Participating employer meaning

This Checklist This Checklist provides points to weigh up when preparing and seeking sign-off for a company voluntary arrangement (CVA) involving the Pension Protection Fund (PPF). It draws on PPF Guidance Note 5 issued in 2018 (see PPF Guidance Note 5: CVAs). When an employing company (or all participating employers in a last man standing scheme) files a CVA proposal with the court, a PPF assessment period begins. Under section 137 of the Pensions Act 2004, the PPF assumes the pension trustees’ voting entitlement (see Practice Note: The Pension Protection Fund—eligibility and entry). In practice, the PPF will typically cast a vote for or against the proposal rather than refrain. The PPF is consistently focused on avoiding any precedent that might allow pension schemes to be diluted where potential PPF entry could arise in the near future (the PPF observes that this has occurred in numerous prior CVAs). The PPF also anticipates that pension trustees will appoint their financial advisers to produce a report addressing the areas of concern...

When does a section 75 debt arise? An s 75 liability crystallises in respect of an occupational pension scheme that is underfunded on a buy-out basis and: an employment-cessation event happens for a relevant participating employer within a multi-employer scheme an insolvency event occurs in relation to a participating employer of the scheme, or the scheme formally goes into winding up In a multi-employer scheme, an employer’s s 75 debt is its allocated share of the scheme deficit, appropriately assessed on a buy-out basis. As an alternative to immediately paying the s 75 debt in full, an employer may enter into a deferred debt arrangement, an apportionment arrangement, or a withdrawal arrangement. Section 75 does not apply at all to money purchase schemes, unregistered pension schemes, unfunded public sector schemes, and a scheme with only one member. ...

Original news Mr S (CAS-39170-Y5Q0)—13 October 2023 Summary The DPO has partly upheld a complaint concerning a section 75 liability arising within a non‑segregated defined benefit scheme governed by Scots law. The complainant, an employer participating in the scheme, had incorporated his sole‑trader plumbing business. He was wrongly assured that incorporation would have no impact; in reality, it triggered a section 75 employer debt under the Pensions Act 1995. Because of the scheme’s complexity, the company was not told the amount of the liability for well over six years. The DPO decided that: no limitation or prescription defence applied; the scheme administrator made a negligent misstatement about the impact of changing the business’s legal status, the complainant reasonably relied on that advice, and suffered financial loss; and the failure to provide timely notice that a section 75 debt had arisen was maladministration. This outcome highlights the complexity of the employer debt framework and the importance of seeking advice. ...

This practice note applies to defined benefit occupational pension schemes The importance of identifying a scheme’s statutory employer(s) A fundamental element of the law governing occupational pension schemes, particularly defined benefit (DB) schemes, is that the main burden of supporting the scheme lies with its sponsoring employers, as a matter of law alone indeed. An employer might have exited the scheme previously without settling all liabilities owed to it; in such circumstances they may still be a ‘statutory employer’ even though they no longer participate. They may therefore continue to bear obligations in relation to the scheme. Under the registered pension scheme regime, various specific obligations fall upon those who qualify as ‘statutory employers’, a notion carried over from the earlier tax-exempt approval regime in force before A-day (for further information on the pre A-day regime, see The pre A-day pensions tax regime [Archived]). These duties will typically extend beyond those that a participating employer assumes under the scheme’s trust deed and rules. For...

ESPS (ESPS) is a trust-based arrangement created by an Electricity Council resolution on 20 January 1983 as an industry-wide pension for employees of the nationalised electricity sector. It remained a single scheme at privatisation on 31 March 1990, after which it was divided into separate sections or ‘Groups’. The rules are not publicly accessible. For further information on statutory protections for ESPS members following privatisation, see Practice Note: —Protected Persons. Each principal electricity company participating in the ESPS forms its own Group; there are currently 23 Groups. Some Groups have a single participating employer, while others have several. Each Group is actuarially independent, with its assets and liabilities assessed on a standalone basis... Although a common scheme-wide benefit structure applied at the point of privatisation, since then each Group has been able to offer different benefits to its members. The ESPS rules comprise a central set of clauses and provisions governing matters that apply across the scheme, with Group-specific rules appended as Schedules. This Practice Note outlines the...

THIS PRACTICE NOTE APPLIES IN RELATION TO DEFINED BENEFIT OCCUPATIONAL PENSION SCHEMES This Practice Note sets out approaches for addressing a section 75 debt in the context of a transaction, with particular emphasis on multi-employer schemes where a range of options may exist. It also outlines considerations connected to the Pensions Regulator's clearance process and the notifiable events regime. For trustee-focused considerations when deciding how a section 75 debt should be managed on an employment cessation event, see Practice Note: employment cessation events—trustee decision-making process. For matters specific to section 75 debts triggered during a group reorganisation, see Practice Note: Intra-group reorganisations and pensions. Determining whether a section 75 debt will be triggered Section 75 debt triggers A section 75 debt (often called an 'employer debt') may become payable by the employer of a defined benefit occupational pension scheme where: the scheme is a multi-employer arrangement and an employment cessation event occurs in relation to that employer (described in this Practice...

Date: [ insert date ] (1) [ Name of Principal Company ] (2) [ Names of Trustees ] (3) [ Name of New Employer ] Deed of Participation relating to [ Name of Scheme ] This Deed is executed the [ insert day ] day of [ insert month ] 20[ insert year ]. Parties [ insert full company name ] registered in England and Wales under company number [ insert number ] and with its registered office at [ insert registered company address ] (the “Principal Company”); [ [ insert full name of company ] registered in England and Wales under company number [ insert number ] and with its registered office at [ insert registered company address ] OR [ insert individual name(s) ] of [ insert individual address(es) ] ] (the “Trustees”); [ insert full name of the new employer ] registered in England and Wales under company number [ insert number...