E.On is a diverse business with a long history of mergers and acquisitions. In the UK, most staff belong to one of three pension plans: career average and final salary arrangements that are closed to new staff, and an open defined contribution (DC) plan.
Ant Donaldson, senior specialist, employee benefits at E.On, says harmonising pensions was helped by the fact that the whole industry is part of the national Electricity Supply Pension Scheme (ESPS), a final salary scheme. “Whenever there is a merger or acquisition involving ESPS members, they are generally moved from one section of the ESPS to another,” he says.
Eight years ago, E.On closed membership of ESPS to new joiners and set up its own career average pension scheme. This was subsequently closed to new members two years ago, when E.On launched a contract-based DC scheme.
There have been some acquisitions that fell outside ESPS. “We have allowed schemes to run on where we felt this was the most sensible course of action,” says Donaldson. “Where appropriate, we have offered members of those schemes the choice to move to whichever of our main three plans was open at the time.”
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