Work Pension Scheme

LegacyUser

We have a company pension scheme anyone can join following probation managed through a broker and our employer will match a certain % of what we put in every month. Its in our staff handbook and also in our contracts that we can join at any time following passing probation. It has been the same since its introduction 10+ years ago.

I hadn't joined yet because I'm 20's. But I planned to in future. Some staff just aren't in it but still had the option to in future.

Today without warning or explanation those not in were sent a waiver to sign saying we acknowledged we were not in the pension scheme and us or dependents couldn't claim any money from the company because we chose not to join. Further to that, if we ever wanted to join in future it was at the discretion of the company and they could turn down membership if they wanted.

Is this even legal? We have never had to sign this waiver before. I've been in the company 5+ years, some others way longer and all of a sudden they want us to sign a waiver? Surely they cant make us sign that, we are already working there years. Our contacts haven't changed and it even states clearly in the contract that we can avail of the pension, and in the employee handbook. But this waiver says in future its at their discretion.

Is a waiver for no pension even normal? I've never heard of anyone signing something like that before.

_Brian

Access to a company funded pension isn’t an entitlement its a perk so they can attach whatever terms to it.

They are legally obliged to nominate a company to run one of those pension saving plans or whatever they are called but it’s not much use to be honest.

Ask can you join right now rather than signing the waiver. Anyone with the option to join such a pension where their employer matches contributions should start with whatever they can afford, it’s free money from the employer and for someone like yourself with the maximum term to maturity it will inntie long term make decent returns.

Squall Leonhart

anon_pension wrote:

I hadn't joined yet because I'm 20's.

That's the best reason to join. A low regular contribution now can be worth way more to you than a larger regular contribution in ten years time.

The longer you have your pension working for you the better, read up on compound interest. And if the company is matching up to a % then you'd be crazy not to take this free money now. Don't sign the waiver, sign up to the pension.

LegacyUser

Thanks for the replies. We are also already years into this scheme and all of a sudden they are changing the rules. I did sign up. One of the other girls simply cant afford to right now though but wants to in future.

She doesn't want to sign because shes wary that it says that joining at a later date is at their discretion and they can turn her down. Surely this waiver is against what it says in our contracts though as our contracts state that we are entitled to join at any time and remain a member and the company with match x% and that's all it says.

ILikeBoats

Company matching = FREE MONEY. Sign up!

Skuxx

Join OP, it's only a small sum every month from your wages. I am also only in my 20's. I pay 3% of my wages and my company pays 7%! It doesn't be long accumulating!!

troyzer

Squall Leonhart wrote: »

That's the best reason to join. A low regular contribution now can be worth way more to you than a larger regular contribution in ten years time.

The longer you have your pension working for you the better, read up on compound interest. And if the company is matching up to a % then you'd be crazy not to take this free money now. Don't sign the waiver, sign up to the pension.

Why the hell would you not join in your 20s? It's so much cheaper in the long run.

Kintarō Hattori

Yep join now. I left it late joining one of these and as a result pay a hefty amount into mine every month. I wish I had been aware enough to have started one in my 20s.

_Brian

I started paying into mine when I was 21, company matched my contributions plus some.

I’m with a different company now and 46 it isn’t worth my while contributing as essentially its a 1:1 return unless going for some high risk venture.

Glass fused light

Join you get a tax deduction on your contribution so the impact on your net is lowered too and your employer is giving you a raise by their contribution.
Learn a little about the scheme and how it works most pension providers will have an advisor you can meet or simple examples of how your scheme works. Most will allow a free movement of asset allocations 1 or2 times a year.
A rule of thum is high(er) risk options in your youth and move to (government) bonds as you get older to lock in your capital which funds the pension payments.

dennyk

Join it immediately; if the company does matching then you're literally leaving money on the table by not joining. Contribute at least as much as is required to max out the company matching, for sure, and try to contribute up to the total amount eligible for tax relief (15% of your gross salary) if you can, to take full advantage of that relief.

BailMeOut

as others are saying join this pension now. These contributes made by your 20 year old self will be very much appreciated by your 70 year old self and probably the best investment you will make your entire life. That plus you are getting matched contributions (free money) and availing of a nice tax break its a big no-brainer!

Jane1012

I joined when I was 22 (I didn't see the point at the time but one of my older colleagues decided to march me upstairs to sign up when she was doing it and talked me in to it), I've never been so thankful for that colleagues actions, I am 29 now and although I still have very long to go to retirement I can see it building up. I only put in 3% but if you think about it, after tax that's really 1.5% of your net so you do not miss it, my company puts in 6% so yes basically free money. Ask them now can you sign up and don't sign the waiver.
I know many companies have changed their policy to auto enrollment for new joiners, I know this became law in the UK a few years ago and I believe we were to follow suit, I am not sure where we stand with this though

Tow

It sounds like a strange interpretation of UK law, which is soon going to introduced here.
Basically, companies will have have to 'auto enroll' employees into a pension scheme, unless the employee signs a waver stating they don't want to join. The waver is valid for a few years, then the process repeats.
The time to join a pension is when you are young and if the employer is topping up contributions you are mad not to join. I would not be surprised if they stop the employer contribution in for new joiners in the future.

Squall Leonhart

Tow wrote: »

I would not be surprised if they stop the employer contribution in for new joiners in the future.

You mean in the OP's specific case, yes?
There is no onus on employers to pay anything into a pension fund for their employee (mine don't!).

BailMeOut

Squall Leonhart wrote: »

You mean in the OP's specific case, yes?
There is no onus on employers to pay anything into a pension fund for their employee (mine don't!).

if they do not you can still setup your own self managed PRSA account with someone like Davy.

It is easy to say to sign up and the tax saving but we don't know what income the OP is on or what tax they pay. Every spare penny could be going on rent for all we know.

OttoPilot

[Deleted User] wrote: »

It is easy to say to sign up and the tax saving but we don't know what income the OP is on or what tax they pay. Every spare penny could be going on rent for all we know.

If the employer is actually offering this, I'd bet my house OP is earning at the higher rate. The tax savings and employer matching contributions are free money.

Squall Leonhart

BailMeOut wrote: »

if they do not you can still setup your own self managed PRSA account with someone like Davy.

I did exactly this...went to a broker, sorted myself out a self managed PRSA with much lower fees than the 5% robbery the likes of Irish Life are charging.

BailMeOut

if the OP is earning say €50k per year then a very low 1.5% contribution is €750 per year or €15 per week which would reduce take home by less than €10 / week. OP how much do you spend on take away coffee per week?!!

BailMeOut

Squall Leonhart wrote: »

I did exactly this...went to a broker, sorted myself out a self managed PRSA with much lower fees than the 5% robbery the likes of Irish Life are charging.

good stuff. Irish Pensions rules are VERY generous and it is mind boggling that more people are not doing what you are doing. I myself do a self managed with Davy and shove as much money I can afford each year into it.

dennyk

Sounds like the waiver is their notification of a contract change, if the pension terms are in your contracts. If your coworker doesn't want to accept the change, she isn't required to sign it; the employer cannot change contractual terms unilaterally without the agreement of the employee. However, if she refuses, she might find herself made redundant or otherwise treated negatively as a result; it may end up being unfair dismissal or illegal retaliation, but she'd still have to go to the time and trouble of filing complaints and/or taking legal action to receive any remedy, so if her finances are that tight, that could be a potential concern...