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What happens when someone leaves the scheme whilst an appeal against refusal to grant Ill Health Retirement is ongoing?

6.3.8 Where someone is leaving voluntarily (e.g. resigning, retiring or leaving under voluntary exit terms (including voluntary redundancy)) they are choosing those exit terms rather than leaving on IHR. Therefore any IHR application will come to an end when the individual leaves. That would include any IHR application at the appeal stage. It is therefore very important that you as the employer make this very clear to any employee who is considering leaving under voluntary terms who also has (or might be eligible for) an application for IHR.

However, where a person is dismissed or made compulsorily redundant, as long as an IHR application has been submitted before their last day of service, the application can continue to its conclusion (again that would include the appeal process). It should be explained to the member that should the IHR terms be granted, any leaving package paid to the member would be replaced by the IHR benefits. Therefore, any amount already paid, would need to be recovered from those benefits.

To avoid an overpayment scenario, you should only pay part of any CSCS lump sum equal to the lump sum that they would receive on IHR. Before doing so, you should obtain a written acknowledgement from the member. Paragraph 6.3.11 refers. Tell the Scheme Administrator that the member has an IHR appeal outstanding.

6.3.9 Should the appeal fail, you can pay the balance of the CSCS lump sum. You will not have to pay interest as this is a discretionary payment.

6.3.10 If the member’s appeal succeeds, write to the Scheme Manager for approval to set off the CSCS benefits against their IHR benefits. Include a copy of the member’s acknowledgement of the debt.

6.3.11 Suggested form of acknowledgement:

I, [member’s name], hereby acknowledge that, should I be granted Ill Health Retirement, I will owe [name of department/organisation] £[amount] which is equal to the sum of Civil Service Compensation Scheme benefits I have/will have received in respect of the termination of my employment.

Signed [member’s signature] Date [date of signing]

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