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Pensions outsourcing, data protection & commercial contracts

Sunday, 25 August 2019

The demands of pension scheme administration and data security are growing as regulation continues to tighten. The industry is responding with increasingly sophisticated arrangements to protect members’ data and manage relationships with a variety of professional service providers. But the legal implications of these arrangements need careful consideration.


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Head of Pensions

Daniel Gerring

Email Daniel
+44 (0)20 7295 3341

Daniel is Head of Pensions at Travers Smith. He advises on all aspects of pensions law, acting for trustees and employers as well as parties to corporate activity.

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As part of our wider pension scheme administration and governance offering, we provide high-quality, bespoke legal support to trustees and employers in two specialist areas that are currently a high priority for many schemes:

Outsourcing, contracts and provider management

The pensions industry now contains a huge variety of third party providers offering to help with the demands of pension scheme management. Alongside the traditional scheme administrators, actuaries, auditors, accountants, investment managers and lawyers, there may now be appointments with communications and benefit consultants, covenant assessors, independent financial advisers, professional trustees, scheme secretaries and the like. Each appointment needs a written contract – and while some are straightforward, requiring only limited legal input, others are complex.

Our lawyers are experts in helping you to put these contracts in place, and to manage them. We like to work collaboratively with our clients, building up long-lasting partnerships that mean we know how you like to work and what your priorities are. Our pensions specialists work seamlessly with our experienced contracts lawyers, providing pensions clients with fully integrated support on a wide range of issues in this area, including:

  • drawing up supplier selection criteria and assisting with tendering and procurement processes to reflect your objectives
  • assisting you to determine the scope specified in selection documentations and to review scopes proposed by suppliers
  • contributing our experience and pensions market insights to your assessment of candidates
  • reviewing and negotiating legal terms to ensure appropriate allocations of risk and responsibility with new providers
  • outsourcing scheme administration and secretarial services, including benefits manuals and member booklet reviews
  • assisting you to manage issues arising during the contracting cycle (such as service transformation or service refresh projects; addressing performance issues; and exit and transition arrangements)
  • resolving disputes with third party providers

Work examples

  • Advising the Association of British Insurers on the creation of the "Pensions Dashboard", the new digital initiative promoted by HM Treasury. This included drawing up a raft of agreements dealing with the contribution each insurer will make to the project, the involvement of other participants and the development of the prototype system by a number of software developers.
  • Advising the Trustee of the AXA UK Group Pension Scheme on the re-negotiation of an outsourced pensions administration contract.
  • Advising the trustee of a £multi-billion UK pension fund on the outsourcing of its administration, and the associated transfer from, and termination of, existing arrangements with the incumbent service provider.
  • Advising the Pension Protection Fund in relation to the outsourcing of its middle and back office investment management functions.

Data protection

Data security is already a major source of reputational and legal risk, and is only going to move higher up the agenda when the EU General Data Protection Regulation (GDPR) comes into force in the UK. Inevitably, pension schemes, employers and their advisers find themselves working with large amounts of scheme personal data, some of which is highly sensitive.

We provide pensions clients with fully integrated support on a wide range of issues in this area, including:

  • compliance issues arising from the EU General Data Protection Regulation, such as the new obligation of "privacy by design and by default"
  • reviewing and updating data protection policies, procedures and communications
  • data protection and security measures on ill health pension applications and discrimination cases
  • how to meet the minimum standards required by law when making pension scheme personal data available to service providers or to employers
  • mechanisms for ensuring legal compliance when transferring pension scheme personal data outside the EEA (e.g. to administrators and their sub-contractors)
  • how to respond to cyber-attack and other data losses

Work examples

  • Advising on GDPR implementation as it applies to pension schemes.
  • Advising the TRW Pension Scheme and assisting its negotiation of the data protection aspects of its £3.5billion liability management exercise, including the record breaking £2.5billion buy out with Legal & General and integrated WULS, PIE and ETV exercises.
  • Advising one of the largest defined benefit schemes in the UK in relation to:
    • developing and writing a suite of data protection policies
    • handling and retention of personal data; and
    • data protection and data security provisions in third party contracts.
  • Routinely advising pension scheme trustees in relation to data protection issues, such as the appointment of third party service providers to process personal data, and dealing with subject access requests and breaches of security.

"I find them extremely responsive - if I ask them to do something, it happens and to a very high standard. They also take time to understand the client."

Chambers, 2017

Industry appointments

We participate in a wide range of pensions industry groups.