Pension Schemes (Northern Ireland) Act 1993

Reduced rates of state scheme Class 1 contributions

37 Reduced rates of Class 1 contributions for earners in contracted-out employment

(1) Where the earnings paid to or for the benefit of an earner in any tax week are in respect of an employment which is contracted-out employment at the time of the payment, the amount of a Class 1 contribution in respect of so much of the earnings paid in that week as exceeds the current lower earnings limit but not the current upper earnings limit for that week (or the prescribed equivalents if he is paid otherwise than weekly) shall be reduced—

(a) in the case of a primary Class 1 contribution, by an amount equal to 1.8 per cent. of that part of those earnings; and

(b) in the case of a secondary Class 1 contribution, by an amount equal to 3 per cent. of that part of those earnings.

(2) Where—

(a) an earner has ceased to be employed in an employment; and

(b) earnings are paid to him or for his benefit within the period of 6 weeks, or such other period as may be prescribed, from the day on which he so ceased,

that employment shall be treated for the purposes of subsection (1) as contracted-out employment at the time when the earnings are paid if it was contracted-out employment in relation to the earner when he was last employed in it.

(3) This section shall not affect the amount of any primary Class 1 contribution which is payable at a reduced rate by virtue of regulations under section 19(4) of the [1992 c. 7.] Social Security Contributions and Benefits (Northern Ireland) Act 1992 (reduced rates for married women and widows).

38 Alteration of rates of contributions under s. 37

(1) Whenever the Secretary of State makes an order under section 42 of the [1993 c. 48.] Pension Schemes Act 1993 altering, with effect from any date, either or both of the contracted-out percentages for the time being applying under section 41 of that Act, the Department may make a corresponding order for Northern Ireland altering, with effect from the same date, either or both of the contracted-out percentages applying under section 37.

(2) An order under subsection (1) may contain consequential provisions altering any percentage for the time being specified in paragraph 2(3) of Schedule 3 as that percentage applies in relation to earnings paid or payable on or after the day as from which the order is to have effect.