The UK arm of US insurance group Aon is slashing its contributions to the company’s pension scheme.
Employees who wish to maintain their defined contribution (DC) pension level will have to pay in more of their salaries. Company contributions will be reduced by up to 50% in some cases.
Aon had previously contributed up to 12% of an employee’s salary – depending on age – to the pension fund in return for a basic 2% contribution from staff, but the new arrangements will see that capped at 6%.
A spokesman said the firm was looking to “reduce fixed costs” because of challenging economic conditions. Employees will be involved in a two-month consultation on the plan.
The company’s defined benefit (final salary) pension scheme was frozen and closed to new members in 2007, the spokesman added.