Pensions update – Staff consultation guide goes live

Final guidelines on regulations making it compulsory for employers to consult with their employees or staff representatives on pension scheme changes are now available on the Department for Work and Pensions (DWP) website.

The Occupational and Personal Pension Schemes (Consultation by Employers and Miscellaneous Amendment) Regulations 2006 take effect in April for those employing more than 150 staff.

The rules will also apply to employers with more than 100 staff from April 2007 and for those with more than 50 employees from April 2008. But the guidance stresses that the DWP expects all employers to consult with employees as best practice, regardless of when the rules start to apply.

The guidance highlights the fact that the regulations relate to an organisation’s total number of employees, rather than the number of employees in its pension scheme. Therefore, if an employer has 200 staff but only 20 are scheme members, it will still have to consult with affected employees from April 2006.

The guidance also states that it will not be satisfactory for employers to use a medium that will reach only some members when communicating any proposed changes to employees and their representatives. For example, placing information on a staff noticeboard and expecting all staff to read it is not good enough.

Employers who contravene the rules risk a fine of up to £50,000 from the Pensions Regulator.

To download a copy of the guidance visit: occ_pen_schemes/oppsce-2006.pdf