Pension: obligation on employer to back-date?

cygnusx02

New Member
Messages
3
Good afternoon

Opinions and advice are kindly requested: my UK employer was supposed to provide a pension fund to me as per my permanent employment contract - my contract stipulates that they will match my contributions up to a max of 5%. I live and work in Ireland and am the only employee here. For 4 years they have faffed and stalled but now they have finally told me that they are ready to set up an Executive Pension Fund. They had assured me during the intervening years that any contributions would be back-dated - they have just told me that they will indeed back-date but only to match whatever lump sum I am ready to put into this new scheme myself. Does anyone have advice as to what my response should be? They are playing with the idea of providing me with an interest-free loan to cover my portion but I am extremely loathe to be beholden to them for another 4 years or so while I 'catch up' my contributions (and I think there are tax implications?)

Thanks!!
 

Leo

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The agreement was for a match of your contributions. Did you set aside an amount over that time which would then be transferred into the scheme once set up? If you don't want to be beholden to them for 4 years, source the funds elsewhere. Note such a loan doesn't lock you into their employment, though you may lose out on any contributions outstanding if you do leave.
 

cygnusx02

New Member
Messages
3
@Seagull @Leo I appreciate your responses very much :) No, I didn't set any money aside....the accountant had told me it would be back-dated (and also said that the company itself was not accruing monies in respect of the obligation) but he failed to mention that they would be enforcing the matching requirement. Now he has told me that I should have set up a pension fund myself to save money into - but why would I have done that when I believed that the company was setting it up? While it might be a technical enforcement of a contractual term I can't help but feel that they have put themselves in a position to gain if I don't find the matching funds. And that if I do find the matching funds I am disadvantaged (either through interest, tax on BIK or a change in the power dynamic of my employment)!
 

Leo

Moderator
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9,823
but he failed to mention that they would be enforcing the matching requirement.
As the deal only related to a match of your own contributions, I'm not sure how else they are to determine how much they should now invest. I think the offer of an interest free loan is a fair one, I'm sure you could structure that over a shorter term if you wish.

To Seagul's point, an element of compensation for a loss in earnings over the period would be a good move on their part.
 
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