Introductory
Citation and commencement1.
These Regulations may be cited as the Occupational and Personal Pension Schemes (Consultation by Employers) Regulations (Northern Ireland) 2006 and shall come into operation on 6th April 2006.
Interpretation2.
In these Regulations—
“the Order” means the Pensions (Northern Ireland) Order 2005;
“active member”—
(a)
(b)
in relation to a personal pension scheme, means any member in respect of whom employer contributions fall to be paid;
“affected members” has the meaning given by regulation 7(4);
F1...
F1...
“employer contributions”, in relation to an occupational or personal pension scheme, means contributions payable by or on behalf of the employer in relation to the scheme on his own account (but in respect of one or more employees);
“member contributions”, in relation to an occupational or personal pension scheme, means contributions, other than voluntary contributions, by or on behalf of active members of the scheme which are payable out of deductions from the member’s earnings;
“listed change” has the meaning given by regulation 6(2);
“multi-employer scheme” has the meaning given by Article 280 of the Order (modification of this Order in relation to certain categories of schemes);
“personal pension scheme” has the meaning given by regulation 3(3);
“prospective member”—
(a)
in relation to an occupational pension scheme, means any person who, under the terms of his contract of service or the rules of the scheme—
- (i)
is able, at his own option, to become a member of the scheme,
- (ii)
will become so able if he continues in the same employment for a sufficiently long period,
- (iii)
will be admitted to the scheme automatically unless he makes an election not to become a member, or
- (iv)
may be admitted to it subject to the consent of his employer;
(b)
in relation to a personal pension scheme, means any person who, under the terms of his contract of service, is eligible if he becomes a member of the scheme for employer contributions to be paid in respect of him;
“relevant employer” has the meaning given by regulation 3(2).
Application of Regulations
Application3.
(1)
These Regulations apply to—
(a)
in the case of an occupational pension scheme which is not a multi-employer scheme—
(i)
any relevant employer, and
(ii)
if there is a relevant employer, the trustees or managers of the scheme;
(b)
in the case of a multi-employer scheme in relation to which there are one or more relevant employers—
(i)
each relevant employer,
(ii)
the trustees or managers of the scheme, and
(iii)
(c)
in the case of a personal pension scheme where direct payment arrangements exist in respect of one or more members of the scheme who are his employees, a relevant employer.
F2(2)
For the purposes of these Regulations “relevant employer” means—
(a)
an employer employing in Northern Ireland at least the number of employees specified in paragraph (2A), and
(b)
in the case of—
(i)
an occupational pension scheme, an employer in relation to the scheme other than one who is excluded by regulation 4, and
(ii)
a personal pension scheme, an employer in relation to the scheme other than one who is excluded by regulation 5.
(2A)
The number of employees referred to in paragraph (2)(a) is—
(a)
150 with effect from 6th April 2006 to 5th April 2007;
(b)
100 with effect from 6th April 2007 to 5th April 2008, and
(c)
50 from 6th April 2008 onwards.
(2B)
For the purposes of paragraph (2)(a)—
(a)
the number of people employed by an employer is to be determined using the same method of calculation as is set out in regulation 4 of the Information and Consultation Regulations (calculation of number of employees), but
(b)
references in that regulation to the previous 12 months are to be taken as references to the period of 12 months ending with the date of the proposal to make a listed change to which regulation 6 of these Regulations applies.
(3)
In these Regulations references to a personal pension scheme are to a personal pension scheme falling within paragraph (1)(c).
Excluded employers: occupational pension schemes4.
(1)
This regulation excludes—
(a)
any employer in relation to a public service pension scheme;
(b)
any employer in relation to a small occupational pension scheme;
(c)
any employer in relation to an occupational pension scheme with fewer than two members;
(d)
any employer in relation to an occupational pension scheme which is an employer-financed retirement benefits scheme; F3and
(e)
F6(f)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F7(2)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F7(3)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)
In this regulation—
“small occupational pension scheme” means—
(a)
a scheme with fewer than twelve members where all of the members are trustees of the scheme and either—
- (i)
the provisions of the scheme provide that F8any decision made by the trustees is made by the unanimous agreement of the trustees who are members of the scheme, or
- (ii)the scheme has a trustee who is independent in relation to the scheme for the purposes of Article 23 of the 1995 Order7 (power to appoint independent trustees) and is registered in the register maintained by the Regulator in accordance with regulations made under paragraph (4) of that Article;
(b)
a scheme with fewer than twelve members F9where a company is the sole trustee of the scheme, and all the members of the scheme are directors of the company and either—
- (i)
the provisions of the scheme provide that any decision made by the company in its capacity as trustee F10is made by the unanimous agreement of the directors who are members of the scheme, or
- (ii)
F11one of the directors of the company is independent in relation to the scheme for the purposes of Article 23 of the 1995 Order and is registered in the register maintained by the Regulator in accordance with regulations made under paragraph (4) of that Article, and
F12Excluded employers: personal pension schemes5.
This regulation excludes any employer in relation to a personal pension scheme where no employer contributions fall to be paid towards the scheme.
Restriction on decision-making pending completion of consultation
Consultation required before decisions to make listed changes affecting schemes6.
(1)
No person falling within regulation 3(1) may decide to make a listed change that affects an occupational or personal pension scheme unless such consultation as is required by regulation 7(3) has been carried out.
(2)
For the purposes of these Regulations, a change affecting an occupational or personal pension scheme is a “listed change” if—
(a)
in relation to an occupational pension scheme, it is listed in regulation 8, or
(b)
in relation to a personal pension scheme, it is listed in regulation 9,
and it is not excluded by virtue of regulation 10.
(3)
Paragraph (1) does not require consultation to be carried out in any of the four cases described in paragraphs (4) to (7).
F13(4)
The first case is where the active or prospective members of the scheme to whom—
(a)
a listed change mentioned in regulation 8(1)(h) relates were notified before 6th April 2012 of the proposal to make that change, or
(b)
any other listed change relates were notified before 6th April 2006 of the proposal to make that change.
(5)
The second case is where, in relation to an occupational pension scheme—
(a)
consultation has already been carried out under these Regulations in respect of a proposal to prevent the future accrual of benefits, as described in regulation 8(1)(c), and
(b)
there is a further proposal as a result of that consultation to make a decision to reduce the rate of such accrual, as described in regulation 8(3)(d).
(6)
The third case is where, in relation to an occupational pension scheme—
(a)
consultation has already been carried out under these Regulations in respect of a proposal to remove the liability to make employer contributions, as described in regulation 8(1)(d), and
(b)
there is a further proposal as a result of that consultation to make a decision to reduce such contributions, as described in regulation 8(2).
(7)
The fourth case is where, in relation to a personal pension scheme—
(a)
consultation has already been carried out under these Regulations in respect of a proposal to cease employer contributions, as described in regulation 9(a), and
(b)
there is a further proposal as a result of that consultation to make a decision to reduce such contributions, as described in regulation 9(b).
Notifications to employers and duty to consult7.
(1)
Any person falling within regulation 3(1) who proposes to make a listed change affecting an occupational or personal pension scheme must give written notice of that change to each employer in relation to the scheme.
(2)
Paragraph (1) does not apply—
(a)
in any of the four cases described in regulation 6(4) to F14(7);
(b)
where the person proposing the change is a relevant employer in relation to—
(i)
an occupational pension scheme which is not a multi-employer scheme, or
(ii)
a personal pension scheme, F15or
(c)
where the person proposing the change employs all the affected members.
F16(3)
A relevant employer must consult about the listed change in accordance with regulations 11 to 16 if—
(a)
that employer (“E”) employs all the affected members, or
(b)
E’s employees appear to E to include affected members and E is a relevant employer who—
(i)
has been notified under paragraph (1), or
(ii)
falls within paragraph (2)(b).
(4)
For the purposes of these Regulations “affected members”, in relation to a proposal to make a listed change affecting an occupational or personal pension scheme, means the active or prospective members of the scheme to whom the listed change relates.
Listed changes: occupational pension schemes8.
(1)
Listed changes that affect occupational pension schemes are—
(a)
to increase the normal pension age specified in the scheme rules for members or members of a particular description;
(b)
to prevent new members, or new members of a particular description, from being admitted to the scheme;
(c)
to prevent the future accrual of benefits under the scheme for or in respect of members or members of a particular description;
(d)
to remove the liability to make employer contributions towards the scheme in respect of members or members of a particular description;
(e)
to introduce member contributions in any circumstances in which no such contributions were previously payable;
(f)
to make any increase in member contributions by or on behalf of members or members of a particular description;
(g)
to make any change specified in paragraph (2) or (3).
F17(h)
to change the rate at which—
(i)
pensions in payment under the scheme are increased, or
(ii)
pensions or other benefits payable under the scheme are revalued,
but only where that change would be, or would be likely to be, less generous to members or members of a particular description.
(2)
A listed change affecting only money purchase benefits is to make any reduction in the amount of employer contributions towards the scheme in respect of members or members of a particular description.
(3)
Listed changes affecting only benefits which are not money purchase benefits are—
(a)
to change to money purchase benefits some or all of the benefits that may be provided under the scheme to or in respect of members or members of a particular description;
(b)
to change, in whole or in part, the basis for determining the rate of future accrual of benefits under the scheme for or in respect of members or members of a particular description;
(c)
to modify the scheme under Article 208(2) of the Order (matters requiring agreement of the employer) so as to reduce the rate of future accrual of benefits under the scheme for or in respect of members or members of a particular description;
(d)
to make any other reduction in the rate of future accrual of benefit under the scheme for or in respect of members or members of a particular description.
F18(e)
to change what elements of pay constitute pensionable earnings, or to change the proportion of or limit the amount of any element of pay that forms part of pensionable earnings, for or in respect of members or members of a particular description.
(4)
“Normal pension age” has the meaning given by section 175 of the Pension Schemes Act.
F19(5)
“Pensionable earnings” means the earnings by reference to which pension benefits are calculated, and an “element of pay” includes basic salary, a pay rise, an overtime payment and a bonus payment.
Listed changes: personal pension schemes9.
Listed changes that affect personal pension schemes are—
(a)
to cease employer contributions towards the scheme in respect of members or members of a particular description;
(b)
to make any reduction in the amount of employer contributions towards the scheme in respect of members or members of a particular description;
(c)
to make any increase in member contributions by or on behalf of members or members of a particular description.
Listed changes: exclusions10.
(1)
For the purposes of regulations 8 and 9, no account is to be taken of any change which—
(a)
is made for the purposes of complying with a statutory provision;
F20(aa)
is made for the purposes of implementing an adjustment measure within regulation 10 of the Occupational Pension Schemes (Charges and Governance) Regulations (Northern Ireland) 2015 (charge limits adjustment);
F21(ab)
is made for either or both of the purposes referred to in regulation 7C(1) of the Occupational Pension Schemes (Modification of Schemes) Regulations (Northern Ireland) 2006 (modification of schemes: revaluation of guaranteed minimum pensions);
F22(ac)
which is or results in an adjustment of the rate or amount of benefits provided under a collective money purchase scheme, provided that such adjustment is made in accordance with—
(i)
the most recent actuarial valuation or (as the case may be) any multi-annual reduction in effect, and
(ii)
the scheme rules;
(ad)
which is made in respect of a collective money purchase scheme that is pursuing continuity option 1 in accordance with—
(i)
Schedule 6 to the Occupational Pension Schemes (Collective Money Purchase Schemes) Regulations (Northern Ireland) 2022 (continuity option 1: transfer out and winding up), or
(ii)
scheme rules made in accordance with that Schedule;
(b)
is made for the purposes of complying with a determination made by the Regulator, or
(c)
has no lasting effect on a person’s rights to be admitted to a scheme or on the benefits that may be provided under it.
(2)
No change which is—
(a)
a regulated modification within the meaning of the subsisting rights provisions, and
(b)
subject to the requirements of those provisions,
falls within regulation 8.
(3)
F23(4)
In this regulation—
“actuarial valuation”, in relation to a collective money purchase scheme, has the meaning given by section 71(2) of the Pension Schemes Act 2021;
“collective money purchase scheme” means a scheme or a section of a scheme which is a collective money purchase scheme for the purposes of Part 2 of the Pension Schemes Act 2021 (collective money purchase benefits: Northern Ireland);
“multi-annual reduction” has the meaning given by regulation 2 of the Occupational Pension Schemes (Collective Money Purchase Schemes) Regulations (Northern Ireland) 2022.
Information provision and consultation
Requirement to provide information11.
(1)
In relation to a proposal to make a listed change affecting an occupational or personal pension scheme, each relevant employer to whom regulation 7(3) applies must provide information about the proposal to—
(a)
such of his employees as appear to him to be affected members of the scheme, and
(b)
any representatives of such members who are to be consulted under regulation 12(2)(a) or (3) or 13(2).
(2)
The information provided under paragraph (1) must—
(a)
be in writing;
(b)
be provided before the start of consultation under regulation 12 or 13;
(c)
describe the listed change and state what effects it would (or would be likely to) have on the scheme and its members;
(d)
be accompanied by any relevant background information;
(e)
indicate the timescale on which measures giving effect to the change are proposed to be introduced, and
(f)
be given in such fashion and with such content as are appropriate to enable, in particular, representatives of affected members to consider, conduct a study of, and give their views to the employer on, the impact of the listed change on such members.
F24(3)
Information provided under this regulation may be provided in accordance with regulations 26 to 28 of the Occupational and Personal Pension Schemes (Disclosure of Information) Regulations (Northern Ireland) 2014 (giving information and documents).
Consultation under existing arrangements12.
(1)
If arrangements specified in paragraph (2) or (3) exist in relation to his employees, each relevant employer to whom regulation 7(3) applies must consult about a listed change in accordance with such one or more of those arrangements as he may choose.
(2)
The specified arrangements are arrangements under which employees appearing to the employer to be affected members—
(a)
are represented by—
(i)
in the case of employees of a description in respect of which an independent trade union is recognised by the employer, the representatives of the trade union,
(ii)
in the case of employees of a description which has elected or appointed information and consultation representatives, those representatives, or
(iii)
where there exists one or more pre-existing agreements which apply to any of the employees, any representatives identified in accordance with such agreement or agreements, or
(b)
are to be consulted directly in accordance with the terms of a negotiated agreement or a pre-existing agreement.
(3)
In any case where—
(a)
an election of representatives as described in regulation 13(2) has taken place before any arrangements referred to in paragraph (2) are made, and
(b)
the interests of affected members are represented by such representatives,
the specified arrangements also include arrangements for consultation of those representatives.
(4)
(5)
(6)
“Pre-existing agreement”—
(a)
means an agreement between an employer and his employees or their representatives which satisfies the conditions set out in regulation 8(1)(a) to (d) of the Information and Consultation Regulations and which has not been superseded, but
(b)
Consultation in cases not covered by regulation 1213.
(1)
This regulation applies to a relevant employer to whom regulation 7(3) applies if (and only if) any of the employees who appear to the employer to be affected members are not covered by consultation arrangements referred to in regulation 12.
(2)
Where, for the purposes of engaging in consultations under these Regulations, representatives of any affected members have been elected in an election which satisfies the requirements of regulation 14(1), the relevant employer must consult with those representatives about a listed change.
(3)
If the interests of any affected members are not represented by representatives who are consulted under paragraph (2), the relevant employer must also consult directly with those members.
(4)
If no representatives have been elected as described in paragraph (2), the relevant employer must consult directly with the affected members about a listed change.
(5)
Consultation under this regulation—
(a)
is required only in relation to the affected members falling within paragraph (1), and
(b)
is additional to any consultation in relation to other affected members which is required by regulation 12.
Election of representatives14.
(1)
The requirements of this paragraph are that—
(a)
the employer must make such arrangements as are reasonably practicable to ensure that the election is fair;
(b)
the employer must determine the number of representatives to be elected so that there are sufficient representatives to represent the interests of active members and the interests of prospective members;
(c)
the employer must determine whether the active and prospective members should be represented by representatives of all such members or by representatives of particular descriptions of such members;
(d)
before the election the employer must determine the term of office as representative of active and prospective members;
(e)
the candidates for election must be active or prospective members of the scheme on the date of the election;
(f)
no active or prospective member may unreasonably be excluded from standing for election;
(g)
all active or prospective members on the date of the election are entitled to vote for member representatives;
(h)
the members entitled to vote may vote for as many candidates as there are representatives to be elected to represent them or, if there are to be classes of representative for particular descriptions of member, may vote for as many candidates as there are representatives to be elected to represent their particular description of member;
(i)
the election is conducted so as to secure that—
(i)
so far as is reasonably practicable, those voting do so in secret, and
(ii)
the votes given at the election are accurately counted.
(2)
Where, after an election of representatives satisfying the requirements of paragraph (1) has been held—
(a)
one of those elected ceases to act as a representative, and
(b)
the active or prospective members (or any description of them) are no longer represented,
those members must elect another representative by an election satisfying the requirements of paragraph (1)(a), (e), (f) and (i).
(3)
The relevant employer must from time to time review the number of representatives determined under paragraph (1)(b) and the number of representatives elected must be adjusted accordingly (whether by members electing one or more other representatives by an election satisfying the requirements of paragraph (1)(a), (e), (f) and (i), by not holding an election under paragraph (2) or otherwise).
Conduct of consultation15.
(1)
Each relevant employer who carries out a consultation must make such arrangements with respect to the persons to be consulted as appear to him to secure that, so far as is reasonably practicable, the consultation covers all affected members.
(2)
In the course of consultation, the relevant employer and any person consulted are under a duty to work in a spirit of co-operation, taking into account the interests of both sides.
(3)
At the start of any consultation required by these Regulations, the relevant employer must notify the persons to be consulted of any date set for the end of the consultation or for the submission of written comments.
(4)
An appropriate period must be allowed for carrying out the consultation which in any event must not be less than 60 days.
(5)
If no responses to the consultation are received before the end of the period allowed for the consultation in accordance with paragraphs (3) and (4), the consultation is to be regarded as complete.
End of consultation16.
(1)
Where the relevant employer who carries out a consultation is not the person who proposed the listed change (“P”), the relevant employer must, as soon as reasonably practicable after the consultation is complete—
(a)
report to P on the views (if any) which were expressed to the relevant employer otherwise than in writing;
(b)
where the responses include written comments, forward those comments to P, and
(c)
in any case where no responses were received, notify P accordingly.
(2)
In a case falling within paragraph (1), P must take reasonable steps to satisfy himself that each consultation required by these Regulations in relation to the scheme was carried out in accordance with regulations 11 to 15.
(3)
After the end of the period allowed for the consultation, the person who proposed the listed change must consider the responses (if any) received in the course of consultation before making his decision as to whether or not to make a listed change.
Miscellaneous
Employment rights and protections in connection with consultation17.
The Schedule contains provision as to employment rights and protections which, in connection with consultation under these Regulations, apply to the employees of an employer in relation to an occupational or personal pension scheme.
F25Remedies for failure to comply18.
F26(1)
The only remedies for a failure to comply with any obligations under regulations 6 to 16 in respect of any proposal or decision to make a listed change are—
(a)
making a complaint to the Regulator;
(b)
an improvement notice issued under Article 9 of the Order, and
(c)
a penalty imposed under regulation 18A.
(2)
A complaint F27under paragraph (1)(a) may be made by—
(a)
any representative of affected members who falls within regulation 12(2)(a) or (3) or 13(2) (including any such representative who is not consulted), and
(b)
any active or prospective member of an occupational or personal pension scheme who considers that he is or may be an affected member.
F28Penalties18A.
(1)
Where a person fails, without reasonable excuse, to comply with a requirement to consult under regulation 7(3), the Regulator may by notice in writing require that person to pay a penalty.
(2)
Any such penalty must be paid within 28 days and must not exceed—
(a)
in the case of an individual, £5,000, and
(b)
in any other case, £50,000.
Powers of the Regulator to waive or relax requirements19.
(1)
The Regulator may by order waive or relax any of the requirements of regulations 6 to 16.
(2)
The power under paragraph (1) may be exercised only if the Regulator is satisfied that it is necessary to do so in order to protect the interests of the generality of the members of the scheme.
Waiver or relaxation of requirements: amendment of Schedule 2 to the Order20.
“PART 5OTHER FUNCTIONS
45.
The power to make an order under regulation 19 of the Occupational and Personal Pension Schemes (Consultation by Employers) Regulations (Northern Ireland) 2006 to waive or relax any of the requirements of regulations 6 to 16 of those Regulations.”.
Waiver or relaxation of requirements: prescribed regulatory function21.
The Regulator’s power to make an order under regulation 19 to waive or relax any of the requirements of regulations 6 to 16 is prescribed for the purposes of Article 92(5)(u) of the Order (special procedure: applicable cases).
Sealed with the Official Seal of the Department for Social Development on 16th February 2006.