NHS Staff Council flexible retirement guidance

The NHS Pension Scheme offers a number of flexible retirement models with more options being introduced from October 2023. This is to help employers retain experienced staff. 

Flexible retirement is one of the examples of flexible working listed in section 33.10 of the NHS Terms and Conditions of Service Handbook (TCS handbook). Sections 33.12 to 33.18, set out provisions for staff to make requests for flexible working, including:

• procedures for discussion
• considerations
• escalation of requests (where necessary)
• processes for final decisions
• handling of appeals
• principles around monitoring and reporting.

Flexible retirement allows organisations and staff to be flexible about:  

• the age at which staff retire  
• the length of time staff take to fully retire  
• the nature and pattern of work in the lead up to final retirement.

Where applicable, employers should discuss the following retirement flexibilities with staff to reach mutual agreement on the most feasible option, and how this will be applied on an individual basis:

• Partial retirement – Active members can take part or all of their pension benefits and continue in their existing post on existing terms and conditions. To access this, staff must agree to reduce their pensionable pay by 10 per cent for the 12 months following their partial retirement date. 
• Retire and return -  Staff may retire, claim their pension and return to NHS employment. Upon return, staff can choose to build up further pension in the 2015 NHS Pension Scheme. This is available to those who have already retired and those who plan to retire.
• Step down - Staff may step down to a different role, for example, to reduce their level of responsibility, in the lead up to retirement.
• Reduction in hours/wind down - Staff can wind down to retirement by remaining in their current post, but reducing the number of hours or days they work.
• Early retirement reduction buy out (ERRBO) - Members of the 2015 Scheme can pay additional contributions to buy out reduction that would be applied to their pension if they retired before their normal pension age.

Process

Up until now there have been varying local practices around how requests for flexible retirement are considered and decided. The available options are now expanding and there is a joint commitment from employers and unions to promote greater access to flexible retirement. This may result in a significant increase in the number of staff interested in requesting flexible retirement.

In this context, the NHS Staff Council believes it is vital that employers ensure that they are using fair, consistent and objective approaches when deciding whether requests can be agreed. Data monitoring and reporting are also essential in providing employers assurance that equity and fairness are being maintained. Flexible retirement requests will often be accompanied by requests for other forms of flexibility – for example around hours or shifts. For all these reasons, the Staff Council strongly recommends:

• employers and trade unions should work in partnership to update policies and processes for the handling of flexible retirement requests within their overall flexible working procedures:
• that staff wishing to request a flexible retirement arrangement should have this considered and processed in line with Section 33 provisions
• where a request can’t be agreed, employers should include an escalation and appeal process
• once a flexible retirement arrangement has been agreed, including any contractual changes such as reduced hours/changed shift patterns, the employee and employer must complete the Retirement Benefits Claim Form (AW8) plus any other relevant supplementary forms and send them to NHS Pensions
• employers should ensure that staff are kept up to date during this process
• monitoring processes should be reviewed to ensure that data on flexible retirement requests and outcomes are collected and reported on, including by protected characteristics, in line with the provisions in  sections 33.19 to 33.22 of the TCS handbook.

Supporting staff to explore their options

Section 33.8 of the NHS TCS Handbook states:

To support a positive culture of flexible working, employers will need to consider how they support and encourage open conversations about flexible working. Examples of opportunities to talk about flexible working include at one-to-one line management / supervision meetings, team / departmental meetings, as part of wellbeing conversations, or as part of recruitment, induction, and annual appraisal processes.

Individuals are responsible for seeking their own advice, considering and assessing which option is right for them. 

Where appropriate employers should refer to NHS Employers retirement resources to support with planning discussions. If required, line managers should signpost staff to up-to-date information on all of the flexible retirement options available.

Conversations should start well ahead of normal retirement ages to support staff with planning ahead.

It is encouraged that line managers and their staff explore flexible retirement options through informal conversations, ahead of submitting a formal request.

A partial retirement calculator will soon be available on the NHS Pensions website to support employees with their decision making. The calculator will identify the impact on total pension benefits determined by taking different percentages of pension. It is recommended that this tool is used as part of discussions regarding potential changes to working arrangements.

Supplementary guidance

Resources for employers:

• NHS Employers' flexible retirement guidance. 
• NHS Employers' flexible retirement and flexible/agile working web pages. 
• Advice for employers on using flexible retirement to support retention.
• NHS Business Services Authority's partial retirement technical guidance.

Resources for members:

• NHS Business Services Authority's partial retirement guidance.
• NHS Business Services Authority's Your options for a flexible retirement.