From April 2025, several regulatory changes have been introduced to the NHS Pension Scheme, affecting how contributions are calculated and how certain types of leave are treated. As reported by NHS Employers, these updates aim to improve fairness and consistency across the system while addressing previously unclear aspects of pension rules.
Updated Contribution Thresholds and Clarity for Absences
The salary thresholds used to determine contribution rates have been updated in line with the September 2024 CPI rate of 1.7%. This change, already reflected in the Electronic Staff Record system, helps ensure NHS staff aren’t pushed into higher contribution brackets solely due to annual pay awards. If the pay award exceeds CPI, further adjustments will be made.
The Department of Health and Social Care (DHSC) has also clarified how contributions should be calculated during periods of reduced pay, stating that they should be based on actual reduced pensionable pay—not assumed full pay (known as deemed pay). While this does not affect benefit accrual, it ensures consistency across employers. Any employers who have previously based contributions on deemed pay will need to issue refunds for overpaid contributions dating back to 1 October 2022.
Pensioning Overtime for Part-Time Staff
A key clarification in the updated regulations concerns overtime pensionability for part-time employees. The 2015 Scheme now formally includes additional hours worked up to whole-time equivalent (WTE) as pensionable. Hours beyond WTE will remain non-pensionable. This change aligns regulation with long-standing policy and practice.
Employers who haven’t already treated additional hours as pensionable must inform affected staff by 1 January 2026. Employees will then have three months to elect to make these hours pensionable, with the option for extensions up to a final cut-off of 1 July 2026.
Further Rule Adjustments for Leave and Eligibility
Additional updates include:
- Neonatal care leave will now be treated similarly to other parental leave for pension purposes.
- Members on parental bereavement leave will now be aligned with those on maternity, paternity, and adoption leave in the 2008 Scheme.
- For those going straight from full pay to zero pay, contributions will be based on the last pensionable salary before leave.
- Keeping in Touch (KiT) days for members on adoption or shared parental leave will now be treated the same as for maternity leave, removing outdated references.
Also notable is a provision for members affected by the McCloud remedy, who may now revoke a deferred choice election under certain conditions.
