Allen & Overy (A&O) seemingly succeeded where Freshfields Bruckhaus Deringer failed, passing through vital changes to its pension scheme without any furore, according to A&O’s recently published annual report.
The final-salary scheme was closed to new members as long ago as 1998, but the report states that, after consultation, last year the firm “closed the scheme to future years’ accruals”.
When signing up to the defined benefit pension scheme members would have been promised a pension equal to a percentage of their final salary for every year worked. However, under the changes they have effectively accepted that they will get no more of those percentages no matter how many more years they work. How very broad-minded of them.
The measures, in addition to a £6m injection (it was ‘surplus cash’, apparently) mean that the firm has reduced its whopping £22m pension scheme deficit, revealed in last year’s report, to a more manageable £10m.