Kantar Worldpanel plans to make the age-related contribution structure for its group personal pension (GPP) plan more flexible to comply with the 2012 pension reforms.
At the moment, employees of the market research firm who are aged under 35 can contribute 2% and receive a 4% employer contribution, while those aged between 35 and 49 contribute 3% and get 6%, and staff over the age of 50 contribute 4% and receive an 8% employer contribution.
Under the new structure, which will be introduced early this year if it receives final approval, the maximum matched contribution will be determined by age bracket, but staff will be able to opt for lower matching levels.
This will make it less daunting for staff under 35 to join the pension scheme because they could contribute as little as 1% in return for an employer-funded contribution of 2%. Meanwhile, employees aged between 35 and 49 could contribute 3%, 2% or 1%.
Hema Patel, compensation and benefits manager at Kantar Worldpanel, said: “The upper limit will still be dependent on age. If you are between 35 and 49, you would still get the 3% and 6% maximum, but if you wanted to contribute 2% you would still get the 4% and if you contributed 1% you would still get 2%.”
Kantar Worldpanel plans to operate this structure for a year before getting rid of the age bands altogether in time for its October 2013 staging date for auto-enrolment. Employees will be automatically enrolled to contribute 1% and receive a 2% employer contribution, but will have the freedom to move up the contribution scale.
Read more on group personal pension schemes