Allianz Cornhill has introduced a salary sacrifice pension arrangement to cut its final salary deficit.
The insurance company hopes to save £250,000 in National Insurance contributions from employees operating in its closed final salary plan, which it will then plough back into the fund’s deficit.
As a result of the savings the group will also increase contributions for employees in its money purchase pension plan. It will move to a non-contributory arrangement, with new joiners receiving 5% of salary, staff with three years’ service 8% and those still with the company after five years will get 10%. Employees that also choose to contribute themselves will be matched for every percentage of salary they put in up to 5%, meaning that a new employee that pays 5% into their pension pot, for example, will receive 15% overall.
Colm Deasy, pensions operations manager at Allianz Cornhill, which employs around 3,500 workers, said: "We recognised that we were [previously] a typically mid-band [pension payer] and we chose not to be an average employer anymore, because we’re hoping to attract the best staff."
Deasy added that these pension changes would act as a precursor to a flexible benefits plan, which it expects to launch later this year. The group has also made significant improvements to its provision of maternity pay and holiday entitlement, as well as a number of changes to its company car scheme.