Part 5Occupational and personal pension schemes: miscellaneous provisions

Pension protection on transfer of employment

258Form of protection

I31

In a case where section 257 applies, it is a condition of the employee’s contract of employment with the transferee that the requirements in subsection (2) or the requirement in subsection (3) are complied with.

2

The requirements in this subsection are that—

I3a

the transferee secures that, as from the relevant time, the employee is, or is eligible to be, an active member of an occupational pension scheme in relation to which the transferee is the employer, and

I3b

in a case where the scheme is a money purchase scheme, as from the relevant time—

i

the transferee makes relevant contributions to the scheme in respect of the employee, or

ii

if the employee is not an active member of the scheme but is eligible to be such a member, the transferee would be required to make such contributions if the employee were an active member, and

c

in a case where the scheme is not a money purchase scheme, as from the relevant time the scheme—

I3i

satisfies the statutory standard referred to in section 12A of the Pension Schemes Act 1993 (c. 48), or

I1ii

if regulations so provide, complies with such other requirements as may be prescribed.

I33

The requirement in this subsection is that, as from the relevant time, the transferee makes relevant contributions to a stakeholder pension scheme of which the employee is a member.

I34

The requirement in subsection (3) is for the purposes of this section to be regarded as complied with by the transferee during any period in relation to which the condition in subsection (5) is satisfied.

I35

The condition in this subsection is that the transferee has offered to make relevant contributions to a stakeholder pension scheme of which the employee is eligible to be a member (and the transferee has not withdrawn the offer).

I36

Subsection (1) does not apply in relation to a contract if or to the extent that the employee and the transferee so agree at any time after the time when the employee becomes employed by the transferee.

I2I47

In this section—

  • “the relevant time” means—

    1. a

      in a case where section 257 applies by virtue of the application of subsection (2) or (3) of that section, the time when the employee becomes employed by the transferee;

    2. b

      in a case where that section applies by virtue of the application of subsection (4) of that section, the time at which the employee would have been a member of the scheme referred to in subsection (1)(c)(i) of that section or (if earlier) would have been eligible to be such a member;

  • “relevant contributions” means such contributions in respect of such period or periods as may be prescribed;

  • “stakeholder pension scheme” means a pension scheme which is registered under section 2 of the Welfare Reform and Pensions Act 1999 (c. 30).