You may need to make urgent changes to your trustee board if you are caught by little-publicised provisions in the Occupational Pension Schemes (Charges and Governance) Regulations 2015. Most commentators have focussed on the charges provisions in those Regulations, but a surprising number of UK pension plans will be caught by onerous additional requirements applicable to “relevant multi-employer schemes” that provide money purchase benefits. Whilst these provisions are mainly intended to apply to master trusts, your pension plan could be caught by this definition without you realising, and if so you could be in for a nasty surprise.

A “relevant multi-employer scheme” is a pension plan where some or all of the participating employers are not “connected employers”, i.e. employers which all form part of the same group of companies with a holding company and one or more subsidiaries. The main issue for trustees of such pension plans relates to the requirement for the majority of the trustees or trustee directors (including the chair of trustees) to be non-affiliated. In brief, there are three factors to consider when determining whether a trustee or trustee director is “non-affiliated”:

• Are they independent of any undertaking which provides advisory, administration, investment or other services in respect of the pension plan?

• Was their appointment process “open and transparent” (this will automatically be satisfied in respect of Member Nominated Trustees/Member Nominated Directors, but may not be true for employer-nominated trustees or trustee directors)?

• Have they been in office for a single period of more than 5 years or for more than 10 years in total (except where more than 5 years have elapsed since the individual last held office as a trustee or trustee director of the same pension plan)? (There are slight variations for professional trustee companies.)

In practice, not many trustee boards are likely to have a majority of the trustees or trustee directors (including the chair) who count as non-affiliated, and the Regulations impose a deadline for compliance for existing pension plans of 6 July 2015. Do get in touch if you think your pension plan may be affected by this.