Can my employer pay less than my contracted hours?

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sammyboy23
sammyboy23 Posts: 1 Newbie
in Pensions, annuities & retirement planning
This year I have received two salary statements from my employer. The first is my salary for pension purposes the second is a higher rate for working additional contracted hours. If my employer has contracted me to work these extra hours at the beginning of the year should my pension not be worked out from theses hours?

Thanks for any help.

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  • hyubh
    hyubh Posts: 3,531 Forumite
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    sammyboy23 wrote: »
    This year I have received two salary statements from my employer. The first is my salary for pension purposes the second is a higher rate for working additional contracted hours. If my employer has contracted me to work these extra hours at the beginning of the year should my pension not be worked out from theses hours?

    In general, no. However, what's the pension scheme?
  • ischofie1
    ischofie1 Posts: 215 Forumite
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    It's generally scheme rules that dictate this.
    My pension includes overtime payments but most don't.
  • PensionTech
    PensionTech Posts: 711 Forumite
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    The above two answers, while accurate, do assume this is a "defined benefit" pension scheme where you accrue an annual pension in retirement that is equivalent to a fraction of your annual salary while working. If we are talking about a different type of scheme, particularly an auto-enrolment defined contribution scheme, then this may be quite different.
    I am a Technical Analyst at a third-party pension administration company. My job is to interpret rules and legislation and provide technical guidance, but I am not a lawyer or a qualified advisor of any kind and anything I say on these boards is my opinion only.
  • hyubh
    hyubh Posts: 3,531 Forumite
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    PensionTech wrote: »
    The above two answers, while accurate, do assume this is a "defined benefit" pension scheme

    On a personal level, I've experienced the opposite in terms of DB vs. DC. In my current employment contract, it's explicitly stated that only basic pay is pensionable for the company's group DC scheme, whereas when I was in the LGPS, certain things beyond basic pay were pensionable (and this list subsequently grew).
  • PensionTech
    PensionTech Posts: 711 Forumite
    edited 25 April 2017 at 4:13PM
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    Ah - then my response assumes your assumption! I do apologise. What I wanted to draw attention to is that DC auto-enrolment schemes specifically must base minimum contributions on all earned income, including overtime.

    Also, another thought: though I have seen a lot of "basic pay" definitions in DB and DC schemes, "contractual earnings" or some variant is not uncommon either. As this was contracted time, not ad-hoc overtime, it'll depend even more on the specific scheme/policy wording in question (again, unless it's auto-enrolment).
    I am a Technical Analyst at a third-party pension administration company. My job is to interpret rules and legislation and provide technical guidance, but I am not a lawyer or a qualified advisor of any kind and anything I say on these boards is my opinion only.
  • Shedman
    Shedman Posts: 1,495 Forumite
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    PensionTech wrote: »
    What I wanted to draw attention to is that DC auto-enrolment schemes specifically must base minimum contributions on all earned income, including overtime....

    I thought the different Tiers within Auto enrolment meant that this wasn't necessarily the case and that there were various definitions of what needed to be included as pensionable pay and that depended on what Tier was declared as being the one to be adopted for a particular auto enrolled scheme. For example I thought a Tier 1 scheme was just based on basic pay excluding overtime, shift allowance, bonuses, etc and that it was just Tier 3 that included all earned income.
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