Mutualisation - pension and other benefits
Over the last 18 months we have been involved in a number of public sector projects which are collectively known as "mutualisations". There is no single formula - a range of corporate vehicles and
Over the last 18 months we have been involved in a number of public sector projects which are collectively known as "mutualisations". There is no single formula - a range of corporate vehicles and structures are available. The common thread in many NHS mutualisations is that employees become shareholders and control the new vehicle. In other cases employees have an ownership stake through an employee trust.
Changes like this bring a range of new challenges. Providing pensions and other risk-based benefits is often high on the list. This is because public sector benefit levels have traditionally been generous and the employee owners would like the new business to continue that approach.
Our experience is that in the legal aspects of mutualisations we concentrate on existing staff because they have legal protection under TUPE and because in some areas, such as the NHS, there are procedures designed to preserve their ongoing pension membership. This work produces a number of challenges for us such as dealing with bank staff, staff in local government schemes and staff, like dentists, who have special treatment in the NHS scheme.
So it was very interesting for me last week to meet up with Andre Turville and Chris Metz of Willis, the worldwide risk and employee benefits consultants. They too have been involved in a number of mutualisations, often, like us, in the NHS. The difference for them is that their focus is on the new recruits who do not benefit from the legal protections that we are involved in drafting.
The new recruits do not create significant legal issues, provided anti-discrimination laws are adhered to. But in HR policy terms the level of insured and other benefits which the new organisation provides can speak volumes about its approach to the brave new world it has entered. It was good to hear that Willis have seen a number of mutuals really focus on benefit packages for new recruits as their future success rests on the whole of the workforce - transferred and recruited - working together for the new body.
Changes like this bring a range of new challenges. Providing pensions and other risk-based benefits is often high on the list. This is because public sector benefit levels have traditionally been generous and the employee owners would like the new business to continue that approach.
Our experience is that in the legal aspects of mutualisations we concentrate on existing staff because they have legal protection under TUPE and because in some areas, such as the NHS, there are procedures designed to preserve their ongoing pension membership. This work produces a number of challenges for us such as dealing with bank staff, staff in local government schemes and staff, like dentists, who have special treatment in the NHS scheme.
So it was very interesting for me last week to meet up with Andre Turville and Chris Metz of Willis, the worldwide risk and employee benefits consultants. They too have been involved in a number of mutualisations, often, like us, in the NHS. The difference for them is that their focus is on the new recruits who do not benefit from the legal protections that we are involved in drafting.
The new recruits do not create significant legal issues, provided anti-discrimination laws are adhered to. But in HR policy terms the level of insured and other benefits which the new organisation provides can speak volumes about its approach to the brave new world it has entered. It was good to hear that Willis have seen a number of mutuals really focus on benefit packages for new recruits as their future success rests on the whole of the workforce - transferred and recruited - working together for the new body.