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The Welsh Authorities Staff Transfers (Pensions) Direction 2012

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This is the Welsh Authorities Staff Transfers (Pensions) Direction 2012 (“the Direction”) which came into force on 6 March 2012.

The direction exercises the Welsh Ministers’ power in section 101, and complies with their obligation in section 102, of the Local Government Act 2003.

The Direction provides that where an authority enters into a contract with a person for the provision of services and those services are, in the period immediately before the contract is entered into, provided by the authority and carried out by employees of the authority:

  • the contract between the authority and the contractor must require the contractor to secure pension protection for each transferring employee and provide that the provision of pension protection is enforceable by the employee; and
  • pension protection is secured so that the transferring employee, after change in employer, has rights to acquire pension rights that are the same as or are broadly comparable to or better than those he/she had as an employee of the authority.

The Direction also requires similar pension protection in relation to those former employees of an authority, who were transferred under TUPE to a contractor, in respect of any re-tendering of a contract for the provision of services.

In the case of employees who are members of the Local Government Pension Scheme, it is possible for the new employer, if they wish, to seek admitted body status within the LGPS so that transferred staff continue to have access to that pension scheme for their future service.

The Direction will apply to Welsh improvement authorities and community councils.  Welsh improvement authorities are county councils and county borough councils in Wales, Welsh National Park authorities and Welsh fire and rescue authorities.