Flexible retirement

Piggy bank and retirement plan

12 / 1 / 2015 00:00 AM

Flexible retirement is defined as flexibility regarding the age at which an employee retires, the length of time an employee takes to retire or the nature and intensity of work in the lead up to final retirement. The NHS Pension Scheme offers a range of pension flexibilities to support both employers and members. The available options must be discussed and agreed between the employer and member.

Pension flexibilities can support your organisation to deliver the following benefits:

  • retention of experienced staff with valuable skills
  • greater choice for employees in how they approach their retirement
  • the creation of a wider pool of expertise for recruitment (by including more older workers)
  • a strategic and effective response to demographic change
  • equality of opportunity and fairness for all employees.

Available options (dependent on which part of the scheme the member is in)


  • Wind down: as an alternative to retiring, staff can opt to wind down by working fewer days or hours in their current post.
  • Step down: staff who do not want to leave work altogether, but who would like to give up the pressure and responsibilities of their current role, can step down into a less demanding role that still makes use of their skills and experience. 
  • Retire and return to NHS employment: staff who have reached the minimum retirement age can opt to retire, take all their pension benefits and return to NHS employment.
  • Draw down: in the 2008 section and the 2015 scheme draw down allows members to take part of their pension benefits while continuing in NHS employment.
  • Late retirement enhancement: In the 2008 section and 2015 scheme a member can choose to retire later than their Normal Pension Age (NPA) and their pension benefits will be increased by the application of late retirement factors.
  • Early retirement reduced buy out: in the 2015 scheme members or employers can pay additional contributions to buy out, or reduce, the actuarial reduction that would be applied to their pension were they to retire before their NPA.

Good practice

  • Using flexible retirement to support workforce planning - this case study outlines City Hospitals Sunderland NHS Foundation Trust's approach to workforce planning and the efforts they have made to allow staff to use flexible retirement.
  • Making flexible retirement a board priority - this case study explores how Tees, Esk and Wear Valleys NHS Foundation Trust ensure working longer is a board priority including how they use their existing policies to enable staff to work longer and what plans they have to increase awareness of the flexibilities within the NHS Pension Scheme among staff.
  • Promoting a culture which supports flexible retirement - this case study looks at how Countess of Chester Hospital NHS Foundation Trust promotes a culture where flexible working is key to an effective workforce and staff are supported to consider a range of options when approaching retirement.

Resources for employers

Working Longer Group factsheets - the employer and employee factsheets walk you through the range of retirement flexibilities available to staff in the NHS Pension Scheme, (1995 and 2008 sections and the new 2015 scheme) in addition to a handy printable checklist that outlines the available options.

Profile your workforce by age - a tool to profile your workforce by age.


Existing policies developed in this area:

Further information

  • NHS Pensions, as the scheme administrator, provide further information on scheme flexibilities
  • Working Longer Group - established to address the impact of a raised retirement age on NHS staff, employers and the provision of health services.
Employers can send any flexible retirement queries to: pensions@nhsemployers.org.

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