There are three key legal issues we recommend trustees to consider this Autumn.
- Review your data protection procedures to protect members from the implications of cyber crime.
- Start your GMP equalisation project.
- Be aware of the effect of the new company moratorium procedure under the Corporate Insolvency and Governance Act 2020.
Data Protection and cyber crime
- Remain vigilant against cyber crime scams, including phishing attacks and ensure your trustee training is up to date;
- Be COVID aware - review GDPR working from home policies for your advisers and check how trustees are keeping data secure;
- Review and update your GDPR policies and procedures;
- Ask administrators and advisers how they are dealing with data transfers to the US following the recent Schrems II judgment;
- Remember Brexit – after 31 December 2020 UK will recognise transfer of data from EEA countries (EU + Norway, Iceland and Liechtenstein) but the European Commission may require additional safeguards;
- Consider a data sharing agreement with the employer to help data transfers for buy-in/buy-out and GMP equalisation.
Find out more about the data protection landscape for pensions trustees.
GMP equalisation project
- Ensure the data reconciliation is completed;
- Review and clean up your common and conditional data;
- Review the new guidance from HMRC on lump sum payments, annual allowance and lifetime allowance protection;
- Remember the HMRC guidance does not cover conversion of benefits, the so-called “D2 option” – legal advice must be sought;
- Watch out for the Lloyds 3 judgment on how to deal with transfers.
Read the latest HMRC guidance.
Corporate Insolvency and Governance Act 2020
- New moratorium procedure for companies, if company could be rescued as a going concern – can last for up to one year with creditor or court consent;
- Moratorium does not trigger a s75 pension debt or a PPF assessment period, as it is not a qualifying insolvency event, so trustees could be in limbo;
- New super-priority ranks ahead of trustee unsecured claims eg deficit recovery contributions;
- Trustees’ votes as creditors can be disregarded if the court sanctions a restructuring scheme and other creditors agree (known as a “cram down”).
Read more about the Corporate Insolvency and Governance Act 2020 [PDF download].
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