# Non contributory pension scheme -useless if you leave.



## Odea (24 Jun 2004)

I worked for a bank that had a non contributory pension scheme. After 16 years I left the bank and I was told that I would get absolutely nothing pension wise because I was leaving the banks employment. Surely, the bank cannot keep pension money that they set aside for me (deferred pay) for 16 years.


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## Azriel (24 Jun 2004)

*Non-contributory*

You'd need to post more details on what the pension promise was.

On the basis that it was a non-contributory Defined Benefit scheme, you should be entitled to benefits based on 16 years membership.

What exactly did they say (on the basis that 'nothing cause you're leaving' seems implausible?


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## Odea (25 Jun 2004)

*Non-contibutory pension*

When did you leave the bank?  Under the current law, this would not be allowed.

d


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## Odea (28 Jun 2004)

*Bank of Ireland Pension scheme.*

The last Odea posting was not mine. I left in 1986 and it was the Bank Of Ireland Pension scheme. The pension booklet said at the time that if I left the employment of the bank I would lose all the benefits accrued.


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## Guest (28 Jun 2004)

*Bank of Ireland Pension scheme.*

> The pension booklet said at the time that if I left the employment of the bank I would lose all the benefits accrued.

Are you saying that you lost the benefit of (a) employer contributions made on your behalf (b) your own personal contributions and perhaps AVCs or (c) both? Did you get any sort of refund or transfer options on any part of the accumulated fund at the time? I know that pension legislation these days includes a two years vesting period after which benefits purchased by employer contributions are preserved even if one leaves their employment thereafter. I don't know what the relevant legislation was like back in the 80s though. Is there a particular reason that this has become an issue now so long after the event? Are you about to retire now or something?


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## another unregistered user (29 Jun 2004)

*re: no contributions*

The 'bank had a non contributory pension scheme'.


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## Guest (29 Jun 2004)

I don't understand what that means in the context of an occupational pension scheme. I only understand the term in the context of the state run social welfare non-contributory (i.e. non PRSI contribution related) pension scheme:



In this context who was the non contributor - the employer or employee - i.e. was the employer putting aside contributions into the employee's pension fund or was it simply deducting some of the employee's salary for this purpose? In either case are you saying that you never received any sort of refund or any sort of transfer value when leaving?


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## ajapale (29 Jun 2004)

Hi <blank>,



> The 'bank had a non contributory pension scheme'.



This means that the employee does not contribute to a scheme. Very nice if you can get it! The bank simply makes a promise to allow the the employee to retire on a proportion of their final salary. Since it is the bank that is making the promise and taking the risk it is up to the bank to decide how it provides for the future liability.


ajapale

This was very common in banking and the public service at home and abroad


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## Guest (29 Jun 2004)

Thanks ajapale - so perhaps it was a normal part of such schemes for the employee to lose any benefits if they left employment before retirement as in this case? Sounds like the sort of scheme from the, now gone but not forgotten, "jobs for life" era?


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## ajapale (29 Jun 2004)

Yes, 'gone but not forgotten'! I imagine that you are correct, the employee looses all benefits when they leave the company.

Incidently, are such "non contributory pension schemes" subject to Benefit-in-Kind taxation?

ajapale


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## Odea (5 Jul 2004)

*Bank of Ireland Pension Scheme.*

As an employee I never had to contribute to my pension nor was there any mechanisim to do so. The bank paid all my contributions in to a defined benefit option. I would receive 40x60ths of my salary on retirement. When I left I was told that I would receive nothing despite the fact that monies had been set aside for me by my employer. The Bank of Ireland would probably not get away with it today under today's pension laws but I still think it would be possible to run a case through the courts to find out if I could claim. Anyone out there point me in the right direction.?


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## Guest (5 Jul 2004)

If it was me then my first port of call would be the Pensions Board and perhaps the DETE employment rights section:

www.pensionsboard.ie
www.entemp.ie


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## Prattler (6 Jul 2004)

*BoI Pension Scheme*

If you left pre 1986 you have no statutory preserved benefit entitlement. However, the scheme rules would usually have had a vesting period after which the member gained entitlement to the Banks contributions. Have you checked is there are vested rights (it would normally have been about 5 years in 1986).


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## Odea (8 Jul 2004)

*Bank of Ireland pension or not.*

Can you clarify what you mean by vested rights? Sounds intetresting.


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## Guest (8 Jul 2004)

*Bank of Ireland pension or not.*

Vesting is simply a process whereby after a certain period of membership of the scheme the benefits bought by (employer) contributions are preserved no matter what happens next (e.g. if you leave). These days a statutory vesting period of two years applies to occupational schemes. So after two years membership (including any vesting period carried in through transfer of another fund into the scheme) the benefits attributable to employer contributions are preserved within your fund and those contributions are "locked in" and (hopefully) attract ongoing growth. (It also means that your personal and AVC contributions are locked in and the opportunity to take a refund of personal contributions only is lost:  ). In the past longer vesting periods applied and I'm not sure that there was any statutory vesting period at all (could be wrong). Prattler is advising you to check if any statutory or scheme specific vesting rules applied in this case that would mean that you have some entitlement to benefits from the fund.


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