LGPS in subsidiary LTD company

johnnyj1000

I worked as a direct employee of a university for 8 years and received the LGPS. Following a restructure, my employment was moved (NOT under TUPE) to a wholly owned subsidiary limited company owned by the university.

I was told that I could no longer retain my LGPS pension as it was not available to me, because the subsidiary company I now work for is involved in commercial trading activities (in my case, running a conference centre attached to the university). I was told that this made it impossible for me to retain the pension.

Does anyone have any views on my situation?

Many thanks

kidmugsy

Which pension is available to you?

johnnyj1000

kidmugsy wrote: »

Which pension is available to you?

HI and thanks for the reply.

I was given a non-final salary pension but allegedly with the same employer contribution. The response was "it is the nearest equivelent".

I guess I am trying to find out whether the reasons given for changing me from the LGPS (i.e. working for a commercial subsidiary) are valid.

Thanks again

mania112

If you don't have a choice, there's not a lot you can do about it.

Your new pension will never be as good as LGPS because it won't be a defined benefit scheme.... ok, that's not strictly true, because your new pension could have 50% employer contribution, but you get the idea.

Still keep up the new pension though, something's better than nothing.

You haven't lost anything, you just won't be gaining as much, as quickly.

johnnyj1000

Many thanks. But do you think that the LGPS is categorically not available to those employees of public sector organisations on the payroll of a wholly owned and trading limited company?

hyubh

johnnyj1000 wrote: »

I was told that this made it impossible for me to retain the pension.

The subsidiary would likely require its own admission agreement with the LGPS fund were LGPS membership desired, and the chances are, any employer rate would be higher than that enjoyed by the university as such. Why were you not transferred under TUPE?

I was given a non-final salary pension but allegedly with the same employer contribution. The response was "it is the nearest equivelent".

If they are trying to fob you off by quoting percentages, then what rubbish! An employer rate of 15% (for the sake of argument) in a DC scheme is not 'the same' as an employer rate of 15% in a DB scheme.

johnnyj1000

hyubh wrote: »

The subsidiary would likely require its own admission agreement with the LGPS fund were LGPS membership desired, and the chances are, any employer rate would be higher than that enjoyed by the university as such. Why were you not transferred under TUPE?

Hi. The reason I was given was that it was not physically or legally possible for me to retain my LGPS pension "outside" the conventional university environs. I was told that trading companies of the uni were simply not eligible as they had a "business" element.

I was not transferred under TUPE as I was originally sent to the trading subsidiary on secondment. After a stint there I was transferred to the payroll of the ltd company permanently and told that I could no longer have the LGPS pension for the reasons listed above.

If they are trying to fob you off by quoting percentages, then what rubbish! An employer rate of 15% (for the sake of argument) in a DC scheme is not 'the same' as an employer rate of 15% in a DB scheme.

I need to find out what they have put me on...I don't really understand it.

Thanks again.

xylophone

Are you a member of a Union? Your rep might be able to advise what is going on.

What official communication was made to you and your colleagues concerning this matter?
As a matter of interest, the pension scheme here is LGPS - don't know whether this is similar to your set up?
http://www.veritau.co.uk/about-veritau

johnnyj1000

xylophone wrote: »

Are you a member of a Union? Your rep might be able to advise what is going on.

What official communication was made to you and your colleagues concerning this matter?
As a matter of interest, the pension scheme here is LGPS - don't know whether this is similar to your set up?

Hi Xylophone and thanks for the info.

I am not a member of a union.

The conference centre staff went through a consultation period, during which the proposal to TUPE them to the limited company was considered and agreed. They all got letters etc explaining that they would be moved to the limited company and that, as a result, would lose their LGPS.

As I was seconded, my then role was not part of the consultation. However just after it I was told that my secondment would become permanent and was moved into the limited company. This happened before I was sent an offer letter and contract. By the time I got the offer letter and contract, they had already moved me onto the new payroll and like the TUPE staff I lost the LGPS.

I argued that (a) they moved me without agreeing terms and (b) the LGPS COULD still be available to me. At that point I was told "...to go with it..." (I have all emails etc).

Since that time, other staff from other areas of the university have been TUPEd into the limited company but they have KEPT their LGPS. I have questioned this and been told that the distinction is that "my" area of the limited company is a commercial trading entity and therefore not eligible.

I guess it is a bit of a muddle but I would like to know where I stand!!!

ALl the best

hyubh

johnnyj1000 wrote: »

The conference centre staff went through a consultation period, during which the proposal to TUPE them to the limited company was considered and agreed. They all got letters etc explaining that they would be moved to the limited company and that, as a result, would lose their LGPS.

TUPE and related employment legislation is what protects employees' LGPS membership by frequently requiring the new employer to enter the LGPS (or more exactly, the relevant LGPS fund) as an admitted body. Technically it wouldn't have to be the LGPS, but open pension schemes of a comparable quality are rare for the sort of companies involved.

Usually the admission agreement for the new employer will be a 'closed' one, meaning no new staff are allowed to join the LGPS. This typically (if not always) contrasts with the terms under which the old employer is an employing authority in the fund.

As I was seconded, my then role was not part of the consultation. However just after it I was told that my secondment would become permanent and was moved into the limited company. This happened before I was sent an offer letter and contract. By the time I got the offer letter and contract, they had already moved me onto the new payroll and like the TUPE staff I lost the LGPS.

I think you should definitely seek proper advice about this.

I argued that (a) they moved me without agreeing terms and (b) the LGPS COULD still be available to me. At that point I was told "...to go with it..." (I have all emails etc).

They don't know what they are talking about then.

I have questioned this and been told that the distinction is that "my" area of the limited company is a commercial trading entity and therefore not eligible.

That can only allude to the terms under which the university itself participates in the LGPS. E.g., if (for the sake of argument) a borough council set up a consultancy business not directly connected to its work as a local authority, then it would be doubtful the people employed by that business would be eligible for the LGPS as 'borough council employees once removed'. However, this says nothing about transferred employees' employment rights - it just means that if the new business were to become involved in the LGPS, it would be under its own banner, not the old employer's.

xylophone

http://www.pensionsadvisoryservice.org.uk/dealing-with-complaints/internal-dispute-resolution-process-(idrp)

I wonder if you might start here? You could ring TPAS for an exploratory chat?