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Pension representatives

Consulting employee representatives on pension matters.

If you operate an occupational pension scheme (OPS) or make direct payments to a personal pension scheme (PPS), you may have to consult employees and/or their representatives if you wish to change certain scheme conditions or arrangements.

Consulting representatives on changes to an OPS or PPS

You have a legal duty to consult with representatives if certain changes are proposed to any OPS you offer to your staff.

Such changes might be:

an increase in the normal pension age
closure of the OPS to some or all new members
increasing member contributions in some or all cases
stopping future accruals in the OPS to some or all members

If you make direct payments to a PPS, you must consult representatives where you propose to:

stop making contributions for some or all members
reduce your contribution for some or all members
require some or all members to increase their contributions

You must consult with the representatives of as many affected members as is reasonably practicable.

Subject to that requirement, you could choose to work with one or more of the following:

previously elected pensions representatives
representatives of a recognised independent trade union - read more on recognising and derecognising a trade union
representatives already elected or appointed under the Information and Consultation of Employees Regulations (Northern Ireland) 2005 - see ongoing information and consultation arrangements
a pre-existing committee of employees, such as a works council or staff forum, that you regularly inform or consult with more generally about business and/or personnel issues

You could also choose to consult directly with employees if provision is made for this in the terms of a pre-existing committee of employees or an agreement you negotiate with any of the types of representative listed.

If you don't already have any such representatives in place, you should arrange for them to be elected.

Election of representatives

The legislation sets out a number of other requirements for election eg

The requirements of this paragraph are that-

(a) the employer must make such arrangements as are reasonably practicable to ensure that the election is fair;

(b) the employer must determine the number of representatives to be elected so that there are sufficient representatives to represent the interests of active members and the interests of prospective members;

(c) the employer must determine whether the active and prospective members should be represented by representatives of all such members or by representatives of particular descriptions of such members;

(d) before the election, the employer must determine the term of office as representative of active and prospective members;

(e) the candidates for election must be active or prospective members of the scheme on the date of the election;

(f) no active or prospective member may unreasonably be excluded from standing for election;

(g) all active or prospective members on the date of the election are entitled to vote for member representatives;

(h) the members entitled to vote may vote for as many candidates as there are representatives to be elected to represent them or, if there are to be classes of representative for particular descriptions of member, may vote for as many candidates as there are representatives to be elected to represent their particular description of member;

(i) the election is conducted so as to secure that-

(i) so far as is reasonably practicable, those voting do so in secret, and

(ii) the votes given at the election are accurately counted.

2. Where, after an election of representatives satisfying the requirements of paragraph (1) has been held-

(a) one of those elected ceases to act as a representative, and

(b) the active or prospective members (or any description of them) are no longer represented, those members must elect another representative by an election satisfying the requirements of paragraph (1)(a), (e), (f), and (i)

3. The relevant employer must from time to time review the number of representatives determined under paragraph (1)(b) and the number of representatives elected must be adjusted accordingly (whether by members electing one or more other representatives by an election satisfying the requirements of paragraph (1)(a), (e), (f) and (i), by not holding an election under paragraph (2) or otherwise).

You must ensure that:

candidates for the election are prospective or active members of the scheme on the date of the election
the number of pension representatives is proportionate to the number of affected prospective and active pension scheme members employed by you, eg one representative per 50 affected or prospective members

Note that if some of the affected members are not represented by a representative, you must consult with those members individually.