Legal firm Shoosmiths is moving from a trust-based defined contribution scheme to contract-based group personal pension (GPP) in June, so that employees can have more control over their own pension.
The company is also planning to roll out an online self-service administration system so employees can go online and view the value of their pension and also make changes, for example, in the amount they contribute to the scheme each month.
Nick Mallett, benefits manager at Shoosmiths, said: “We are moving from a trust-based pension to a contract-based scheme because, at the moment, the [plan] is inflexible for staff. It is just very old-fashioned.”
It is hoped that the switch will also help to boost take-up of the scheme, added Mallett. “Currently, take-up is around 600 of the 1,500 staff, but the move [to a contract-based plan] should boost numbers because the pension scheme will be more of a talking point for employees.”
The employer contribution rates, which are currently based on age and salary, will remain the same. The maximum employees can receive is 7.5%, provided they contribute 3.5%.
Employees at the firm have been consulted on the move and internal pension experts have run road shows for staff explaining what the change means for them.
When the scheme, provided by Axa, is launched later this year, employees will be supplied with paper-based information about it as well as a guide that will be posted on the company intranet.