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Working as Substitute while Receiving a Pension
Posted by Schooldays Newshound, on 27/01/2023.
Tags: Education And Politics
Under the current rules in 2023, all retired teachers can work as a teacher for up to 50 days in any calendar year, without pension ‘abatement’ rules applying.
Find a role as a substitute teacher
Substitute posts are advertised on subseeker.ie.
How substitute work interacts with your pension
Similar to other public sector workers it is possible that, when as a retired teacher you return to work in the public sector, your pension may be reduced slightly if you earn over a certain amount. This is known as abatement.
Retired teachers returning to teach in the public sector can work up to 50 days in the calendar year, and abatement will not apply.
Your pension will only be reduced by abatement if your earnings on return to employment plus your pension payment exceed your pensionable pay at retirement (updated to reflect any pay changes since your retirement).
Abatement is calculated on a daily basis.
Abatement will not apply for the first 50 days worked in a calendar year. Above 50 days, the impact of abatement on your pension may be slight. Please see the worked examples below.
If you work above 50 days, your pension will only be abated to the point that your pension, plus your earnings as a substitute teacher, no longer exceed your retirement salary. Any abatement will stop as soon as you stop working.
Abatement is calculated based on a retiree’s gross pension, salary and former pensionable pay at retirement.
If a retired teacher is in receipt of a supplementary pension –
Your supplementary pension will not be included in any abatement calculations. Your supplementary pension will stop for the period of your employment and will restart as soon as you stop working.
Abatement Calculation
Abatement is calculated and applied on a daily basis.
Your pay on return, pension, and pensionable pay at retirement will be divided by the number of work days in a year to arrive at the daily rate.
There are 182 working days in a primary school year
There are 166 days in a post-primary school year.
If (Pay on Return) + (Pension) > (Former Pensionable Pay) your pension will be abated.
Definitions
- “Former Pensionable Pay”: This is the present day value of the Pensionable Pay (that is salary and pensionable allowances) which was used in the calculation of your pension.
- “Pension”: The gross public service pension payable to you and which is the subject of abatement. It does include your supplementary pension (if in receipt).
- “Pay on Return”: The gross total of all salary, emoluments and allowances (whether pensionable or not) that you receive in their new/current position(s). (If a retired teacher is employed in two or more public service positions, then this is the aggregate of all earnings).
- “Abatement”: This is a reduction in your public service pension(s) in circumstances where your pension(s) is in payment and you are re-employed in the public service.
Abatement Waiver – the first 50 days of work in each calendar year, with certain conditions
As outlined in Department of Education Circular 03/2021, a waiver is in place for a limited period up to 2023 for appropriately qualified teachers who:
- are employed in the capacity for which they are qualified;
- are suitable for employment in all respects and;
- in circumstances where it is not practicable to meet the teaching requirements other than by the employment of a retired teacher
The abatement waiver applies to the first 50 days worked in any calendar year. For the purposes of this waiver any day in which a teacher works is counted as 1 day regardless of the number of hours worked.
Likelihood of abatement
Since retirees are moved to the first point of the pay scale upon returning to employment, the vast majority of retired teachers will not be subject to any abatement as a result of occasional substitute work.
Abatement becomes somewhat more likely for those retirees who have returned to work in a full-time capacity and/or have advanced several points up the pay scale. However even in these circumstances a large majority of retirees will not be subject to any abatement.
Details on the rates of pay for part-time teachers are available.
Further queries
If you have any further queries about abatement please contact the Department of Education at abatementqueries@education.gov.ie
Examples of substitute work
Example 1: Substitute employment for less than 50 days – Abatement Does Not Apply
Paul is a retired post primary teacher who has returned to do some substitute work in his old school for a total of 49 days in the calendar year. Paul’s current substitution rate is €38,192 per annum. As Paul does not exceed the 50 free days granted by the waiver, abatement does not apply.
Example 2: Substitute employment – Abatement Does Not Apply
Bob is a retired primary teacher who has returned to do some substitute work in his old school. He has exceeded the 50 free days granted by the waiver of abatement. His former pensionable pay (updated to reflect any pay increases since his retirement) is €80,160 and he is receiving a pension of €40,079.
Bob’s current substitution rate is €38,192 per annum. Abatement is calculated on a daily basis and there are 182 days in a primary school year.
Bob’s pension will be abated if, (Pay on Return) + (Pension) > (Former Pensionable Pay)
Bob’s daily rates are:
Pay on Return = 38192/182 = €209.85
Pension = 40079/182 = €220.21
Former Pensionable Pay = 80160/182 = €440.44
Therefore, in Bob’s case, (Pay on Return) + (Pension) = €209.85 + €220.21 = €430.06.
Since this is less than his daily former pensionable pay, Bob’s pension will not be subject to any abatement.
Bob’s pension will not be abated. He will continue to receive his pension as normal and he will earn €209.85 for each day worked.
Example 3: Substitute employment – Abatement Applies
Anne is a retired primary teacher who has returned to do some substitute work in her old school. She has exceeded the 50 free days granted to her by the waiver of abatement. Her former pensionable pay (updated to reflect any pay increases since her retirement) is €74,882 and she is receiving a pension of €36,118.
Anne has advanced several points up the pay scale and her current substitution rate is €42,300 per annum. Abatement is calculated on a daily basis and there are 182 days in a Primary school year.
Anne’s pension will be abated if, (Pay on Return) + (Pension) > (Former Pensionable Pay)
Anne’s daily rates are:
Pay on Return = 42300/182 = €232.42
Pension = 36118/182 = €198.45
Former Pensionable Pay = 74882/182 = €411.44
Therefore, in Anne’s case, (Pay on Return) + (Pension) = €232.42 + €198.45 = €430.87.
Since this is greater than Anne’s daily rate of former pensionable pay by €19.43, her fortnightly pension will be abated by €19.43 for every day that she works in that fortnight. Anne’s pension will be abated and will reduce to €179.02 for each day worked. She will earn €232.42 for each day worked.
Example 4: Part Time Contract, Abatement Does Not Apply
Lisa is a retired post primary teacher. She has been offered a part time contract at her old school where she will only be working half days. Her former pensionable pay and pension are €74,882 and €36,118 respectively. Although the full time equivalent rate for her part time contract is €42,300 per annum, since she is only working half days her effective salary on return is €21,150 per annum.
Lisa’s pension will be abated if, (Pay on Return) + (Pension) > (Former Pensionable Pay)
Lisa’s daily rates are:
Pay on Return = 21,150/166 = €127.41
Pension = 36118/166 = €217.57
Former Pensionable Pay = 74882/166 = €451.10
Therefore, in Lisa’s case, (Pay on Return) + (Pension) = €127.41 + €217.57 = €344.98.
Since this is less than the daily rate of Lisa’s former pensionable pay, she will not be subject to any abatement as a result of this contract.
Lisa’s pension will not be abated. She will continue to receive her pension as normal and she will earn €127.41 for each half-day worked.
Example 5: Part Time Contract, Abatement Applies
Claire is a retired post primary teacher who has returned to work as a substitute teacher on a part time contract. Under this contract Claire will work 4 hours per day which means she has a work pattern of 0.8. Her Retirement Salary is €66,244 and she is receiving a pension of €33,122. Her full time substitute rate is €44,799 per annum. However since Claire is on a work pattern of 0.8 her effective Salary on Return is €44,799 * 0.8 = €35,839. Abatement is calculated on a daily basis and there are 166 days in a post-primary school year.
Claire’s daily rates are:
Pay on Return = 35,839/166 = €215.90
Pension = 33,122/166 = €199.53
Former Pensionable Pay = 66,244/166 = €399.06
Therefore, in Claire’s case, (Salary on Return) + (Pension) = €215.90 + €199.53 = €415.43.
Since this is greater than Claire’s daily Retirement Salary by €16.37, her fortnightly pension will be abated by €16.37 for every day that she works in that fortnight.
Claire’s pension will be abated and will reduce to €183.16 for each day worked. She will earn €215.90 for each four-hour day worked.
Note: As the supplementary pension is not included the abatement calculations, changes to a supplementary pension in payment are not reflected in the above examples.
Further Information
Department of Public Expenditure and Reform Circular Letter 24/2022 – Guidance on the application of Abatement of Public Service Occupational Pensions under Section 52 (1) to (5) of the Public Service Pensions (Single Scheme & Other Provisions) Act 2012
Circular 24 2022 Guidance on the application of Abatement of Public Service Occupational Pensions
This Circular contains further details on the application of abatement and further examples.
Every effort has been made to ensure the accuracy of this information. In the event of an error or omission the provisions of the Scheme(s) will govern.
Source: gov.ie
Noreen McHugh
(23/10/2023 13:23)
Could retired Special Needs assistants who do substitute work in school occasionally have their supplementary pension abated?