Date posted: 01/03/2010

Audience: This Notice will be of particular interest to:

  • HR staff involved with departures attracting compensation under the CSCS

Action: You should:

  • Note the changes to the current CSCS CER terms which affects those aged between 57 and 60 who left on CER terms on or after 16 July 2008 and those age 60 and over who left on CER terms on or after 1 April 2009.
  • Ensure an additional payment is made to those ex-members identified by your pension scheme administrator. Write to them using the attached form of words.
  • Work with your pension scheme administrator to ensure that there is no double-payment to those who have received early payment of the CER top-up compensation lump sum in consequence of raising a grievance or lodging a claim through Internal Dispute Resolution or with the Employment Tribunal.
  • Ensure your Finance colleagues are aware of the cost implications.

Timing: Immediate

  1. We explained in EPN253 that we were planning to amend the current CSCS rules to allow those whose last day of service is on or after 16 July 2008 on CER terms aged between 57 and 60 and to those whose last day of service is on or after 1 April 2009 on CER terms age 60 and over to receive the full 6 months lump sum compensation payment.
  2. We can now confirm that the CSCS amendments were laid before Parliament on the 5 February. We have instructed your pension scheme administrators to revise all CER awards that fall into either of the categories mentioned above.
  3. Please work with your pension scheme administrators to identify those that have already received the top up payment by way of an ex-gratia payment, to ensure they do not receive the payment again. These may be individuals who have raised a grievance with you or have taken their complaint to an Employment Tribunal.
  4. The additional ‘top up’ payment will be the difference between full 6 months lump sum compensation payment less the tapered lump sum or the statutory redundancy payment already received, plus interest for late payment. Your administrators will inform you of the ‘top up’ payment, including interest, which you should then pay to the individual. As this is an early exit lump sum compensation payment you should pay it from the same account as you internally charge your monthly early retirement bills you receive from Capita. We have provided a form of words for you to write to all those receiving a CER ‘top up’ compensation lump sum payment.
  5. The additional top up payment is not payable to anyone who has left or leaves on either Compulsory Early Severance or Flexible Early Severance terms.
  6. We have asked your administrator to identify those whose total compensation payment comes to more than the £30,000 (the tax free element on compensation). If any of these are identified you should deduct tax only from the amount that exceeds £30,000 of the total payment.
  7. You should ensure that your Finance department is aware of the additional CER top-up compensation lump sum payments.
  8. We have provided a work around for your APAC to use on PenServer for any future CER cases. This means that in future anyone leaving on CER age 57 or above will receive the full 6 months lump sum compensation payment from Capita in the normal way.

References

EPN251 and EPN253

Contacts

Enquiries about content, distribution or to receive in a different format

employerhelpdesk@cabinet-office.x.gsi.gov.uk
01256 846414
Employer Helpdesk
Civil Service Pensions
Grosvenor House
Basing View
Basingstoke
RG21 4HG

Published:
1 March 2010
Last updated:
25 January 2022