News: Closing DB schemes could break age discrimination laws.

Pensions Week, October, 2005

Companies that close their defined benefit (DB) schemes to new employees could be breaching age discrimination laws and face a potential backlash from employees.

A survey by Aon Consulting found that almost half of the respondents were worried about a backlash from employees.

Despite the concerns over employee relations, 68% of firms continued to view closed DB schemes, which are typically more generous than defined contribution arrangements, as a key component of the employee benefits it offers.

Donald Duval, chief actuary at Aon Consulting, commented: "Given the amount of money that companies are having to plunge into DB schemes, it is not surprising that a majority of employers see the scheme as a valuable part of the total benefits...

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