Redundancy

At a Glance

✓ If you are age 55 or over, your pension may become payable immediately if you are made redundant.

✓ No reduction will apply for the early payment of your main pension benefits.

✓ Your employer decides whether business efficiency retirement applies.

✓ Different rules may apply to certain additional pension benefits.

If you are age 55 or over and your employment ends because of redundancy or in the interests of business efficiency, you may be entitled to receive your LGPS pension benefits immediately.

Unlike voluntary early retirement, your main LGPS benefits will not normally be reduced for early payment.

What is the process?

If you leave employment because of redundancy or in the interests of business efficiency, the process will normally involve the following steps:

1
Employer decision
Your employer will determine that your employment is ending because of redundancy or in the interests of efficiency.
2
Notify the Fund
Your employer will notify Gwynedd Pension Fund that you are eligible to receive your benefits.
3
Calculate your benefits
The Fund will calculate your pension benefits and the options available to you.
4
Receive your retirement pack
You will receive details of your benefits and the options available.
✓
Pension starts
Your pension will start being paid from your retirement date.

Who is eligible?

You must normally:

  • Be age 55 or over on the date your employment ends.
  • Be an active member of the LGPS when you leave employment.
  • Be made redundant or leave employment in the interests of business efficiency.

What is redundancy or business efficiency retirement?

Redundancy occurs when your post ceases to exist or when fewer employees are required to carry out particular work.

Business efficiency retirement may occur when your employer decides that terminating your employment is in the interests of the efficiency of the service or organisation.

Your employer will decide whether these circumstances apply.

What benefits will I receive?

If you qualify, your LGPS benefits will become payable immediately.

This will include:

  • Your annual pension.
  • Any automatic retirement lump sum payable.

Will my pension be reduced?

Your main LGPS benefits will not normally be reduced for being paid early.

However, different rules may apply to certain additional benefits such as Additional Voluntary Contributions (AVCs) or other additional pension benefits.

What if I am under age 55?

If you leave employment because of redundancy or business efficiency before reaching age 55, your benefits will not normally be paid immediately.

Instead, they will normally become deferred benefits.

Can I take part of my pension as a lump sum?

When you take your pension, you can normally exchange part of your annual pension for a one-off tax-free lump sum.

Commuting pension will increase the lump sum you receive at retirement, but it will reduce the annual pension paid to you for the rest of your life.

Read more about commuting pension for a lump sum →