Lloyds TSB Asset Finance is to launch salary sacrifice on additional voluntary contributions (AVCs) for its 5,500 employees from the third quarter of this year.
The company will also increase contributions for staff who choose to make AVCs through the arrangement, by adding a further 5% of the total amount staff sacrifice. The move is intended to incentivise employees to participate and will be funded using the company’s 12.8% national insurance (NI) savings. The remainder of the firm’s NI savings will be invested back into the company.
Janine Sparks, head of reward at Lloyds TSB Asset Finance, said: “This is not necessarily something that staff have been asking for, but we think it will be good for them.”
She added that it is hoped the introduction of the salary sacrifice arrangements will encourage more staff to save for retirement.
Members of the organisation’s defined benefit (DB) scheme, which was closed to new joiners in 1998, and its defined contribution pension scheme will be eligible to take advantage of the tax-efficient programme.
Lloyds TSB Asset Finance opened the DC arrangement, Lloyds TSB Group Pension Investment Plan after the DB option was closed to new joiners.
Currently 20% of staff at the company make AVC payments into their pension schemes.