COVID-19 remains a concern across the globe and has claimed over 484,000 lives to date 1 . Lockdowns have been introduced in many countries in the mission to quell COVID-19, affecting over 3.9 billion people worldwide2 . Clearly, COVID-19 has had a drastic impact. The need t o keep the country moving has catalysed widespread changes in working practices, operational delivery and communication. The pensions industry is no exception.
Remote working was widespread in some companies even before COVID-19. It is often touted as a hallmark of a flexibly-minded workplace. Some companies would have been hesitant to provide this facility on the grounds of cost - the cost of ensuring that hundreds or thousands of employees have the equipment and software needed to reliably and effectively work remotely. The office environment is also a staple for many and so businesses may have been reluctant to adapt.
Members still want to retire and transfer their benefits and we still need to be there for them. Social distancing measures make office-working impractical or indeed impossible and so, as with other industries, remote working has been embraced in pensions en-masse. Some companies may now be working with little real change for their members, whereas others are or were offering restricted services, demonstrated for example in the temporary closure of call-centres.
The Office for National Statistics reported that, previously, less than 30% of the workforce had worked remotely, and that from January 2015 to December 2019 the percentage of individuals who mainly work from home increased from 4.3% to 5.1%3 . While this remains a small percentage, i t still represents an upward trend, which has been magnified by COVID-19. In June 2020 The Guardian reported that “49% of workers reported working from home at some point in the seven days to 14 June, up from 41% the previous week”4 . Personally, I enjoy the office environment and instant messaging i s no replacement for face-to-face colleague interaction. However, remote working has rapidly become a reality for many and it seems that it will remain in most businesses.
Firstly, many have not relished the necessary restrictions that have been placed on our day-to-day lives (although the vast majority have been compliant). It represented a considerable shift from what was considered normal. If there is a total phase away from remote working after COVID-19, I believe that many would be alienated, as they may see it as a restriction on their ‘new normal’. They will see other companies that still offer remote working, and may be drawn to them. The cost of losing talented staff (and associated costs with nurturing their replacements) may far outweigh the feared cost of reduced productivity levels. Moreover, where businesses have spent tens of thousands of pounds on laptops and monitors it would be wasteful to lock them away until the hardware is struck by obsolescence. Keeping the resources available and enabling employee flexibility will not only help to retain talent but will also ensure that the employer gets the most from the money that they have invested in their staff.
Any increase in flexible working will mean that the delivery of training needs to be more flexible as well. Pensions are complex by nature and training needs cannot be left aside. From personal experience, the training that I have received has mostly been delivered either in group sessions or ‘on-the-job’. Online training (which is typically composed of an interactive presentation and a summative assessment) has also been popular in the past as it enables the learner to study at their own pace. While training professionals may have adapted existing group sessions into online training in this sense, the boom in video conferencing should not be understated. On 1 April 2020 the video conferencing app Zoom announced that daily meeting participants had increased from 10 million to 200 million between December 2019 and the end of March 2020 . Zoom subsequently announced on 22 April 2020 5 that this amount had increased again to over 300 million daily meeting participants6 . The exponential growth i n this one application indicates a voracious appetite for video conferencing services. As with many other industries, the applications for the pension industry have included the interviewing of job applicants and the carrying out of management meetings. The functionality to display presentations also enables group training sessions to be delivered virtually in real-time, which is more palatable than a total reconstruction of the training program. As explored above, a total reversion to office working seems unlikely and therefore it follows that the increased need for flexible training will remain. COVID-19 has demonstrated the virtues of video conferencing which stands willing and able to meet this need.
Despite living in a digital age, some working practices may remain which are positively analogue. For example, an investment manager may still require a physical signature before they will enact dealing instructions. Although rare, contribution data files may still be provided in paper format. The shift from office working may have necessitated overdue changes - investment managers might be accepting dealing instructions by email, and contribution data could be transmitted via Excel spreadsheets. Some companies may have even adopted middleware (or be looking to do so as soon as is practicable) to ensure that they can offer a seamless service despite COVID-19. While these changes may be reactive rather than proactive, it is implausible that companies will actively renege on them when time and money has been spent for the specific purpose of making scheme functions more efficient and to ensure their unblemished continuation. I would argue that it would be hard to explain to a client or Independent Governance Committee why operational obstacles are being reconstructed.
Similar changes may have been adopted at a member level. The closure of offices may make it impossible to take delivery of physical documents, such as those which are used for the purpose of satisfying a security check. Administrators may be relaxing these rules and accepting scanned copies of documents, in the interest of ensuring that members can still move into retirement unaffected by administrative impracticalities. This potentially means that it could be possible for all relevant documentation to be provided to administrators by email, and this could actually lessen the average duration of a retirement, transfer or death work item compared to pre-COVID-19 performances. This will of course be contingent on the capacity of administrators to work with quicker response times, as this could lead to a ‘bottleneck’ in the short term whereby pre-COVID-19 casework is nearing completion at the same time as inadvertently expedited casework received after the commencement of the lockdown. At a glance, changing practices to improve processing times will obviously seem appealing. Nevertheless, some administrators may be particularly strict around requirements for original documents and will be keen to reverse these changes in the interest of member security. While this is not to say that alternative practices can also ensure member security, administrative contracts would have been drawn up with clients on the basis of working practices that were in force when they were signed. If administrators wish to amend their practices over the longer term, it would be courteous to formally discuss this with the client even if the terms of the agreement do not specifically call for client consultation or consent. Even if the end result is the adoption of relaxed document requirements, there could be some reversal in the short term while changes are formalised. At least for a time, document requirements could differ from client to client being subject to individual administration agreements.
As I have discussed, an increase in email correspondence may have been partly driven by schemes due to administrative concerns. It is also worth recognising that the shielding and social distancing measures at the start of the lockdown may have all but prohibited the elderly and the sick from venturing to their nearest post office to send in documents. As the situation improves, individuals may feel more inclined to use letters as their preferred method of communication. We should therefore expect to see some shift back towards letter correspondence. However, Ofcom reported in 2019 that 67% of 65-74 year olds use the internet, along with 52% of those who are 75 or over . This compares to 65% of 65-74 year 7 olds and 44% of those who are 75 or over, as demonstrated i n Ofcom’s 2017 report8 . As older i ndividuals are gradually becoming more technologically astute, when prompted toward email correspondence they may become amenable to raising queries in this manner going forwards. When calling scheme administrators (especially third party administrators and large personal pension providers) there is often a message which will highlight the possibility of self service through an online portal. Online portals are offered by the vast majority of FTSE 350 DC pension schemes9 . While the DC schemes of the FTSE 350 may not be wholly representative of pension schemes as a whole, they represent a considerable number of lives which have the benefit of them. If callers are drawn to these services (even by necessity) they may decide to use them again. This may particularly be the case for a member who has not communicated with the scheme to date but has received notice of being due to take their benefits, who has no precedent to fall back on when it comes to discussing their benefits.
In late April, The Pensions Regulator (TPR) issued their “ Communicating to members during COVID-19” guidance, which i s available on their website1 0. This mainly reiterates existing guidance, such as the requirement to provide retirement risk warnings (where applicable), and highlights the importance of financial guidance and advice. In principle, this should already be entrenched in a scheme’s practices and therefore should not represent any change. The guidance goes further by providing a template letter to be issued in the course of a Defined Benefit to Defined Contribution transfer. The letter acknowledges current market volatilities, but otherwise simply emphasises the need for guidance and advice. Schemes may wish to consider integrating aspects of the letter into their standard transfer quotations, even after COVID-19, if the existing templates are considered to be lacking. Beyond the template letter, TPR’s guidance also addresses members opting out of pension schemes and expressing concerns about market volatility themselves. It encourages schemes to refer members to The Pensions Advisory Service (TPAS), which is soon to be part of the Money and Pensions Service (MAPS). This remains a good working principle even without the backdrop of COVID-19, and again schemes may deem that it warrants integration into ongoing scheme communications if they have not already.
COVID-19 has demonstrated that drastic change can occur with little to no warning. The pensions industry has displayed versatility in the face of adversity and the adaptations that have been made do well to take care of our members. The situation is unprecedented in our lifetimes and therefore it is difficult to say whether things will return to be as they once were. The situation is almost reminiscent of the introduction of the pension flexibilities. This is in the sense that schemes have been given an opportunity to change the ways in which they can serve their members, but the decision as to whether they will make changes is ultimately their own.
 ‘COVID-19 Dashboard by the Center for Systems Science and Engineering (CSSE) at Johns Hopkins
University (JHU)’ - Accessed 25 June 2020
 ‘Coronavirus: Half of humanity now on lockdown as 90 countries call for confinement’ - Accessed 20
 ‘Coronavirus and homeworking in the UK labour market: 2019’ - ‘Main Points’ and ‘Overview of
homeworking’ - Accessed 23 June 2020 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/articles/coronavirusandhomeworkingintheuklabourmarket/2019
 ‘Growing number of Britons working from home, says ONS’ - Accessed 23 June 2020
 ‘A Message to Our Users’ - Accessed 24 June 2020
 ‘90-Day Security Plan Progress Report: April 22’ - Accessed 24 June 2020
 ‘A Message to Our Users’ - Accessed 24 June 2020
 ‘90-Day Security Plan Progress Report: April 22’ - Accessed 24 June 2020
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