Amex suspends UK pension contributions
UK - American Express has confirmed it is suspending contributions into both its defined benefit (DB) and defined contribution (DC) schemes in the UK for 18 months.
The financial firm said following consultation with employee representatives and employees it had "temporarily suspended contributions to the UK pension plans" as of 1 July 2009.
American Express blamed the move on the "pressures of the current economic environment" and said it was just one of a number of global cost-cutting measures, although it claimed the suspension would be lifted "no later than 1 January 2011" and added it may be sooner if conditions improve.
The majority of the firm's 6,000 UK staff are in its DC stakeholder scheme, where members currently receive 3% contribution from American Express and up to 6% in matching contributions, equating to a maximum of 9%, although that support will now be suspended.
A spokesperson for the company confirmed the suspension would also impact contributions to the closed DB scheme, but said the details were "too complicated" to go into compared with the "quite clear cut" effect on the DC scheme.
The UK schemes are not the only ones to be affected by the cost-cutting measures, as American Express added the suspension had already been implemented for its US schemes from 1 April, but it had taken longer to come into effect in the UK because of the consultation period.
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