My employer is taking away my WYPF DB pension and moving me to a DC pension scheme....

Marcon

hyubh said:

Marcon said:

CDunn911 said:

...... I am substantially worse off but it is also difficult to present a reasonable compensation offer. Has anyone been through anything similar or can anyone offer advice or know someone who can?

Thanks

What makes you think you're going to be offered any 'compensation'? You won't have a contractual entitlement to a DB pension for the whole of your employment, and any number of people will have been through a similar unwelcome exercise.

I'm afraid the only 'remedy' here is to vote with your feet if you don't like the move - which I can quite understand. 

I can't see any place where the OP claims they are 'entitled' to compensation. 

OP's opening post: 'I am substantially worse off but it is also difficult to present a reasonable compensation offer.'

Moonwolf

CDunn911 said:

...... I am substantially worse off but it is also difficult to present a reasonable compensation offer. Has anyone been through anything similar or can anyone offer advice or know someone who can?

Thanks

My recommendation would be to see how you can benefit from it, t might be an opportunity.  I have both types of pension through changing employers, while the DC just doesn't give the same guaranteed growth , I feel it gives me extra flexibility.

I'm assuming that existing benefits are being deferred and your accrued pension will grow by CPI until you retire.  With the state pension will that be enough to cover the basics? You don't say how old you are or what you have accrued so far.

A DC scheme while always worse does give you benefits. It is usually easier to change how much you pay in so when you can afford it you can maximise your savings, particularly good if it is salary sacrifice. 

With a DC scheme it is usually possible to be very flexible around how much you take out and when (tax being considered),

If your DB schemes cover your minimum lifestyle then you can take more risks with your DC pot, hoping for higher growth and when you retire you can draw down what you need for the extras.

 You will also be able to decide when the time comes, if you want to retire early is it better to draw down more or take an actuarial reduction on your DB pension or a bit of both, balancing security of income against the potential for better growth

Moonwolf

hyubh

Marcon said:

hyubh said:

Marcon said:

CDunn911 said:

...... I am substantially worse off but it is also difficult to present a reasonable compensation offer. Has anyone been through anything similar or can anyone offer advice or know someone who can?

Thanks

What makes you think you're going to be offered any 'compensation'? You won't have a contractual entitlement to a DB pension for the whole of your employment, and any number of people will have been through a similar unwelcome exercise.

I'm afraid the only 'remedy' here is to vote with your feet if you don't like the move - which I can quite understand. 

I can't see any place where the OP claims they are 'entitled' to compensation. 

OP's opening post: 'I am substantially worse off but it is also difficult to present a reasonable compensation offer.'

That still doesn't imply they think they have a 'contractual entitlement'. A reasonable interpretation is that they were asking for how they might negotiate the loss of a very substantial employee benefit. Maybe taking the attitude of finding a new job ASAP would save time in the end, but unless we're talking about a tightly regulated public sector environment (in which the loss of the DB pension wouldn't arise in the first place), all pay and benefits are ultimately the result of negotiation. Don't ask, don't get...

Albermarle

Moonwolf said:

CDunn911 said:

...... I am substantially worse off but it is also difficult to present a reasonable compensation offer. Has anyone been through anything similar or can anyone offer advice or know someone who can?

Thanks

My recommendation would be to see how you can benefit from it, t might be an opportunity.  I have both types of pension through changing employers, while the DC just doesn't give the same guaranteed growth , I feel it gives me extra flexibility.

I'm assuming that existing benefits are being deferred and your accrued pension will grow by CPI until you retire.  With the state pension will that be enough to cover the basics? You don't say how old you are or what you have accrued so far.

A DC scheme while always worse does give you benefits. It is usually easier to change how much you pay in so when you can afford it you can maximise your savings, particularly good if it is salary sacrifice. 

With a DC scheme it is usually possible to be very flexible around how much you take out and when (tax being considered),

If your DB schemes cover your minimum lifestyle then you can take more risks with your DC pot, hoping for higher growth and when you retire you can draw down what you need for the extras.

 You will also be able to decide when the time comes, if you want to retire early is it better to draw down more or take an actuarial reduction on your DB pension or a bit of both, balancing security of income against the potential for better growth

Moonwolf

A DC scheme while always worse 

Just to be clear though, the main reason why a DC scheme is worse, is that normally employers contribute a lot less to them than to a DB scheme.
If an employer added a similar amount to a DC scheme than a DB scheme, it would be debatable which was better or worse,

doodling

Hi,

Pat38493 said:

When my company decided to shut down the DB scheme in 2008 and force everyone onto a DC scheme, I challenged it based on that fact that my original work contract specifically stated that I would be in a pension scheme that provided a guaranteed benefit with the proportions in the actual contract.

They told me that if I refused to accept it I was effectively resigning from the company.  I am not sure if that was legally correct, but rightly or wrongly I chose not to hire a solicitor to investigate, partly because none of my other colleagues seemed bothered, even when you pointed out that this was like a big pay cut.

Not wanting to hijack the OP's thread too much, but yours was an extremely rare situation where you had a contractual right to a DB scheme, most people in DB schemes (most likely including the OP) do not.

In your case, they would have either been constructively dismissing you, or making you redundant, depending on how competent their HR people would have been if you had made an issue of it.  Of course, that would only have helped you if you had wanted to leave your job with a dollop of redundancy pay at that time - great if you were planning to leave anyway but not so great if you weren't and even less great if the jobs market wasn't very good at that time.

Pat38493

doodling said:

Hi,
In your case, they would have either been constructively dismissing you, or making you redundant, depending on how competent their HR people would have been if you had made an issue of it.  Of course, that would only have helped you if you had wanted to leave your job with a dollop of redundancy pay at that time - great if you were planning to leave anyway but not so great if you weren't and even less great if the jobs market wasn't very good at that time.

Yes - I did suspect at the time that they were being economical with the actualité when they claimed I would just be choosing to resign.  However for various reasons I didn't think it was the right time to start a legal dispute with my employer, particularly if none of my other colleagues seemed willing to make an issue of it (although there were only a small number of colleagues in this exact situation as the company had been made up from various acquisitions over the years).

To be honest if I was 100% sure it would result in a redundancy payment, I probably would have gone for it as I have quite generous contractual redundancy terms as well.  However I thought there was a risk I would end up with only a token settlement.