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Internal dispute resolution (IDR) is a means of dealing with member grievances in connection with their pension scheme with the objective of avoiding external interference.
It was introduced as a legal requirement for occupational pension schemes by the Pensions Act 1995 in April 1997. Scheme trustees are required to operate a (at one time two-stage) system to allow members and others to complain: first (usually) to the scheme manager or administrator; and secondly, if dissatisfied, to the trustees (or perhaps the chairman). Following IDR, a member may submit his claim to TPAS or the Pensions Ombudsman. The Pensions Act 2007 amended the provisions of the Pensions Act 1995 to allow schemes to adopt a single-stage dispute arrangement. It is up to trustees to determine whether they wish to opt for this type of arrangement.
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DB to DC transfers—step-by-step guide for trustees The table sets out the step-by-step process for trustees of occupational pension schemes to follow once they receive a request from a member to transfer defined benefits (DB benefits) or safeguarded-flexible benefits (ie DC benefits with a guaranteed or promised element) to a defined contribution (DC) pension scheme, ie once the member applies for a statement of entitlement (also known as a transfer quote). More specifically, it shows the interaction between the requirements of: • the Pension Schemes Act 1993, s 99(2) • the Occupational Pension Schemes (Transfer Values) Regulations 1996, SI 1996/1847, reg 6 • the Pension Schemes Act 2015 (Transitional Provisions and Appropriate Independent Advice) Regulations 2015, SI 2015/742, regs 6, 8, and • the amendments to the Advice Regulations referred to immediately above introduced by the Pension Schemes Act 2015 (Transitional Provisions and Appropriate Independent Advice) (Amendment) Regulations 2017, SI 2017/717, reg 4, made with effect from 6 April 2018 • the Occupational and Personal Pension Schemes (Conditions for Transfers) Regulations 2021,...
Basic scheme information before 6 April 2014—checklist [Archived] THIS CHECKLIST APPLIED ONLY TO OCCUPATIONAL PENSION SCHEMES UP TO 5 APRIL 2014 For information on the requirement to provide basic scheme information after 5 April 2014, see Practice Note: Disclosure requirements applicable to occupational and personal pension schemes after 5 April 2014 — Basic scheme information and Checklist: Basic scheme information after 5 April 2014—checklist. Basic scheme information requirement Under the Occupational Pension Schemes (Disclosure of Information) Regulations 1996, SI 1996/1655 (the 1996 Disclosure Regulations), which are now repealed, basic scheme information had to be provided to prospective members (and in certain circumstances others) by trustees of the following occupational pension schemes: • registered schemes or schemes that were formerly tax approved (or in respect of which an application for tax approval has been made which has not been determined) • schemes with superannuation funds under the Income and Corporation Taxes Act 1988, s 615(6), and • public service pension schemes (as defined in the Pension Schemes Act 1993, s 1)...
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THIS PRACTICE NOTE APPLIES IN RELATION TO OCCUPATIONAL PENSION SCHEMESThe legal framework for an occupational pension scheme’s internal dispute resolution procedure (IDRP) is set out in:•sections 50, 50A and 50B of the Pensions Act 1995 (PA 1995), and•the Occupational Pension Schemes (Internal Dispute Resolution Procedure Consequential and Miscellaneous Amendments) Regulations 2008, SI 2008/649The Pensions Regulator’s General Code of Practice also includes a section on dispute resolution procedures.Scope of IDRPPension scheme trustees have a duty to establish, run and manage a scheme’s IDRP. The IDRP enables scheme members, or those with an interest in the scheme, to challenge decisions, acts or omissions relating to their scheme benefits or the pension scheme.Individuals considered to have an interest in the pension scheme include those who have ceased, or claim to have ceased, to be a member or beneficiary of the scheme, or a prospective scheme member. This includes widows, widowers and surviving dependants.Complaints relating to the employer are outside the scope of the IDRP process. Scheme members and those with an interest in...
THIS PRACTICE NOTE APPLIES IN RELATION TO OCCUPATIONAL AND PERSONAL PENSION SCHEMESDisputes in relation to a pension schemes can take various forms. Depending on the type of scheme in question and the relevant facts, they can be potentially pursued through a number of different avenues. This Practice Note focuses on disputes that may be brought by aggrieved members in respect of pension rights under occupational or personal pension schemes.Disputes relating to occupational pension schemesAn employee (or former employee) with a complaint relating to their pension rights under a trust-based occupational pension scheme acquired during the course of employment may (depending on the particular facts of their claim) have two principal avenues through which they can pursue their claim:•make a written complaint against their employer—this is possible if the pension claim in question can be shown to relate to contractual rights under their contract of employment•make a written complaint against the scheme trustees (and potentially again, the employer) insofar as the claim can be shown to arise under rights the individual...
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Pensions warranties—defined contribution scheme—share purchase agreement Replace Schedule 4, paragraph 19 of Precedent: Share purchase agreement—pro-buyer—corporate seller—conditional—long form with the following: 1 Pensions 1.1 Except as provided for by the Pension Scheme, the Company is not and has never participated in an arrangement or agreement to provide pensions, annuities, lump sums, gratuities or similar benefits on retirement, long-term ill-health or death, or pursuant to a pension sharing order, in relation to the service or historic service of a present or former employee of the Company or any other person, or for the benefit of that individual’s dependents. 1.2 All benefits under the Pension Scheme are provided on a money purchase basis. No assurance, guarantee or promise has been made to any employee of the Company as to the amount of benefits to be provided under the Pension Scheme. 1.3 Copies of the following documents have been Fairly Disclosed to the Buyer: 1.3.1 the governing documentation of the Pension Scheme including the trust deed and rules and all ancillary and...
Business sale agreement—pensions warranties (where buyer participates in seller’s scheme) This precedent has been prepared on the basis that the drafter is acting for the buyer The following warranties have been drafted for a transaction where the Buyer: 1 decides to replicate pension benefits for transferring Employees in the same pension scheme by entering a deed of substitution to participate and assume responsibility for the scheme, or 2 agrees to accept a transfer of Employees’ past service benefits from the Seller’s pension scheme to its own scheme. You are strongly advised to involve a pensions specialist at the earliest opportunity. 1 Interpretation and definitions For the purposes of paragraphs 2 to 7 inclusive: [ Employee means [define as necessary either by class or named individuals];] Pension Scheme [s] mean[s] [[insert name(s) of scheme(s)] OR an arrangement or practice for the payment of, or contribution towards, an annuity, pension, lump sum, gratuity or similar benefit to be given on retirement, long-term ill-health or death, or pursuant to...
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The wife of a deceased member has requested information regarding the deceased member's pension from the trustees of a pension scheme in order to support a medical negligence claim, but the wife is neither a current or prospective beneficiary under the scheme. In these circumstances: (i) if the scheme trustees do not disclose the information and the wife complained to the Pensions Ombudsman, would the complaint fall within the remit of the Ombudsman, and (ii) if the complaint does fall within the Pensions Ombudsman’s remit and the complaint is successful, what award could the Ombudsman make? It is stated that the wife of the deceased member is neither a current or prospective beneficiary under the pension scheme. However, it is not specified if the occupational pension scheme was contracted-out of the State Earnings Related Pension Scheme (SERPS) or was a contracted-in scheme. For example, since 1978, all occupational pension schemes (and personal pension schemes) which contracted-out of SERPS had to provide for a survivor’s pension for a...
A former member-nominated director (MND) (who has just lost their position as MND) of a corporate trustee would like to challenge the result of the election as they believe one of the newly elected MNDs did not follow the rules of the process. Should the former MND bring a challenge through the scheme’s IDRP process or go straight to the Pensions Regulator? We have assumed that the pension scheme concerned is a defined benefit scheme and that the former MND is a member of the scheme. Whether the former MND should first challenge the result of the MND election through the pension scheme’s internal dispute resolution procedure or complain directly to the Pensions Regulator depends on the nature and seriousness of the breach. Under section 10 of the Pensions Act 1995, the Pensions Regulator has the power to fine trustees for breach of the statutory requirement to put in place and implement arrangements which provide for at least one-third of the total number of directors of a...
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Pensions analysis: The court struck out as an abuse of process the claimant’s claim for a declaration as to the true construction of the rules (‘the Rules’) of the Port of Felixstowe Pension Plan (‘the Plan’) on the basis that the Pensions Ombudsman (‘the PO’) had already made a final and binding determination (‘the PO’s Determination’) against the complaint of the claimant, which he had not appealed, in respect of the same issues raised in the claim. Written by Oliver Hilton, barrister at Radcliffe Chambers, Lincoln’s Inn.
The Pensions Ombudsman has acknowledged an ongoing dispute involving the trustees of the Boots Pension Scheme and certain scheme members regarding the removal of an option to retire at age 60 on an unreduced pension. The regulator has confirmed that discussions are underway with the relevant parties and that it is adopting a lead case approach to address the high volume of similar complaints arising from this issue. This approach is intended to expedite the progression to a final determination, thereby providing prompt clarity and minimising the impact of numerous individual complaints on the overall complaint resolution process. The Ombudsman has also advised that no additional complaints relating to the removal of this retirement option will be accepted during the investigation period, while separate complaints concerning other issues can continue to be raised through the established internal dispute resolution process.
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