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Our Ref: LGR 85/19/77 654 INDEX 15 November 1999 |
LOCAL GOVERNMENT PENSION APPEAL
SUPERANNUATION ACT 1972
LOCAL GOVERNMENT PENSION SCHEME REGULATIONS 1997 (the 1997 regulations)
1. I refer to your letter dated 7 September 1999 in which you appeal (under regulation 102 of the 1997 regulations) against the decision of Mr XXX, the Appointed Person for XXX Council, in relation to your local government pension scheme (LGPS) dispute with XXX Ltd (the company).
2. The Appointed Person found that the company had acted reasonably in that at no time could they have foreseen that you were incapable of discharging your duties on the basis of permanent ill-health.
3. The Secretary of State’s powers under regulations 102 and 103 of the 1997 regulations are to reconsider the original disagreement referred to the Appointed Person under regulation 100. This regulation refers to a matter relating to the LGPS, which effectively means whether the statutory provisions governing the LGPS have been correctly applied in the circumstances. The Secretary of State has no powers to direct the company to act outside the provisions of the regulations. The disagreement you referred to the Appointed Person was whether the company should have granted you ill-health retirement benefits with enhancement when your employment was terminated on 19 September 1999.
4. The question for decision: The question you have asked the Secretary of State to decide is whether you should have ceased employment with the company on 19 September 1999 by reason of being permanently incapable of discharging efficiently the duties of that employment because of ill-health or infirmity of mind or body, and so qualify for the immediate payment of your LGPS benefits with enhancement.
5. Secretary of State’s decision: The Secretary of State has taken into account the appropriate regulations and all the representations and evidence submitted. He finds that the company decided to terminate your employment on grounds of redundancy and he has no powers in the context of a pensions appeal to alter the reason a member’s employment is terminated once the reason for termination is established. However, he also finds that the company have not acted properly within the requirements of the 1997 regulations in reaching their decision that you were not entitled to ill-health retirement benefits. The Secretary of State has decided therefore that the company must reconsider the matter in a proper fashion, demonstrating that they have investigated and taken full account of the medical issues and addressed the precise requirements of the regulations. His decision does not require the company to come to a different decision if, after a proper reconsideration, they conclude that your employment should not be treated as having been terminated on ill-health grounds. His decision replaces that made by the Appointed Person.
6. The Secretary of State’s reasons and the regulations which he considers apply in this case are set out in the annex to this letter, which forms an integral part of the decision. He is acting judicially and has no power to modify the way the regulations apply to the facts of the case. Having made his decision he has no power to alter it and his officials cannot discuss the case further. The decision is binding and can only be overturned by a judgement of the High Court or the Pensions Ombudsman.
7. The Pensions Advisory Service (OPAS) is available to assist members and beneficiaries in connection with difficulties which they have failed to resolve. Their address is 11 Belgrave Road, London, SW1V 1RB (telephone number 0171 233 8080).
8. The Pensions Ombudsman may investigate and determine any allegation of maladministration or any complaint or dispute of fact or law in relation to the local government pension scheme. His address is 11 Belgrave Road, London, SW1V 1RB (telephone number 0171 834 9144).
9. A copy of this letter has been sent to the Appointed Person, the company and the Pension Manager.
1. The following evidence has been received and taken into account:
a) from you: letter dated 7 September 1999 (with enclosures); and
b) from the Appointed Person: documents considered by him (listed in the Department’s letter of 4 October 1999).
2. From the evidence submitted the following points have been noted:
a) your date of birth is 19 September 1949;
b) you were a member of the LGPS;
c) on 26 February 1999 you were informed that your post was being made redundant due to the re-organisation of the administrative and managerial structure of the company;
d) on 12 March 1999 you were issued with a notice of redundancy, and at your request the company agreed that the effective date of your redundancy would be 19 September 1999;
e) on 2 June 1999 you made a formal request to be examined by the company’s medical advisor on the grounds that the company should terminate your employment on grounds of permanent ill-health;
f) the company responded stating that the decision to terminate your employment was taken on the grounds of redundancy; and
g) on 19 September 1999 you ceased employment with the company.
3. The Secretary of State has considered the regulations which, in his view, apply. Regulation 27(1) of the 1997 regulations states “Where a member leaves a local government employment by reason of being permanently incapable of discharging efficiently the duties of that employment because of ill-health or infirmity of mind or body, he is entitled to an ill-health pension and grant.”. Regulation 97(9) states “Before making a decision as to whether a member may be entitled under regulation 27 … on the ground of ill-health, the Scheme employer must obtain a certificate from an independent registered medical practitioner as to whether in his opinion the member is permanently incapable of discharging efficiently the duties of the relevant local government employment because of ill-health or infirmity of mind or body.”. With effect from 1 July 1999 the medical practitioner had to be qualified in occupational health medicine.
4. The Secretary of State has considered all the representations and evidence. You believe that there is medical evidence to show that the company should have terminated your employment on the grounds of permanent ill-health. You maintain that even though you requested to be referred to the company’s medical advisor on several occasions prior to being made redundant, you were not referred to him.
5. The Appointed Person determined that “… XXX Ltd has acted reasonably in that at no time could they have foreseen that you were incapable of discharging your duties and responsibilities on the basis of permanent ill health. Neither did you yourself appear to be of the same opinion until after the threat of redundancy was discussed … I have concluded that your termination of employment on the grounds of permanent ill health was not appropriate …”.
6. The Secretary of State notes that, in their letter of 12 March 1999 containing your notice of termination, the company advised you of your right and means of appeal against redundancy. The Secretary of State further notes that you chose not to exercise that right of appeal; in your letter of 19 March 1999 you allege that you were no longer fit for employment for the foreseeable future and you stated “there is no point in exercising my right of appeal against termination of employment”. The Secretary of State finds it difficult to understand why, if you considered your ill-health to be a significant issue at that time, you then chose not to take the opportunity formally presented to you to appeal against redundancy. Nevertheless, following further correspondence about your state of health, you formally made a request on 2 June 1999 for your employment to be terminated by reason of permanent ill health rather than redundancy. You also stated your belief that you were entitled to be seen by the company’s medical advisor. The company, in their letter dated 16 June 1999, stated that they had taken further advice but that their decision to terminate your employment on the grounds of redundancy remained the same.
7. The Secretary of State takes the view that, while it is clear that the reason for your proposed termination was redundancy, the question of ill-health retirement was raised prior to the termination of your employment taking effect. In confirming their redundancy decision, the company effectively made a decision that you were not entitled to ill-health retirement benefits. Under regulation 97(9) of the 1997 regulations, before making a decision about such entitlement, the company were required to obtain a certificate from an independent registered medical practitioner as to whether in his opinion you were permanently incapable of discharging efficiently your duties because of ill-health or infirmity of mind or body.
8. The Secretary of State concludes that the company were required to refer the question of whether you were permanently incapable of performing efficiently your duties to an independent registered medical practitioner. They failed to do so, and in consequence their decision was not taken properly. He accordingly decides that they must now do so. However, if the medical practitioner does consider that you were, when you ceased employment, permanently incapable of performing efficiently your duties by reason of ill-health, the company will only be required to pay ill-health retirement benefits under regulation 27 if they decide that such permanent incapacity should be regarded as the proper reason, rather than redundancy, for terminating your employment. Such a decision is an employment matter which is for them to take in the light of all the relevant circumstances. It is not a pensions question that can be decided on appeal under the LGPS.