Explanatory Note
(This note is not part of the Regulations)
These Regulations are concerned with the industry-wide pension scheme established in accordance with the Industry-Wide Coal Staff Superannuation Scheme Regulations 1994 and the industry-wide pension scheme established in accordance with the Industry-Wide Mineworkers' Pension Scheme Regulations 1994. Both of the regulations were made under the Coal Industry Act 1994. Such an industry-wide scheme is defined in the present Regulations as a “New Scheme”.
The present Regulations make provision for the protection of persons in relation to a New Scheme and in relation to a scheme which an employer must provide on a winding up of a New Scheme under regulation 8 or 9 (alternative scheme). The Regulations define a “relevant scheme” as a New Scheme or an alternative scheme.
Regulation 3 defines those entitled to protection as being—
(a)those who participate
(i)in a New Scheme in consequence of the exercise of an option under paragraph 3(2) of Schedule 5 to the 1994 Act;
(ii)in a relevant scheme by reason of a change of duties (dealt with by regulation 11); or
(iii)in an alternative scheme provided under regulation 8 or 9
and
(b)those who have pension rights under a relevant scheme in consequence of the death of a person falling within (a).
A person falling within (a) is defined in the Regulations as a “protected employee” and a person falling within (b) is defined as a “protected beneficiary”. Protected employees and protected beneficiaries are defined as “protected persons”.
Regulation 3 also specifies that a protected person may cease to be entitled to protection principally where he elects under regulation 14 to cease to be protected, where he ceases to be in continuous employment or where he withdraws from the scheme.
Regulation 4 provides that references in the Regulations to a protected person being in continuous employment shall be construed in accordance with paragraph 4(11) of Schedule5 to the 1994 Act. Paragraph 4(11) defines continuous employment by reference to Schedule 13 to the Employment Protection (Consolidation) Act 1978. The effect of this is that if a protected employee is employed in a business which is transferred from one person to another and continues to be employed in the business after the transfer his employment will be regarded as continuous.
Regulation 5 requires the employer to take steps to ensure that there are sufficient assets to secure the accrued pension rights of protected persons.
Regulation 6 provides for the future pension rights to which a protected employee is entitled. It provides for him to accrue pension rights in accordance with the New Scheme in which he participates or an alternative scheme. It provides that on a change of employer which does not affect continuity of employment to an employer who participates in a relevant scheme the protected employee has the right to accrue pension rights on the same basis as protected employees in that scheme but where the rights of protected employees are worse than his participation date rights (i. e. the rights in the New Scheme when the protected employee became a participant) the protected employee has the right to accrue pension rights on the same basis as participation date rights. Where the change of employer is to an employer who provides a scheme in which there are no protected employees the pension rights are to be no worse than participation date rights. Special rules are applied where there is a total winding up.
Regulation 7 sets out the requirements with which an alternative scheme must comply.
Regulations 8 and 9 provide for partial and total winding up of a relevant scheme. Where this takes place the employer must provide an alternative scheme for protected persons. The regulations provide for the no worsening of the future pension rights.
Regulation 10 deals with a change of employer of a protected employee where the change does not affect continuity of employment or where the new employer opts to allow the protected employee to continue as a participant in a relevant scheme and is able to do so without the scheme ceasing to be approved for the purposes of the relevant enactments. If the new employer is not a participant in the scheme in which the employee participates he is required to apply to become a participant and the participant employers must ensure that the application is accepted. The regulation makes provision regarding future pension rights where there is a pension group within the scheme.
Regulation 11 makes provision for the protection of a protected employee to be carried from one scheme to another on a change of duties.
Regulation 12 makes provision for re-employed pensioners to join or re-join a pension scheme.
Regulation 13 restricts the amendment of a relevant scheme which results in the reduction of benefits of protected persons or increases contributions payable by protected employees.
Regulation 14 makes provision for a protected person to elect to cease to be entitled to protection and specifies the procedure for doing so.
Regulation 15 provides for any duty imposed by the Regulations on the employer of a protected person to be extended to any person by whom such employer is or has been wholly owned and for a former employer to be treated as an employer in respect of accrued pension rights which a protected employee does not require to be transferred to a scheme provided by his new employer.
Regulation 16 makes provision for disputes to be referred to arbitration.
Schedule 1 sets out the form of notice of election referred to in regulation 14(2) and Schedule 2 sets out the form of acknowledgement of such notice referred to in regulation 14(4).