Whitbread, the leisure group which owns Costa Coffee and Premier Inns, will extend eligibility for its trust-based defined contribution (DC) pension scheme to an extra 14,000 staff and increase employer contribution rates to between 4.5% and 6% of salary.

This announcement, which is partly motivated by the changes to pensions legislation in 2012, comes at the same time as the decision to close its final salary pension scheme to existing members.

The final salary scheme will be closed to future accruals by the end of 2009 and will affect around 800 staff, or 3% of the company’s workforce.

The final salary scheme has been closed to new staff since 31 December 2001.

Lesley Williams, pensions director at Whitbread, said: “The changes will bring the pension benefits across the business into line and ensure we offer fair pension benefits to all.

“Extending eligibility for the pension fund and improving the level of employer contributions will continue to ensure attractive benefits for Whitbread employees and for those joining the business.”

She also said the move was partly motivated by the changes due to UK pensions from October 2012 when all staff will have to be automatically enrolled into a pension plan.

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