Employers will not be able to make major changes to their pension scheme without first consulting the scheme’s members under new regulations, the government has announced.
The regulations, introduced under the Pensions Act 2004, require employers to consult with current and prospective members, or their representatives, on significant changes to their occupational or personal pension scheme for a period of at least 60 days before the changes can be introduced.
The requirements will affect employers with more than 150 employees from April 6, 2006, employers with 100-150 employees from April 6, 2007 and employers with 50-100 employees from April 6, 2008.
Minister for pensions reform, Stephen Timms, said members needed to fully understand their pension scheme and the effect that changes would have on it and their future pensions.
“I am very keen that where we can, we enable members of pension schemes to have a more active role in the decisions that are taken on their behalf,” he said.
“These regulations will enhance members’ understanding of how their schemes work and give them an important say in the running of those schemes.”