Worth the leaving the NHS for private sector?

Newheight13

Hello,

I’m currently a band 8A working for the NHS, and have been offered a new job in the private sector. The pay is 10k higher which I thought was great, but the pension only has  a 6% employer contribution. I’ve currently been working for the NHS for 12 years so at top of the band and 33 days holiday. 

Any thoughts on the above? 

Many thanks 

itsthelittlethings

I wouldn’t have thought it would be worth it when you factor in the pension.

elsien

How do the job roles themselves compare, plus holidays, sick leave, and all the other stuff? 

Newheight13

Pretty much equal everywhere else. Just the pension is a concern I think, though I’m not sure I understand the true value of my pension. 

Grumpy_chap

Newheight13 said:

Hello,

I’m currently a band 8A working for the NHS, and have been offered a new job in the private sector. The pay is 10k higher which I thought was great, but the pension only has  a 6% employer contribution. I’ve currently been working for the NHS for 12 years so at top of the band and 33 days holiday. 

Any thoughts on the above? 

Many thanks 

What was your reason for looking for a new role?

If the driver was primarily money, then you need to factor in the value of the pension.

If the driver was other factors, the overall reward package value might be less significant.

The NHS pension is quite amazing how much it pays - my wife worked in an NHS admin role for few years and her pension looks set to beat mine by a mile

Silvertabby

Newheight13 said:

Hello,

I’m currently a band 8A working for the NHS, and have been offered a new job in the private sector. The pay is 10k higher which I thought was great, but the pension only has  a 6% employer contribution. I’ve currently been working for the NHS for 12 years so at top of the band and 33 days holiday. 

Any thoughts on the above? 

Many thanks 

In round figures:

New job  £70K per year.
6% employer's pension contribution = £4,200 (assuming employer contributions are based on ALL of your salary - not always the case)
10% your contribution = £7K
Total = £11,200, plus or take depending on your investment choices.  This is a one-off return for one year's service.

NHS £60K per year
Employer's contributions are irrelevant.
10.7% your contribution = £6,420
In return, you will have accrued a fully protected fully index linked pension of £1,111 per year (which will increase by CPI plus 1.5% while you remain an active member of NHS pensions).  Unlike the £11,200 one-off contribution, this pension of £1,111 plus per year will be paid for the rest of your life.

Plus, don't forget to factor in the other benefits of being a contributing member of NHS pensions - death benefits, ill health benefits, redundancy terms etc etc.

If your decision is based purely on finances, then your new job would have to pay a LOT more than an extra £10K to compensate for the pension rights you would be giving up.  

Marcon

Newheight13 said:

Hello,

I’m currently a band 8A working for the NHS, and have been offered a new job in the private sector. The pay is 10k higher which I thought was great, but the pension only has  a 6% employer contribution. I’ve currently been working for the NHS for 12 years so at top of the band and 33 days holiday. 

Any thoughts on the above? 

Many thanks 

How old are you?

Newheight13

I’m 34 years old. I’ve been working in the NHS for 12 years and started on a band 4. I would still have income protection with my new role and death benefits. I’m happy we’re I’m working but the new role does give me more time with my family which I value over money. That said, I do want to make sure they’re finically secure.

 The new company have  asked what wage I would want, so I want to go in with an amount that’s matches the package I’m on basically?? Any comments on that would be very helpful!!

Also, since starting at the NHS I now have a MS which could potentially cut my career short. Does this mean that I wouldn’t be eligible for life insurance with my new employer as I already have a medical concern? 

Many thanks for all the helpful comments.  🙂

NCC1701-A

Elsein mentioned comparing sick leave above, another way of thinking about it is your acceptance of risk and ability to cope with income fluctuations.

You'd be moving from your current entitlement of 6 months full pay followed by 6 months half pay to starting to build up a new entitlement from scratch in the new job.  You could take out private income protection or use savings to cover mortgage, rent & bills should the worse happen and this would be another cost.  

You've obviously done very well to move from band 4 to 8a in just 12 years.  What are the career opportunities like in the new organisation and does this remain important to you?

That all said, extra time now with family is irreplaceable.  

Only you can weigh up all the pros and cons given your needs and wants, trying to convert such a decision in £s isn't always helpful.

Newheight13

Thank you, another thing I hadn’t considered was sick pay of 6 months I’ve accumulated. Lots to consider for sure! 

Marcon

Newheight13 said:

I’m 34 years old. I’ve been working in the NHS for 12 years and started on a band 4. I would still have income protection with my new role and death benefits. I’m happy we’re I’m working but the new role does give me more time with my family which I value over money. That said, I do want to make sure they’re finically secure.

 The new company have  asked what wage I would want, so I want to go in with an amount that’s matches the package I’m on basically?? Any comments on that would be very helpful!!

Your family will never again be as young as they are now (ditto you), and family time can never be replaced - but financial security is important too, as you are clearly aware. Taking out your own life cover (see below) is worth considering.

You've already said the pay is £10K higher, which gives a pretty clear indication of what the company is going to agree to pay as a maximum.

You are only 34, so a pension contribution rate of 6% from the employer isn't overly generous, but isn't out of line for that age. If you were 54 and being offered 6%, it would be much less attractive (the money has much less time to 'grow').

Newheight13 said:

Also, since starting at the NHS I now have a MS which could potentially cut my career short. Does this mean that I wouldn’t be eligible for life insurance with my new employer as I already have a medical concern? 

Many thanks for all the helpful comments.  🙂

Not sure what 'a MS' - is that multiple sclerosis, or medical shorthand for something else? Either way, if it could impact on your career, ill health early retirement from active (contributing) membership of the NHS scheme is a hugely valuable benefit if you are no longer able to work. You certainly need to look at the sick pay conditions, including whether your new employer offers 'salary replacement insurance' (aka Permanent Health Insurance - nothing to do with medical insurance).

Group life insurance policies do sometimes exclude certain conditions, but only where death is either imminent or the risk of death in the immediate future is much increased. Again, it's a point to check. If your diagnosis makes it very expensive to take out your own life cover on top of whatever the employer offers, ask if it's possible to have higher life cover with your new employer. They may agree to provide this as part of your package, or ask you to pay the extra premium (which is usually a lot lower than the rate you'd get as an individual).

This all looks like a lot of questions and demands, but it all comes down to negotiation. Make sure you have a clear idea of what you are asking for, and where the deal blockers are ie don't say something is 'essential' and then back down, because it just makes you look weak and a sitting target to be trodden on. Your career progression so far makes it obvious that you are an extremely strong candidate, so use that to your advantage. You are at your strongest just before you agree the contract - once you've accepted, your power is effectively gone until the next round of salary negotiations.