Pension after changing jobs

loveroflight

Hi.
I'm considering moving to a different school in a different county. Does this have any adverse repercussions on my pension. Do I have to go to a similar school? ie ETB school?

rainbowtrout

No, you get a statement of service from Dept/ETB depending on which you are currently working for, submit to your new employer. Not sure if you need to do this if you move from one Dept school to another.

loveroflight

Thanks Rainbowtrout. What about increments?

rainbowtrout

You should start on the same increment that you finished on in your last school, and move up an increment in the normal manner.

Liberal_irony

Out of curiosity, what happens if you leave the profession?

rainbowtrout

You will receive a pension on retirement age based on number of years served/80 multiplied by final salary, which would be low enough if you leave early.

Joe222

rainbowtrout wrote: »

You will receive a pension on retirement age based on number of years served/80 multiplied by final salary, which would be low enough if you leave early.

Would this be added to the state pension or is it inclusive?
Thus meaning if your pension doesn't go above the state pension value you have paid into the system for nothing?

Kristopherus

Joe222 wrote: »

Would this be added to the state pension or is it inclusive?
Thus meaning if your pension doesn't go above the state pension value you have paid into the system for nothing?

You'll have to have paid Class A PRSI contributions to qualify for a State Contributory Pension. And the qualifying criteria is strict enough. Have a look at www.welfare.ie.

rainbowtrout

Joe222 wrote: »

Would this be added to the state pension or is it inclusive?
Thus meaning if your pension doesn't go above the state pension value you have paid into the system for nothing?

ya I think so.

I did some calculations a couple of years ago, and posted about it on a thread on here, and based on full hours (and pre 2011 pay scale as I am pre 2011 teacher), to receive a pension equal to the state pension, i.e. the break even point you have to work about 16 years in teaching to get a pension of about 12K. The only difference is a lump sum will be paid out no matter how long you work but it would be very small.

E.g. A person who stays in teaching for 5 years on pre 2011 payscale, so started on point 3 and finished on point 7, has an hons degree and dip allowance would have finished on an annual salary of 47080.

Pension entitlement would be 5 * 1/80 *47080 = 2942.50
Lump sum would be 5 * 3/80 * 47080 = 8827


Someone on point 18 of the scale after 16 years on full hours (again with hons degree and dip) and leaves teaching would have finished on 61769

16 * 1/80 * 61769 = 12353 (pension)
16 * 3/80 * 61769 = 37061 (Lump sum)

So ignoring the lump sum, 16 years does appear to be the break even point assuming full employment in that time.

rainbowtrout

Kristopherus wrote: »

You'll have to have paid Class A PRSI contributions to qualify for a State Contributory Pension. And the qualifying criteria is strict enough. Have a look at www.welfare.ie.

Teachers that were employed after 1995 all pay Class A PRSI. Pre 95 paid class D. Their pension is slightly different.

Joe222

rainbowtrout wrote: »

ya I think so.

I did some calculations a couple of years ago, and posted about it on a thread on here, and based on full hours (and pre 2011 pay scale as I am pre 2011 teacher), to receive a pension equal to the state pension, i.e. the break even point you have to work about 16 years in teaching to get a pension of about 12K. The only difference is a lump sum will be paid out no matter how long you work but it would be very small.

E.g. A person who stays in teaching for 5 years on pre 2011 payscale, so started on point 3 and finished on point 7, has an hons degree and dip allowance would have finished on an annual salary of 47080.

Pension entitlement would be 5 * 1/80 *47080 = 2942.50
Lump sum would be 5 * 3/80 * 47080 = 8827


Someone on point 18 of the scale after 16 years on full hours (again with hons degree and dip) and leaves teaching would have finished on 61769

16 * 1/80 * 61769 = 12353 (pension)
16 * 3/80 * 61769 = 37061 (Lump sum)

So ignoring the lump sum, 16 years does appear to be the break even point assuming full employment in that time.

Christ that is not good. So if you worked for 16 years and made pension contributions you would get nothing except that lump sum.

This must have huge repercussions for people who take time out to look after kids, to become a carer or want to retire due to illhealth.

For those who are on the new pension system they will be left with peanuts (unless the state pension is significantly cut which is possible).

For example if you took time out to be a carer you could be forced into the new pension system.

rainbowtrout

Joe222 wrote: »

Christ that is not good. So if you worked for 16 years and made pension contributions you would get nothing except that lump sum.

This must have huge repercussions for people who take time out to look after kids, to become a carer or want to retire due to illhealth.

For those who are on the new pension system they will be left with peanuts (unless the state pension is significantly cut which is possible).

For example if you took time out to be a carer you could be forced into the new pension system.

Well as the state pension is part of the teaching pension ya, you get nothing extra after 16 years except the lump sum. And that is based on full pay. Someone working part time hours, job share would have to work longer to get to that break even point.

I had the calculations done for the career average earnings (new pension) and as the pension is much lower, then a teacher would have to work longer to break even.

A teacher on the post 2011 scale on full hours starting on point 1 and finishing on point 16 have a career average earnings of 44235 per year.

16 * 1/80 * 44235 = 8835 pension

If they work 27 years to get to the top of the payscale and then leave teaching they will get:

27 * 1/80 * 55573 = 18755 (which includes the state pension)

Kristopherus

rainbowtrout wrote: »

Teachers that were employed after 1995 all pay Class A PRSI. Pre 95 paid class D. Their pension is slightly different.

Yep, I know that and was expecting a correction:D.

rainbowtrout

Joe222 wrote: »

Christ that is not good. So if you worked for 16 years and made pension contributions you would get nothing except that lump sum.

This must have huge repercussions for people who take time out to look after kids, to become a carer or want to retire due to illhealth.

For those who are on the new pension system they will be left with peanuts (unless the state pension is significantly cut which is possible).

For example if you took time out to be a carer you could be forced into the new pension system.

Missed this earlier.

If you take approved leave, e.g. career break, maternity leave etc, then you cannot be forced into new pension. If you resign/lose your job and don't take up another teaching post for more than 26 weeks then you will be kicked into the new pension scheme if you're not in it already.

But I agree, for those who take time out to mind kids/ carers etc, it does have an effect on pension one way or the other.

Joe222

This whole new pension system should be stopped.
One pension system for everyone.

The younger generations are paying the price for this.

The unions made a hames of this.

I still don't think younger public servants appreciate how poor the new pension is compared to the old one.

Older teacher retires on final salary of 66,000.
Their pension is half that so 33,000 of a pension based on a full 40 years.

New entrant teacher retires on final salary of 66,000. Let us say their starting salary was 33,000.
New pension is based on average salary.
So 49,500
Their pension is half that so 24,750.

So a 9,000 difference in pension.

Why is this stuff even being allowed. Pure discrimination.

byhookorbycrook

I agree, Joe, but you will find that while lots of people make noise, many don't follow it through. The more LPTs come to union meetings and lobby TDs, the better the chance there is of something happening. For many, many years- and especially during the good times, my husband and I were the youngest teachers at the union meetings. It's only as things began to go pear shaped, that those younger than use began to get involved. And yadda, yadda, sure the union... but they are our best chance of pushing for equality and until younger members start pressing along with the older ones, nothing will change.

rainbowtrout

Joe222 wrote: »

This whole new pension system should be stopped.
One pension system for everyone.

It's not going to happen. There are currently four different 'system's in operation, not a whole load of difference between the first three in the end payout, but eligibility requirements are different.

Pre 95, Pay Class D PRSI, can go at 60, pension based on final salary don't get state pension
Post 95 - Pre 2004, Pay Class A PRSI, can go at 60, pension based on final salary, state pension is part of total pension
Post 2004 - Pre 2013, Pay Class A PRSI, can't get pension until 65, pension based on final salary, state pension is part of total pension
Post 2013 - Pay Class A PRSI, pension based on career average earnings, can't get it until 65, are pretty screwed if they haven't worked a decent number of years on full hours

Joe222 wrote: »

I still don't think younger public servants appreciate how poor the new pension is compared to the old one.

No, they haven't a clue. And many won't educate themselves about it either until it's too late.

rainbowtrout

If anyone is interested, here is my pensions spreadsheet. There are two tabs: Old pension (pre 2013) and new pension (post 2013).

Some assumptions made: that a teacher is working full hours, has an honours dip and degree (in the case of pre 2013). No allowances included for A/B posts. Long service allowance was added to the incremenet for the last few years where it would be applicable.

The best pension for pre 2013 with 40 full years is €35k based on a finishing salary of about 71K

The final finishing salary on the post 2013 scale is just under 70K, but career average earnings pulls the figure to just under 58K for pension calculation purposes leaving final pension at just under 29K. That is best case scenario for the new pension. When you allow for the fact that many teachers won't teach a full 40 years because they go into teaching late, don't have full hours from the off, take a career break, go on job share (especially women with kids, have never met a male teacher on job share), then there will be many teachers who will not make potential top pension in the post 2013 scenario.

man_no_plan

rainbowtrout wrote: »

If anyone is interested, here is my pensions spreadsheet. There are two tabs: Old pension (pre 2013) and new pension (post 2013).

Some assumptions made: that a teacher is working full hours, has an honours dip and degree (in the case of pre 2013). No allowances included for A/B posts. Long service allowance was added to the incremenet for the last few years where it would be applicable.

The best pension for pre 2013 with 40 full years is €35k based on a finishing salary of about 71K

The final finishing salary on the post 2013 scale is just under 70K, but career average earnings pulls the figure to just under 58K for pension calculation purposes leaving final pension at just under 29K. That is best case scenario for the new pension. When you allow for the fact that many teachers won't teach a full 40 years because they go into teaching late, don't have full hours from the off, take a career break, go on job share (especially women with kids, have never met a male teacher on job share), then there will be many teachers who will not make potential top pension in the post 2013 scenario.

And to add insult to injury, as they can't retire until 65 they will continue to pay contributions if they go over 40 years (which is entirely possible) buy only get the benefit of a max of 40 years service.

If we could put our monthly pension contributions into a private scheme there would have to be a better return.

rainbowtrout

man_no_plan wrote: »

And to add insult to injury, as they can't retire until 65 they will continue to pay contributions if they go over 40 years (which is entirely possible) buy only get the benefit of a max of 40 years service.

If we could put our monthly pension contributions into a private scheme there would have to be a better return.

True, but I also suspect in the greater scheme of things, unlikely for most. With a five year teacher training degree or degree + two year dip, teachers are training for 5-6 years. Many won't start teaching until 23-24, and if they do a straight 40 years will be 63-64 with 40 years served. I can't see there being too many that will fall into that category.

The nature of modern employment means it is far more likely for people to change career more than once, or to travel or take a career break etc, than to complete 40 years.

But there should be a mechanism that once you've paid your 40 years that you can continue to work but not pay the pension contribution, or at least get it refunded on retirement or something.

amacca

Does anyone know what happens to your contributions if you leave teaching for another job before your 40 years of service are done

are they forfeit ..or is there a mechanism to transfer the value of your contributions over to the new scheme in the new job...presumably not if its private sector or you are contributing to a private pension plan?

rainbowtrout

amacca wrote: »

Does anyone know what happens to your contributions if you leave teaching for another job before your 40 years of service are done

are they forfeit ..or is there a mechanism to transfer the value of your contributions over to the new scheme in the new job...presumably not if its private sector or you are contributing to a private pension plan?

It would essentially be frozen and you would receive the appropriate public service pension on retirement, if you transfer to the public sector.

amacca

rainbowtrout wrote: »

It would essentially be frozen and you would receive the appropriate public service pension on retirement, if you transfer to the public sector.

So theres no mechanism for continuing contributions into your teaching pension if you leave teaching....similar to a scheme I was in when I word in 3rd level.....Its frozen until retirement age.

I suppose you could however have whatever fraction of your teaching pension you are due from teaching along with whatever private pension you contributed to/are entitled to?

Perhaps it makes sense but stuff like that is big a barrier to moving jobs.

If you move to private sector do you lose all your contributions?

Geuze

amacca wrote: »

If you move to private sector do you lose all your contributions?

No, preserved pension benefits.

Joe222

Geuze wrote: »

No, preserved pension benefits.

But only if your pension > the state pension. Otherwise zilch. The unions need to look into this.

rainbowtrout

amacca wrote: »

So theres no mechanism for continuing contributions into your teaching pension if you leave teaching....similar to a scheme I was in when I word in 3rd level.....Its frozen until retirement age.

I suppose you could however have whatever fraction of your teaching pension you are due from teaching along with whatever private pension you contributed to/are entitled to?

Perhaps it makes sense but stuff like that is big a barrier to moving jobs.

If you move to private sector do you lose all your contributions?

No you can't contribute to the teaching pension if you are not a teacher in the public sector. If that was the case then it would be open to abuse where people would work in the public sector for a short period of time to get into the pension scheme and then leave but continue to pay in while contributing nothing to public service in terms of employment.

Your contributions are frozen if you move to the private sector.

Joe222

rainbowtrout wrote: »

No you can't contribute to the teaching pension if you are not a teacher in the public sector. If that was the case then it would be open to abuse where people would work in the public sector for a short period of time to get into the pension scheme and then leave but continue to pay in while contributing nothing to public service in terms of employment.

Your contributions are frozen if you move to the private sector.

If you transfer to another area of the public service what happens I wonder?