If you work out the pay for full time members on a daily basis, then you will need to include any extra pay received on 29 February in addition to the other days in the year.

If you work out the pay for full-time members monthly, then the pay figure will be largely unaffected by the extra leap year day because monthly pay is the same each month, no matter how many days are in the month. The only time the extra leap year day would make a difference is if the member left in February.

Example

A member joined on 14 April 2011 and leaves on 21 March 2020. They have always worked full time and have never had a break in service.

Total membership = 8 years 343 days (including the extra leap year day)

Salary 1 April 2018 – 31 March 2019: £16,860.00

Salary 1 April 2019 – 31 March 2020: £17,340.00

The calculation of the final salary pay, for the members last year (22 March 2019 – 21 March 2020)

On a daily basis would be as follows:

22 March 2019 – 31 March 2019 = 10 days

01 April 2019 – 21 March 2020 = 356 days

(£16,860.00 ÷ 365) X 10 = £461.92

(£17,340.00 ÷ 365) X 356 = £16,912.44

Total final salary pay: £17,374.36

On a monthly basis would be as follows:

22 March 2019 – 31 March 2019 = 10 days

01 March 2020 – 21 March 2020 = 21 days

(£16,860.00 ÷ 365) X 10 = £461.92

(£17,340.00 ÷ 365) X 21 = £997.64

(£17,340.00 ÷ 12) X 11 = £15,895.00

Total final salary pay: £17,354.56

Members who have worked part time during their final year will not have much impact on their final salary pay from the extra leap year day.

Example

Member joins on 14 April 2011, leaves on 31 March 2020 and has always worked 21.50 hours out of a possible 37.00 hours.

Their final salary pay period is 1 April 2019 – 31 March 2020. Their actual earnings were £8,355.44.

(£8,355.44 ÷ 21.50) X 37 = £14,379.13

Equating this up to full time equivalent uses hours rather than days, so the extra day does not impact final salary pay.

If a member has worked for only part of the year, including 29 February, then some adjustment is required to work out the full year equivalent pay. Local Government Pension Scheme (Benefits, membership and contributions (BMC)) Regulation 9(4) is explicit and states:

‘If a member is only entitled to count part of the year specified in regulation 8(2) as a period of active membership in relation to the employment which he ceases to hold, his final salary pay is his pensionable pay during that part multiplied by 365 and divided by the number of days in that part.’

If the part year straddles 29 February, then 29 February is a day in that part year and should be counted as such.

However, when equating the pay received up to the full year equivalent you would still multiply by 365 (and not 366) because regulation 9(4) specifically states that.

Example

Membership 1 September 2019 – 31 March 2020 = 0 years 213 days (including the extra day for the leap year)

Actual pay received during this period: £7,632.09

To work out the full year equivalent:

(£7,632.09 ÷ 213) X 365 = £13,078.46

If a member has worked part time for only part of the year, including 29 February, then some adjustment to take account of the extra day is required to work out the full year full time equivalent pay.

Example

A member has worked 14.00 hours out of possible 36.00 hours between 1 August 2019 – 31 March 2020. Their actual pay received is £4,631.07.

To work out final salary pay, you first need to equate up the pay received to the full time equivalent. As explained above the extra leap year day will not affect this part of the calculation:

(£4,631.07 ÷ 14) X 36 = £11,908.47

Then you need to equate the full time part year figure up to the full year equivalent. In this part of the calculation, you will need to take the extra leap year day into account. The member has worked 244 days between 1 August 2019 and 31 March 2020 (including the extra leap year day):

(£11,908.47 ÷ 244) X 365 = £17,813.90

If a member has had a break in service (for example, a day on strike) during their final salary pay period, including 29 February, then the pay received during their final year will need to be equated up to the notional full year equivalent.

To calculate the final salary pay, work out the actual pay received and divide it by the number of days that the member has worked in the year, then multiply the answer by 365. If those days include 29 February, then the extra day should be included in the calculation.

Example

A member’s final year is 1 January 2020 – 31 December 2020. The member works full time.

The member has had three strike days during this period. This means the number of days used in the calculation is 366 (days in the leap year) – 3 (strike days).

Actual pay received during this period: £22,365.00

(£22,365.00 ÷ 363) X 365 = £22,488.22

If a member has worked for only part of the year (including 29 February) and the member has had a break in service, then you will need to do an amalgam of the methods above to work out the full time equivalent whole year pay.

You will first need to work out the membership, making sure that you include the extra day for 29 February in your calculations. Then deduct any days that the member is not entitled to count.

Take the actual pay received during the period, divide it by the number of days that the member is entitled to count, and multiply the answer by 365.

Example

Membership 1 September 2019 – 31 March 2020 = 0 years 213 days

But the member has had two days strike on 1 March 2020 and 2 March 2020, for which they have decided not to repay contributions.

The reduced membership is = 0 years 211 days

Actual pay received during this period: £7,560.43

To work out the full time equivalent:

(£7,560.43 ÷ 211) X 365 = £13,078.47