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Pross

Dorset_Boy said:

Preserved benefits are the pension entitlement someone who has left the scheme has. The pension entitlement is revalued each year and effectively also increases in line with the triple lock.
Additionally, public sector pensions that are in payment are also increased each year in the same way. So for example, those receiving a LGPS pension saw it increase by 10.1% in April.

Public sector schemes are / have moved to career average whilst a member, so typically your wife will accrue 1/49th of her annual pensionable salary each year.
Under the old final salary system, he pension would have been based on her final salary (different definitions apply), and as people's salaries typically increase as the approach retirement, a big pay rise in the last few years would have a big impact on the pension entitlement.

Career average is still a gold standard pension and all the liability falls on the employer. It may not be the platinum standard of final salary, but is still way more valuable than a money purchase arrangement as seen outside the public sector.

The value of public sector pension are totally underestimated by most who work in that sector.

I've never quite worked out what would happen if I went back into Local Government, I previously did over 8 years on a final salary scheme and was earning about £18k when I left. If I got a job back there now I'd probably be looking at something around £45-50k so if even those previous 8 years were still based on the new final salary it would make a massive difference but I assume the final salary is limited to the final salary before the rules changed.

First.Aspect

One of our neighbours is a nurse. She's appalled at the lack of awareness within the industry at just how good and how valuable the additional allowances are. They get a lot of extra leave for children, a lot of leave per se, and very attractive pensions.

I know it's not the be all and end all, but if they want much higher headline pay, perhaps something has to give.

Pross

Dorset_Boy said:

rick_chasey said:

Pross said:

Triple lock has to go. I'm really struggling to understand why someone who no longer works should have their income potentially linked to earnings of those in employment on the rare occasions pay rises actually get ahead of inflation and having a fixed rise even if inflation and wage rises are low is also a bit baffling. Surely by now any shortfall in the state pension this was supposed to address has been dealt with?

Sorry to sound like Rick. I'm saying this as someone who'll be collecting a pension sooner than I'd like to admit so it would suit me on a personal level for it to stay but isn't really sustainable.

Right. I think it’s sensible that the government(s) take a serious look at social security and reevaluate the whole model and obviously pensions are right at the top.

I think we need to get better at incentivising people to save appropriately for a much longer retirement and recognise that there is a cost for not doing so - we shouldn’t really have to bankroll poor savers for possibly decades.

The viability of a full social security net is definitely being challenged and will be tested to destruction with an aging population and an increasingly difficult environment for working age people, in all senses.

One of the big, big successes of the Government over the last 13 years has been auto-enrolment, coupled with pensions freedoms. The sad thing is that the auto-enrolment model is what Brown should have introduced in 2001, not his cocked up stakeholder waste of time and money.

The triple lock should become an average of the three measures, rather than the highest.

But also don't forget, all those with preserved benefits in other public sector schemes, yet to draw their pensions, also saw massive hikes in their pensions, so it really isn't just those already retired who benefit.

What's the thinking on it not just being index linked, surely that would ensure it keeps in track with the wider cost of living?

Irrespective of who benefits it just feels like a financially unviable system.

wallace_and_gromit

Dorset_Boy said:

1. Preserved benefits are the pension entitlement someone who has left the scheme has. The pension entitlement is revalued each year and effectively also increases in line with the triple lock.

2. The value of public sector pension are totally underestimated by most who work in that sector.

Re 1 - Thanks. Having no experience of preserved public sector scheme benefits, I hadn't clocked that they were increased in line with the triple lock too. I thought such increases were capped at some meagre level. Presumably that is just a private sector thing.

Re 2 - So true. Though maybe not so valuable now interest rates have returned to more historically normal levels. With interest rates at nearly zero, even a seemingly modest defined benefit pension was worth a King's Ransom.

Dorset_Boy

Pross - you couldn't rejoin the old final salary scheme so your final salary for that element would be your pensionable final salary at the time you first left.

On the triple lock, historically inflation for pensioners has been higher than for those of working age. In part because typically they buy fewer white good, electricals and tech which have seen deflation over the years.

kingstongraham

wallace_and_gromit said:

Dorset_Boy said:

1. Preserved benefits are the pension entitlement someone who has left the scheme has. The pension entitlement is revalued each year and effectively also increases in line with the triple lock.

2. The value of public sector pension are totally underestimated by most who work in that sector.

Re 1 - Thanks. Having no experience of preserved public sector scheme benefits, I hadn't clocked that they were increased in line with the triple lock too. I thought such increases were capped at some meagre level. Presumably that is just a private sector thing.

Re 2 - So true. Though maybe not so valuable now interest rates have returned to more historically normal levels. With interest rates at nearly zero, even a seemingly modest defined benefit pension was worth a King's Ransom.

Public sector pension benefits are uprated by CPI, not the triple lock, I think. Private sector by some measure of inflation but usually limited (to 5% for the one I still have kicking about).

Dorset_Boy

kingstongraham said:

wallace_and_gromit said:

Dorset_Boy said:

1. Preserved benefits are the pension entitlement someone who has left the scheme has. The pension entitlement is revalued each year and effectively also increases in line with the triple lock.

2. The value of public sector pension are totally underestimated by most who work in that sector.

Re 1 - Thanks. Having no experience of preserved public sector scheme benefits, I hadn't clocked that they were increased in line with the triple lock too. I thought such increases were capped at some meagre level. Presumably that is just a private sector thing.

Re 2 - So true. Though maybe not so valuable now interest rates have returned to more historically normal levels. With interest rates at nearly zero, even a seemingly modest defined benefit pension was worth a King's Ransom.

Public sector pension benefits are uprated by CPI, not the triple lock, I think. Private sector by some measure of inflation but usually limited (to 5% for the one I still have kicking about).

I think you are right, but CPI has been higher than the other 2 triple lock measures for the last few years so it has resulted in the same increase. They went up by 10.1% in April 2023 and 3.1% in 2022.

Pross

First.Aspect said:

One of our neighbours is a nurse. She's appalled at the lack of awareness within the industry at just how good and how valuable the additional allowances are. They get a lot of extra leave for children, a lot of leave per se, and very attractive pensions.

I know it's not the be all and end all, but if they want much higher headline pay, perhaps something has to give.

I think it is SC who regularly suggests trading with them on pensions. As mentioned above I genuinely don't think anyone who has worked in the public sector all their lives appreciates just how big a benefit that is. Also, as you say, things like sick leave and annual leave is significantly better than you will get in the vast majority of private sector companies. I was on 32 days annual leave plus up to 13 days a year of flexi leave back in 1998 and despite having worked in a few companies with very good leave policies by my sector's standard I've never been close to that since even when being able to purchase extra leave. The first company I went to in the private sector provided 6 months full pay and 6 months half pay sick leave for about 10 years until a few people abused it and it was dropped as part of the efficiency savings in the GFC. It went to 10 days rolling in any given 12 month period which I think has also been the policy in the places I've worked since and even that is better than many where it is statutory pay only.

pblakeney

Anecdotal evidence. Nurses have been asking for wage increases for years. Typical response has been like it or lump it. Compound that over years. RCN has been complicit.
Nurses sickness benefits appear to be getting cut as some are simply being let go as not capable after long term (1 year) sickness.

pangolin

I'm in a DC private pension and have a good headline pay rate but employer only matches the minimum 3% so I have to chuck a lot in.

Starting to think I should look for a public sector job!

Pross

With some exceptions (e.g. dealing with a treatable illness) I would suggest that being off sick for a year probably does mean you aren't capable. Getting an insurance policy that would pay you full, or even half, salary for a year would cost a fortune. On the flip side, things like mental health conditions and potentially physical issues like back problems will often be exacerbated if not originally triggered by the work so I could see lots of legal cases coming up.

surrey_commuter

Pross said:

First.Aspect said:

One of our neighbours is a nurse. She's appalled at the lack of awareness within the industry at just how good and how valuable the additional allowances are. They get a lot of extra leave for children, a lot of leave per se, and very attractive pensions.

I know it's not the be all and end all, but if they want much higher headline pay, perhaps something has to give.

I think it is SC who regularly suggests trading with them on pensions. As mentioned above I genuinely don't think anyone who has worked in the public sector all their lives appreciates just how big a benefit that is. Also, as you say, things like sick leave and annual leave is significantly better than you will get in the vast majority of private sector companies. I was on 32 days annual leave plus up to 13 days a year of flexi leave back in 1998 and despite having worked in a few companies with very good leave policies by my sector's standard I've never been close to that since even when being able to purchase extra leave. The first company I went to in the private sector provided 6 months full pay and 6 months half pay sick leave for about 10 years until a few people abused it and it was dropped as part of the efficiency savings in the GFC. It went to 10 days rolling in any given 12 month period which I think has also been the policy in the places I've worked since and even that is better than many where it is statutory pay only.

Definitely one of my hobby horses.

Depending on the scheme the annual worth is 30-50%.

Divide that by three and you have the employer contribution, a hefty payrise and a nice saving.

shirley_basso

rick_chasey said:

First.Aspect said:

rick_chasey said:

First.Aspect said:

rick_chasey said:

wallace_and_gromit said:

FWIW - probably not that much - UK average pay growth in the last year (7.8% excl bonuses) is now outpacing CPI inflation (6.8%).

https://www.theguardian.com/business/live/2023/sep/12/uk-unemployment-rises-real-wages-grocery-inflation-business-live

Won’t last is my semi informed prediction.

Course it won't. Any big pay rise in a given year is always punished, and averages out much lower over time. Its why the ask from a lot of the unions and medics at the moment is ill judged. They should be asking for something modest over several years, because half of that will be some other government or some other ministers problem, and the result will be less newsworthy. So more likely to get a yes.

Fwiw this would not be my advice to individuals re pay bargaining.

Obviously different at a public sector and collective bargaining, so not commenting on that, but pay is almost always anchored to what you’re currently on > always take more now as the raises thereafter are based on that new number so the benefit is compounded.

Similarly, my advice is never to take less pay, regardless of how good the role is, if comp is anywhere of relevance to you.

I found out my roles salary isn't even benchmarked by the firm recently. They are making it up as they go along. Can't see the point in bargaining with anything other than my feet at this stage of chaos.

Best outcome would be to realise I'm X% under market value and push them up a bit, but that would be a dead cat bounce.

It's actually in the e.ployee handbook that we shouldn't ask each other about salaries. That's not a good sign.

There is always a reason to say no to previously agreed upon pay rises.

Always take the money now. Very few people get given pay cuts unless they’re in very performance orientated pay.

You almost always start comp negotiation based on your existing comp. So might as well make existing comp as high as possible.

People surprisingly forget sometimes that pay is recurring so £5k increase is compounded across your remaining career.

Defintely didn't kick up enough of a fuss during recent sub-inflation payrises. A colleague went absolutely ballistic and threatened to walk (very cleverly argued) and I think it worked out.

Pross

pangolin said:

I'm in a DC private pension and have a good headline pay rate but employer only matches the minimum 3% so I have to chuck a lot in.

Starting to think I should look for a public sector job!

I considered it when I was looking to move jobs last year but in my line of work the role would be far less technical and more political. I don't have the diplomatic skills to deal with idiot Councillors. One I remember from my early days was the Councillor who was chairman of the highways committee ranting at my boss about a recently installed traffic calming scheme in his ward that wasn't slowing drivers enough for his liking. He was demanding they be made more severe and my boss was trying to explain that the legislation didn't allow this to which he was told 'I don't care what the legislation says I want them higher'. I would have probably ended up being sacked if I had to deal with that. Also, most of the technical work is now subbed out to consultants and I think I'd be bored.

rick_chasey

shirley_basso said:

rick_chasey said:

First.Aspect said:

rick_chasey said:

First.Aspect said:

rick_chasey said:

wallace_and_gromit said:

FWIW - probably not that much - UK average pay growth in the last year (7.8% excl bonuses) is now outpacing CPI inflation (6.8%).

https://www.theguardian.com/business/live/2023/sep/12/uk-unemployment-rises-real-wages-grocery-inflation-business-live

Won’t last is my semi informed prediction.

Course it won't. Any big pay rise in a given year is always punished, and averages out much lower over time. Its why the ask from a lot of the unions and medics at the moment is ill judged. They should be asking for something modest over several years, because half of that will be some other government or some other ministers problem, and the result will be less newsworthy. So more likely to get a yes.

Fwiw this would not be my advice to individuals re pay bargaining.

Obviously different at a public sector and collective bargaining, so not commenting on that, but pay is almost always anchored to what you’re currently on > always take more now as the raises thereafter are based on that new number so the benefit is compounded.

Similarly, my advice is never to take less pay, regardless of how good the role is, if comp is anywhere of relevance to you.

I found out my roles salary isn't even benchmarked by the firm recently. They are making it up as they go along. Can't see the point in bargaining with anything other than my feet at this stage of chaos.

Best outcome would be to realise I'm X% under market value and push them up a bit, but that would be a dead cat bounce.

It's actually in the e.ployee handbook that we shouldn't ask each other about salaries. That's not a good sign.

There is always a reason to say no to previously agreed upon pay rises.

Always take the money now. Very few people get given pay cuts unless they’re in very performance orientated pay.

You almost always start comp negotiation based on your existing comp. So might as well make existing comp as high as possible.

People surprisingly forget sometimes that pay is recurring so £5k increase is compounded across your remaining career.

Defintely didn't kick up enough of a fuss during recent sub-inflation payrises. A colleague went absolutely ballistic and threatened to walk (very cleverly argued) and I think it worked out.

Yeah leverage in the bargain is important blah blah

rjsterry

shirley_basso said:

rick_chasey said:

First.Aspect said:

rick_chasey said:

First.Aspect said:

rick_chasey said:

wallace_and_gromit said:

FWIW - probably not that much - UK average pay growth in the last year (7.8% excl bonuses) is now outpacing CPI inflation (6.8%).

https://www.theguardian.com/business/live/2023/sep/12/uk-unemployment-rises-real-wages-grocery-inflation-business-live

Won’t last is my semi informed prediction.

Course it won't. Any big pay rise in a given year is always punished, and averages out much lower over time. Its why the ask from a lot of the unions and medics at the moment is ill judged. They should be asking for something modest over several years, because half of that will be some other government or some other ministers problem, and the result will be less newsworthy. So more likely to get a yes.

Fwiw this would not be my advice to individuals re pay bargaining.

Obviously different at a public sector and collective bargaining, so not commenting on that, but pay is almost always anchored to what you’re currently on > always take more now as the raises thereafter are based on that new number so the benefit is compounded.

Similarly, my advice is never to take less pay, regardless of how good the role is, if comp is anywhere of relevance to you.

I found out my roles salary isn't even benchmarked by the firm recently. They are making it up as they go along. Can't see the point in bargaining with anything other than my feet at this stage of chaos.

Best outcome would be to realise I'm X% under market value and push them up a bit, but that would be a dead cat bounce.

It's actually in the e.ployee handbook that we shouldn't ask each other about salaries. That's not a good sign.

There is always a reason to say no to previously agreed upon pay rises.

Always take the money now. Very few people get given pay cuts unless they’re in very performance orientated pay.

You almost always start comp negotiation based on your existing comp. So might as well make existing comp as high as possible.

People surprisingly forget sometimes that pay is recurring so £5k increase is compounded across your remaining career.

Defintely didn't kick up enough of a fuss during recent sub-inflation payrises. A colleague went absolutely ballistic and threatened to walk (very cleverly argued) and I think it worked out.

Bit of a high risk strategy and depends on your employer not calling your bluff.

shirley_basso

For that guy - he was holding a lot of cards and employer didn't want him to leave.

For me - I think I could have made a major stink and it may / may not have worked. Wouldn't have threatened to walk though.

rjsterry

Extortion is not a great way to build a relationship with your employer. Very much an SME perspective but in order to award a pay rise the employer needs to bring in more income (all other things being equal). If you can demonstrate a positive impact on the bottom line that's a good place to start.

pangolin

rjsterry said:

Extortion is not a great way to build a relationship with your employer. Very much an SME perspective but in order to award a pay rise the employer needs to bring in more income (all other things being equal). If you can demonstrate a positive impact on the bottom line that's a good place to start.

What if the employee is doing a good job and inflation is at 10%? Do they need to demonstrate they are bringing in 10% more income than they were?

kingstongraham

rjsterry said:

Extortion is not a great way to build a relationship with your employer. Very much an SME perspective but in order to award a pay rise the employer needs to bring in more income (all other things being equal). If you can demonstrate a positive impact on the bottom line that's a good place to start.

I don't think saying "pay me more or I'll go and get paid more somewhere else" is extortion.

rjsterry

pangolin said:

rjsterry said:

Extortion is not a great way to build a relationship with your employer. Very much an SME perspective but in order to award a pay rise the employer needs to bring in more income (all other things being equal). If you can demonstrate a positive impact on the bottom line that's a good place to start.

What if the employee is doing a good job and inflation is at 10%? Do they need to demonstrate they are bringing in 10% more income than they were?

There are lots of complicating factors. Just putting forward the employer's point of view. If you go in with 'pay me more or I'm stealing the client list' you are advertising that you are a liability.

rjsterry

kingstongraham said:

rjsterry said:

Extortion is not a great way to build a relationship with your employer. Very much an SME perspective but in order to award a pay rise the employer needs to bring in more income (all other things being equal). If you can demonstrate a positive impact on the bottom line that's a good place to start.

I don't think saying "pay me more or I'll go and get paid more somewhere else" is extortion.

The implication was that there was a bit more of a commercial threat but I may have misread that.

shirley_basso

He effectively said "this is absolute bullsh*t. If that's the best you can do then clearly the culture of reward does not suit my ambitions, and I have the stats to back it up that it won't take me long to find somewhere else that will pay me what I am worth"

they said 'we will get back to you'

He said 'no you won't, i want to speak to someone today"

He spoke to someone and I think got what he wanted

TheBigBean

kingstongraham said:

rjsterry said:

Extortion is not a great way to build a relationship with your employer. Very much an SME perspective but in order to award a pay rise the employer needs to bring in more income (all other things being equal). If you can demonstrate a positive impact on the bottom line that's a good place to start.

I don't think saying "pay me more or I'll go and get paid more somewhere else" is extortion.

"Pay me more, I'm making loads of money for the company" is a better argument.

rick_chasey

All depends on the context. Obviously. But yes if you’re good and paid below market rate it’s quite straightforward to say “I’d like to work here but the comp is making it very hard to stay because I can genuinely get x over here”

First.Aspect

Received wisdom is that if someone threatens to leave, the payrise is a sticking plaster.

rick_chasey

First.Aspect said:

Received wisdom is that if someone threatens to leave, the payrise is a sticking plaster.

That’s what we tell people to close out an offer, but I’ve seen no correlation with people successfully being countered to stay and more likely to leave in the future.

My view is if the counter is successful you were never that unhappy and it was all about pay or you’ve already decided so you’ll ignore the counter anyway.

rjsterry

shirley_basso said:

He effectively said "this is absolute bullsh*t. If that's the best you can do then clearly the culture of reward does not suit my ambitions, and I have the stats to back it up that it won't take me long to find somewhere else that will pay me what I am worth"

they said 'we will get back to you'

He said 'no you won't, i want to speak to someone today"

He spoke to someone and I think got what he wanted

Good for him. Obviously I don't know whether that approach was justified or the history. If he had the numbers to back up his claim - more than just so-and-so down the road are offering £X - then fair enough.

rjsterry

rick_chasey said:

All depends on the context. Obviously. But yes if you’re good and paid below market rate it’s quite straightforward to say “I’d like to work here but the comp is making it very hard to stay because I can genuinely get x over here”

*Slightly* different tone to SB's example.

rick_chasey

rjsterry said:

rick_chasey said:

All depends on the context. Obviously. But yes if you’re good and paid below market rate it’s quite straightforward to say “I’d like to work here but the comp is making it very hard to stay because I can genuinely get x over here”

*Slightly* different tone to SB's example.

Ha, when I actually know what I’m talking about I can be more refined than I normally am, honest.