UK - Ernst & Young is to press ahead with plans to freeze its defined benefit pension scheme despite legal attempts by employees to block it.
The accountant first revealed its intention to freeze accruals into the Ernst & Young £381m retirement benefits plan in March.
In May, scheme trustees – acting on behalf of its members – instructed City law firm CMS Cameron McKenna to fight the firm’s plans.
But in Ernst & Young’s annual report – which revealed a 13% fall in profits – chairman Nick Land said the firm would “press ahead” with plans to freeze the scheme next year.
This will mean that 1300 members of Ernst & Young’s defined benefit scheme – 25% of its workforce – will have to transfer to a money purchase scheme next year.
The annual report disclosed an FRS17 deficit in the scheme – which closed to new members in 1997 – of £151.7m.
CMS Cameron McKenna was unable to comment on the development.
*The average profit per partner at Ernst & Young fell from £449,000 in 2001 to £378,000 in 2002.
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