ITN closed its defined (DB) benefit scheme to future accrual and introduced a new defined contribution (DC) scheme on 1 April 2010.
When it closed its DB plan, it also introduced salary sacrifice to make the new group personal pension (GPP) more tax-efficient. Staff must put in a minimum of 4% to receive a matching contribution from the organisation. For instance, if they contribute 7%, ITN will pay in 10%.
ITN’s 700 employees were informed of the changes in a targeted communications campaign that began in November 2009. It included postings on the intranet and a number of workshops, some of which were held in conjunction with GPP administrator Standard Life.
Sue Utting, ITN’s compensation and benefits manager, says: “It was basically taking everyone who was in the DB [scheme] around every eventuality of what would happen, what their options were, why things were put in place, what the rules were, everything to do with their DB closure.”
Since the switch, ITN has increased pensions take-up by 20%. “We also have about 10% of staff who have opted outside of the standard investment management choices and are doing all sorts of whizzy investment management themselves, so that shows a degree of engagement we were quite surprised about,” adds Utting.
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