Bristow Staff Pension Scheme · CAS-66959-W8P0

CAS-66959-W8P0

Ombudsman’s Determination Applicant Mr S

Scheme The Bristow Staff Pension Scheme (the Scheme)

Respondents The Trustees of the Bristow Staff Pension Scheme (the Trustees)

Bristow Helicopters Limited (BHL)

Outcome

Complaint summary Mr S’ complaint is that at the time of his decision to leave BHL’s employment through voluntary redundancy, he was not notified by Aon or BHL that in order to remain eligible for the Discretionary Pension Supplement (the DPS) in the Scheme his pension would need to be put into payment immediately.

Background information, including submissions from the parties On 3 September 1979, Mr S’ employment with BHL began and on 1 July 1982 he became a member of the Scheme.

The Scheme is governed by its Trust Deed and Rules of 22 December 2003, which were revised and published with amendments made on 16 January 2004 (the Scheme Rules).

Section 10 of the Scheme Rules refers to the terms of the DPS, and this states: “The Trustees may at their absolute discretion pay a pension equal to the amount of the Discretionary Pension Supplement to a Member (other than a Member who is a pilot or an S.A.R. Aircrew employee or a Deferred Pensioner).…”.

Aon was the administrator of the Scheme at the time of the events that are the subject of Mr S’ complaint.

On 24 June 1988, BHL issued a letter to Mr S notifying him of a change in the conditions of his employment (the 1988 Letter). This letter in part explained a change 1 CAS-66959-W8P0 in his Normal Retirement Age (NRA) in the Scheme to 62 and it stated, “certain improvements” had also been made within the Scheme, including recognition of the fact that male members would receive no State Pension between the points of reaching NRA and the State Pension Age. It was explained that the company would provide funding “to go some way towards protecting the financial position of those affected.”

An enclosure was provided with the 1988 Letter that explained the introduction of this “Additional Pension”. This section was titled as such, and it stated as below:

“The Company Recognises that currently men do not receive State benefits until their 65th birthday. To bridge the gap between age 62 and 65, men will receive a temporary additional pension equal to the Basic State Pension on retirement provided 25 years’ Pensionable Service has been completed. A proportion of the Basic State Pension is payable if you have completed less than 25 years Pensionable Service.

This temporary pension will be reviewed if the State change their retirement age for men from 65”.

On 23 January 2002, a Scheme Update letter was issued to Mr S (the 2002 Letter). A question and answers document was provided, and this included a section to explain the DPS and when it applied. It noted that “…the DPS is an entitlement to relevant staff who joined the Scheme prior to 1989”. It also specified that, “The supplement does not apply to Pilots / SAR crew or staff at Middle Wallop, nor does it apply to members that draw a pension from deferment”.

With effect from 31 January 2004, the defined benefit section of the Scheme was closed to future accrual. Notification of the change was issued to active members (including Mr S) and the options to leave the Scheme or contribute to the defined contribution section were explained (the 2004 Letter). This document, under the heading of “Effect on Other Benefits” stated: “While you remain in service with Bristow and contribute to the DC Section early retirement, ill health, death in service and loss of licence pensions and the discretionary pension supplement are still payable – provided that those benefits currently apply to you”.

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In March 2005, a Member’s Handbook was issued to all active members, including Mr S (the 2005 Handbook). An explanation of the DPS was included which was as follows:

“The Trustee may provide Staff members with a pension supplement when such members retire from service before the current State Pension Age (65 for men and 60 for women). The supplement is only payable between 60 and 65 provided the person is not in receipt of State Invalidity Benefits. The amount of the supplement, if granted, is an annual sum equivalent to 1/25th of the single person’s Basic State Pension for each year of Pensionable Service up to 31 January 2004.”

The 2005 Handbook also set out the different benefits payable in different circumstances, including where a member leaves service before retirement, as became relevant in Mr S’ case. It also noted that a copy of the Scheme Rules was available on request and that these overrode the 2005 Handbook, if there was any uncertainty or conflict between the two.

On 1 November 2017, Mr S signed to accept the terms of a settlement agreement between himself and BHL regarding his decision to take voluntary redundancy (the Agreement). This document confirmed Mr S’ employment with BHL ended on 14 November 2017.

The Agreement included a section to state Mr S was provided with independent advice from a qualified Solicitor regarding its terms and the effect of him signing to agree those terms. Under clauses 6.1 and 6.2 the document stated it was agreed by Mr S that he would not bring particular claims or proceedings against BHL or its group companies, with the types of possible claims specified. Under clause 6.3 the Agreement stated that:

“6.3 The parties agree that Clauses 6.1 and 6.2 shall not apply to:

6.3.1 any pension rights or pension benefits which have accrued up to the Termination Date.”

In December 2017, Mr S received a pension statement. His complaint stated that this document only included the details of his contributions up to April 2017, so it was not up to date to include all of his contributions made before he left BHL.

In January 2019, Mr S contacted Aon to request a pension statement as he had not received one since December 2017 and had received no contact from it or BHL regarding his pension during 2018.

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Mr S received the statement from Aon, but it was incorrect, with funds missing from his defined contribution pension in the Scheme. Mr S explained this issue took several weeks to resolve and after it was, he arranged for his pension to be put into payment on 22 May 2019.

On the same day, following communication with a former BHL colleague, Mr S became aware he may not be eligible for the DPS.

On 23 May 2019, Mr S issued a letter to one of the Trustees of the Scheme to explain his concerns and to seek assistance. Mr S’ concerns are summarised at paragraph 27 below.

On 14 September 2019, Mr S issued a further letter to the Trustees of the Scheme to again explain his circumstances, and he requested that he received the DPS. Mr S highlighted in this letter that his earliest recollection of any mention of the DPS was in the “Pension Handbook dated Autumn 1988” (the 1988 booklet), and he provided a copy of the relevant paragraph, which was as below:

“When you retire on pension before the State Pension Age the Company may, at its discretion, and with the Trustees agreement, then decide to pay you an additional temporary pension, payable until State Pension Age. If granted, the amount of this temporary pension will be equal to the single person’s Basic State Pension in force at the time provided you have completed at least 25 years’ service. If you have completed less than 25 years the temporary pension, if granted, will be 1/25 of the Basic State Pension for each year of pensionable service.”

On 18 November 2019, Aon issued a letter to Mr S on behalf of the Trustees to explain that his concerns and his request to receive the DPS had been considered. The request was declined on the basis that under the Scheme Rules Mr S was not eligible to receive the DPS. The relevant paragraph from the March 2005 booklet was highlighted and it was also explained that the matter had been referred to BHL, for it to consider whether it would agree to meet the potential cost of the augmentation of granting the DPS to Mr S.

On 22 March 2020, Mr S issued a further letter to the Trustees to reiterate his concerns and highlight that the 1988 Letter inferred that funding would have already been made for him and his DPS, as a qualifying member of the Scheme. He requested urgency given that he was due to reach the age of 60 in two years, with that being the point at which he expected the DPS to become payable to him.

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On 15 October 2020, BHL wrote to Mr S to confirm the outcome of its review, which was to decline his request to receive the DPS. The letter explained BHL was in agreement with the decision made by the Trustees. It stated that BHL did not intend to provide funding to the Scheme to cover the augmentation costs for matters that fall outside of the Scheme Rules.

Mr S raised a formal complaint in response to the decision he was not eligible to receive the DPS. Again, his concerns are summarised at paragraph 27 below.

The Trustees’ position Mr S’ complaint was considered under the Scheme’s Internal Dispute Resolution Procedure (the IDRP). On 31 October 2022 the Chair of the Trustees issued its response to Mr S (the IDRP response). The complaint was not upheld, and the following points were made: -

The Trustees had acted in accordance with the Scheme Rules.

The Scheme Rules set out the eligibility criteria for the DPS, which stated that it was not payable to a deferred pensioner, which Mr S became when he did not take his pension immediately at the point of redundancy.

While members may not be familiar with the full details of the Scheme Rules, the Member’s Handbook provided a summary of the benefits available in the Scheme, including the DPS.

The Chair of the Trustees explained it was satisfied that the Member’s Handbook sufficiently explained the eligibility criteria, and it was clear to state that DPS is only provided where a member retires from active service.

BHL’s position Fieldfisher LLP (Fieldfisher) responded on behalf of BHL in this matter. Its comments submitted to The Pensions Ombudsman (TPO) are summarised below: -

• Mr S is not entitled to receive the DPS. The Scheme Rules stated the Trustees have discretion to pay the DPS and that it was not payable to a deferred member of the Scheme, which Mr S became after leaving BHL but not starting his pension until later.

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• Mr S received independent legal advice on the termination of his employment, and he entered into the Agreement. BHL would have expected Mr S to have received advice on the effect of the termination of his employment on his pension benefits and options, or he should have been advised to seek separate advice.

• Clause 6 of the Agreement stated that it was in full and final settlement of all claims Mr S had or might have against BHL and its group companies arising out of or connected with his employment with BHL, or the termination of that employment. Further, clause 6.3 of the Agreement stated the claims that could not be brought by Mr S did not include those regarding accrued pension rights or benefits. At the date of the termination of his employment, Mr S’ right to the DPS had not accrued and the Agreement subsequently “bars” him from bringing his complaint to TPO.

• The law was clear to say an employer is in most circumstances under no duty to inform an employee of their pension benefit rights or to inform them of any possible way to take their benefits which may be more beneficial for them. The limited circumstances where that should happen did not apply in Mr S’ case.

• BHL, as a matter of practice, did not provide information or guidance on pension benefits or options to employees who were leaving its employment. In addition, BHL’s records regarding the termination of Mr S’ employment did not indicate he raised the issue of the benefits payable to him in the Scheme.

• Mr S was provided with a summary of his benefits and options on several occasions and ought reasonably to have been aware that the DPS was only potentially payable to him if he chose to receive his pension at the time of leaving BHL’s service.

• The 2004 Letter was evidence of the above. It made clear to Mr S the DPS would not be payable to someone in his position, where benefits commenced after leaving BHL’s employment.

• The 2005 Handbook made clear that the DPS was payable only to members when they retire from service. The later sections of the 2005 Handbook also made clear the benefits payable in the Scheme where a member leaves service before retirement and this did not include the DPS. Further, the 2005 Handbook made clear reference to the fact that retirement refers to a member starting their pension, rather than just their employment with BHL ending.

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• The 2005 Handbook explained that the full terms of the benefits payable under the Scheme are set out in the Scheme Rules and how to obtain a copy of these. Subsequently, Mr S had ample opportunity to understand the precise terms of the benefits available to him.

• Considering the early retirement factors that would have applied, it was “by no means certain” that Mr S would have put his pension into payment even if the DPS had been drawn to his attention at the time of him leaving BHL’s employment.

Mr S’ position The main concerns raised by Mr S are summarised below.

The historic information he received led him to understand he would automatically qualify for the DPS.

He received the 1988 Letter from BHL stating his NRA was being lowered and it explained the company would be paying an additional amount that would later become known as the DPS. The need to fund the DPS was known at that point.

The 2002 Letter referred to the DPS and stated it was an entitlement to relevant staff who joined the Scheme prior to 1989, as he did.

The Member’s handbook did not detail the eligibility criteria for the DPS.

After 38 years of service he took voluntary redundancy from BHL in November 2017, and this process concluded in about 12 days.

He was never informed by Aon or BHL that to receive the DPS, his pension would need to be put into payment at the point of leaving BHL’s employment. He expected to have received some form of notification at the time of being made redundant and if he had been informed, he would have taken his pension straight away and so, he would have received the DPS.

After he did not receive any contact about his pension in 2018, he contacted Aon in January 2019 and a statement was later provided, which was incorrect. He did not expect to lose his entitlement to the DPS while awaiting this pension statement. He also noted there was no form of online portal available for the relevant defined benefit section of the Scheme.

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• It was in May 2019 that he became aware he was not eligible for the DPS and his later requests for it were declined. He had spoken to others who left BHL with some receiving the DPS as expected and others having to request it was added. He had been informed by the Trustees that no other qualifying member of the Scheme had been declined the DPS previously.

• His concern that he received no information or contact from BHL or Aon about his pension options at the time of him leaving his employment with BHL had not been addressed.

• It was the lack of information provided to him at the time of leaving BHL that led to him deferring his pension.

Adjudicator’s Opinion

The Adjudicator highlighted that the Pensions Schemes Act Part X allows TPO to deal with complaints of maladministration and disputes of fact or law concerning occupational pension schemes. He said that as there was a dispute related to the events surrounding the DPS he did not agree with Fieldfisher’s comment that the Agreement prevented Mr S from bringing his complaint to TPO.

The Adjudicator considered section 10 of the Scheme Rules and noted that this clearly stated the DPS was not available to a deferred pensioner. He said that Mr S became a deferred pensioner in the Scheme when he left BHL (and the Scheme) and did not put his pension into payment at that time. The Adjudicator concluded that in terms of what the Scheme Rules allow, Mr S was consequently not eligible for the DPS. He added that because the Scheme Rules set out that the decision to pay the DPS was at the discretion of the Trustees, he was satisfied it could decide whether Mr S should receive it or not.

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In respect of the 1988 Letter, the Adjudicator said it showed when the DPS was introduced. He noted that the enclosure provided with the 1988 Letter contained an explanation for the basis of the DPS and the level at which it would be paid, depending on the length of pensionable service. Further, the enclosure stated the DPS was payable “on retirement”. The Adjudicator also noted that the wording from the 1988 booklet, was very similar as it explained that the DPS was applicable “When you retire on pension…”

Mr S referred to the 2002 Letter in his complaint and highlighted its enclosure and the wording about the DPS that stated it was an entitlement to relevant staff who joined the Scheme prior to 1989, as he did. The Adjudicator acknowledged that it did, but went on to point out that this letter also specified the DPS did not apply to “…members that draw a pension from deferment” and that this was applicable to Mr S.

The Adjudicator highlighted the 2004 Letter that was issued to Mr S and explained it included wording that referred to the DPS as a benefit that was payable “while you remain in service”. He also noted the 2005 Handbook and said it contained a section on the DPS with wording that stated it was payable when “…such members retire from service…”.

The Adjudicator said it was his view that the information provided to Mr S over time was clear to explain when the DPS was payable and that it would not include where a pension was drawn from deferment.

He added that Mr S’ concern that he should have received further information at the time of leaving BHL was not a material issue. That was because the relevant information about the terms of the DPS had already been provided to Mr S, which would have allowed him to consider his options with regards to leaving BHL and when to draw his pension.

The Adjudicator also considered the Occupational and Personal Pension Schemes (Disclosure of Information) Regulations 2013 (the Regulations) and did not identify any requirement within the Regulations that stated Mr S should have been provided with any information about his retirement options or the DPS at the time of redundancy.

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As Mr S did not accept the Adjudicator’s Opinion, the complaint was passed to me to consider. I have considered the post Opinion comments provided by Mr S, but they do not change the outcome. I agree with the Adjudicator’s Opinion.

Ombudsman’s decision Mr S’ key complaint, that was accepted for investigation, is that he has not received the DPS. He pointed to the Trustees’ decision to decline his request for the DPS in the Scheme (on the basis that he was not eligible to receive it), and BHL’s decision to decline the option to fund its equivalent through an augmentation of Mr S’ benefits.

The complaint states Mr S was not made aware that to be eligible for the DPS his pension must be put into payment as soon as he left the Scheme (i.e. he would not qualify as a deferred pensioner). He also complained that he did not receive any information about his pensions when leaving the Scheme – although, as set out in paragraph 15 above, I note that he did receive a statement within two months of leaving service1.

In this case, the conditions for payment of the DPS are set out in the Scheme Rules. The key sentence of Section 10(1) of the Scheme Rules provides that “The Trustees may at their absolute discretion pay a pension equal to the amount of the Discretionary Pension Supplement to a Member (other than a Member who is a pilot or S.A.R. Aircrew employee or a Deferred Pensioner) ….”. An explanation of when it may be paid is also to be found in the handbooks and correspondence highlighted in earlier paragraphs of this Determination.

Firstly, I note that, in any event, Mr S never had an absolute right to the DPS under the Scheme Rules. Section 10 of the Rules confirms that the DPS is an additional pension that “may” be provided and that this was at the absolute discretion of the Trustees.

Furthermore, the same section specifies that the DPS is not available for a deferred pensioner. Mr S deferred his pension when he left the employment of BHL. Thus, having become a ‘deferred pensioner’ for the purposes of the Scheme Rules, he no longer fell within the ambit of the discretion for payment of the DPS).

1 Regulation 27A, of The Occupational Pension Schemes (Preservation of Benefit) Regulations 1991, requires a leaving service statement, with limited information, to be provided within two months of leaving service. 11 CAS-66959-W8P0

Mr S claims that, had he known that becoming a deferred pensioner would result in him no longer being eligible for the DPS, he would have made different decisions. I have considered the information issued to Mr S about the DPS prior to the time of his leaving BHL and becoming a deferred pensioner. I agree with the Adjudicator’s view that its terms were made clear to him, including that the DPS was not payable where a pension is deferred and not taken upon retirement from service. For example, I find this was clear from the 2002 Letter, the 2004 Letter and the 2005 Handbook. There was no additional requirement for any of the terms of the DPS to have been brought to Mr S’ attention at the time of him leaving the Scheme, as he had already been appropriately notified of its existence (and, having become a deferred pensioner, there was clearly no requirement to provide further information on the DPS to him, as this was no longer a right or an option available to him under the Scheme Rules).

Separately, I have also considered whether BHL should have taken proactive steps to highlight to Mr S that he was losing the right to be considered for the DPS at the point that he was considering voluntary redundancy (and thus became a deferred pensioner). In some limited circumstances, a term can be implied in employment contracts for an employer to bring valuable pension rights to the attention of an employee2. In my view those circumstances do not apply here (notably, for the reasons set out above, the existence and requirements of the DPS had already been drawn to Mr S’s attention). Rather, this situation is more akin to that found in University of Nottingham v Eyett [1999] 12 PBLR, where the employer in that case was found not to be under an implied duty to advise an employee of the financial impact of his retirement options. In that case Hart J pointed to the fact that in Scally “…the relevant plaintiffs were wholly ignorant of the existence of the valuable right in question and had no means of knowing of its existence unless told of it by their employers”, but in this case a “. … careful reader of the explanatory booklet which was available to the Complainant…” would have been able to deduce the consequences of his choices. In my view the same is true here.

2 See Scally v Southern Health & Social Services Board & Others [1991] PLR 195 (Scally) – in which Lord Bridge of Harwich sets out in paragraph 12 the circumstances in which such an implied term might be found to exist: “I would define it as the relationship of employer and employee where the following circumstances obtain: (1) the terms of the contract of employment have not been negotiated with the individual employee but result from negotiation with a representative body or are otherwise incorporated by reference; (2) a particular term of the contract makes available to the employee a valuable right contingent upon action being taken by him to avail himself of its benefit; (3) the employee cannot, in all the circumstances, reasonably be expected to be aware of the term unless it is drawn to his attention.” 12 CAS-66959-W8P0

I am very sympathetic of Mr S’ position. I appreciate it would have been disappointing for him to have discovered he would not receive the DPS. However, for the reasons I have explained I find that there is no requirement for the Trustees to provide Mr S with the DPS in the Scheme, and I am satisfied he was given sufficient information to be aware of the requirements of the DPS.

I do not uphold Mr S’ complaint.

Dominic Harris Pensions Ombudsman 18 February 2026

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