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 Home Pensions
Boots introduces SMART Pensions17 June 2008Starting from July, Boots will change the way contributions are paid into their pension schemes by introducing SMART Pensions. SMART Pensions is a salary sacrifice arrangement and this is how it works: Employees will no longer pay their own pension contribution – Boots will pay it for them along with the company’s own regular contribution. In return, employees accept a reduction to their gross pay equal to the amount they regularly contributed to the pension scheme. However, because of the reduction to gross pay, employees will pay less National Insurance contributions meaning an increase in the amount of pay they take home with them. Boots also benefit because they will pay less employer NI contributions. Most Boots employees who are included in this system will benefit now from an increase in the amount of their “take home” pay although – for members of the Boots 2006 Stakeholder Pension Plan only – paying less NI contributions may result in a small decrease to the earnings-related part of the state pension they will receive in later life. Some employees will not be included by Boots. These will be lower paid employees whose eligibility for other state benefits might be affected by joining. Also, employees whose pay would fall below the level of the current National Minimum Wage by joining cannot be included. Overtime rates, holiday pay, bonus, statutory maternity/paternity/adoption and sick pay will not be affected. These kinds of arrangements are becoming increasingly common and have already been introduced by Tesco and Co-op Group amongst others. Usdaw members who have questions or concerns about this new arrangement can contact the Contact Details Pensions section Ph: 0161 249 2440 Fax: 0161 249 2475 Email: pensions@usdaw.org.uk  Printer Friendly Page  Email to a Friend
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