When your job transfers

The pension that you have already built up will be dealt with under the rules of the old employer's scheme.

What pension must the new employer have to offer?

The new employer involved in a business transfer has to offer a minimum level of pension provision to employees transferred under a sale governed by the TUPE Regulations.

The new provisions only apply on a TUPE transfer. In other words, on transfers of a business or sale of assets. They do not apply, therefore, when ownership changes as a result of a sale of shares.

In addition, the business being sold must have an occupational pension scheme already in place immediately before the transfer. Exactly what is an occupational pension is not clear and hasn’t yet been defined by the courts.

If you have any kind of pension arrangement in place in your company you should contact Usdaw for advice.

The requirements apply to employees who are active members of the scheme, and those eligible to join the scheme, but have not done so, even if there is a waiting period for joining the scheme that cannot be met due to the transfer.

The purchaser of the business must provide a pension scheme for transferred employees, either by offering an occupational pension arrangement or a stakeholder arrangement, subject to minimum conditions. Employers do not have to offer the same arrangements that applied with the old employer. If a money purchase scheme or stakeholder scheme is offered by the purchaser, they have to match the employee's contribution, up to the level of six per cent of basic pay.

Contact Usdaw for advice in order that we can check the new pension offered complies with the law.

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© 2003 (USDAW) Union of Shop, Distributive and Allied Workers
This page: http://www.usdaw.org.uk/pensions/resources/1149525086_18475.html
Last Modified: Monday, 03-Jul-2006 23:29:08 EST
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