When ill-health stops you from working, your Local Government Pension Scheme (LGPS) may be paid straight away, regardless of your age. But it is quite a complex process and depends on a number of factors – including your employer’s consent, the severity of your illness and whether your condition is likely to improve.
If you are too ill to continue to work, you need to firstly discuss your options with your employer who will support you through the process. This may include discussions around your continued employment.
To be eligible to be considered for an ill-health pension you must:
- Be below normal pension age.
- Have at least 2 years qualifying service (not just 2 years in current employment, you may have other qualifying service such as a transfer in or previous local government pension service).
- Be permanently incapable to do your job until your normal pension age. *
- Not be immediately capable of undertaking gainful employment**
- Have been certified by the Independent Registered Medical Practitioner (IRMP) as meeting the ill health pension criteria
* Permanently incapable means the member will, more than likely not, be incapable to do their current job efficiently until, at the earliest his/her Normal Pension Age. Check your State Pension age - GOV.UK (www.gov.uk)
Please note - if a member would on the balance of probabilities, recover sufficiently to be capable of undertaking their current employment before their normal pension age, they cannot be permanently incapable.
** Gainful employment means paid employment for at least 30 hours a week for a period of at least a year. This is not comparable to your current employment. For example, if you are currently employed in a more physical role, but would be capable of working in an office, this would be deemed as gainful employment.
It is important to note that although a discussion around your continued employment due to your ill-health may take place, an award for an ill-health pension is not guaranteed.
If you are awarded a pension early on permanent ill-health, your employer will also determine the level of benefits due to you. This is decided based on when you are likely to be capable of gainful employment.
|Member is incapable of undertaking any gainful employment before Normal Pension Age Check your State Pension age - GOV.UK (www.gov.uk)
|All the pension built up plus an enhancement of 100% of benefit that could have been built up between leaving and your Normal Pension Age.
|Permanent – payable for life
|Member is incapable of undertaking any gainful employment for at least 3 years, but is likely that they will be capable of doing so before Normal Pension Age. Check your State Pension age - GOV.UK (www.gov.uk)
|All the pensions built up plus an enhancement of 25% of benefit that could have been built up between leaving and Normal Pension Age.
|Permanent – payable for life
|Member is currently incapable of undertaking any gainful employment, but is likely that they will be capable of doing so within 3 years.
|All the pension built up on leaving employment (no pension enhancement to Normal Pension Age). Check your State Pension age - GOV.UK (www.gov.uk)
|Paid for a maximum of 3 years (with a review at 18 months)
If you are ill to continue to work, you firstly need to discuss your options with your employer who will support you though the process. This may include discussions around your continued employment including, reasonable adjustments to your current role which enables you to continue in your current employment.
Please note- that although discussions around your continued employment due to your ill-health may take place, an award an ill health retirement is not guaranteed.
Under the LGPS your employer must seek the medical opinion of an Independent Registered Medical Practitioner (IRMP). An IRMP is a doctor qualified in occupational health medicine, who has not been involved in your case before and who is authorised to act by the Staffordshire Pension Fund.
Your employer will provide the IRMP with details of your occupation and sickness records. You will also be asked to provide as much information as you can about your medical condition. Your GP or Consultant may be able to assist you with this part of the process.
Once the IRMP has completed their review they notify your employer, confirming whether you meet the ill – health retirement criteria. They will also give an opinion whether you should be eligible for a Tier 1, Tier 2, or Tier 3 ill-health pension.
Based on the IRMP report and other available information your employer will then decide whether to award you your pension early on medical grounds and the level of benefit that will be awarded.
There are two possible outcomes:
Application Approved – if your application has been accepted, your employer will let you know their decision in writing. They will also confirm which tier of pension you are eligible for. This determines the level of benefit you receive and for how long.
Application Declined – if your application is refused and your contract of employment is terminated your pension would be deferred. Staffordshire Pension Fund.
You can apply for an ill-health retirement again in the future. If you meet the criteria this time your benefits would be released early without any reductions. But if your pension has already been deferred, you would no longer be entitled to any enhanced benefits.
Appeals – If you are not satisfied with the decision you should contact your employer for clarification and further explanation. Misunderstandings or incorrect information can be explained or put right by doing so.
If you are still dissatisfied, you have a right to appeal under the Internal Dispute Resolution Process (IDRP). Staffordshire Pension Fund - How to raise a complaint or dispute.
You may not appeal purely because you disagree with the decision. Your appeal should set out any evidence of a procedural error, or any issue with the evidence that was relied on (e.g., that it was out of date, incorrect, incomplete).
Action by your Employer
If your Employer approves your ill health application, they must complete and return a leaver form to the Staffordshire Pension Fund, which notifies us that an ill health retirement has been approved and the level of benefit to be paid. The leaver form must also include your salary details up to the date your contract is terminated.
Please note due to the timing of your employer’s payroll, your employer may not be in a position to submit a completed leaver form until about 6-8 weeks after you have left employment.
Action by the Staffordshire Pension Fund
On receipt of the fully completed leaver form from your employer, the Staffordshire Pension Fund will arrange the following:
- provide you with your pension options (you must complete the pension option form and return it to the Fund)
- bank details form for you to be complete and return to the Fund
- lifetime allowance declaration – completion and return to the Fund is required by HM Treasury and Customs. This form will ask you to provide details of all other pensions (except state pensions), you are in receipt of or due to receive in the future
- copy of your birth certificate, plus if applicable copies of your marriage, civil partnership certificates and spouses birth certificate to be forwarded to the Fund
- nomination of beneficiary form for the lump sum death grant form to be complete and return to the Fund
Please note from receipt of the completed leaver form to the Fund issuing the above documentation you should allow 10 working days.
Action by you
You must complete and sign the required forms and certificates and return to the Staffordshire Pension Fund.
Payment of your monthly pension and lump sum
On receipt of your signed and completed forms together with the relevant birth certificates etc., the Fund will:
- arrange payment of any tax-free pension lump sum into your bank or building society. Please allow 15 working days from the date the Fund receives your completed forms
- arrange payment of your monthly pension will take place on the next available pay date, together with any arrears of pensions
- write to you confirming the tax-free pension lump sum paid into your bank or building society, together with information regarding payment of your monthly pension