A recent question in Parliament addressed a controversial area where independent schools have taken steps to address their ongoing commitments in respect of the Teachers’ Pension Scheme (TPS).
The question from Tulip Siddiq, Labour MP for Hampstead and Kilburn was as follows: “To ask the Secretary of State for Education, what steps his Department is taking to discourage employers in the independent schools sector from using dismissal and re-engagement to withdraw teachers from the Teachers’ Pension Scheme”
You can read the response from Robin Walker, MP for Worcester, at the link below.
The issue being raised highlights a challenge for schools as they tend to historically have had specific wording around eligibility to join the TPS in their employment contracts – rather than a more generic offer to membership of a workplace pension scheme. This means if they want to withdraw from the TPS (and a consultation with staff is required in order to do this) and replace TPS pension provision with a defined contribution scheme they have to amend the employment contracts of the teaching staff – teaching staff are asked to voluntarily accept the new terms and conditions via an updated contract of employment. They would only be dismissed and then re-employed if they did not accept the new terms and conditions.
Schools that have taken this course of action have done so as a last resort only when all else has failed.
We have worked with around 40 schools over the past 4 years, and thankfully, all of the schools that we have worked with have engaged constructively with the teaching staff to accept the new terms and conditions. We have assisted them to put forward a high-quality defined contribution solution to replace the TPS, with a level of contribution from the employer that compares well with that previously paid to the TPS. The staff see the value in this option.
The response by Robin Walker references that “The department has recently implemented new regulations, following engagement with the independent education sector, to support independent schools to continue in the Teachers’ Pension Scheme.” – he is referring there to phased withdrawal (closing the TPS to new members) which became available from last September. This is another useful tool for schools looking to take their initial steps to reduce the costs associated with having staff in the TPS.
If you want to discuss any issues related to the TPS, please click here to contact the author, Neil Barton.