Tesco Pensions Scheme
– Ill Health Pensions
Introduction
Understanding the scheme rules
This is an advice sheet for Usdaw members who are
applying, or thinking of applying to the Tesco Pension
Scheme for early retirement on the grounds of ill health.
It is important to understand the definition of ‘Incapacity’ in
the rules:
Both sections of the Tesco scheme (Final Salary and Pension
Builder) have a rule which allows a member who cannot
work again because of ill health to take an early retirement
pension at any age.
When is an ill health pension
appropriate?
Most applications for ill health pension are made after the
member has had a long period of absence from work and
should only be considered when there’s little chance of
carrying on in employment with Tesco.
Who decides who qualifies?
It is up to the pension scheme Trustees to decide who
qualifies for an ill health pension and the company’s
agreement is needed as well. Company approval is normally
delegated to Personnel Managers (PM), who have an
important role in deciding if an application for ill health
pension should be sent to the Trustees.
The application process
Step one: PM refers employee to Occupational Health (OH).
Step two: OH obtains medical report from doctor(s) with
your consent and sends Employee Health Report to PM. If
both OH and PM agree that the medical evidence suggests
the ill health criteria may be met – go to step three.
Step three: PM meets employee and discusses report. The
PM will explain the process of applying for ill health pension
and ask the employee if they want to apply.
Step four: PM and employee complete the application form
RP78511 (Request for early retirement on ill health grounds)
Step five: PM sends application to OH who gathers together
all the medical evidence and sends it to the Trustees.
Step six: The Trustees make a decision having reviewed all
the medical evidence supplied in support of the application.
Step seven: Trustees send their decision to the PM, who
tells the employee what was decided.
Improving workers’ lives – Winning for members
Improving workers’ lives – Winning for members
‘Incapacity means physical or mental impairment that
prevents (and will continue to prevent) the Member from
following his or her normal occupation and is likely to do so
at least until the Member reaches Normal Pension Age (65).
Before deciding whether a Member is suffering from
Incapacity, the Trustee must obtain evidence from a
registered medical practitioner that the Member is (and will
continue to be) incapable of carrying on his or her
occupation. The Trustees decision as to whether a Member is
suffering from Incapacity will then be final.’
Note that the medical condition and the inability to work
must be permanent.
You won’t be offered an ill health pension if Tesco are able
to offer you an alternative job which you could reasonably
be expected to accept in spite of your incapacity.
You may be turned down if you provided false information
about the state of your health when you joined the scheme.
There is no minimum age or minimum number of years of
service needed to qualify for an ill health pension.
Only current scheme members can apply. Deferred members
(those who have already left Tesco) can apply to have their
pension paid early on grounds of incapacity, but different
rules apply to them.
An ill health pension cannot be taken as well as redundancy.
Two kinds of ill health retirement
Limited ill health pension
The Trustees may award you a limited ill health
pension if they are satisfied you have permanent
incapacity and are unable to do your current job, and
no reasonable alternative job is available.
A limited ill health pension is based on the amount of
pension you have built up so far with no reduction
applied for early payment.
Access to Medical Reports Act 1988
Under the Act, an employer or pension scheme cannot apply
to your doctor for a medical report without first notifying you
and telling you your rights under the Act.
You have a right to see the report before it is sent and no
charge may be made for this. If you want a copy of the
report you may have to pay a reasonable charge.
If you think the report is inaccurate or misleading, you can
ask your doctor to change it. If your doctor refuses you can
ask for a statement of your own views to be attached.
Full ill health pension
The Trustees may award you a full ill health pension
if they are satisfied that your incapacity makes it
likely that you will be unable to take on any paid
employment before you reach age 65, in your current
role or any job elsewhere.
This isn’t the same as whether you will ever be offered
another job in the future but whether it’s likely that
you will be fit to take on any paid employment.
A full ill health pension is enhanced to include the
pensionable service that you would have completed if
you had carried on working for Tesco until age 65.
Again, no reduction is applied for early payment.
The medical evidence
The Trustees need to see a medical report which gives
details of your medical condition and also tells them what
the chances are of you being able to work again, whether for
Tesco or another employer.
Your own doctors will be asked to prepare a report. You will
be asked for permission to approach your doctor. If you’re
being treated for several medical problems it is important to
make sure that OH know about all the doctors who are
treating you.
The doctor(s) should be asked the questions needed to
establish whether you meet the definition of incapacity in
the scheme rules.
The doctor(s) should be asked whether the incapacity for
work is permanent or not. This isn’t the same as asking
whether the medical condition is permanent. Some medical
conditions are permanent but partial recovery or relief of
symptoms may allow someone to get back to doing some
kind of paid work.
The question of whether incapacity is permanent is often the
crucial factor in deciding whether a member qualifies or not.
Doctors won’t always know for sure how a medical condition
will develop in future and so their opinion on how permanent
the incapacity will be should be based on the balance of
probabilities.
The Act only applies to reports commissioned from a doctor
who is treating you and not to reports obtained from an
independent or company doctor.
Usdaw recommend that you should always ask for your
own copy of any medical reports that are made about your
condition to make sure that you agree with what’s in them
and in case you need to check what the doctor said at a
later date.
What to do if your application is
turned down – review
Internal Dispute Resolution
Procedure (IDRP)
Even though the rules say that the Trustees’ decision is final,
in most cases they are willing to review a decision to turn
down an application or an award of Limited rather than Full.
The pension scheme has a formal complaints procedure in
place called the IDRP for short.
Usdaw members should contact the Union’s Pensions Team
for assistance if they want to launch an appeal.
We will explain the reasons why your application was
turned down.
We will give you an opinion on what your chances are
of overturning the decision.
We will tell you what the next steps you need to take
are.
We may commission another report from your doctor.
If appropriate we will write to the pension scheme on
your behalf.
Call the Pensions Team on 0161 249 2440.
Deferring making a decision
In some cases the Trustees will ask for further medical
evidence to be provided at a future date rather than making
an immediate decision, when new medical evidence may
make it clearer whether the incapacity is permanent or not.
For example, if you are awaiting the results of some
investigations, or an operation is planned.
If by the time the new medical report is available the
employee is no longer working for Tesco, it will be down to
them to get the report and send it to the Trustees.
Review of ill health pensions
When they have awarded an ill health pension, the scheme
rules allow the Trustees to review their decision at a future
date, maybe in a few years time. They can also make regular
reviews until the member reaches age 65. They will notify
you if this is the case at the time of your award.
When reviewing their decision, the Trustees will request an
up-to-date medical report to confirm the member’s continued
incapacity or inability to take on any paid employment. If the
report indicates that the member’s medical condition has
improved enough for them to be able to get back to some
kind of paid work, the Trustees can either reduce the ill
health pension or suspend paying it completely.
The Trustees will not grant the member the option of a
tax-free lump sum on ill health retirement if they intend
to review their decision in the future.
When seeking a review of the
Trustees’ decision:
You should only launch a complaint through the IDRP after
you have asked the Trustees to review their decision to turn
you down and you still do not think that a correct and fair
decision has been made.
There will be a time limit in place for making complaints –
it is best to assume it is within six months of either being
refused or leaving employment, whichever comes first.
Case law made by the courts says that a decision to turn
down an application for ill health pension can only be
successfully challenged if one or more of the following can
be proven:
That the decision making body (ie the trustees) did not
ask the right questions or receive the full information.
That they did not direct themselves correctly in law
and in particular did not apply the scheme rules
correctly.
You must act quickly.
That they did not take all of the relevant factors into
account or they paid too much attention to factors that
are irrelevant.
Go through your PM and OH and say that you want
your application reviewed.
That they arrived at a perverse decision (ie a decision
which no reasonable body could have made).
Also make sure that any Usdaw rep involved knows
what is happening.
Have another look at the medical report and read it
carefully. If you don’t have the medical report go back
to your doctor and ask for a copy. Strictly speaking the
doctor can refuse, but few will do so.
You should write to the Trustees and briefly say why
you think their decision is wrong.
If you think the reason why you were turned down is
because the medical evidence used to make the
decision was inaccurate, incomplete or out of date then
say so and consider approaching your doctor(s) to get
the problem put right.
Remember that generally, unless the medical evidence
supports your application, you will not succeed with an
appeal.
If the Trustees have followed the correct procedures, asked
the right questions, applied the scheme rules and only taken
account of relevant evidence, it will be very difficult to
challenge their decision.
The Pensions Ombudsman
The Ombudsman is appointed by Parliament to investigate
maladministration by pension schemes. The Ombudsman can
examine the process by which the decision not to award
pension has been made in order to check that it is
reasonable in the strict sense (ie not perverse), having
regard to what the rules say. The Ombudsman has the power
to overturn decisions in those rare cases where a board of
trustees has made a serious error or acted wholly
unreasonably.
Contact details
Tesco’s Pensions Department
Phone: 0845 070 1113
email: [email protected]
Write to Tesco Pension Trustees Ltd, PO Box 4126
Cardiff CF14 4ZP
Usdaw’s Pensions Team
Phone: 0161 224 2400
email: [email protected]
Write to Usdaw, Pensions, 188 Wilmslow Road
Manchester M14 6LJ
Two kinds of ill health retirement
Limited ill health pension
The Trustees may award you a limited ill health
pension if they are satisfied you have permanent
incapacity and are unable to do your current job, and
no reasonable alternative job is available.
A limited ill health pension is based on the amount of
pension you have built up so far with no reduction
applied for early payment.
Access to Medical Reports Act 1988
Under the Act, an employer or pension scheme cannot apply
to your doctor for a medical report without first notifying you
and telling you your rights under the Act.
You have a right to see the report before it is sent and no
charge may be made for this. If you want a copy of the
report you may have to pay a reasonable charge.
If you think the report is inaccurate or misleading, you can
ask your doctor to change it. If your doctor refuses you can
ask for a statement of your own views to be attached.
Full ill health pension
The Trustees may award you a full ill health pension
if they are satisfied that your incapacity makes it
likely that you will be unable to take on any paid
employment before you reach age 65, in your current
role or any job elsewhere.
This isn’t the same as whether you will ever be offered
another job in the future but whether it’s likely that
you will be fit to take on any paid employment.
A full ill health pension is enhanced to include the
pensionable service that you would have completed if
you had carried on working for Tesco until age 65.
Again, no reduction is applied for early payment.
The medical evidence
The Trustees need to see a medical report which gives
details of your medical condition and also tells them what
the chances are of you being able to work again, whether for
Tesco or another employer.
Your own doctors will be asked to prepare a report. You will
be asked for permission to approach your doctor. If you’re
being treated for several medical problems it is important to
make sure that OH know about all the doctors who are
treating you.
The doctor(s) should be asked the questions needed to
establish whether you meet the definition of incapacity in
the scheme rules.
The doctor(s) should be asked whether the incapacity for
work is permanent or not. This isn’t the same as asking
whether the medical condition is permanent. Some medical
conditions are permanent but partial recovery or relief of
symptoms may allow someone to get back to doing some
kind of paid work.
The question of whether incapacity is permanent is often the
crucial factor in deciding whether a member qualifies or not.
Doctors won’t always know for sure how a medical condition
will develop in future and so their opinion on how permanent
the incapacity will be should be based on the balance of
probabilities.
The Act only applies to reports commissioned from a doctor
who is treating you and not to reports obtained from an
independent or company doctor.
Usdaw recommend that you should always ask for your
own copy of any medical reports that are made about your
condition to make sure that you agree with what’s in them
and in case you need to check what the doctor said at a
later date.
What to do if your application is
turned down – review
Internal Dispute Resolution
Procedure (IDRP)
Even though the rules say that the Trustees’ decision is final,
in most cases they are willing to review a decision to turn
down an application or an award of Limited rather than Full.
The pension scheme has a formal complaints procedure in
place called the IDRP for short.
Usdaw members should contact the Union’s Pensions Team
for assistance if they want to launch an appeal.
We will explain the reasons why your application was
turned down.
We will give you an opinion on what your chances are
of overturning the decision.
We will tell you what the next steps you need to take
are.
We may commission another report from your doctor.
If appropriate we will write to the pension scheme on
your behalf.
Call the Pensions Team on 0161 249 2440.
Deferring making a decision
In some cases the Trustees will ask for further medical
evidence to be provided at a future date rather than making
an immediate decision, when new medical evidence may
make it clearer whether the incapacity is permanent or not.
For example, if you are awaiting the results of some
investigations, or an operation is planned.
If by the time the new medical report is available the
employee is no longer working for Tesco, it will be down to
them to get the report and send it to the Trustees.
Review of ill health pensions
When they have awarded an ill health pension, the scheme
rules allow the Trustees to review their decision at a future
date, maybe in a few years time. They can also make regular
reviews until the member reaches age 65. They will notify
you if this is the case at the time of your award.
When reviewing their decision, the Trustees will request an
up-to-date medical report to confirm the member’s continued
incapacity or inability to take on any paid employment. If the
report indicates that the member’s medical condition has
improved enough for them to be able to get back to some
kind of paid work, the Trustees can either reduce the ill
health pension or suspend paying it completely.
The Trustees will not grant the member the option of a
tax-free lump sum on ill health retirement if they intend
to review their decision in the future.
When seeking a review of the
Trustees’ decision:
You should only launch a complaint through the IDRP after
you have asked the Trustees to review their decision to turn
you down and you still do not think that a correct and fair
decision has been made.
There will be a time limit in place for making complaints –
it is best to assume it is within six months of either being
refused or leaving employment, whichever comes first.
Case law made by the courts says that a decision to turn
down an application for ill health pension can only be
successfully challenged if one or more of the following can
be proven:
That the decision making body (ie the trustees) did not
ask the right questions or receive the full information.
That they did not direct themselves correctly in law
and in particular did not apply the scheme rules
correctly.
You must act quickly.
That they did not take all of the relevant factors into
account or they paid too much attention to factors that
are irrelevant.
Go through your PM and OH and say that you want
your application reviewed.
That they arrived at a perverse decision (ie a decision
which no reasonable body could have made).
Also make sure that any Usdaw rep involved knows
what is happening.
Have another look at the medical report and read it
carefully. If you don’t have the medical report go back
to your doctor and ask for a copy. Strictly speaking the
doctor can refuse, but few will do so.
You should write to the Trustees and briefly say why
you think their decision is wrong.
If you think the reason why you were turned down is
because the medical evidence used to make the
decision was inaccurate, incomplete or out of date then
say so and consider approaching your doctor(s) to get
the problem put right.
Remember that generally, unless the medical evidence
supports your application, you will not succeed with an
appeal.
If the Trustees have followed the correct procedures, asked
the right questions, applied the scheme rules and only taken
account of relevant evidence, it will be very difficult to
challenge their decision.
The Pensions Ombudsman
The Ombudsman is appointed by Parliament to investigate
maladministration by pension schemes. The Ombudsman can
examine the process by which the decision not to award
pension has been made in order to check that it is
reasonable in the strict sense (ie not perverse), having
regard to what the rules say. The Ombudsman has the power
to overturn decisions in those rare cases where a board of
trustees has made a serious error or acted wholly
unreasonably.
Contact details
Tesco’s Pensions Department
Phone: 0845 070 1113
email: [email protected]
Write to Tesco Pension Trustees Ltd, PO Box 4126
Cardiff CF14 4ZP
Usdaw’s Pensions Team
Phone: 0161 224 2400
email: [email protected]
Write to Usdaw, Pensions, 188 Wilmslow Road
Manchester M14 6LJ
Tesco Pensions Scheme
– Ill Health Pensions
Introduction
Understanding the scheme rules
This is an advice sheet for Usdaw members who are
applying, or thinking of applying to the Tesco Pension
Scheme for early retirement on the grounds of ill health.
It is important to understand the definition of ‘Incapacity’ in
the rules:
Both sections of the Tesco scheme (Final Salary and Pension
Builder) have a rule which allows a member who cannot
work again because of ill health to take an early retirement
pension at any age.
When is an ill health pension
appropriate?
Most applications for ill health pension are made after the
member has had a long period of absence from work and
should only be considered when there’s little chance of
carrying on in employment with Tesco.
Who decides who qualifies?
It is up to the pension scheme Trustees to decide who
qualifies for an ill health pension and the company’s
agreement is needed as well. Company approval is normally
delegated to Personnel Managers (PM), who have an
important role in deciding if an application for ill health
pension should be sent to the Trustees.
The application process
Step one: PM refers employee to Occupational Health (OH).
Step two: OH obtains medical report from doctor(s) with
your consent and sends Employee Health Report to PM. If
both OH and PM agree that the medical evidence suggests
the ill health criteria may be met – go to step three.
Step three: PM meets employee and discusses report. The
PM will explain the process of applying for ill health pension
and ask the employee if they want to apply.
Step four: PM and employee complete the application form
RP78511 (Request for early retirement on ill health grounds)
Step five: PM sends application to OH who gathers together
all the medical evidence and sends it to the Trustees.
Step six: The Trustees make a decision having reviewed all
the medical evidence supplied in support of the application.
Step seven: Trustees send their decision to the PM, who
tells the employee what was decided.
Improving workers’ lives – Winning for members
Improving workers’ lives – Winning for members
‘Incapacity means physical or mental impairment that
prevents (and will continue to prevent) the Member from
following his or her normal occupation and is likely to do so
at least until the Member reaches Normal Pension Age (65).
Before deciding whether a Member is suffering from
Incapacity, the Trustee must obtain evidence from a
registered medical practitioner that the Member is (and will
continue to be) incapable of carrying on his or her
occupation. The Trustees decision as to whether a Member is
suffering from Incapacity will then be final.’
Note that the medical condition and the inability to work
must be permanent.
You won’t be offered an ill health pension if Tesco are able
to offer you an alternative job which you could reasonably
be expected to accept in spite of your incapacity.
You may be turned down if you provided false information
about the state of your health when you joined the scheme.
There is no minimum age or minimum number of years of
service needed to qualify for an ill health pension.
Only current scheme members can apply. Deferred members
(those who have already left Tesco) can apply to have their
pension paid early on grounds of incapacity, but different
rules apply to them.
An ill health pension cannot be taken as well as redundancy.