None. They are the ones financing the thing so if they want to change it to a dc scheme they can. Your accrued DB benefits will be preserved and all future benefits will be dc.
The contract of employment sets out the relationship between the employee and the employer. Unless there is a provision in that contract to alter the scheme, then the contractual obligation applies.There is probably terms in contract and/or trust deed that the trustees have discretion to alter the scheme.
In bad times, yes - but in good times, many employers benefited from 'payment holidays' for DB schemes, remember?The employee may or may not be making a contribution but you can bet your bottom dollar that it is a fraction of the real cost of the benefit.
The contract of employment sets out the relationship between the employee and the employer. Unless there is a provision in that contract to alter the scheme, then the contractual obligation applies.
In bad times, yes - but in good times, many employers benefited from 'payment holidays' for DB schemes, remember?
Yes indeed, the employers are on the hook for the contracts they signed, just like any other contracts they signed, and they can't swan off into the sunset having sold off their business while renaiging on their contractual commitments.The employer is always on the hook. Those payment holidays are a long time ago now. What is it, 75% of DB schemes are underfunded now?
The employees most definitely do not HAVE to sign for any alteration to their contracts, thought they should rightly keep a keen eye on the overall viability of the business. They should certainly get independent advice, through a trade union or other source, and get access to the relevant accounts if the employer is pleading inability to pay.What will happen is the employees will have to sign an alteration to their employment contract changing the scheme from DB to DC. If that isn't done, the employer will say they can't afford to employ X amount of staff AND run a DB scheme, so they'll lay people off.
And as you rightly point out, not all DB schemes are underfunded, so I'm not sure why you assume that this particular one is underfunded.
It is all very well talking about employment rights but that's not going to be much consolation if the scheme is wound up and is unable to meet its obligations. Employees shouldn't just automatically agree to it but they should be very careful about saying no just because their contract says they have a DB scheme.
What is the role of the trustees here? If the employees were automatically moved to a new scheme, they would no longer have any relationship with the trustees of the old DB scheme.Because if it wasn't, there would be no reason who for the Trustees who have to act in members best interests to agree to it.
Fully agree - and they should be equally very careful about saying yes.It is all very well talking about employment rights but that's not going to be much consolation if the scheme is wound up and is unable to meet its obligations. Employees shouldn't just automatically agree to it but they should be very careful about saying no just because their contract says they have a DB scheme.
What is the role of the trustees here? If the employees were automatically moved to a new scheme, they would no longer have any relationship with the trustees of the old DB scheme.
The trustees manage the scheme. They don't employ the staff, or set the terms and conditions of the staff. That is down to the employer.
Fully agree - and they should be equally very careful about saying yes.
The employer generally can't close a DB scheme without the approval of the Trustees who have to act in the members best interests. I can't see any Trustee agreeing to close a fully funded DB scheme simply because the employer has decided he wants a DC scheme instead. The Trustees would need to be convinved that there are financial reasons for the change.
The employer generally can't close a DB scheme without the approval of the Trustees who have to act in the members best interests. .
Do not at all agree that the OP must move to DC. It looks like a company takeover and there are rules on this, so that it's a transfer of undertaking and the OP should be still employed as though it was a seemless transfer.
Next question then is what are his rights. Can companies just change the pension scheme, or do the employees have to sign something. So the OP needs to get professional advice from an expert in this area.
and employer ranging from 5 to 11%.
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