I have two questions about Defined Benefit pension schemes.
Our company has a scheme whereby at normal retirement age (60),
One receives 2/3 of the final salary – after a min. 30 years service.
In 2004, because of under-funding, this was arbitrarily changed by the company and/or trustees whereby increases to the pensionable salary were limited to a max. of 4% per annum. Is this change legal – or do the scheme members have to agree to it? Secondly, if (for any reason) one later had a salary decrease, would the pensionable salary be decreased as well or is there anything in pensions legislation which prevents this from happening? Many Thanks.....
Our company has a scheme whereby at normal retirement age (60),
One receives 2/3 of the final salary – after a min. 30 years service.
In 2004, because of under-funding, this was arbitrarily changed by the company and/or trustees whereby increases to the pensionable salary were limited to a max. of 4% per annum. Is this change legal – or do the scheme members have to agree to it? Secondly, if (for any reason) one later had a salary decrease, would the pensionable salary be decreased as well or is there anything in pensions legislation which prevents this from happening? Many Thanks.....