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Forced into Company scheme!

edited 4 December 2012 at 3:30PM in Auto-enrolment
2 replies 2.4K views
mrshumphreyjrmrshumphreyjr Forumite
5 posts
edited 4 December 2012 at 3:30PM in Auto-enrolment
I have been employed since 2007, and had a employers contribution of 7.5% gross written into my original contract. Our company has been taken over twice, the last time was in 2011 and was an asset purchase. This employer has now asked me to contribute into their scheme - minimum 3% to enable me to continue to receive this 7.5% pension contribution which I had previously received as a benefit.

I have three personal pensions schemes in operation (22 years/18 year and 5 years) which add up to over 8%, of my current nett salary which is the reason why I had never added to my work scheme. I keep these schemes separate from my job simply because if I left employment, I do not have to transfer to another job. I do not really see why I need to consolidate my pensions simply because my employer wants to change their scheme!

I also moved a small balance from a made up scheme (personal pension) about three years ago into this company scheme - less than £850. I have been presented with a change of employment contract which states this change. Can they force me to contribute or not? Can they legally refuse to give me this benefit. I feel pressured into paying extra into a scheme which I cannot afford, and I already have a good mix of personal pensions in operation already. I am also worried I will lose the benefit of my personal pension moved. By that I mean, if I do not sign this contract, can they keep the money I have transferred. Please help I am very worried about this.

Replies

  • dunstonhdunstonh Forumite
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    I have been presented with a change of employment contract which states this change. Can they force me to contribute or not?

    Legislation change can force a change of contract. Auto enrolment is a legislation change. How much it influences on employment law, i will leave to someone else.
    I am also worried I will lose the benefit of my personal pension moved.

    Why?
    which I cannot afford

    If you are a basic rate taxpayer, the 3% equates to 2.4%. Why not just reduce the payments to your other schemes by the same amount? Why not investigate consolidation as having four schemes running may not be cost effective.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • atushatush Forumite
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    That is what I would have done in your case.

    If you can't afford to invest a further 2.4% of your salary, decrease the ongoing (but not stop) payments into your PP to fund the new 3% requirement.
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