An arrangement that a participating employer in a defined benefit pension scheme (defined benefit scheme) may enter into with the trustees of the scheme when it withdraws from participation. The aim of the arrangement is to reduce the amount of the employer debt that the employer becomes liable to pay. To be approved by the Pensions Regulator, the arrangement must meet certain specified conditions. Primarily, it must provide for the withdrawing employer to pay the basic, lower, amount of the employer debt, and one or more guarantors to pay the residual amount.
Related links
multi-employer scheme (multi-employer pension schemes)
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.