Lloyds Banking Group is to revise its pensionable pay cap for around 35,000 employees who are members of its six defined benefit (DB) pension schemes.
Following a consultation with employees and unions in November 2013, the bank will revise the current cap on the increase in pensionable pay from 2% to 0.
It will also provide a one-off 3% lump-sum payment to affected employees.
According to Lloyds Banking Group, the change has been made to ensure pension benefits are more balanced across the group, particularly as two-thirds of its employees are not members of the six DB pension schemes.
A spokesperson from Lloyds Banking Group said: “In line with many other UK organisations, Lloyds Banking Group has been reviewing its pension arrangements in order to ensure that it continues to offer a competitive and sustainable pension to all its employees.
“The group believes that the defined benefit schemes remain an important part of the employees’ benefit package.
“On that basis and following its review, the group has decided to make changes to its defined benefit pension schemes as initially proposed.
“The group consulted on these proposals with active members and our recognised unions prior to this announcement; following these consultations we have agreed it would be appropriate to provide a one-off lump-sum payment to employees who are currently members of defined benefit schemes.
“Unlike a number of organisations, the group has decided that it will keep its defined benefit pension schemes open to future accrual, but has introduced a change to the pensionable pay cap.”
