Auto-enrolment for 4 million people who are members of hybrid pension schemes could be delayed until 2017 through a loophole in the legislation, a consultancy has warned.
The rule which allows companies with defined benefit (DB) or hybrid schemes postpone the enrolment until 2017 was originally brought in to align benefits and contributions for defined contribution (DC) schemes and DB schemes by 2017.
However, LCP principal Andy Cheseldine (pictured) said when the legislation was passed in 2008 it included every hybrid scheme, even those with closed DB elements or DC schemes, including life cover.
He said companies which only use the DC part of their hybrid scheme could take advantage and postpone automatic enrolment.
He added: "We estimate that over 3,000 private sector employers were due to auto-enrol more than 4 million workers in 2013 and the majority of these enrolments could be pushed back to 2017 without any compensatory backdating.
"We understand that primary legislation will be required to rectify this situation."
LCP raised the issue with the Department for Work and Pensions last week and is yet to receive a formal reply.
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