UK - New legislation will put an end to companies enforcing "major changes" to its pension schemes without first consulting its employees, said pensions reform minister Stephen Timms.
The announcement has come at a time when companies across the globe have looked to enact wholesale changes to their pension schemes in a bid to shed some of their significant pension deficit.
The legislation is the result of a lengthy consultation period, and stems from the Pensions Act of 2004.
Under the new law, employers are required 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.
Stephen Timms said pension scheme members needed to fully understand their pension scheme and the effect that changes will 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,” said Timms. “These regulations will enhance members' understanding of how their schemes work and give them an important part in the running of those schemes.
The legislation will come into effect on April 6 this year for employers with more than 150 employees, and April 6 2007 for employers with more than 100 employees. Employers with more than 50 employees will have until April 6, 2008 before the law comes into effect.
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