Freshfields Bruckhaus Deringer is planning to close its final salary pension scheme to future accrual.
Its consultation period with staff over the proposed move ended on 26 April and Adam Brooke, employee benefits manager at the law firm, said it was very likely the planned closure would go ahead.
If so, the scheme will close at the end of June and its 200-odd members transferred to Freshfields’ group personal pension (GPP) plan on 1 July. Just under 1,200 employees are already members of the GPP, which is administered by Hargreaves Lansdown.
Brooke said funding volatility was a key reason for the move. “Final salary [scheme] members do not get the [same] support that GPP members get at the moment from Hargreaves Lansdown, so there is a need to be fair to everyone as well,” he added.
The proposed change has been explained to staff in presentations and one-to-one meetings. “There is obviously disappointment from some staff, but the sessions have been very productive and it is very much about ‘how do we transition this?’,” said Brooke. “Hargreaves Lansdown is helping to allay fears and make the transition as smooth as possible.”
The final salary scheme was closed to new joiners in 2000.
Since the beginning of the year, Freshfields has also been using group presentations to advise its employees of the benefits of joining the GPP. “We started talking about doing this towards the end of last year after it was identified internally that it would be something good to do for employees,” said Brooke.
“Our employee feedback has been very positive. One employee said to me: ‘I am so annoyed at myself for not doing this sooner’.”
Brooke said he hoped that, in the future, between 80% and 90% of new Freshfields employees would join the GPP.
From 1 July, the firm will also introduce mortgage advice as a benefit for staff, which will be provided by CMS Cameron McKenna. It will begin communicating this new perk to staff at the end of this month.