Watch out if employers opt out

Article Abstract:

It is believed that many employers in the UK will decide to take up the option to opt out of new regulations regarding pension scheme trustees which are due to come into effect in Apr 1997. The new legislation states that pension scheme members will have the right to select some of the trustees, but employers can opt out as long as the pension scheme members are informed about this and given the opportunity to oppose the move. If employers opt out, then members will have little say in how the pension scheme is managed.

Laws, regulations and rules

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Employers' pensions

Article Abstract:

While almost 21 million people in the UK are members of an employers' pension scheme, most are unaware of how their scheme works or what they will receive when they retire. There are two different types of employers' scheme: money-purchase and final-salary, although some companies offer a mixture of both. The amount an employee contributes to either scheme depends on how it is set up. A non-contributory scheme requires no payment while a contributory scheme requires a typical payment of between 3-5% of gross pay.

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Employers' pension schemes

Article Abstract:

It is vital to be fully informed before deciding to join an employers' pension scheme, especially with regard to what benefits the scheme offers and how the pension can be boosted if necessary. Factors to take into account include the level of pension which will be available, the number of years of contribution required, life insurance and how much of the pension can be taken as a lump sum. It is also important to consider the impact on pension arrangements of changing jobs.

Pensions

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