Firms awaiting verdict on consultation clause

A new information and consultation clause is expected to be inserted into the Pension Bill during a House of Commons standing committee session.The amendment, if successful, will require employers to provide information and consult with unions and members before any major scheme changes are implemented, such as scheme closure to new members or increased member contributions.

Work and pensions secretary Andrew Smith (pictured) – during the second reading of the Pensions Bill – warned business leaders the requirement would be “more than a rubber-stamping exercise”.

He added: “It will involve recognised trade unions or approved workplace information and consultation arrangements.”Amicus pensions officer Bryan Freake said unions wanted more than a token role in such proceedings.

He said: “Pensions are an extremely valuable benefit, worth around 20% of salary.

“If the scheme is to be closed or changed dramatically, employees should be properly involved in the process, not just told this is what the company will do.

“Employers should be obliged to give information, to discuss the issues, consider alternatives and then to consult with a view to reaching agreement with trade unions and members of the scheme.”

But the Confederation of British Industry believes any additional power given to unions would be “quite a concern” for employers.

Senior policy officer Jay Scheth said: “Trade unions should not be given any special privileges in the consultation process.

“It must not hinder companies making changes necessary in the long-term interests of the sponsoring company and the scheme.”

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