Productivity programme: Pension information Q&A

You can retire from the age of 55.

If you retire before the age of 65 your pension will be reduced to allow for the fact that we will pay it for longer.

The Company and the Trustees will currently allow early retirement but to retire early you will need to take all your Unilever pension benefits at the same time.

Final Salary Plan pension and early retirement discretion

Unilever currently allow employees, who immediately start to take their pension when they leave, to take the relevant part of their Final Salary pension with a lower reduction. This is provided under the ‘early retirement discretion’.

Under the early retirement discretion, Unilever reduces your Final Salary pension from a lower age. This means that the reduction applied for early retirement is less.

In the past, this lower age was 60. Over the last 2 years the Company has been phasing out the early retirement discretion by gradually increasing the age that is used to work out the reduction. For 2024, under the early retirement discretion, the Final Salary pension is currently reduced for each year your pension is taken early before age 63. This is the last year that the early retirement discretion will apply.

In January 2025 the early retirement discretion will end completely. This means if you leave Unilever after 1 January 2025 and immediately start to take your pension, the relevant part of your Final Salary pension will be reduced for each year taken early before age 65.

Before then, if you leave Unilever and take your pension straight away, it will be reduced from age 63.

How the Final Salary part of your pension will be reduced:

Early retirement discretion does not apply to your DB Career Average Plan pension - this part of your pension is reduced for each year it is taken before age 65.

If you want to take advantage of early retirement discretion

Where possible, Unilever will consider a date of redundancy before 1 January 2025 so members with Final Salary pension can benefit from early retirement discretion. This will be considered on a case-by-case basis.

If you would like to retire before January 2025 you should speak to your line manager and ask them to update Workday.

It might be possible to transfer your Unilever pension to another registered pension arrangement.

You will not get the same benefits from another scheme as you do from the Unilever UK Pension Fund, and not all pension schemes will accept a transfer.

If you want to transfer your Unilever pension out of the Fund, you will need to ask us for a ‘cash equivalent transfer value’ after you have left Unilever. And if the value of your DB Career Average Plan pension and Final Salary Plan pension is more than £30,000, by law, you must take independent financial advice.

Find out more about transferring your pension.

Watch out for pension scams

There are lots of different pension scams, but many start the same way, with a phone call out of the blue or an advert offering a free pension review.

Scammers want to trick you into handing them your money. They might promise you upfront cash or invest your money in a one-off ‘deal’ with ‘guaranteed’ high returns.

If you fall for a scam you could end up paying high charges or owing lots of tax.

You could even lose all your money.

Read more about how to avoid pension scams

If you are actively building up benefits in the Unilever UK Pension Fund, you can pay some or all your redundancy lump sum into the DC Investing Plan until your redundancy date.

You can do this:

• if you plan to immediately start to take your pension, or
• if you plan to leave your pension in the Fund and become a ‘deferred’ member.

If you need money now

If you need money now, paying your redundancy lump sum into pension might not be the best option for you. If you decide not to pay it into pension, you will pay tax on your redundancy lump sum in the same way that you pay tax on your pay.

If you do not need money now

If you do not need money now, you could pay your redundancy lump sum into the DC Investing Plan. There are 2 advantages to doing this:

1. This can be more tax efficient. You will not pay tax now on the money you pay into the DC Investing Plan.

2. Your money will be invested, which will give it a chance to grow between now and when you retire.

To pay your redundancy lump sum into pension you need to make a one-off voluntary contribution from your pay. This will be taken from your pay in the same month that your redundancy lump sum is paid.

You must tell us if you want to pay your redundancy lump sum into your pension before you get your redundancy lump sum payment. It will not be possible after that.

To do this you need to:

• Complete a one-off variable extra voluntary contribution form
• Return the form to the Expert Pensions Team by the end of the month before you are paid your redundancy lump sum or the date you are leaving Unilever, if it’s earlier. So, if you expect to be paid your redundancy lump sum in December, you need to return your form before the 30 November or before the date you leave Unilever if this is earlier than 30 November.

You will not be able to pay your redundancy lump sum into your pension if we do not get the form in time.

Some important things to consider

If you want to retire straight away

Paying your redundancy lump sum into your pension might delay your first pension payment and any tax-free lump sum you get from the Fund.

Be careful of tax limits

There is a limit to how much pension savings you can build up in all your pensions over a tax year without paying a tax charge. This is known as the annual allowance and the limit is £60,000 for most people. For high earners, the limit can be as low as £10,000.

You are considered a high earner if your pay, your Benefits Envelope, your redundancy lump sum and any other earnings you pay tax on, are worth more than £200,000 in total in the tax year.

Unused annual allowance from some previous years can be carried forward into the current tax year.

Find out more about the annual allowance.

If you think you might be affected by this, please contact the Expert Pensions Team.

We will help you check how much of your annual allowance you have used for your Unilever Pension before you make any final decisions.

You should be aware that it can take 3-4 weeks to calculate how much of your annual allowance you have used.

You can make a one-off extra voluntary contribution to the DC Investing Plan at any time before you leave Unilever by completing the extra voluntary contributions form.

Return the form to the Expert Pensions Team by the end of the month before you are paid your redundancy lump sum or the date you are leaving Unilever, if it’s earlier. So, if you expect to be paid your redundancy lump sum in December, you need to return your form before the 30 November or before the date you leave Unilever if this is earlier than 30 November.

You will not be able to pay any new extra voluntary contributions into your pension if we do not get the form in time.

When you stop working for Unilever your core life cover and any extra life cover that you pay for will stop. This means that your loved ones will not be entitled to a cash lump sum payment of between 4 and 8 times your annual pensionable earnings on the date of your death.

If you are paying for voluntary serious ill-health DC top up, this cover will stop when you leave Unilever.

We’ll be sending you a personalised pension and redundancy PDF that shows you what your pension options are.

You can book a one-to-one with the Money Matters team to help you understand your options. Your personalised pension and redundancy PDF will give you more information about this.

If you are thinking about retiring, you can also book an at retirement one-to-one with the Money Matters team.

You can also pay for independent financial advice with Origen Financial Services at a discounted rate.

You will be able to get support and information on Unilever Pension Hub after you leave.

As a deferred member you will continue to have access to the Unilever Pension Hub. Contact details for our specialist teams can be found in the Contact Us section.