Case Studies

Tesco

Can you have a defined benefit scheme, which delivers manageable risk from the employer's perspective, removes some of the unpopular cross-subsidies inherent in final salary schemes, and simplifies administration? Is this just fiction? No! We've just done this for one of our clients.

Tesco has 110,000 part-time employees in the UK. Given the fact that so many staff regularly change their contractual hours to suit business requirements or their own personal circumstances, the client concluded that a traditional final salary scheme would incur excessive administration and communication overheads. Instead, they wanted a flexible pension scheme that could readily be offered to all staff, whether full-time, part-time, permanent or temporary.

In recent years, many companies have moved towards money purchase type arrangements. Tesco, however, preferred not to expose its staff to the investment risks associated with such arrangements and wanted a new approach that was tailored to their specific situation and the types of employees they hire.

Our solution was to propose an innovative design that met their specific needs. It removed unnecessary administration and communication overheads, afforded a manageable structure suitable for today’s flexible workforce, and provided the full range of benefits typically provided by a top-quality pension scheme in the UK.

Innovative, individually tailored pension plan designs that help companies meet their business objectives will continue to evolve in the future. Our success as a firm, and the success of our clients, will depend on our consultants being able to develop creative solutions to our clients’ business issues. Where Watson Wyatt leads, others are sure to follow.

Here is an unusual safe. Each of the buttons must be pressed once only in the correct order to reach OPEN. The number of moves and direction to move is marked on each button. 1c means move one place clockwise and 1i means move one place inwards. Which button is the first you must press?