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GLOSSARY

Protected rights definition

Published by a LexisNexis Pensions expert

What does Protected rights mean?

The name given to the fund built up by contracting out of the state second pension; they are the rights which, in a contracted-out money purchase scheme, replace the rights an individual would have earned under SERPS. Since they are money purchase, you have no idea what they are until retirement, so that they are not in fact protected at all. Protected rights is the collective term for the National Insurance rebate, associated tax relief and investment return.

As protected rights no longer exist after April 2012, this may help to simplify administration in terms of record-keeping, member communications and benefit processing. As defined in regulation 3 of the Personal and Occupational Pension Schemes (Protected Rights) Regulations 1996 (SI 1996/1537). Before 6 April 2009 this also included safeguarded rights, wherever appropriate. (HMRC). It is the lowest amount of benefits that a contracted-out money purchase scheme is required to provide to a member, calculated by using the defined contribution basis, with the money paid into the scheme as minimum contributions or minimum payments. The rules were relaxed in the Finance

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Pension increases and revaluation—statutory minimum

Pension increases and revaluation—statutory minimum Statutory minimum increase rates The table below summarises the current statutory minimum increase that occupational pension schemes must apply annually to each tranche of pension. Period of pensionable service to which pension is attributable (or, in the case of money purchase benefits, period in which contributions were made) Statutory minimum pension increase Source Before 6 April 1997 None, save that in order to refund surplus assets to a sponsoring employer under the Social Security Pensions Act 1975, s 58A, it used to be necessary (up until 5 April 2006) to revalue all pensions in payment (excluding GMPs and money purchase benefits) annually in line with the Retail Prices Index (RPI) subject to a cap of 5% Despite the absence of a statutory minimum increase, many defined benefit pension schemes provided, in practice, at least a modicum of inflation protection on a scheme-specific basis Social Security Pensions Act 1975, s 58A (now repealed) Between 6 April 1997 and 5 April 2005 inclusive For benefits...

Obtaining a medical report during employment—checklist

Obtaining a medical report during employment—checklist This is a Checklist of the main issues that an employer will need to consider when seeking a medical report on a current employee during the employee’s employment: • What is the purpose of the report? See Practice Note: Medical reports—data protection issues and AMRA 1988—Purposes of medical report • Why is it necessary to obtain health information, and what is the justification for seeking a medical report—is there a specific feature of the role that requires it, or is it to assess general health for a demanding senior role? • What does the report need to cover—what does the employer need to know, avoiding being intrusive where it is not necessary or relevant? Is it possible to minimise the health information being processed by the employer by involving an occupational health (OH) service or professional? • Who will see the report, and when, and what they will use it for? • Who will prepare the report? ◦ If it is the employee’s GP...

Discover our 5 Checklists on Protected rights

Protected rights before 6 April 2012 [Archived]

’Protected rights’ were the benefits which schemes contracted-out on a money purchase basis had to provide, before 6 April 2012, to contracted-out members in lieu of the state benefits foregone as a consequence of contracting-out. For more information on contracting-out, see Practice Note: What does ‘contracting-out’ mean for pension lawyers?Contracting-out on a money purchase basis (or DC contracting out) first became possible in April 1988, but was abolished on 6 April 2012. The abolition meant that, on and from 6 April 2012, it ceased to be possible to accrue protected rights and the statutory restrictions applicable to protected rights accrued before that date ceased to apply. In effect, this means that former protected rights can be treated as normal scheme benefits, save to the extent that the scheme rules provide otherwise. For more information, see Practice Note: Abolition of DC contracting out.Which schemes could contract out on a money purchase basis?Before 6 April 2012, protected rights could be provided by the following schemes:•contracted-out money purchase (COMP) schemes, including defined benefit...

Abolition of DC contracting-out

Contracting-out on a money purchase basis before 6 April 2012Contracting-out was the mechanism whereby an individual (whether employed or self-employed) could elect to forgo accrual of the element of the State pension which, before 6 April 2016, was known as the additional State pension (or Second State Pensions (S2P)).Contracting-out on a money purchase basis (or DC contracting-out) first became possible in April 1988.Contracting-out on a money purchase basis required the relevant contracted-out pension scheme to provide contracted-out members with ’protected rights’ in lieu of the state benefits forgone as a consequence of contracting-out.Schemes contracted-out on a money purchase basisBefore 6 April 2012, protected rights could be provided through the following contracted-out schemes:•contracted-out money purchase (COMP) schemes. While these occupational pension schemes were mostly defined contribution schemes, there could also be defined benefit schemes contracted out on a money purchase basis through a protected rights underpin•the COMP section of mixed benefit (COMB) schemes. COMB schemes were created on 6 April 1997 and made it possible for a contracted-out salary-related (COSR) scheme...

Discover our 63 Practice Notes on Protected rights

Pre-employment medical report—application for report

Pre-employment medical report—application for report [insert date] [insert name and address of doctor] Private and confidential Dear [insert doctor’s name] Request for pre-employment medical report on [insert prospective employee’s name and date of birth] We have offered the above-named individual employment as [insert job title], conditional on their being fit to carry out the duties required for this role. This letter confirms our request for you to prepare a report on this individual’s fitness to carry out the duties required for the position of [insert job title][, as set out in the enclosed job description.]. We also confirm our arrangement for you to examine the individual at [insert time][am OR pm] on [insert date] at [insert address]. Please include consideration of the following matters within the scope of your [examination OR report]: [insert specific questions such as] • [Are there any medical reasons why the individual should not [insert relevant duties as set out in the job description eg do shift work, carry out strenuous physical...

Pre-employment medical report—letter to individual requesting report

Pre-employment medical report—letter to individual requesting report [Insert date] [Insert employee’s name and address] Private and confidential Dear [insert name] Consent for pre-employment medical report As set out in our offer of employment dated [insert date], we would like to obtain a medical report from [the Company’s occupational health service] on your state of health in order to assess whether you are fit to carry out the duties required for the role you have been offered[, as set out in the job description]. In order to prepare the medical report, [the Company’s occupational health service] will need [to carry out a medical examination of you AND/OR access to your medical records, held by your GP or consultant]. It is the Company’s policy to make all offers of employment in this type of role conditional on our receiving a satisfactory medical report because the proposed duties involve [insert eg details of any aspects of the job that are particularly physically or mentally demanding; whether the job involves long or unsocial...

Dive into our 102 Precedents related to Protected rights

Are employees with fewer than two years' continuous service counted for the purpose of triggering statutory collective consultation obligations on redundancy?

Are employees with fewer than two years' continuous service counted for the purpose of triggering statutory collective consultation obligations on redundancy? According to the Trade Union and Labour Relations (Consolidation) Act 1992, where an employer is proposing to dismiss as redundant 20 or more employees at one establishment within any period of 90 days or less, this gives rise to statutory obligations to: • inform • consult • notify the Secretary of State in the Department for Business, Energy and Industrial Strategy This statutory consultation obligation is separate from and in addition to: • any consultation to ensure the dismissal is fair • any duty to inform and consult in relation to a relevant transfer under Transfer of Undertakings (Protection of Employment) Regulations 2006, SI 2006/246 'Employee' in this context means an individual who has entered into or works under a contract of service or of apprenticeship. Whether or not an individual falls within this definition will, therefore, depend on their employment status (subject to any express...

Can an employer require their employee to use their own equipment for home working during the Coronavirus lockdown?

Can an employer require their employee to use their own equipment for home working during the Coronavirus lockdown? With some exceptions (eg in the building trade), it is customary for the employer to provide an employee with the equipment necessary to do their job (as opposed to a self-employed person who is usually expected to provide their own equipment). There are no particular statutory provisions relating to the provision of equipment to an employee who is homeworking. See Precedents: Policy—homeworking and Policy—temporary homeworking arrangements [Archived]. Paragraph 4 of Precedent: Policy—homeworking provides that the employer will provide all necessary equipment to a designated homeworker, but not to an ‘ad hoc homeworker’. In the context of the coronavirus (COVID-19) lockdown, where an employer may have had to arrange for a large number of employees to work from home unexpectedly, the employer may be unable to provide the necessary equipment, such as computer equipment, desks and chairs to all of its staff. In those circumstances, it may be that it would be a...

See the 173 Q&As about Protected rights

Insurance adjustor loses appeal in COVID-19 mask bias claim

Law360, London: A London appeals judge has dismissed an insurance claims adjustor's case that his employer's policy on mask-wearing during the coronavirus (COVID-19) pandemic was discriminatory because of his belief in 'bodily autonomy'.

Enforcement of mixed debt security restricted under moratorium (Bluestone Mortgages v Stoute)

Restructuring & Insolvency analysis: In Bluestone Mortgages Ltd v Stoute, the High Court heard an appeal concerning the enforcement of a possession order by a mortgage lender where part of the secured debt was subject to a mental health crisis moratorium under the Debt Respite Scheme Regulations 2020. The core issue was whether, where a judgment or order relates to both a moratorium debt and non-moratorium debt, the creditor requires the court’s permission to enforce the non-moratorium part of the debt during a moratorium period. Mr Justice Mellor upheld the lower court’s interpretation of regulation 7 of the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020 (the Regulations), SI 2020/1311 such that it prohibits enforcement without court permission if any part of the debt is protected. The judgment reinforces that mixed security triggers moratorium protections. Practitioners advising secured lenders must take note: enforcement action, even when largely related to non-moratorium debt, may require the court’s permission if the moratorium debt is also...

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