Insurance broker Marsh plans to terminate the contracts of staff who do not agree to take a cut in their pension provision.
The UK’s biggest insurance broker will lay off anyone who refuses to sign an amended contract that would replace the firm’s final salary pension with a “career revalued” scheme.
In the new scheme, pension benefits are based on how much an employee earns per year, which increases in line with the Retail Price Index before they retire.
Staff affected would then be offered a new contract with the same terms and conditions but with the less generous pension.
In a statement issued yesterday, a Marsh spokesman said: “At Marsh, we are committed to providing a competitive and sustainable benefits package for our staff and to take action that can help us maintain a competitive but sustainable pension plan for the future.
“To continue to meet this commitment, we have to respond to the continuing pressures on pension funding of increased life expectancy, lower than anticipated investment returns, greater regulation in the UK and more stringent accounting standards in the US.”
Changes to the scheme were developed in conjunction with the staff consultation committee, outside advisers and the pension scheme’s trustees, the spokesman said.