Misys won the 2016 Employee Benefits Award for Best DC Pensions Change.
The introduction of a new GPP revolutionised Misys’ existing fragmented and unsustainable scheme by simplifying a complicated, time-consuming process, creating a superior employee offering and creating cost-efficiencies across the business.
Misys is a financial services software provider operating across 130 countries with a 2,000 strong customer base. Globally, they employ 4,700 people including 450 in their UK head office. With the average employee age being 42, the UK arm of Misys employs a mix of recent graduates and educated professionals, the majority of whom were members of the Trust-based DC Misys Group Pension Scheme (MGPS).
Following a series of acquisitions over a four-year time period which changed the nature of the business in addition to incoming pensions legislation, it became necessary to overhaul the company’s pension schemes to fit with the new global benefit philosophy, ‘cost-effective, competitive, simple and flexible’.
The initial UK pensions offering was disparate, financially untenable and ‘up against the legislative clock’. Exceeding over £430k of fees per annum, the schemes provided little flexibility over pension freedoms, had little control over current/future costs and required multiple processes/payments. In addition, a pension communications booklet was six years out-of-date, putting staff at risk of making decisions based on incorrect information.
In response, Misys launched a single GPP with fully targeted communications to support existing employees rather than 90 per cent of ex-employees, as was previously.
- Information is now streamlined using highly automated systems provided by GPP provider
- Streamlined auto-enrolment compliance
- Introduction of New Default Investment Option (DIO) based on new pensions flexibilities
- Introduction of a Core Fund range allowing members targeted investment choice.
Employees now benefit from a superior and flexible retirement offering which is legally compliant with auto-enrolment. Online access to understand their personal situation, make choices, view benefits and contributions is also available. From the business perspective, costs and legal liability are now controlled with planned spend for governance, investment monitoring and employee communications. In particular:
- Reduced ongoing fees from £430,000pa to £50,000pa
- Increased satisfaction with benefits from 62% to 75% in the 2015 UK Employee Satisfaction Survey
- A single GPP with a greatly reduced AMC
- The Deferred members were moved into a Trustees buyout at the same AMC as the GPP, with access to the same online tools and retirement flexibilities.
- In the first six months since the scheme was established, 25 per cent of employees log in quarterly, compared with 5 per cent in the old scheme
The Employee Award judges said: “Misys harmonised a number of costly legacy pension schemes into a single group personal pension (GPP) plan. We felt the organisation had a strong, clear strategy around what it wanted to achieve and worked hard to establish a dialogue with trustees and employees. Despite the complexity of the project, it achieved its aims in just seven months, with impressive results. It also balanced the needs of the business and employees”.
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