New pension scheme adopted for Statoil ASA

The defined contribution pension scheme will be Statoil’s occupational pension. It will come on top of the National Insurance pension and the contractual pension scheme (AFP).

“The chosen solution means that Statoil still has an attractive and competitive pension model. The company also obtains increased predictability with regard to its future pension commitments,” says Magne Hovden, senior vice president Corporate People and Organisation in Statoil.

Following amendments to the pension legislation from 1 January 2014, two options have been considered in addition to the current benefit scheme: defined contribution pension and a hybrid pension.

“Most major Norwegian industrial enterprises have transferred from defined benefit pension to defined contribution pension. The reason Statoil ASA is making this change is our need to adjust to the Norwegian pension reform and the standards that apply for Norwegian workplaces. The decision to move to a defined contribution pension scheme was made following thorough preparations and discussions with the trade unions,” says Hovden.

The transition to a new pension model takes effect from 1 January 2015. 

FACTS

The key elements in the transition to a new pension scheme: Contribution rates will be 7% for a pensionable salary up to 7.1G and 22% for pensionable salaries above 7.1G All employees will be transferred from the defined benefit scheme to the new defined contribution scheme, except for one group of employees who will be exempt Exemption will apply for employees with up to 15 years left before retirement age A transition scheme will also be established with an age-based supplement to be disbursed when the person retires. This transition scheme covers employees between the ages of 37 and 51 (between 35 and 49 for offshore employees)