Being done out of pension !

paternoster

My civil service employer decided to offer me early retirement. As I was in a final salary scheme all paperwork, naturally, set out my pension based on the salary I earned to date.
The correspondence made clear that I if I accepted the offer it constituted a binding contract. I accepted the offer and had a formal leaving date of 29 Feb 2012. As I had some leave owing I left the office in mid- Feb.

On 28th Feb the employer phoned me and told me that I had been overpaid for 3 years, owed them £10K+, and that my pension would now be reduced by about £3K pa.

I dispute that I have been overpaid, but all my paperwork was disposed of before I left, and HR cannot find anything that definitively states that I should have received any lower sum.

I have enlisted union help, but this matter has now been dragging on nearly 6 months, and I`m still waiting on `policy` or `HR` to rule finally on the matter.

Can the contract with the original pension based on final salary figures merely be reduced unilaterally?

Can this alleged overpayment be enforced by the employer?

Are there any further steps I can take, because my decision to leave was based on an income that I`m now not getting?

dunstonh

Can the contract with the original pension based on final salary figures merely be reduced unilaterally?

If an error was made and can be shown to be the case then you have no entitlement to benefit from that error.

Can this alleged overpayment be enforced by the employer?

The employer is not the issue. The trustees/administrators are the ones driving it.

Are there any further steps I can take, because my decision to leave was based on an income that I`m now not getting?

You need to leave it to the union to investigate and keep pestering them and check what they are doing is right.

themull1

Must have been a hell of an overpayment!! did your salary level match that on your payslips?

mjm3346

How are you repaying the £10k+ that you owe? Unless it is being deducted from the "new" pension figure the numbers do not appear to add up.

Strange you still have such faith in HR as you posted this only yesterday

paternoster wrote: »

I doubt that HR will get it wrong, they see cases like this frequently, and the rules are published for all to see. Have you seen the internal guidance on your departments intranet? If not, ask HR to provide it. Also the suggestion made earlier about contacting the union is a good one.
I`ve forgotten the exact formula, but your manager (or managers manager) will decide what %, up to 100% you qualify for. The percentage is appealable. The potential compensation, based on on years accrued and salary, is based on set figures and not appealable.
I hope you get a good outcome, and recover in time.

https://forums.moneysavingexpert.com/discussion/comment/55199723#Comment_55199723




and the same applies to your duplicate post here
https://forums.moneysavingexpert.com/discussion/comment/55200273#Comment_55200273

rpc

I am curious - in this case, if the overpayment is proven to be correct and is reclaimed, can someone in the OP's position 'undo' early retirement?

OP took early retirement based on the figures in the proposal. It seems to me that either the company/trustees are estopped from changing them or that the OP should be allowed to go back to work (providing that the finances were a fundamental factor in the decision to take early retirement, which they surely are).

Usually when this crops up it is because someone is given a quote and then the quote is revised. That I understand, but once the early retirement has been taken it is a very different scenario.

paternoster

mjm3346 wrote: »

How are you repaying the £10k+ that you owe? Unless it is being deducted from the "new" pension figure the numbers do not appear to add up.

Strange you still have such faith in HR as you posted this only yesterday

Its simple:

My issue is not provided for in any guidance, and the issue arose with local business managers, not HR who are at one remove.

I was never notified of any alleged overpayment until I had left and accepted the pension quote.

The overpayment is alleged to be over a number of years, hence it size. I am still disputing it, and have not repaid anything

paternoster

rpc wrote: »

I am curious - in this case, if the overpayment is proven to be correct and is reclaimed, can someone in the OP's position 'undo' early retirement?

OP took early retirement based on the figures in the proposal. It seems to me that either the company/trustees are estopped from changing them or that the OP should be allowed to go back to work (providing that the finances were a fundamental factor in the decision to take early retirement, which they surely are).

Usually when this crops up it is because someone is given a quote and then the quote is revised. That I understand, but once the early retirement has been taken it is a very different scenario.

exactly the point! thank you

jackyann

I too am confused. You state that you were overpaid for 3 years, and the total sum was about £10k; ie: about £3,300 pa.
That means your final salary was £3,300 less pa than you expected, and your pension will be based on this. That doesn't mean £3k less pension (although of course I accept that whatever the proportion is, it makes a difference). Maybe the "£3k less pa" includes repayment of overpaid salary - and maybe you can repay this over a much longer period of time.

I am surprised that you destroyed all the paperwork - a cautionary tale for others - I still have mine, 2 years after retirement.
I agree that the only course is to use the union (thank goodness you are in one!) and drive as hard a bargain as you possibly can. As you must be below State Pension age, maybe you can suggest that repayment waits until you have that income.

Goldenyears

IF there was an overpayment and IF it was unreasonable for you to know there was such an overpayment, then they cannot force you to repay this amount of £10K (nevertheless they would reduce your pension). I have personal knowledge of such a precedent.

dunstonh

Goldenyears wrote: »

IF there was an overpayment and IF it was unreasonable for you to know there was such an overpayment, then they cannot force you to repay this amount of £10K (nevertheless they would reduce your pension). I have personal knowledge of such a precedent.

Expectation is certainly an issue and it is one that can work. However, I am aware of cases where that has been tried and failed because of paperwork issued years previous that showed the error if anyone actually looked at is closely. You have to feel that documentation is going to play a key part in this.