BT Group Closes Defined-Benefit Pension Plan

By Dimitrios Kontos

BT Group PLC (BT.A.LN) said Monday that it will terminate its defined-benefit pension plan, having reached an agreement with the Communication Workers Union on future pension arrangements.

The U.K. telecommunications company said it will close the plan to future benefits in early summer 2018.

The company will instead establish a "hybrid" plan that combines elements of both defined-benefit and defined-contribution plans, and has agreed with the union on the arrangements for 20,000 non-management employees.

Benefits accrued in the pension plan for service prior to June 1, 2018, will remain preserved within it, subject to revaluation according to rules and relevant legislation, the company said.

The company said it has decided to increase its standard maximum contribution rate to 10% for employees who joined the company after 2009.

BT said the changes bring more financial certainty for the company in terms of its future pension arrangements and help it to balance the needs of pensioners with investments it is making in the U.K. communications networks.

Shares at 1218 GMT were down 1.85 pence, or 0.8%, at 226 pence.

Write to Dimitrios Kontos at [e-mail]

(END) Dow Jones Newswires

March 19, 2018 08:44 ET (12:44 GMT)

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