To be a member of the Local Pension Scheme (LGPS) an individual must be employed by a Scheme employer listed in Parts 1 to 4 of Schedule 2 of the Local Government Pension Scheme Regulations 2013. No individual can contribute to the LGPS unless they are contractually employed by a Scheme employer.
Employees of so-called designation bodies (Town and Parish Councils and Admission bodies) have to be designated as being eligible for membership of the Scheme. Otherwise all employees aged under 75 who have a contract of employment of at least 3 months duration must be contractually enrolled onto he LGPS from their first day of employment (although any employee has a right to opt out of the Scheme at any time).
There is no lower age limit for joining the scheme and the restrictions that previously applied of 40 years membership at 60 and 45 years membership at 65, were removed many years ago. In fact, employees working on beyond their Normal Pension Age can continue to contribute to the scheme up until 2 days before their 75th birthday.
Membership includes:
- Any period for which a member has paid (or is treated as having paid) contributions (including any period during which a member is away from work because of illness or injury)
- Any period which a member is entitled to count following a transfer of former pension rights into the Scheme
- A pension credit received following a divorce settlement.
A member may not count any period for which a refund of contributions has been paid, or any period for which a transfer of pension rights has been paid out of the scheme.
Casual employees
It is the responsibility of a Scheme employer to determine whether or not a 'casual' employee should be admitted to the Scheme from the first day of employment. A Scheme employer needs to determine whether or not such an employee has a contract of employment of at least 3 months and whether or not a mutuality of obligation exists between the employee and the Scheme employer (i.e. can the employee turn down work offered by the employer).
Irrespective of this a casual employee can elect to opt into the Scheme at any time but would only be entitled to a refund of contributions if ultimately they have built up less than 2 years of qualifying membership.