What kinds of pensions do employers provide?

Employers can provide two different types of workplace pension arrangement. They may set up an occupational pension scheme, which will be managed by a board of trustees. Or they may make an arrangement with a pension provider such as an insurance company to provide a group personal pension or a group stakeholder pension.

A group personal pension or group stakeholder pension will always be a 'money purchase' pension – often called 'defined contribution' or 'DC', which is very similar to any other type of savings arrangement. An occupational pension scheme may either be a money purchase arrangement, or a salary-related pension – often called 'defined benefit' or 'DB' (although these are now uncommon in most of the private sector).

Note: This content is provided as general background information and should not be taken as legal advice or financial advice for your particular situation. Make sure to get individual advice on your case from your union, a source on our free help page or an independent financial advisor before taking any action.