asked Her Majesty's Government:
Why employers who have paid the lower “contracted out” national insurance contributions for an employee are then required to pay the higher full rate if the employee chooses to remain at work beyond state pension age. [HL249]
Reduced rate employer and employee national insurance contributions (NICs) are payable in respect of individuals under state pension age who have contracted out of the state second pension. Once individuals reach state pension age they no longer pay NICs or accrue further entitlement to the state second pension. Employer NICs are therefore payable at the full rate for individuals working beyond state pension age, regardless of whether they were previously contracted out.