The Teachers (Compensation for Redundancy and Premature Retirement) Regulations 2015

PART 6 Adjustments

Application of this Part

26.  This Part applies to eligible teachers.

Redundancy payments

27.—(1) This regulation applies to a credited teacher (C) where—

(a) C’s credited period exceeds 6 2/3rds years; and

(b) C has received, or is to receive, compensation under regulation 6 in respect of the cessation of C’s former employment.

(2) If C’s lump sum compensation payable under regulation 20 would exceed the relevant amount, it is to be reduced by the relevant amount.

(3) If C’s lump sum compensation payable under regulation 20 would equal the relevant amount, it is not to be paid.

(4) If C’s lump sum compensation payable under regulation 20 would be less than the relevant amount—

(a) it is not to be paid; and

(b) the rate of C’s annual compensation payable under regulation 19 is to be determined by the scheme manager on advice from the scheme actuary.

(5) The relevant amount is—

where—

A is the amount of the redundancy payment;

B is the length of time, expressed in years and any fraction of a year, by which the credited period exceeds 6 2/3rds years.

Termination payments

28.—(1) This regulation applies to a credited teacher (C) who receives a termination payment.

(2) A termination payment is the aggregate of any lump sum payments made to C by C’s former employer which—

(a) are made in consequence of, or as compensation for, the loss of C’s former employment;

(b) are made in pursuance of any contract or arrangement or any provision contained in, or made under, any enactment, whenever made or enacted;

(c) are not made by way of an excepted payment.

(3) The excepted payments are—

(a) a redundancy payment in respect of the cessation of C’s former employment;

(b) so much of any payment in lieu of notice of termination of that employment as does not exceed the remuneration which C would, but for its termination, have received for the three months following the material date;

(c) compensation paid under regulation 8, 10, 11, 19 or 20.

(4) If C’s lump sum compensation under regulation 20 would exceed the termination payment, it is to be reduced by the amount of the termination payment.

(5) If C’s lump sum compensation under regulation 20 would be equal to the termination payment, it is not to be paid.

(6) If C’s lump sum compensation under regulation 20 would be less than the termination payment—

(a) it is not to be paid; and

(b) C’s annual compensation under regulation 19 is to be reduced by the difference.

(7) C’s annual compensation under regulation 19 is to be reduced by the amount of the termination payment if—

(a) by reason of regulation 27(3) or (4) no lump sum compensation is payable under regulation 20; or

(b) lump sum compensation was paid under regulation 20 before the termination payment became payable.

(8) The reduction under paragraph (6)(b) in annual compensation payable under regulation 19 is a reduction in the total amount payable, and accordingly payment is to be suspended until the full reduction has been achieved

Periodic payments

29.—(1) This regulation applies if—

(a) relevant periodic payments are payable to a credited teacher or to a person to whom compensation is payable under regulation 21 or 22; and

(b) the material date is later than 31st August 1985.

(2) Relevant periodic payments are payments made by the credited teacher’s former employer which—

(a) are in respect neither of a lump sum nor of a return of contributions;

(b) are made as mentioned in regulation 28(2); and

(c) are not made under regulation 13.

(3) If the relevant periodic payments in respect of any period equal or exceed the annual or other compensation that would be payable in respect of that period, excluding any compensation paid under regulation 9 or 13, the compensation is not to be paid.

(4) If the relevant periodic payments in respect of any period are less than the compensation referred to in paragraph (3), that compensation is to be reduced by the amount of those payments.

Cessation of discretionary annual compensation during new employment

30.—(1) If a credited teacher (C) enters further employment, compensation payable under regulation 18(1) is to be reduced in accordance with this regulation.

(2) The reduction mentioned in paragraph (1) is to be made if the result of the calculation in paragraph (3) exceeds F, where F is the total, in years and any fraction of a year, of C’s reckonable service assuming that C had remained in the former employment until, being an existing scheme member, C attained the age of 65 or, being a 2015 scheme member, C attained normal pension age.

(3) The calculation is as follows—

where—

A is C’s effective service;

B is the period, in years and any fraction of a year, between the material date and the later of the date of completion of the further employment and the date C, being an existing scheme member, attains the age of 65 or, being a 2015 scheme member, attains normal pension age;

C is the credited period;

D is the total period in respect of which any previous reductions were made to compensation payable under regulation 31(1) as a result of C entering further employment;

E is the total, in years and any fraction of a year, of any additional periods of service credited to C in respect of termination or redundancy under the provisions referred to in paragraph 1 of Schedule 2.

(4) The reduction mentioned in paragraph (1) is to be calculated in accordance with the following formula—

where—

• G is the period, in years and any fraction of a year, by which the result of the calculation in paragraph (3) exceeds F;

• H is the shorter of B and C-D;

• J is the lower of C’s average salary in the former employment and the figure produced by applying the formula where K is C’s average salary in the new employment and L is the PIA index adjustment.