WORKPLACE PENSION SCHEMES

AND EMPLOYER CONSULTATIONS

Jeremy Branton

Employers reviewing existing workplace pension schemes against the automatic enrolment
(AE) criteria may find they have a duty to consult with their workers. This could apply if they
are considering amending contributions to an existing occupational pension scheme (OPS)
or group personal pension (GPP) or closing an existing OPS as part of the process. This presents
an ideal opportunity to promote the benefits of pension saving. Consultation with employees
about their pension provision is likely to increase their engagement with the process.
WHEN DOES THE DUTY TO CONSULT APPLY?
The consultation rules apply to employers who:
have at least 50 employees (not members)
sponsor an OPS (including final salary and money purchase
but not one member schemes)
operate a GPP via salary deduction into which they make
contributions from their own resources.

10 techtalk

The consultation process is triggered where a listed change (see below)

has been proposed to affected members pension arrangements.
Affected members are existing and prospective members and their
representatives. Deferred and pensioner members dont need to be
consulted as its unlikely any changes would impact benefits already
accrued or in payment. While the employer has the duty to consult,
the change itself may have been initiated by another party such as
the trustees, administrator or scheme provider.
The Pensions Regulator (TPR) expects employers to provide sufficient
information for those affected to understand the implications of the
changes being proposed. Employers should also consider the quantity
and complexity of information they provide employees and allow an
appropriate period for the consultation process to take place.