YOU need to act THIS WEEK to avoid being automatically enrolled in the company’s “Salary Swap” scheme – even if you followed the advice issued last week.
Remember – the company are offering no facility to leave salary swap after 2008, but you can join at any time.
The UNITE reps in Manchester issued advice last week about the company’s new scheme, including a model letter and form for people to use.
Sadly, rather than resolving the issues with salary swap, the company is (for now) piling more pressure on people with unrealistic deadlines.
The company has emailed people who used the model letter with one of three standard responses. This notice is intended to explain what these mean and how to use the company response.
The company say they will accept the UNITE version of the form to opt out of salary swap for pensions. If you haven’t sent this off yet and want to avoid the risk of being trapped into the salary swap scheme for pensions, you need to get this to HRdirect by the end of the week.
If you do opt out of salary swap, Pensions Choices will not be affected until July anyway.
The company still intend to put you into Salary Swap, even if you sent the model email that UNITE provided. To avoid this, you need to act now.
However, in response to the emails from employees, the company is now offering an extra option:
- You can do nothing and be enrolled in salary swap on the default benefit levels – risking being trapped in a flawed scheme, but avoiding accepting the problematic “Declaration” – for now
- You can go into Self Service, change Your Choices and accept the problematic Declaration
- You can now return the new form they have provided to opt out of the non-pension aspects of salary swap without the need to accept the Declaration. Your benefits will revert to your contractual entitlements.
Sadly, the company are still not giving people the option likely to be in the best interests of the company and many employees – to be in Salary Swap without accepting the Declaration.
Your reps are receiving many queries. Here are answers to a few:
If I opt out of salary swap, will I lose all my benefits?
No. Your benefits package will revert to your contractual entitlements. This could be an increase or a decrease, or mean no change at all, depending on the choices you made in the past. However, the company will not give you access to the “optional extra” benefits (the HRdirect letter calls these “elective”).
If I stop having a benefit, can I take it up again in future?
Whether you join salary swap or not, the company is making no promise that benefits (other than those you are contractually entitled to) will be available in future. However, if you don’t opt out of salary swap, you will lose the right to revert to your contractual entitlements after this year.
If I revert to my contractual entitlements I/my spouse/my family would no longer be covered by the medical scheme – what are the consequences?
Beyond the obvious, also bear in mind that there can be restrictions on cover for existing conditions when someone rejoins a medical scheme.
I had a contractual entitlement but had declined the medical scheme – how am I affected?
Reps have raised this question with the company, but the answer is not clear yet. The facility to decline medical benefit pre-dates the introduction of Personal Choices. It is likely that if you opt out of salary swap then HRdirect would enter you into the medical scheme again – if this happened you would be taxed on the extra benefit. If you want to avoid this it would be wise to specifically tell them you still decline the benefit.
Hopefully the company will sort out the issues without further delay so that UNITE can recommend people join an amended scheme.
Which Option For You For Non-Pension Benefits?
Since the “default” benefit levels are the same as your contractual ones, it’s hard to see why anyone would choose option a) over the new option c).
You are likely to choose option b) if you think the consequences of being in salary swap and accepting the Declaration are preferable to reverting to your contractual benefits for even a short period of time.
Otherwise option c) is probably for you – returning the form provided by the company in response to the original model email (correcting the section of their form about medical cover if necessary).
You can opt out of salary swap for pensions using the UNITE form.
You can either make your choices, accept the Declaration on Self Service and be enrolled in salary swap for non-pension benefits, or opt out THIS WEEK by sending the model email provided by UNITE last week, then returning the form HRdirect send in response.
In either case, please let the company know how unhappy you are at not being given the option of choosing the benefits you want without accepting their unreasonable Declaration.
Ironically, the introduction of salary swap has had the effect of reducing choice for many employees, as the company is refusing to allow you to make choices without accepting the Declaration, as you could before Salary Swap was introduced.
UNITE has pointed out to the company that far from reassuring employees, the company’s approach is reinforcing the view held by many staff that Salary Swap is being forced on unwilling employees to save the company money, rather than being a genuine staff benefit.
There are many other questions being raised about Salary Swap, particularly its relationship to Pensions Choices and AVCs. Your reps hope to clarify all these questions and issue further guidance after the immediate focus of helping people to opt out before Friday has passed.
Please feel free to pass on this email to colleagues who are interested. If you are one of those colleagues and are interested in finding out more about the union, please get in touch with the union using the form here:
You can join UNITE/Amicus regardless of which location you work at or whether you are home based, what your job is, whether you are a “permanent” employee or an agency temp.