Jurisdiction(s):
United Kingdom

Key definition

Outsourcing definition

What does Outsourcing mean? Outsourcing is the engagement of a third-party supplier to perform functions or services that would otherwise be carried out in-house, with the instructing organisation (including law firms and in-house legal teams) retaining responsibility for the outcome, client care and regulatory compliance. The term is descriptive rather than a single statutory concept, although sectoral rules define it for specific purposes (for example, FCA/PRA and Central Bank of Ireland rules on material outsourcing; SRA Standards and Regulations and law society rules on supervision, confidentiality and client notification). Typical features include an outsourcing agreement or master services agreement setting service levels, governance, audit...

Private Sector Outsourcing: TUPE Pension Obligations, Beckmann Liabilities, Minimum Pension Provision, Consultation Duties and Auto-enrolment - Key Risks for Customers and Suppliers

Published by a LexisNexis Pensions expert

Practice notes

THIS PRACTICE NOTE APPLIES TO OCCUPATIONAL AND Personal pension SCHEMES

The nature of an Outsourcing

Outsourcing arises where an organisation contracts with a third party to assume responsibility for delivering services that its own staff presently perform under the organisation’s direction. In almost all cases, employees’ contracts of employment move automatically to the service provider as part of the arrangement. A common illustration is a company (the Customer) handing over its IT function to a specialist firm (the Supplier) under an outsourcing deal. In that scenario, the Supplier undertakes to supply IT services to the Customer, with the Customer’s current IT team transferring to the Supplier. The automatic movement of employment can give rise to pension issues and related matters. This is pertinent on a first-generation outsourcing and when the service provider changes during the arrangement. Pension issues may emerge on termination of the outsourcing agreement...

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Andrew Patten

Fieldfisher

I started life as a pensions lawyer in 1996. Since then, each passing year has seen an increase in the amount and complexity of pensions law and regulation. It can be difficult, even for an expert, to keep up with the pace of change. I help clients by delivering clear, practical advice and recommendations allowing them to navigate this complex pension's landscape and achieve a successful outcome to their issue. My work covers schemes and employers of all shapes and sizes with those in the financial services, retail and energy sectors being an area of specialism. Areas of focus include funding and security arrangements, liability management exercises, scheme restructurings (closing schemes, changing benefit structures and merging schemes) and outsourcing, administration, governance and benefit audit projects. I am also experienced in acting as a professional trustee. I play an active role in the pensions industry, sitting on...

Web page updated on 21/05/2026

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