Can a company sack you for not accepting a pension change

Marktheshark

Unfortunately it is part of the big 3 scams of our generation.

Endowments
Pensions
Leasehold property.

All 3 involve giving your wages to people in shiny suits in return for a bit of paper making promises.

gadgetmind

I did well with an endowment (sold it at a good profit), my pensions are looking healthy, and I've leased (business) property without any issues.

Scams? Really?

agarnett

gadgetmind wrote: »

I did well with an endowment (sold it at a good profit), my pensions are looking healthy, and I've leased (business) property without any issues.

Scams? Really?

You have time on your hands gadgetmind, most don't. And particularly most do not sell endowments into second-hand endowment markets, now did they ever?

The endowment scam was linked to the very much still hidden with-profits scam. That's the one where providers spotted a massive slush which they coveted, groomed policyholders that markets were against them, let them think that endowments were a bad product, let them think they were mis-sold (they were not - they were reneged upon by covetous boards of directors), and successfully undermined the entire endowment market so that theyu could grab the enormous (billions) in spoils from the inherited estate within the funds.

Why do you think you were able to sell your endowment in a strange market for a profit?

Who do you think bought it? Ever occurred to you that the providers themselves were buying them back at a discount, even from smarts like you :rotfl:

And don't be obtuse about leasehold property. You know that the poster was referring to residential leasehold. Only those in the heady stratosphere are involved with commercial leaseholds. Come down a bit if you wish to pontificate.

Yes SCAMS.

It is definitely the right word. Wall to wall scams.

atush

gadgetmind wrote: »

I did well with an endowment (sold it at a good profit), my pensions are looking healthy, and I've leased (business) property without any issues.

Scams? Really?

Totally agree,

made money on an old endowment, pensions are doing really well, and I have rented property in the past but now own instead. And my property is worth hundreds of thousands more than it cost me. Of course, it wont show any profit til I sell.

redbuzzard

The basics of this sort of change are that if you continue to work there having been notified of the changes, you are deemed to have accepted the new terms. If you really don't want to work on the new terms you can leave.

It's possible that an individual contract or some sort of collectively agreed terms could cut across that, but it's usually what it amounts to.

One of my employers (a FTSE100 company) successively closed the DB pension, reduced bonus opportunities, cut car allowances, removed permanent health insurance, and reduced other benefits. As far as I know nobody avoided this by refusing to sign a new contract (it was effected purely by notice) and nobody was forced to leave.

agarnett

As far as I know nobody avoided this by refusing to sign a new contract (it was effected purely by notice) and nobody was forced to leave.

Better the devil you know, eh? I somehow think that the OP is of a slightly different breed to long-term Financial Services survivors with their own sharp teeth and leather necks who indulge in dog eat dog as the norm!

Not a financial services example? Oops, my bad!

Southend1

atush wrote: »

Cant see anyone paying to be a member if the union doesnt cover their current employment?

As Freecall rightly points out, there are millions of union members whose employer does not recognise their union for bargaining or consultation at the current time.

This is mainly because of the wider benefits to the members of union membership e.g. Access to legal advice and services, financial advice, representation at grievance or disciplinary hearings, payment of tribunal fees, education and qualifications, financial assistance e.g help with school uniform costs for the kids/winter fuel grants, rulebook benefits such as death in service payment/sickness benefit/accident benefit, discounted holidays/insurance/mortgages/dental care plans, etc etc

Also if you want to get union recognition from your employer for increased bargaining power then you can get statutory recognition if membership within the bargaining unit is sufficient, so it's worth it in that case too.

Considering the subs are generally only a few pounds a week or month (often depends on earnings), many people think it is well worth it and will often view their membership as a kind of essential insurance policy in the same way as they would view car insurance.

pvt

agarnett wrote: »

If it was still a true FS scheme then the "final salary on exit" would be the salary at the point the old scheme closed, but revalued annually to hopefully inflation proof the entitlement earned to date, to scheme retirement date.

I don't believe this is correct.

The basic rule of pension schemes is that whatever you have accrued cannot be altered or watered down. If you have accrued 10/60ths of FS, then that entitles you to 10/60ths of your FS, assuming you are still with the same company when you retire.

If you leave the company before retirement age, then it becomes a deferred pension and the benefit becomes 10/60ths of your salary at the point of leaving, plus whatever annual indexing is defined in the scheme.

pvt

sandsy wrote: »

Most employers have now dropped final salary scheme arrangements due to the high cost. The contributions required from employers to such schemes are so great that, in some cases, they threaten the future of the company.

The main reason that DB or FS schemes have been dropped by companies is that they are a very unpredictable liability. A company with an FS scheme that is 100% funded (in other words the predicted liabilities = the predicted assets) would appear to have no liability.

If circumstances change and the value of the assets go down by 25% (because of a stock market crash), or the value of the liabilities goes up (because of a step change in life expectancy predictions), the company can suddenly find itself with a huge potential liability that it has to provision for and report in its annual figures. It would be very easy for a large/old pension scheme in a mid sized company to turn from being cost neutral to having a £1bn shortfall in one year.

Closing the scheme does not remove this liability, but it gradually reduces the unpredictability as time goes by.

What many companies have done is close their FS schemes to new starters. They could potentially further reduce the unpredictability of any future liability by closing it to current members, but as most of the unpredictability relates to pensioners, deferred members, and the benefits that current active members have already accrued, the effect is relatively small. And it pees-off the only people they don't really want to pee-off, which is current active members.

agarnett

pvt wrote:

agarnett wrote:

If it was still a true FS scheme then the "final salary on exit" would be the salary at the point the old scheme closed, but revalued annually to hopefully inflation proof the entitlement earned to date, to scheme retirement date.

I don't believe this is correct.

The basic rule of pension schemes is that whatever you have accrued cannot be altered or watered down. If you have accrued 10/60ths of FS, then that entitles you to 10/60ths of your FS, assuming you are still with the same company when you retire.

I think I understand your point, pvt - you are saying that even if a company FS scheme is closed to all new contributions by existing active members after 10 years of service, and the employee continues in a new scheme from that date but with the same employer, if he then gets several times promoted for example - after the original scheme closes, but before retirement - the Final Salary used to calculate his 10/60ths from the original scheme will be his final several times promoted salary as at his retirement date?

You may be right, but my view stems from a somewhat similar experience to the OP.

The reason I say this is because I had one such FS scheme stopped in its tracks, and then I continued for another couple of years in the new (DC) scheme before leaving.

Then a couple of years after I left, the old scheme was completely wound up and I ended up with a Section 32 buyout policy for that part of my pensions with that employer. That policy was to replace my original FS scheme entitlement, and the final salary used was not the FS when I left the company, but the FS at the point the old scheme closed to contributions.

Do you think my S32 may have been incorrectly arranged if it was done that way?