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Document What is Voluntary Protection of Pay?

If you have reached minimum pension age and choose to step down to a role where your new or remaining duties are less demanding and carry less responsibility than your previous duties, you may be able to apply for Voluntary Protection of Pay if your pay reduces by 10% or more.

Voluntary Protection of Pay was introduced from 1 April 2008 to provide more flexibility in the 1995 Section of the Scheme. The provision supports the Improving Working Lives initiatives which exist in the NHS and recognises that in the run up to retirement you may prefer, if possible, to remain in NHS employment, perhaps in a lesser capacity, while protecting your pension benefits.

This provision also allows an employer to maintain the valuable knowledge and skills of a member who may otherwise have left the NHS. Any ‘step down’ will therefore be agreed between the employer and the member, and the employer will have to provide NHS Pensions with information that the step down has been agreed. The provision is also intended for lasting, rather than trivial or short term reductions in pay.

It would normally be expected that the step down would occur with the same employer. However if a suitable role to ‘step down’ to cannot be provided by one employer, but can be arranged with another, this would be acceptable. In this case both employers will have to provide information that confirms a ‘step down’ arrangement has been agreed. The provision is not intended for situations where a member leaves one employer and joins another on a reduced rate of pay without an agreement between employers.

To be eligible you must:

  • be a member of the 1995 Section or have a final salary link to 1995 Section pension benefits
  • have stepped down to a role where your new or remaining duties are less demanding and carry less responsibility than your previous duties (as confirmed by your employer(s))
  • have a reduction in pensionable pay of at least 10% for a period of at least one year, beginning with the first pay day on which the reduced pensionable pay was paid (as verified by your employer(s))
  • not of had any other reduction in pensionable pay in the 12 month period before you stepped down (as verified by your employer(s))
  • have applied after 12 months, but within 15 months, of your pensionable pay being reduced
  • have attained your minimum pension age in the 1995 Section (further information about minimum pension age can be found in the Member Guide)
  • have attained at least two years qualifying membership within the NHS Pension Scheme at the time you step down
  • have not previously protected your pensionable pay under the Voluntary Protection of Pay arrangements

For further information regarding voluntary protection of pay and to download the SM R9 application form, please refer to the protection of pay and voluntary protection of pay factsheet on our website.

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