or more years' qualifying service who is retired under the Approved category, will receive a preserved pension and lump sum under GUS Subject to rule 2.19 the preserved pension at rule 2.17 may be brought into payment immediately under GUS rather than at age 60 and calculated in accordance with rule If a pension becomes payable to a member under regulation 2.18, the employing authority must make a contribution to Treasury in accordance with rule 30 (Augmentation)of GUS A public servant who retires under 2.17 and elects to receive a pension under 2.18 above shall be paid the following benefits: an annual pension calculated as follows PS x FPP Where: PS is Pensionable Service FPP is the percentage of Final Pensionable Pay at Age 60 for Section 2 Members (as set out in Rule 31.7 of GUS) a public servant may commute part of his or her pension, in accordance with rule 41 of GUS, for a lump sum. 2A COMPULSORY RETIREMENT AND REDUNDANCY CATEGORY - (SECTION 2 (FORMER MANUAL WORKERS 1977 AND NATIONAL TRANSPORT MEMBERS) Application 2.A.1 2.A.2 2.A.3 Subject to Rule 2.A.3 this Section applies to a public servant who was a member of, or eligible to be a member of, the former Schemes listed in Part 2 of Appendix 1 to this Scheme. In this section a public servant who is compulsorily retired early on grounds of redundancy will receive compensation calculated in accordance with Rules 2.2 to 2.16 subject to Rule 2.A.3. For the purposes of this section any reference to age 60 in Rules 2.1 to 2.16 substitute age 65 11

16 3 COMPULSORY AND REDUNDANCY CATEGORY (SECTION 3 (FORMER CLASSIC PLUS, PREMIUM AND NUVOS) AND SECTION 2 (FORMER CLASSIC) OPTANT OUT MEMBERS) Application 3.1 Subject to rule 3.2 this section applies to a public servant who: was a member of, or eligible to be a member of, the former Classic Plus, Premium or Nuvos Sections of the Schemes listed in Part 1 of Appendix 1 to this Scheme and who is compulsorily retired early on grounds of redundancy will receive the benefits as described in rules 3.2 to 3.8 Members who have opted in accordance with rule 2.5 to be treated under this section. 3.2 This section does not apply to: persons who hold an appointment in the Public Service for a fixed or limited Term; or persons serving in the Public Service whose terms of employment exclude them from the provisions of this scheme. 3.3 A person shall not be regarded as retired early for the purposes of this section on ceasing to be in the Public Service if the person is re-employed in the Public Service after not more than 28 days. Interpretation 3.4 In this section, unless otherwise specified: active membership has the meaning given in Isle of Man Government Unified Scheme and, in respect of a person who is not a member of GUS, means the last period during which the person has served in the Public Service and does not include any earlier period separated from it by a break in service. current qualifying service shall have the same meaning as qualifying service in GUS except that qualifying service prior to the commencement of current pensionable service (as defined in this rule 3.4 ) shall not be current qualifying service. current pensionable service shall have the same meaning in relation to a person as pensionable service in GUS, except that it shall not include any pensionable service described in rule 27 of GUS (Contractual Additional Pension Contribution Membership and Contractual Additional Pension Contributions); 12

17 (d) scheme year means a period of one year beginning with 1st April and ending with 31st March. Compulsory Early Retirement Eligibility for redundancy or compulsory early retirement benefits 3.5 Subject to rule 3.6, a person to whom this section applies shall be eligible for the compulsory early retirement benefits specified in rule 3.7 if: he is aged 50 or over; he has five or more years qualifying service; and he is compulsorily retired early on the grounds of structure or limited efficiency or retired early on the ground of redundancy or compulsory early retirement. 3.6 In the case of a new entrant, the reference to qualifying service in rule 3.5 shall be deemed to be a reference to current qualifying service (as defined in rule 3.4). Compulsory early retirement benefits 3.7 For the purpose of rule 3.5 and subject to rule 3.8, compulsory early retirement benefits are: a lump sum compensation payment payable on compulsory early retirement and shall be the equivalent of six months final pensionable pay; a lump sum compensation payment payable on compulsory early retirement and calculated as follows - PS x 3/80 x FPE x AF where: PS is the person s pensionable service FPE is the person s final pensionable pay AF is a factor specified by the Scheme Actuary a lump sum compensation payment payable on compulsory early retirement and shall be calculated as follows: NEPS x 3/80 x FPE where: NEPS is the notional enhancement of pensionable service calculated in accordance with rule

18 (d) FPE is the person s final pensionable pay an annual compensation payment payable from compulsory early retirement up to and including the day before the member reaches age 60 and calculated shall be calculated as follows: (PS +NEPS) x 1/80 x FPE where: PS is the person s pensionable service NEPS is the notional enhancement of pensionable service calculated in accordance with rule 3.18 FPE is the person s final pensionable pay (e) an annual compensation payment payable as provided in rule 3.17 and calculated shall be calculated as follows: (NEPS PR) x 1/80 x FPE where: NEPS is the notional enhancement of pensionable service calculated in accordance with rule 3.18 PR is calculated as follows: Where the person is re-employed in the Public Service after compulsory early retirement and the period between the date of his compulsory early retirement and the date of his reemployment is less than the period represented by the notional enhancement of his pensionable service in accordance with rule 3.18, PR is the aggregate of each re-employment period. For the purposes of this rule, reemployment period means the period beginning with the date of re-employment in the Public Service after compulsory early retirement to the end of the period represented by the notional enhancement of pensionable service calculated in accordance with rule 3.18 or, if it occurs earlier, the end of that period of reemployment. FPE is the person s final pensionable pay from the employment in respect of which he is taking compulsory early retirement 3.8 Section 2 and 3 optants out shall not be eligible for the lump sum compensation payment in rule 3.7. Calculation of compulsory early retirement benefits 3.9 For the purpose of calculating compulsory early retirement benefits, all service in the Public Service of an optant out shall be treated as service as a member of GUS. 14

19 3.10 The compulsory early retirement benefits of a new entrant shall be calculated by reference to current pensionable service (as defined in rule 3.4 ) in place of pensionable service Subject to rule 3.12, the lump sum compensation payment in rule 3.7, shall be the equivalent of six months final pensionable pay For the purpose of calculating the lump sum compensation payment referred to in rule 3.7, final pensionable pay shall be calculated as follows where the person has a period of part-time service to which paragraph or applies: in the case of a member who has exercised the option under Rule 2.5, where there is part-time service in the last three years of reckonable service, final pensionable pay shall be calculated as final pensionable pay is calculated under rule 4.2 for the purposes of calculating the lump sum compensation payment under rule 2.5; and in the case of a person who is not a Rule 2.5 Optant, where there is part-time service in the 12 months ending with the last day of the person s reckonable service or in the last two years ending during or at the same time as his active membership period of Isle of Man Government Unified Scheme, final pensionable pay shall be calculated in accordance the rules of that Scheme A member may opt to exchange all of the annual compensation payment in rule 3.7 (e) which he would otherwise receive for a lump sum which shall be determined by the PSPA after consultation with the Scheme Actuary. The option must be exercised by notice in writing to the scheme administrator in such form as the PSPA requires before this annual compensation payment comes into payment on reaching pension age. If the option is not exercised, the annual compensation payment will be paid from pension age for life. In the case Section 2 and Section 3 optants out the annual compensation payment in rule 3.7(e) will be automatically exchanged for a lump sum which shall be determined by the PSPA after consultation with the Scheme Actuary and shall be paid on reaching age Subject to paragraph below and to rules 3.15 to 3.17, the notional enhancement of pensionable service for the purposes of rules 3.7 to 3.7(e) shall be 6⅔ years subject to the limit that the resulting annual compensation payment in rule 3.7(d) may not exceed the notional annual compensation payment as defined in rule For the purpose of determining the notional enhancement of pensionable service in paragraph above, the resulting annual 15

20 compensation payment in rule 3.7(d) shall be calculated using final pensionable pay The notional annual compensation payment shall be calculated as follows: RS + x 1/80 x PFPP where: RS is the person s pensionable service as at the date of compulsory early retirement PRS means projected pensionable service and is the pensionable service which would have accrued from the day after the date of compulsory early retirement to the day before the person attained pension age if the person had remained in full-time employment instead of being retired early except that no account shall be taken of any added years or contributed pension which would have been bought in this period PPE means projected pensionable pay and is what the person s final pensionable pays would have been if he had remained in fulltime employment to pension age instead of being retired early. For the purpose of calculating this amount: no account shall be taken of any increase in the elements which make up final pensionable pay other than: (i) an increase which would have been due under assimilation arrangements provided that such arrangements have been promulgated at the date of the compulsory early retirement; and (ii) an increase in the elements that make up final pensionable pay which has been promulgated at the time of the compulsory early retirement, notwithstanding that it is not due to be brought into payment at that time; pay from a grade or pay band held on temporary promotion or from a grade or pay band in which the person was substituting or deputising for an absentee shall be taken into account if the department in which the person was so employed is of the opinion that, if the person had not been retired early, it would have expected such temporary promotion, substitution or deputising to have continued until the person reached pension age or until a date within the last two complete scheme years ending during or at the same time as the period from the day after compulsory early retirement to the day before the person reached age The notional enhancement of pensionable service shall not exceed the length of pensionable service as at the date of compulsory early retirement. 16

21 3.17 For persons who work part time, the notional enhancement of pensionable service of 6⅔ years in rule 3.12 shall be reduced in the same proportion that the person s actual pensionable service bears to what it would have been had the service been given in a full-time capacity. For the purpose of calculating the notional annual compensation payment, PRS will be assessed on the basis that the employment would have been in a full-time capacity and then reduced in the same proportion as the notional enhancement of 6⅔ years was reduced. Compulsory retirement benefits for Public Servants who have reached age If a person to whom this section applies is, after 31st March 2012, compulsorily retired on the grounds of structure or limited efficiency or retired on the ground of redundancy; has reached age 60 on the date of compulsory retirement; and has (i) in the case of a new entrant, five or more years current qualifying service; or (ii) otherwise, five or more years qualifying service, the person is eligible for a lump sum compensation payment which is the equivalent of six months final pensionable pay For the purpose of calculating the lump sum compensation payment referred to in rule 3.18, final pensionable pay is calculated in accordance with rule 3.12 where the person has a period of part-time service to which paragraph or of rule 3.12 applies A person shall not be regarded as compulsorily retired for the purposes of rule 3.18 on ceasing to be in the Public Service if the person is reemployed in the Public Service after not more than 28 days. Compulsory Early Severance Eligibility for compulsory early severance benefit 3.21 Subject to rule 3.22, a person to whom this section applies shall be eligible for the compulsory early severance benefit specified in rule 3.27 if: he has at least one year s qualifying service; and he is under the age of 50 or he has less than five years qualifying Service; and he is compulsorily retired early on the grounds of structure or limited efficiency or retired early on the ground of redundancy. 17

22 3.22 In the case of a new entrant, the reference to qualifying service in rule 3.21 shall be deemed to be a reference to current qualifying service (as defined in rule 3.4). Calculation of compulsory early severance benefit 3.23 For the purpose of rule 3.21, and subject to rules 3.24 to 3.26, compulsory early severance benefit means a compensation payment calculated as follows: one month s final pensionable pay multiplied by the length of the person s pensionable service: one month s final pensionable pay multiplied by the length of the pensionable service given after the later of: (i) (ii) the date on which five years qualifying service is completed; and the person s 30th birthday; plus one month s final pensionable pay multiplied by the length of the pensionable service given after the 35th birthday; up to a maximum of three years final pensionable pay For the purpose of calculating compulsory early severance benefit, all service in the Public Service of an Optant out shall be treated as service as a member of GUS The compulsory early severance benefit of a new entrant shall be calculated by reference to current pensionable service and current qualifying service (each as defined in rule 3.4) in place of pensionable service and qualifying service, respectively Where there is part-time service in the 12 months ending with the last day of the person s pensionable service or in the last two complete scheme years ending during or at the same time as his active membership period of GUS, in calculating the maximum compulsory early severance benefit, final pensionable pay will be the higher of: the person s final pensionable pay; or the greater of the following amounts: (i) (ii) the member s permanent pensionable pay in the 12 months ending with the last day of his reckonable service, and the member s permanent pensionable pay in one of the last two complete scheme years ending during or at the same time as his active membership period, 18

23 then multiplied by A/B where (i) (ii) A is his pensionable service and B is what his pensionable service would have been if he had worked full-time throughout the period of his service which reckons. Flexible Early Retirement Eligibility for flexible early retirement benefits A public servant to whom this section applies shall be eligible for the flexible early retirement benefits specified in rule 3.28 if: he is aged 50 or over; he has five or more years qualifying service; and he is retired early under flexible early retirement. Flexible early retirement benefits A.4 For the purpose of rule 3.27 and subject to rule 3.29, flexible early retirement benefits are those set out in rules 3.7 to 3.7(e). For the purpose of calculating flexible early retirement benefits, references to compulsory early retirement benefits and compulsory early retirement shall be read as references to flexible early retirement benefits and flexible early retirement, respectively GUS optants out and Section 2 optants out shall not be eligible for the lump sum compensation payment in rule 3.7. Calculation of flexible early retirement benefits For the purpose of calculating flexible early retirement benefits, all service in the Civil Service of a GUS optant out shall be treated as service as a member of GUS and all service in the Public Service of a Section 2 optant out shall be treated as service as a member of Section 2 of GUS. Flexible Early Severance Eligibility for flexible early severance benefit 3.31 Subject to rule 3.32 a person to whom this section applies shall be eligible for the flexible early severance benefit specified in rule 3.32 if: he has at least one year s qualifying service; and he is under the age of 50 or he has less than five years qualifying service; and he is retired early under the flexible category. 19

24 Calculation of flexible early severance benefit 3.32 For the purpose of rule 3.30 and subject to rules 3.33 to 3.34 flexible early severance benefit means a compensation payment calculated as follows: (d) two weeks final pensionable pay for each year of reckonable service during the first five years of qualifying service; plus three weeks final pensionable pay for each year of reckonable service during the next five years of qualifying service; plus four weeks final pensionable pay for each year of reckonable service after the first ten years of qualifying service; plus two weeks final pensionable pay for each year of reckonable service after the fortieth birthday, up to a maximum of two years final pensionable pay For the purpose of calculating flexible early severance benefit, all service in the Public Service of a GUS optant out shall be treated as service as a member of GUS Where there is part-time service in the 12 months ending with the last day of the person s reckonable service or in the last two complete scheme years ending during or at the same time as his active membership period of GUS, in calculating the maximum flexible early severance benefit, final pensionable pay will be calculated in accordance with Rule 12.6 of GUS. 4 FURTHER PROVISIONS Part-time service 4.1 Other than as described in this rule and rule 4.2, benefits for part-time staff who are retired early will be determined in the same way as for full-time staff. In determining enhancement to pensionable service under rule 2.3, the enhancement of 6⅔ years will be reduced in the proportion that the Public Servant s actual pensionable service bears to what it would have been had the service been given in a full-time capacity. For the purposes of limiting benefits to those which would have been earned had service continued to the pension age, the element of projected pensionable service will be assessed on the basis that the employment would have been in a full-time capacity and then reduced in the same proportion as the enhancement of 6⅔ years was reduced. 20

25 4.2 Where there is part-time service in the last three years of pensionable service, then: In calculating the lump sum compensation payment under rule 2.3 and the maximum additional compensation payment under rules 2.8a or 3.3a, `pensionable pay will be the greater of: or the Public Servant's pensionable pay calculated by reference to the actual pay and pensionable emoluments in whichever of the last three years of pensionable service gives the highest figure, rather than by reference to the full-time rate of pay; the Public Servant's pensionable pay will be the public servant's Final Pensionable Pay multiplied by A/B where: A is his pensionable service, and B is what his pensionable service would have been if he had worked full-time throughout the period of his service which reckons. Widows' and dependants' benefits 4.3 In rule 37.1 and 50.5 of GUS, which define the length of pensionable service for which contributions are due for Ill Health Pension or Dependents Benefits, the amounts `A' and `B' will be taken to include any enhancement of pensionable service under rule 2.2, except in the case of enhancement under the provisions of rule RE-EMPLOYMENT 5.1 Where a former public servant has received a payment under the Rules of the former Civil Service Compensation Scheme Rules, (as applied to the Isle of Man), the former section 10 Rules of the Principal Civil Service Pension Scheme, (as applied to the Isle of Man) or through Rules 2.3, 2.12, 2.20, 3.7 and 3.18 of this Scheme, who has received compensation for loss of office in the form of: early payment of pension; or An annual compensation payment calculated in accordance with rule 3.7 of this scheme, or the equivalent regulations in the former provisions of the Civil Service Compensation Scheme; shall be deemed to be in receipt of a Pension attributable to his or her own Pensionable Service under GUS, and in accordance with Rule 14.1 of GUS be ineligible to join that Scheme. 21

26 5.2 A Public Servant who meets the criteria of Rule 5.1 above and is compulsorily retired early on grounds of redundancy he or she will receive a compensation payment calculated, from the date of their reemployment, under Rule 2.9 of this Scheme. 5.3 Where a former public servant has received compensation for the loss of office under rules 2.9, 2.10, 2.11, 2.12 and 3.28 (Severance payments for loss of office) or the equivalent regulations in the former provisions of the Civil Service Compensation Scheme or Section 10 of the PCSPS, he or she will be eligible to rejoin GUS in accordance with the Rules of that Scheme 5.4 Any public servant to whom rule 5.3 applies, for the purpose of calculating any further award of benefits under rules 2.8 or 2.10 or 2.14, other than an award of pension benefits, or 2.15, or 9.3 the limit contained in rule 2.3 the benefits that are deemed to have been earned under that rule shall be calculated as if service had begun on the date of re employment. 5.5 For the purposes of rule 5.6, former pension arrangements means the pension scheme that the public servant was a member of up to an including 31 March Where a former public servant has received a payment under Rules 2.3, 2.12, 2.20,3.7 and 3.18 of this Scheme, or the equivalent rules of the former Civil Service Compensation Scheme,(as applied to the Isle of Man) or the former section 10 Rules of the Principal Civil Service Pension Scheme, (as applied to the Isle of Man) and whose compensation for loss of office in the form of: early payment of pension; or An annual compensation payment calculated in accordance with rule 3.7 of this scheme; and rejoins the public service before his or her 75 th birthday, in a post that except for rule 5.1 would have been pensionable under the public servant s former pension arrangements, the annual payment will be abated in accordance with rule If upon being re-employed the public servant s salary is equal to, or higher than, his old salary, the whole of the pension will be suspended. If he or she is re-employed at a salary lower than his or her old salary, the pension in payment (including any increase under an Annual Pensions (Increase) Order) will be reduced to the amount by which his or her old salary exceeds his or her salary on his first day of re-employment. 5.8 While the public servant is re employed, the pension in payment will attract pensions increase but will not be otherwise adjusted, unless there is a change to the public servants terms and conditions that 22

27 results in an increase in salary, and before the change the whole of his pension was in payment; or results in a decrease in salary, and before the change the whole of his pension was suspended; where the public servant will be treated for the purposes of this rule as having been newly re-employed on the date of the change. In applying this rule, no account shall be taken of any decrease in pension resulting from an election made under rule 41 of GUS or Rule 3.50 of the member s former scheme. 5.9 Where a person who received a lump sum compensation payment under rule 2.4, 2.9, 2.10, 2.11, 2.14, 2.15, 3.23, 3.28 or 9.3 part of that payment will be repayable if: the period between the date of early retirement and the date of re employment, is less than the notional period in terms of months or weeks of pensionable pay represented by the compensation payment received. This rule does not apply where re employment is made on or after 1 April 1997 on merit on the basis of fair and open competition Repayment will be required only after the person has been reemployed for a period or periods totalling 15 days in any 91 day period. The amount to be repaid will be such part of the lump sum compensation payment as represents the excess of the notional period in paragraph over the period in paragraph. 6 FIXED OR LIMITED TERM APPOINTMENTS 6.1 For the purposes of this section `Public Servant' shall mean any person serving in full-time or part-time employment in the Public Service. 6.2 An employing department may if in its opinion it is necessary for management reasons to do so and if it would be appropriate to do so make at its discretion a payment to a Public Servant on a fixed or limited Term appointment which does not expressly provide that in practice notice will be given if his or her employment is terminated prior to the maximum period of employment if that appointment is terminated early by mutual consent. 6.3 The payment referred to in rule 6.2 above is by way of compensation for the unexpired period of the fixed or limited Term appointment and will be calculated as follows: 23