BSF Thread, Dull but potentially deadly aspects of TUPE - can anyone confirm in United Kingdom (UK) Specific Forums; I heard a rumour which intrigued me and which I would like to post here - hopefully to get it ...
8th July 2010, 06:49 PM #1
Dull but potentially deadly aspects of TUPE - can anyone confirm
I heard a rumour which intrigued me and which I would like to post here - hopefully to get it confirmed or killed. I post it here as its related to BSF.
TUPE details are duller than very dull things from the cold and remote planet "Feffing Dull" So arm yourself with a string coffee and read on.
When a person is tuped across there is a value attached to their pension fund which is linked to the pension funds investments.
At the end of the contract they may be tuped back.
Now the suggestion is that the fund may in the meantime decreased in value. At this point the difference has to be made up by the contractor.
As the stock exchange is volatile ( BP one of the major cash sources to pension funds wont be paying out much in future) its likely this could be a huge amount per person.
Many of you will be tuped I guess - has anyone gone into the endgame and financial liability ?
The question to ask is I think
"In the event of transfering back to the LEA scheme forwhatever reason will any shortfall in the fund be made good by your employer. Do they have to funds to do this ?"
For schools thinking of going the Acadamy route this needs to be understood. As the academy may end up with a huge bill for making up the lost value of TUPED staff pension funds, if they ever revert to the LEA.
9th July 2010, 09:09 AM #2
I can't answer your question but being TUPE'd in a couple of years time is not something I am looking forward to. Apart from having the same terms and conditions on Day 1 of my transfer no-one in HR or my Union can give any reassurances that these won't change pretty quickly after TUPE. With the way the economy is going I'm sure my new employer will be looking to save as much money as possible with those of us they take on.
I hope you are able to find a definitive answer to your question - it isn't something that anyone has mentioned at school.
Last edited by PeteM; 9th July 2010 at 11:51 AM.
9th July 2010, 12:18 PM #3
I don't believe that pensions are included in TUPE legislation - so it will be whatever your T&C say. There is no reason (apart from cost) that academies cannot remain part of the current LGPS, and indeed - this is what we have been told will be happening.
9th July 2010, 02:12 PM #4
- Rep Power
I suggest you speak to your union rep as this is a complex area - for starters it depends upon whether your private sector employer and the LA opt for an Admitted Body Status for the pension scheme where you basically remain a member of the LA pension and the private sector makes contributions to it or they opt for a private GAD approved pension scheme which is usually a specially set-up part of the private sector companies own pension scheme. The latter is considered far riskier and isn't supported by unions although there are governance arrangments stipulated in the BSF stanbdard form contract documents to prevent a Captain Bob situation with the pension fund.
Private sector exposure to shortfall in bulk transferred schemes to a GAD approved pension are usually capped with thr LA continuing to take risk in the event of a shortfall - not too sure about risk when after 20-25 years the employees TUPE back to the LA or , more likely, another private sector supplier.
Big issue for BSF is those staff who have TUPE'd early on the basis that future school projects in non-sample schemes would fund them - now these schemes aren't going to happen this leaves a major affordability issue for the private sector companies.
9th July 2010, 05:35 PM #5
thanks for comments. I did find this from CIPD
Strictly speaking, obligations relating to provisions about benefits for old age, invalidity or survivors in employees' occupational pension schemes do not transfer under TUPE. However, the provisions of the Pensions Act 2004 sections 257 and 258 do apply. In effect, this means that provisions equivalent to the TUPE regulations apply to pension rights. In essence, if the previous employer provided a pension scheme then the new employer has to provide some form of pension arrangement for employees who were eligible for, or members of the old employer's scheme. It will not have to be the same as the arrangement provided by the previous employer but will have to be of a certain minimum standard specified under the Pensions Act."
I think the bit about "this means that provisions equivalent to the TUPE regulations apply to pension rights" is the interesting bit. I think this also infers that on transfer back to the LEA the TUPE person should not be disadvantaged. The company in this case needs to buy them back into the LEA scheme. As one is guarenteed by the our soverign and the othere by "market conditions" this could be very costly.
Now all this may seem boring but there are some ICT providers who have pulled out contracts under BSF. Once the money is found to be hard to make ICT firms may not be so keen to retain the contract.
Its a small details but I think tupe'd staff need to get absolute clarification on this point.
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