NEWS   |    June 29, 2020

Partner Jane Kola comments in New Law Journal on the advantage of using a formal process to suspend pensions while the crisis lasts

Even before the carnage of COVID-19, many businesses were ailing, often weighed down by legacy defined benefit (DB) pensions schemes. Now, all too many well-known firms have fallen into administration. The legal repercussions will last for years. For failing firms, their often underfunded DB schemes will fall into the lifeboat Pension Protection Fund with worse outcomes for members. COVID-19 has compounded this black hole and a three-month emergency easement from the Regulator until 30 June on deficit repair contributions may just be a stay of execution.

Partner Jane Kola commented:

“Employers who simply stop paying are storing up trouble. Those who use a formal process with the trustees to suspend them properly will be in a much stronger position once the current crisis is over.”

On the challenges of signing legal documents during the lockdown, she added:

“Signing legal documents is coming up time and again. Pension lawyers are rightly picky about execution but now we need to test the boundaries of traditional legal practice and apply the law which is more flexible than we would be in normal circumstances.”

Read Jane’s comments in New Law Journal.

The views in this article are intended for general information purposes only and should not be used as a substitute for professional advice. Arc Pensions Law and the author(s) are not responsible for any direct or indirect result arising from any reliance placed on content, including any loss, and exclude liability to the full extent. Always seek appropriate legal advice from a suitably qualified lawyer before taking, or avoiding taking, any action. If you have any questions on the points raised in the above, please do not hesitate to get in touch.

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