Wyn Derbyshire

This Practice Note looks at the use of the terms ‘associate’ and ‘connected’ in the pensions arena—terms defined for the purposes of the Insolvency Act 1986, ss 249 and 435.

This Practice Note focuses on the pension protection levy imposed by the Pension Protection Fund. In particular, it explains the purpose of the levy, which schemes have to pay it, the different elements of the levy, ie the risk-based element (known as the risk-based levy) and the scheme-based element (known as the scheme-based levy) and how each element is calculated.

This Practice Note provides an introduction for persons who are new to Pensions law to the Pensions Ombudsman, in particular the role of the Ombudsman, who can bring a complaint before the Ombudsman and how it is done, the types of complaints/disputes that cannot be determined, the Ombudsman’s powers of redress, and how to appeal decisions made by the Ombudsman.

This Practice Note provides an introduction for persons who are new to pensions law to the Pensions Regulator, in particular its role, the duty to report to the Pensions Regulator and the Pensions Regulator’s powers, including its moral hazard powers, ie the power to issue a contribution notice or a financial support direction. This Practice Note also looks at the ability for one or more parties to apply for clearance from the Pensions Regulator to protect themselves from the risk that the Pensions Regulator might exercise its moral hazard powers against them.

This Practice Note summarises the various powers of the Pensions Regulator. This Practice Note also looks at proposals to extend the Pensions Regulator’s powers.

This Practice Note looks at who the Pensions Regulator is, what it does and its legislative objectives. It also covers the requirement for the Pensions Regulator to establish the non-executive committee (to enable it to discharge its non-executive functions) and the Determinations Panel (to exercise its ‘reserved regulatory functions’). The Practice Note also identifies the various codes of practice issued by TPR, looks at the jurisdiction of the Pensions Regulator Tribunal and the call for a single pensions regulator.

This Practice Note looks at the case Independent Trustee Services v Hope [2009] EWHC 2810 (Ch) (the Ilford case) which concerned the relevance of the Pension Protection Fund (PPF) in the trustees’ decision-making process and considers its impact on such decision making, including on the duty to take into account relevant factors and disregard irrelevant ones, the duty to act for a proper purpose, and the duty to act in the best interest of scheme beneficiaries. This Practice Note also looks at the impact of the case Granada UK Rental & Retail Ltd v The Pensions Regulator (Box Clever) on whether trustees can take account of the existence of the PPF in their decision-making.

This Practice Note provides an introduction for persons who are new to Pensions law to the different types of pension schemes (or pension arrangements) in the UK, including the state pension, private sector pensions, workplace pensions, occupational pension schemes, hybrid schemes, cash balance schemes, employer-financed retirement benefit schemes (EFRBS), personal pension schemes, self-employed pensions, and public sector pension schemes.

This Practice Note looks at the National Employment Savings Trust (NEST) (referred to as the workplace pension set up by government) as a means by which an employer can satisfy its enrolment duties under the automatic enrolment legislation. In particular, the Practice Note sets out the key aspects of NEST, covering its nature and governance and how NEST operates, including participation by employers, contributions, transfers, investments and benefit structure.

This Practice Note looks at the restrictions on the reduction of a person’s pension entitlement under an ongoing registered defined benefit pension scheme, in particular the provisions of sections 91–93 and section 67 of the Pensions Act 1995, and the provisions of the scheme’s governing documentation. It also looks at how reducing a pension in payment is treated under the pensions tax regime and at some examples of common scenarios in which pensions reduction can occur.

This Practice Note focuses on the considerations necessary for the correct identification of a pension scheme's statutory employer(s) in a defined benefit (DB) scheme. In particular, this Practice Note considers the reasons for identifying statutory employers, the various legislative definitions of employer, how those definitions interact, issues where a scheme has no statutory employer and circumstances which may be give rise to difficulties.

This Practice Note looks at the powers of the Pensions Regulator to wind up an occupational pension scheme or issue a modification order in relation to winding up such a scheme.

The pensions due diligence (DD) enquiries are drafted for the buyer and general in scope—in practice, they should be amended as necessary to reflect the circumstances of the relevant transaction (and relevant pension scheme). Not every enquiry will be relevant to every pension scheme, and also if the buyer if not taking on the scheme.

This set of notes and specimen documents forms an automatic enrolment (AE) pack intended to enable employers, including small and micro-employers, to deal with the requirement to enrol employees into an AE scheme.

This Checklist summarises the key steps to follow when carrying out a bulk transfer of a group of members from one occupational pension scheme to another.

Pension scheme mergers—checklistPlanning of merger•Reach “in principle” agreement between trustees and employers of both transferring and receiving schemes on pursuing merger exercise.•Review governing provisions of both transferring and receiving schemes to confirm transfer of assets, liabilities and members can be made. Amend provisions if necessary and possible.•Check whether schemes’ benefit structures are compatible.•Check whether contracted-out status of either scheme poses a problem.•Review respective funding positions of schemes and obtain actuarial advice. Check whether employer top-up payment required.•Agree how receiving scheme is to treat transferred past service rights (eg under separate section).•Agree nature of future pension provision, taking account of potential employment law issues.•Check whether member consent or consultation required.•Agree timetable for merger.Implementation of merger•Carry out consultation exercise if required by statute (SI 2006/349).•To minimise likelihood of successful challenge under employment law, consider seeking consent from transferring members in respect of:◦transfer of accrued rights (even if transfer is to be carried without member consent), and◦any changes arising in respect of future pension provision•Where transfer is with consent, seek transferring members’ consents to transfer.•Where transfer is without consent, provide information to members of transferring scheme about transfer at least one month before transfer occurs.•Comply with any transfer formalities under governing provisions of transferring or receiving scheme.•Obtain actuarial certificate from transferring scheme’s actuary (using the certificate set out in SI 1991/167, Sch 3).•Implement transfer of assets, liabilities and members as agreed under merger deed.•Issue new explanatory literature as appropriate in respect of any changes to receiving scheme.•Check whether trustees of either scheme have a statutory obligation to notify Regulator of making and receiving of transfer payment (SI 2005/900).Wind-up of transferring scheme•Check all assets, liabilities and members have been transferred. Consider issuing notices under Trustee Act 1925, s 27 in respect of potential missing beneficiaries.•If any assets or liabilities remain (eg in respect of contracted-out rights), consider how to deal with them.•Once trustees of transferring scheme are satisfied scheme has no further assets, liabilities and members, scheme can usually be wound up.