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Occupational Pensions
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orange


Posts: 97
Joined: Jul 2011
Post: #1
24-08-2011 04:13 PM

What rights does a company has under the tupe transfer to freeze someone pension till the default retirement age of 65?
It appears to me that no government is interested to stop this happening.

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Bt


Posts: 160
Joined: Jul 2003
Post: #2
24-08-2011 04:30 PM

You normally have a choice whether to transfer or defer.

You often lose out if you transfer. You will often only get a percentage of your entitlement as you usually have to make up the employers portion in your new scheme from your transferred amount. They usually reduce your number of entitled years.

If you have a good amount/number of years in your old scheme its usually to your advantage to defer.

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roz


Posts: 1,790
Joined: Mar 2005
Post: #3
24-08-2011 05:43 PM

Personally I think you need to check your contract of employment and also seek legal advice. From recollection a transfer of pension obligations after TUPE is not automatic but it does depend on a number of factors. Most companies I believe always reserve the right to cease or change the terms of occupational pension schemes at will.
It is a poor state of affairs but probably next on the agenda to resolve.

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Johnc


Posts: 138
Joined: Jan 2007
Post: #4
24-08-2011 06:17 PM

I can only talk from my own experience. I was transferred from BT to HP under Tupe in 2004. BT had a final salary scheme and HP a money purchase scheme. Tupe does not cover pensions, and essentially we had the option of freezing our BT pension under the terms then on offer, which meant that it was unavailable until age 60, and we joined the HP scheme, albeit on slightly better terms which were negotiated by our union. Since then I believe that recent goverment legislation means that you can take your pension from age 55, and a number of people who were included in our transfer have since taken the BT pension at age 58 or 59. I suspect it depends on the terms of the scheme you are leaving at the time of transfer. We did of course have the option of transferring all our pension to HP, but that would have been bonkers, since the BT scheme was index linked and effectively gauranteed by the goverment, and nobody did as far as I can recollect.

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Sherwood


Posts: 1,347
Joined: Mar 2005
Post: #5
24-08-2011 08:19 PM

My understanding is that TUPE does not protect occupational pension schemes.
As previously stated it is usually advisable to freeze your current pension until you can draw it.
However, I believe that on a TUPE transfer an employer is required to contribute 6% to a pension scheme.
In some cases the position was better. But this government made changes recently.

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orange


Posts: 97
Joined: Jul 2011
Post: #6
25-08-2011 09:45 AM

What sort of changes has the government made recently? Can you explain please? It will help me to understand the situation.
I was in the final salry pension scheme for 30 years and therefore I had no alternative than deferring the accumulated pension when they transferred me. If I did not accept the transfer, I was out of work without any redundancy payment. The new contract has kept the length of service but not the pension, which became frozen (or deferred) till the age of 65. However prior to this, I could have got my pension at the age of 60 with the company's consent without actuarial reductions.
They did not red circle me at the time of the transfer but promised that when I reached 60, I was able to apply for my deferred pension. Now instead they are saying that the trustees have changed the rules (we have received no written ifnormation of these new rules), and do not consent people to retire after the age of 60 and certainly not with a full pension. This company ( a very wealthy energy-commodities company - 7th in the world) said that it would be a large financial burden for them if they allowed me to take my pension without penalties (my pension is not even a third compared to the one fat cats in the company get).
Previosuly for others, especiall top managers this rule did not apply. The new pension scheme, based on stocks and shares is very risky and I have to pay a large sum of money in every month (almost a mortgage payment) in order to recover the losses incurred from the old pension scheme. With the recent shares crash, that means we have already lost all the money we paid in.
There are also talks that they wish to wind up the scheme alltogether. I am worried that I loose it all, because once the money in the pot has gone, it has gone for ever and it will be very stressful to recover it. By that time I will be dead. How can the government let this happening and offer no protection to people who have worked all their life? Especially women? Is there any politician out there who can take notice of this and make the government aware of the situation and do something about it? not to allow the sharks to take advantage of people who worked all their life? I paid money in the scheme. How many other people have been conned under these transfers?
Also, the ex company (the one who sold us like goats ) is saying that if they consider my pension, they will also sum up the new one and the future state one, to see if I need that money. How can this be? Can they do this? The state pension is separate from occupational pensions, the new one is with a different provider.

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Sherwood


Posts: 1,347
Joined: Mar 2005
Post: #7
25-08-2011 05:14 PM

I was referring to the Government's Code of practice dated 13 March 2003, which related only to public sector contracts. This Government abolished this on 23 March 2011.
This protected pension schemes for public sector workers.
My understanding of TUPE is that it did not protect private sector workers' pensions. But after a TUPE transfer they are usually entitled to expect a contribution of 6% from their employer.
The TUPE transfer should not affect your previously accumulated pension. My understanding of pensions is that there should be some consultation before changes are made. it sounds as if this may not have happened. I think you need to discuss this with thetrustees.
Are you a member of a union. They are usually expert in this area.
Personally, I would write to Jim Dowd our local MP for help.

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orange


Posts: 97
Joined: Jul 2011
Post: #8
26-08-2011 09:41 AM

No I am not a member of a Union. If we get into union, our life is made a hell. They don't like that.
The consultation were with local reps and one of them was my manager, anyway. They promised me they could red circle the situation but when time came to apply, they said they haven't got money to put in to guarantee me the deferred pension, so whether I was 60, or 65 years old, the problem would still exist. They offered me a pension much lower than the one deferred, all in acturial deductions. At the same time if I resign from the new place, I cannto take out the money paid in and they will let me go without anythign, not even a thank you for having been here for over 30 years.

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michael


Posts: 3,196
Joined: Mar 2005
Post: #9
26-08-2011 10:03 AM

Orange,
I think you should speak to a pensions advisor for proper guidance relating to your specific circumstances. I did a little Googling and would suggest contacting:
http://www.pensionsadvisoryservice.org.uk/

Quote:
We are an independent voluntary organisation that is grant-aided by the Department for Work and Pensions (DWP).

We provide information and guidance to members of the public on all pension matters, covering state, company, personal and stakeholder schemes.

We also help any member of the public who has a problem, complaint or dispute with their occupational or private pension arrangement. We do not deal with problems, complaints or disputes relating to state pensions.

Our service is free and is provided by a nationwide network of volunteer advisers who are supported and augmented by technical and administrative staff based in London.

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orange


Posts: 97
Joined: Jul 2011
Post: #10
26-08-2011 10:21 AM

Yeah, I have been already in touch with them. I need to collect all the information I have in writing. Unfortunatley some meetings were never confirmed in writing, even when I asked to do so. As soon I have all the ifnormation togehter, I shall send to them and let them have a look. In the meantime wil lwrite also to Jim Dowd and Ian Duncan Smith because it is very unfari what is happening and I believe I am not the only one around.
thanks for all your help

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orange


Posts: 97
Joined: Jul 2011
Post: #11
12-10-2011 09:15 AM

I have now received a reply from my local MP who contacted the dept of work nd pensions - Steve Webb. the letter is a standard letter on the Tupe subject and it confirms tat in 2004 the government gave the right to employers to transfer people with same conditions but with different types of pension which were less favourable to the employees.
This gave employers carte blanche to do what they liked regarding the pension funds.
I have also received a letter from the pension Advisory Bureau which says that in the statute of the Pension Trustees, there is an article saying that they allow to an employee to have the pension but very much reduced. In few word the government and the law system allow employers to rob you of your pension and you have no way of appealing against this situation.

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brian


Posts: 2,002
Joined: Apr 2005
Post: #12
12-10-2011 12:13 PM

As far as I understand if you have a occupational pension and you stop working with that company prior to the retirement the pension scheme has to add the inflation rate per year ( up to max 5% ). Not sure if the RPI or CPI.

Suggest if that has not happened you consult a pensions specialist.

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orange


Posts: 97
Joined: Jul 2011
Post: #13
13-10-2011 03:59 PM

I have done already. The pension will increase according to RPI because it is deferred but this means that I cannot get it at the age I am now before 65 because I have been transferred under the TUPE to another company. If I were still working with the company or leave the company I could have applied for my pension now without reductions. The only obstacle was to obtain the permission rom the company to have it.
The ay they have done it, consulting Freshfields solicitors, it was that there could be no appeal against them. THe trustees, which are mainly directors of the company, can decide what they want anytime they want. No matter how many years you have been working fo them.

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roz


Posts: 1,790
Joined: Mar 2005
Post: #14
13-10-2011 08:39 PM

Ive just received both my annual pension update and the Unison ballot papers for strike action, through my door on the same day. How can anyone say that what I am being offered is anyway fantastic.? The reality of what people get in the public sector is completely different to the media portrayal. My ballot paper is going straight back tomorrow with a clear ' yes ' vote.

The thing about pensions is that they are a deferred salary ie you get paid a proportion at a later day. I have never understood why, globally, firms have the right to change their minds and change the terms. you wouldn't get away with varying someones salary in that manner so why the deferred part? Its not right,but something colossal needs to be done in order to stop people doing it in the short term.

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orange


Posts: 97
Joined: Jul 2011
Post: #15
14-10-2011 11:22 AM

I agree with you. There should be law stopping company taking advanage of the pensions funds for their benefits.
They say life expectancy is longer than it used to be, but can ensure that. 10,000 women are diagnosed with cancer of the womb every year, other with breast cancer, men and women with other sort of cancers. Some make it till to a certain venerable age, others don't. In fact the ones wh make to an older age are the ones who were born prior to the last wars when food was not contaminated and pace less hectic than today.

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brian


Posts: 2,002
Joined: Apr 2005
Post: #16
15-10-2011 03:20 PM

Oh dear Roz here we go again.

As with many state workers you have not totally understood.

No one is saying that your pension is fantastic but it cannot be afford to be funded by the private sector workers who get much worse provision.

We have to accept people are living many years longer than in the 50's etc when these schemes were put in place.

It is terribly unfair for you to expect people with worse provision than you to have to pay for your mostly unfunded generous schemes. Where is your sense of justice.

I do hope you and others will not go on these unjust strikes when you are asking the poor to pay for you. I notice one of your Union bosses earns over half a million.Very brotherly.

If you are really upset about your pension I suggest you notify your employer that you wish to freeze your scheme from now and you will go into the real world and invest for your own pension. Somehow I do not think you will do this.

If the strikes do proceed I trust the employers will be told to block anyone taking part from promotion.

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shzl400


Posts: 729
Joined: Oct 2007
Post: #17
16-10-2011 11:48 AM

Brian, it's a whole bizarre other world in the public sector. You have to be in it to truly understand.

The pensions, which I admit now appear relatively generous against the ups and downs of private pensions, are one of the few perks remaining in the public sector. However, it's not as if we don't contribute substantially to those pensions and the LGPS is fully funded.

There is practically zero job security, with all staff being subject to "restructures" on an almost annual basis as budgets are cut to the bone, and those who remain are expected to deliver all their former colleagues' work.

There's also been a pay freeze in effect for two years now, so combined with the effects of inflation, public sector pay, which was never generous, has now slipped well behind.

And finally, Brian, there is no such thing as "promotion". In order to get a higher grade's pay, you have to get a higher graded job, which is only possible if such a job is vacant (less common in these days of cuts and restructures) and then only by competitive interview.

I spent 15 years working in the private sector before moving into the public sector 10 years ago, so I feel I can speak equally for both. They both have their different pros and cons, but I can assure you that pay and pensions are definitely not as generous in the public sector, particularly when you add the other perks often seen in the private sector - BUPA, gym membership etc.

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brian


Posts: 2,002
Joined: Apr 2005
Post: #18
16-10-2011 11:57 AM

Thanks for your explanation but take issue with works fully funded.

Fully funded by whom , not the members I guess. There is no way they are contributing 100% to these very generous pensions.

If the are fully fundred it is by the employers who get their money from local and national governments , in otherwords us.

According to media the so called wage freeze did not apply to many with so called merit or grade rises ( whatever they are). Also many private sector workers have taken wage REDUCTION to retain their jobs.

For 43 years I worked to 4 private sector companies and in all cases I have no idea what any colleagues were being paid.

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sandy


Posts: 189
Joined: Oct 2006
Post: #19
16-10-2011 12:35 PM

1. public sector workers pay tax, too.
2. surely not knowing what colleagues earn is neither good nor transparent in terms of fairness.
3. why should we all be brought down to the worst conditions rather than aspiring to better conditions for all?

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brian


Posts: 2,002
Joined: Apr 2005
Post: #20
16-10-2011 01:20 PM

Sandy
I agree Public Sector workers are taxpayers but it all comes from the private sector.

We cannot afford such a large public sector now as like other countries we have to make sacrifices

I hope HMG holds out and if required takes the issue to the electorate.

For instance not that long ago LBC did not have their brand new extension to the Town Hall. Where did all these people work or was there less workers.

Final Salary pensions are totally unfunded and cannot be justified .

Perhaps best if everyone contributed to their own pension. No argument.

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