Part-time employees at a Scottish college are waiting to discover if they have been affected by a problem with their pension payments, The Herald can reveal.

In a communication to staff at the beginning of the year, the principal and CEO of South Lanarkshire College explained that an error made by the organisation meant that part-time staff may have been overpaying on their pension contributions for nearly a decade.

This happened because the college did not make appropriate changes to contribution rates when rules were changed in 2015, with a shift from ‘full-time equivalent’ calculations to those based on actual earnings.

The college has conceded that “in many circumstances, for part-time employees, this would reduce the percentage of the employee contribution rate and, therefore, the actual amount of contributions paid by each employee.”

Officials are now “working on the assumption that all part-time colleagues from 2015 – 2023 may have been affected.”

The mistake only came to light following a review of an “internal auditor pensions contributions report”, and the discovery has now forced the college to engage an outside “payroll specialist” to “conduct a comprehensive review of all part-time employees during the period identified.”

Due to the number of employees who may have been affected, the college has decided to proceed using a ‘project sprint’ approach, which means that staff will be put into groups of around 20 people, with each person then “having their contributions reviewed, concluded and, if appropriate, consulted on a resolution on any contribution discrepancy.”

Each individual “project sprint” would be expected to take around 90 days, with the full timetable not due to conclude until “the end of February 2025”. Staff will be prioritised “predominantly based on alphabetical order of surname”, although a “priority lane” has also been established to allow staff to request that their case is dealt with more quickly. The communication gives the example of those due to retire soon as someone who may need access to the priority lane.

The situation is described as “a systematic error”, but the college communication states that “all money contributed by employees was subsequently paid and reported to the SPPA.”

A spokesperson for the Scottish Public Pensions Agency (SPPA) said: “South Lanarkshire College notified SPPA in early May of potential part time employee incorrect pension contributions.  The calculation and provision of pension contributions is the responsibility of the employer. Changes in contributions at macro levels are affected by a wide range of factors and a single change to a small number of employees would not cause any form of alert to the SPPA. We are in touch with South Lanarkshire Council and have confirmed that there will be no impact to any pensionable benefits.”

Asked to clarify whether refunds to staff would come from the SPPA, their spokesperson added: “The refund of any pension contributions to members in this case is the responsibility of the employer.”

Earlier this month, members of the local branch of EIS-FELA, which represents college lecturers, passed a motion of No Confidence in the college’s principal, with issues over pensions deductions cited as one reason for the vote.

A spokesperson for the EIS told The Herald: “It is quite incredible that part-time staff at South Lanarkshire College have been subject to excessive pension contribution deductions from their salaries for the best part of a decade. This means that throughout a long period of austerity, real-terms pay cuts and the worst cost-of-living crisis in living memory, part-time lecturers at SLC have received even lower monthly salaries than they have been entitled to.

“This must now be rectified as a matter of urgency, with all lecturers repaid in full for what they have lost, together with appropriate compensation to each and every lecturer who has been disadvantaged through no fault of their own.

“Recently, members of the EIS-FELA Branch at the college passed a vote of no confidence in the Principal about the on-going pensions issue and her intention to deduct (deem) 100% salary from lectures taking part in legitimate industrial action. The branch has called on the principal to withdraw the threat of deeming and to work constructively to find a solution to this pension saga.”

The Herald approached South Lanarkshire College with a number of questions about the management of pension payments at the institution. We asked who was responsible for the failure to update contribution rates in 2015, and exactly how the problem had been uncovered. We also asked why it took so long for anyone to notice the problem, and how much the college expects to have to spend on the services of outside payroll experts as it attempts to resolve the situation.

In response, a spokesperson for the college said: “This was a regrettable historic operational failure during a previous administration, which has been picked up and is being addressed with the utmost urgency.

“The college takes this matter extremely seriously and has ensured the Auditors, the Board of Management and the Trade Unions have been kept informed throughout. The Project Plan has been fully discussed and agreed with the Trade Union representatives. The respective pensions agencies have been fully informed.

“Pension Rights are a reserved matter, and only limited details are publishable and may be found on the SLC website in the Audit and Risk Committee (ARC) February Minutes which were published in May 2024.

“It would be inappropriate to comment further while an investigation is ongoing.

“Everything that can be published is already in the public domain.”