The improved scheme will be more understandable for colleagues and will provide a predictable pension pot when they choose to retire, a significant improvement on the existing defined contribution plan.
Morrisons will also be launching a campaign which aims to encourage Morrisons’ 131,000 colleagues to save for retirement and sign up for the affordable scheme. The campaign will be led by personal finance adviser and TV personality Alvin Hall.
A cash balance scheme, which is relatively unusual in the UK, shares the risk of being in the pension scheme between Morrisons and its employees, the supermarket said. Morrisons will guarantee the pension pot payable at retirement when members typically purchase an annuity.
Key characteristics of the new scheme are:
Morrisons group human resources director, Norman Pickavance, said: “We are developing this innovative pension scheme because our aim is to build strong longer term relationships with all our colleagues. Providing a trustworthy predictable pension is our way of showing our commitment to our colleagues throughout their career and into retirement. I believe this approach will set us apart and help ensure that colleagues will stay with us for the long term.”
Source: Morrisons
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