Occupational Pension Schemes (Contracting-out) Regulations 1996
| Year | 1996 |
1996 No. 1172
PENSIONS
Occupational Pension Schemes (Contracting-out) Regulations 1996
Made 25th April 1996
Laid before Parliament 29th April 1996
Coming into force 6th April 1997
The Secretary of State for Social Security in exercise of the powers set out in Schedule 1 and of all other powers enabling him in that behalf, after agreement with the Occupational Pensions Board that certain proposals within these Regulations need not be referred to it, by this instrument, which otherwise contains regulations made for the purpose of consolidating regulations revoked herein and regulations which are consequential upon enactments contained in Part III of the Pensions Act 19951and are made before the end of the period of 6 months beginning with the coming into force of the enactments of that Part by virtue of which they are made2, hereby makes the following Regulations:
PART I
PRELIMINARY
Citation, commencement and interpretation.
1.—(1) These Regulations may be cited as the Occupational Pension Schemes (Contracting-out) Regulations 1996 and shall come into force on 6th April 1997.
(2) In these Regulations, unless the context otherwise requires—
“the 1993 Act” means the Pension Schemes Act 19933;
“the 1995 Act” means the Pensions Act 1995;
“the actuary” means the actuary appointed for the scheme in pursuance of section 47(1) of the 1995 Act or the actuary otherwise authorised by virtue of these Regulations to provide certification in accordance with section 12A(6) of the 1993 Act4;
“the Administration Act” means the Social Security Administration Act 19925;
“administrator”, in relation to an occupational pension scheme, means the person resident in the United Kingdom having responsibility for the management of the scheme or, in the case of an overseas scheme, means the person resident in the United Kingdom appointed in accordance with section 590(2)(c) of the Taxes Act;
“age-related payment” means a payment made by the Secretary of State in accordance with section 42A(3) of the 1993 Act6;
“the Contributions and Benefits Act” means the Social Security Contributions and Benefits Act 19927;
“earnings period” has the same meaning as in the Social Security (Contributions) Regulations 19798;
“emoluments” means so much of a person’s remuneration or profit derived from employed earner’s employment as constitutes earnings for the purposes of the Contributions and Benefits Act;
“employer” includes a person who, by virtue of paragraphs (4) or (5) or regulations 12 to 14, is treated as an employer for the purposes of these Regulations;
“income tax month” means a period beginning on the 6th day of any calendar month and ending on the 5th day of the following calendar month;
“independent trade union” means an independent trade union recognised to any extent for the purpose of collective bargaining;
“insured scheme” means a scheme in which the benefits are secured by one or more policies of insurance or annuity contracts and which is managed by an insurance company which issued the policy or contract;
“minimum funding requirement” shall be construed in accordance with section 56 of the 1995 Act;
“the Occupational Pensions Board” means the Occupational Pensions Board established under section 66 of the Social Security Act 19739and dissolved under section 150 of the 1995 Act;
“overseas scheme” means an occupational pension scheme which is—
(a) established under irrevocable trust or by such other means as the Secretary of State may approve, and
(b) administered wholly or primarily, outside the United Kingdom;
“principal appointed day” has the same meaning as in section 7(2B) of the 1993 Act10;
“scheme” means an occupational pension scheme;
“section 9(2B) rights” are rights (other than rights attributable to voluntary contributions within the meaning of section 111 of the 1993 Act) which are attributable to an earner’s service on or after the principal appointed day in employment which is contracted-out in accordance with section 9(2B) of the 1993 Act11;
“the Taxes Act” means the Income and Corporation Taxes Act 198812;
“trustees”, in relation to a scheme which is not set up or established under a trust, means the managers or administrators of the scheme.
(3) In these Regulations, unless the context otherwise requires, a reference—
(a)
(a) to a numbered Part is to the Part of these Regulations bearing that number;
(b)
(b) to a numbered regulation or Schedule is to the regulation in, or Schedule to, these Regulations bearing that number;
(c)
(c) in a regulation or Schedule to a numbered paragraph is to the paragraph in that regulation or Schedule bearing that number;
(d)
(d) in a paragraph to a lettered or numbered sub-paragraph is to the sub-paragraph in that paragraph bearing that letter or number.
(4) For the purposes of these Regulations, any person, government department or public authority who, under Part I of the Contributions and Benefits Act or regulations made thereunder, is, or is to be treated as, the secondary Class 1 contributor shall be treated as the employer of the earner in respect of whom the Class 1 contributions are payable.
(5) For the purposes of these Regulations and without prejudice to paragraph (4), there shall be treated as the employer of a self-employed earner to whom a scheme applies any person (other than that self-employed earner), government department or public authority who makes or is liable to make payments towards the resources of the scheme in respect of that self-employed earner (either under actual or contingent legal obligation or in the exercise of power conferred, or duty imposed, on a Minister of the Crown, government department or any other person, being a power or duty which extends to the disbursement or allocation of public money).
(6) For the purposes of these Regulations, a person is to be regarded as a member of a scheme during a period when his service in relevant employment is such that at the time when it is given it either—
(a)
(a) qualifies him for benefits (in the form of pension or otherwise, payable on the termination of his service or on his retirement or his death) under the scheme which in the opinion of the Secretary of State are referable to that period, or
(b)
(b) is certain so to qualify him subsequently if it continues for a sufficiently long time and the rules of the scheme and the terms of his contract of service remain unaltered during that time.
(7) Any document required or authorised under the provisions of these Regulations to be sent to any person shall be deemed to have been sent if it was sent by registered post or by recorded delivery service to that person’s usual or last known address or (in the case only of a document required or authorised to be sent to an employer) to the address of the principal place at which any employment to which the document relates is last known to have been carried on.
PART II
CERTIFICATION OF EMPLOYMENTS
Making of elections for the issue of contracting-out certificates
2.—(1) Subject to the provisions of regulation 10, an election with a view to the issue of a contracting-out certificate—
(a)
(a) may only be made—
(i) after notices to make such an election have been given by the employer in accordance with regulation 3; and
(ii) within the period after the expiry of those notices which is specified in regulation 5; and
(b)
(b) shall be made in writing to the Secretary of State and shall include the particulars specified in regulation 6.
(2) An employer may elect that the employment of earners in an employment shall be contracted-out by reference to a scheme in relation to all earners in that employment with the exception of those mentioned in either or both of sub-paragraphs (a) and (b), namely—
(a)
(a) where an earner in an employment to which the scheme relates opts in writing not to join or, as the case may be, not to remain as a member of any contracted-out employment to which the scheme relates, any earner who so opts; and
(b)
(b) in a case where it is possible for one or more earners to be unable to complete 5 years' service in that employment as members of that scheme before reaching the normal pension age of that scheme, the earner or earners whose length of service (consisting of service in that employment as a member of that scheme, or linked qualifying service in relation to such service, or both) falls short of a minimum length of service (not exceeding 5 years) specified in the rules of the scheme and who cannot (so far as is known when the contracting-out certificate is issued, or if later in the case of a particular earner, when he enters the employment) complete such a minimum length of service before reaching the normal pension age of the scheme.
Notices by employers of intended election.
3.—(1) A notice of intention to make an election with a view to the issue of a contracting-out certificate shall be given by the employer, in the manner specified in paragraph (3), to—
(a)
(a) the earners in respect of whose employment the election is proposed to be made, and those (if any) in that employment in relation to whom the employer is not electing that the employment shall be treated as contracted-out;
(b)
(b) the trustees and administrator of the scheme to which the election is to relate;
(c)
(c) where there is a policy of insurance or annuity contract as a means of securing the protected rights, guaranteed minimum pensions or any benefits arising in respect of section 9(2B) rights to be payable under the scheme, the insurance company or Friendly Society concerned; and
(d)
(d) all independent trade unions recognised in relation to the earners concerned.
(2) Notices given under this regulation shall be in writing and shall—
(a)
(a) specify the scheme and the employments concerned and, if...
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