SHELL OVERSEAS CONTRIBUTORY PENSION FUND · in a pension fund whilst on overseas assignments for Shell companies. If you are a member of the Pre-2009 Section of the SOCPF and then

SHELL OVERSEAS CONTRIBUTORY PENSION FUNDExplanatory booklet

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You get a refund of your contributions

You get a transfer

You become a Deferred Member

Take your pension at Pension Age, or take early or late retirement

Retire early for approved medical reasons and your Employing Company consents

Die in service

With two or more years’ service

Leave the SOCPF before Pension Age

With between three months’ and two years’ service

You get a refund of your contributions or a transfer

And later

You get a pension from the SOCPF and an option to take a lump sum

And later

Your dependants receive benefits when you die

With less than three months’ service

You get a refund of your contributions

If you...

In addition to a lump sum



And later



And later


or or

QUICK GUIDE TO THE SOCPF

This diagram helps you see at a glance the advantages of being a member of the SOCPF. There are two different sections of the SOCPF but this summary applies to both. More detailed information on SOCPF benefits is contained in this booklet.

Shell Overseas Contributory Pension Fund Explanatory booklet

CONTENTS

1

1. Introduction 3 How the SOCPF works 5

Factsheets available 6

2. The Pre-2009 Section of the SOCPF 7 Your benefits in the Pre-2009 Section at a glance 9

Your benefits in the Pre-2009 Section in detail 11

Membership 11

Contributions 13

Retirement Benefits 14

Death in Retirement 18

Leaving 21

Death in Service 26

Serious Illness (Incapacity) 29

3. The Post-2009 Section of the SOCPF 33 Your benefits in the Post-2009 Section at a glance 35

Your benefits in the Post-2009 Section in detail 37

Membership 37

Contributions 39

Retirement Benefits 40

Death in Retirement 44

Leaving 46

Death in Service 51

Serious Illness (Incapacity) 54


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4. Other information 57 Trust Deed and Regulations 59

Tax status of the SOCPF 59

Communication with members 59

Assignment of benefits 59

Divorce 60

Evidence of age 60

Making an enquiry or complaint 60

Useful contacts 62

Jargon buster 63

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INTRODUCTION1


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INTRODUCTION

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1One of the most significant benefits offered by Shell companies for employees who are UK base country employees and are working overseas for a Member Company is the Shell Overseas Contributory Pension Fund (SOCPF). This is a valuable benefit with many features in addition to a pension, not only for you but also for your dependants.

The Trust Deed and Regulations of the SOCPF is the definitive document determining pension benefits available to members. Copies are available from the Pensions Advisory Unit or the Pensions Administration Team. All contact details can be found on page 62.

This booklet gives a summary of the benefits provided to members of the SOCPF and their dependants.

Please be aware that there are two different sections of the SOCPF:

nn The Pre-2009 Section applies to existing SOCPF members at 31 December 2008. New members and re-joiners cannot join this Section.

nn The Post-2009 Section applies to existing SOCPF members at 28 February 2013 who joined the scheme after 1 January 2009.

New members and re-joiners cannot join the SOCPF.

This chapter outlines general information which applies to all members. Chapters 2 and 3 offer detailed information on the Pre-2009 and Post-2009 Sections respectively.

There are also factsheets which provide additional information about the SOCPF. The list overleaf shows you the factsheets available and where to obtain them.

How the SOCPF works

The SOCPF is a Defined Benefit Scheme. This means that your pension calculation is defined and is based on the Accrual Rate that applies to you and your Final Pensionable Salary and Pensionable Service when you leave. Your pension is not related to the performance of investments or to the value of contributions made to the SOCPF.

Contributions made to the SOCPF by you and your Employing Company are invested to pay for benefits. The SOCPF is administered by a trustee company, Shell Trust (Bermuda) Limited. Trustee directors are responsible for administering the SOCPF according to the SOCPF’s Trust Deed and Regulations and Bermudian law.


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Factsheets available

If you have access, the factsheets below are available on the Pensions website – www.shell.co.uk/pensions. Alternatively, you can get copies from the Pensions Advisory Unit or the Pensions Administration Team (see page 62 for contact details).

Factsheet Pensions website

Pensions Advisory Unit

Pensions Administration Team

Dependant Assurance 3 3 3

SOCPF Pensions on Divorce 3 3 3

Transfers out of the SOCPF ✗ ✗ 3

SOCPF Tax Status 3 3 3

Opting out of the SOCPF 3 3 3

Part-time Working 3 3 3* for Employed Members

** for Deferred/Retired Members

*

*

* *

* *

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2


INTRODUCTION

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2

2 THE PRE-2009 SECTION OF THE SOCPF


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2The Pre-2009 Section applies to people who were already members of the SOCPF at 31 December 2008. Benefits of this Section – at a glance and in detail – are shown in this chapter.

Your benefits in the Pre-2009 Section at a glance

Who can be a member?

Any employee employed by a Member Company on a regular contract, who:

Joined the SOCPF on or before 31 December 2008; or

Is a Linked Fund Member who has had continuous membership in the SOCPF or SCPF prior to 1 January 2009.

What does it cost me? Currently, your contributions are 2% of your Pensionable Salary up to £30,000 and 6% of your Pensionable Salary over £30,000. Your contributions cease after 36 years’ Pensionable Service if you are in this Section.

Can I transfer pension benefits from another pension provider into the SOCPF?

From 1 July 2018, the SOCPF will no longer accept transfers of benefits from other pension schemes into the fund.

How is my pension calculated?

Your pension is based on a formula: 1/54th Accrual Rate x Pensionable Service x Final Pensionable Salary

You can find more information on page 14.

What is my Pensionable Salary?

Your Pensionable Salary is the annual figure on which your contributions to the SOCPF are based. It is a sterling amount based on the equivalent Pensionable Salary for your job group in the UK, and is set by your Employing Company.

How is my Final Pensionable Salary calculated?

This will be calculated as your Pensionable Salary at the date you leave service or die, whichever is the earlier. If you have been in receipt of pensionable shift allowance at any time, please contact the Pension Administration Team to find out how your Final Pensionable Salary is calculated.

THE PRE-2009 SECTION OF THE SOCPF


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At what age can I take my pension unreduced and without Employing Company consent?

For most Pre-2009 members this will be from age 60.

Some members have a lower Pension Age, such as those with Fleet, Aircrew or Overseas B service before 1 January 1986.

Members who joined the SOCPF before 1 March 1974 (known as Pre-75 members) have additional rights (see page 16).

What if I’m too ill to work and leave my Employing Company’s service as a result?

There are three levels of pension that can be paid at the discretion of your Employing Company, based on its opinion of your medical condition:

Total Incapacity – a pension based on your Final Pensionable Salary and Prospective Pensionable Service to Pension Age (or Pensionable Service to date of leaving your Employing Company’s service if later than Pension Age), subject to a minimum of two-thirds of your Final Pensionable Salary.

Partial Incapacity – a pension based on your Final Pensionable Salary and completed Pensionable Service to date of leaving your Employing Company’s service, subject to a minimum of one-third of your Final Pensionable Salary.

Ill Health Pension – a pension based on your Pensionable Service when you leave your Employing Company’s Service, reduced for early payment if payable immediately on leaving Employing Company service on or after Normal Minimum Pension Age (NMPA) but before Pension Age.

If you have a serious illness it may be possible for you to exchange 100% of your pension for a lump sum.

What if I die? If you die in service, the benefits for your dependants are:

A lump sum of three times your Pensionable Salary, paid at the discretion of the Founding Companies; and

Pensions to a Qualifying Spouse (or to a dependant if there is no spouse at the discretion of the Founding Companies) and Children, based on a percentage of the pension you would have been entitled to at your Pension Age (based on your Pensionable Salary when you died).

Benefits are also payable to dependants if you die in retirement, or before you take your pension. More information can be found on pages 18 & 19.

What about pension increases?

Your SOCPF pension increases by the movement in the UK Retail Prices Index (RPI) up to 7% each year. The Founding Companies may ask the Trustee to approve RPI increases over 7%.


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Membership

If you were a member of the SOCPF at 31 December 2008 and have had continuous Pensionable Service since that date, you are a member of the Pre-2009 Section. This chapter aims to give you information about the SOCPF to use as a reference throughout your membership.

JoiningThe Pre-2009 Section of the SOCPF closed to new joiners and re-joiners from 1 January 2009.

Joining at a later dateIf you decided not to join the SOCPF when first invited, you cannot join either the Pre-2009 Section or Post 2009 Section at a later date as they are both now closed to new joiners.

Terminating your membershipYou may opt out of membership of the SOCPF at any time by giving notice in writing to the Trustee through your Employing Company. Membership will terminate on the last day of the month following that in which your Employing Company receives the notice.

YOUR BENEFITS IN THE PRE-2009 SECTION IN DETAIL


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Working in the UKIf you return to work for a Shell Group company in the UK, you will normally cease accruing benefits in the SOCPF and will be invited instead to join the Shell Contributory Pension Fund (SCPF). The SCPF is a UK Registered Pension Scheme. The SOCPF is designed so far as possible to be complementary to the SCPF. This enables UK base country employees of Shell Group companies who are Member Companies to participate in a pension fund whilst on overseas assignments for Shell companies. If you are a member of the Pre-2009 Section of the SOCPF and then work in the UK, joining the SCPF, you will join the Pre-2009 Section of the SCPF provided your Pensionable Service in the two Funds is continuous.


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Contributions

Contributions made to the SOCPF by you and your Employing Company are invested to pay for benefits.

Company contributionsThe Member Companies pay the balance of the cost of providing SOCPF benefits after taking into account member contributions and investment returns.

Your contributionsAs an SOCPF member, you are required to contribute a proportion of your Pensionable Salary to the SOCPF.

Since 1 January 2004, member contribution rates have been:

Pensionable Salary up to £30,000 a year 2%

Pensionable Salary over £30,000 a year 6%

The Founding Companies can amend the contribution rates in future, with the approval of the Trustee.

For details of the tax treatment of contributions, please refer to the factsheet ‘SOCPF Tax Status’ (see page 6).

Whilst a member of the SOCPF, you cannot make contributions to the SCPF Additional Voluntary Contributions Arrangement. If you are a Linked Fund Member and were making AVC contributions whilst a member of the SCPF, you must stop making AVC contributions whilst a member of the SOCPF.


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Retirement Benefits

The main aim of the SOCPF is to provide you with a pension. These pages look at the pension you can expect to receive from the SOCPF as a member of the Pre-2009 Section.

Your Pension Age is the age at which you can take your pension from the SOCPF unreduced and without your Employing Company’s consent. For most Pre-2009 members this will be age 60.

Some members with Fleet, Aircrew or Overseas B service before 1 January 1986 have a lower Pension Age, and if this applies to you then you will have been advised of your individual Pension Age.

How is my pension calculated at my Pension Age?The pension you receive at your Pension Age is calculated using a formula that is based on your Pensionable Service and your Final Pensionable Salary. The formula is:

Accrual Rate x Pensionable Service x Final Pensionable Salary

As a member of the Pre-2009 Section, your Accrual Rate is 1/54th.

Please refer to the factsheet ‘Linked Fund Membership and the Inter Fund Linking Rules (IFLR)’ if you are a Linked Fund Member (see page 6).

How is my Final Pensionable Salary calculated?This will be calculated as your Pensionable Salary at the date you leave service or die, whichever is the earlier. If you have been in receipt of pensionable shift allowance at any time, please contact the Pension Administration Team to find out how your Final Pensionable Salary is calculated.

EXAMPLE

Mark is a member of the Pre-2009 Section of the SOCPF and retires at age 60 with 30 years’ Pensionable Service and a Final Pensionable Salary of £59,400.

Mark’s pension at retirement is calculated as follows:


1/54th x 30 x £59,400 = £33,000

Mark’s pension is £33,000 a year and is paid (with annual increases when granted) for the rest of Mark’s life.


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Cash lump sumAt retirement, you can commute some of your pension for a cash lump sum. You will be given details of the maximum amount of cash lump sum available as you approach retirement.

If you take a cash lump sum, your pension will be reduced.

The cash lump sum is calculated as follows: 25% x annual pension x commutation factor = Maximum cash lump sum

The commutation factor is based on age and gender. For example, at age 60, the commutation factors are currently:

Male 18.661 Female 19.603

The reduction in the annual pension is calculated as follows:

Cash lump sum = Reduction to annual pension (commutation)Commutation factor

EXAMPLE

Mark is able to take a pension of £33,000 a year when he retires at the age of 60. His maximum cash lump sum and the reduction to his annual pension will be calculated as follows:

25% x £33,000 x 18.661 = Mark’s maximum cash lump sum = £153,953

The reduction in his annual pension for the commutation is:

Cash lump sum = Reduction to annual pension

Commutation factor

£153,953

18.661 = £8,250

This means that Mark can choose to take a cash lump sum of up to £153,953 and a reduced pension of £24,750 (£33,000 – £8,250).

Mark can also choose to take a lower cash lump sum, which will result in a lesser reduction to his annual pension, or no cash lump sum at all.


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Pre-75 membersIf you joined the SOCPF before 1 March 1974 and have continuous Pensionable Service, you can access your pension at any time up to five years before Pension Age. You do not need permission from your Employing Company to do so, but you must have left service. For women, no reduction to pension is made. For men, a reduction is made for the part of your pension relating to your service before 17 May 1990. From 1 January 2009 this reduction has been set by the Founding Companies (after consulting the Actuary) at 4% for each year it is paid early; this percentage may change in the future.

Early retirementIf you decide to leave service you can take your pension early, without Employing Company consent, after the age of 55. Your pension will be calculated in the same way as at Pension Age (see page 14), based on your Pensionable Service to the date of your early retirement.

However, as your pension will be paid for a longer period of time, it will be reduced (by an early retirement factor) and paid at a lower rate for the full term of your pension. This will affect any Qualifying Spouse’s or dependant’s benefits arising from your death after early retirement because these pensions are calculated as a percentage of your pension. The early retirement factor is set by the Founding Companies (after consulting the Actuary) at 4% a year, with effect from 1 January 2009, but this can be reviewed and may change in future. (The early retirement factor of 3% with consent, will be removed from 31 December 2018.)

Retirement at or after Pension AgeFor most Pre-2009 Section members, Pension Age is age 60. The Pensions Advisory Unit will contact you before you reach your Pension Age to remind you of your pension options.

If your Employing Company agrees that you can continue your employment after Pension Age, and the laws of your host country allow, you may choose to:

nn Continue to work in pensionable employment but not draw your pension from the SOCPF and accrue further SOCPF pension; or

nn Continue to work but leave the SOCPF and draw your pension.

If you continue to work and accrue further SOCPF pension, you will remain a member of the SOCPF at the same accrual and contribution rate as before and you will be entitled to the same benefits such as death in service and incapacity pensions.

If you continue to work and draw your SOCPF pension, and if you die while employed, you will be treated as a Retired Member for death benefits. For more details see page 18.

You may want to take independent financial advice before making a decision.

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17

YOUR QUESTIONS ANSWERED

What if I work part-time?If you work part-time, or have worked part-time for some of your Pensionable Service, your pension will be adjusted to take this into account. If you die in Pensionable Service any lump sum that is paid would be based on your Pensionable Salary at the date of your death. A factsheet on ‘Part-time Working’ is available from the Pensions Advisory Unit, the Pensions Administration Team or the Pensions website – www.shell.co.uk/pensions.

What if I am absent from work?Absence from work, including maternity, paternity and adoption leave, may have an effect on your pension. If this applies to you, please contact your HR Adviser in the first instance for information.


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Death in Retirement

If you die in retirement having left service, the SOCPF provides benefits for your dependants.

Pension for Qualifying SpouseYour Qualifying Spouse will be entitled to an SOCPF pension from the first day of the month following your death. The pension varies depending on the terms of your retirement. See the table below for details:

If... Then...

Your pension was paid from Pension Age and you died after Pension Age…

Your surviving Qualifying Spouse will be entitled to 60% of the pension you received when you took your pension, but before adjustment for any cash lump sum taken and allowing for increases to the pension between the member’s retirement and death.

You left before 1 January 2009 with an option to receive a reduced early pension from age 55 and took that option…

Your surviving Qualifying Spouse will be entitled to 60% of your pension before the reduction for early payment and before any adjustment for taking a cash lump sum and allowing for increases to the pension up to the date of death.

Your pension was paid early with reduction under the early access arrangements introduced from 1 January 2009...

Your surviving Qualifying Spouse will be entitled to 60% of your pension after the adjustment for early payment, but before adjustment for taking a cash lump sum and allowing for increases to the pension between the member’s retirement and death.

You left with Employing Company consent to early pension payment and your pension was paid immediately with reduction and was not an incapacity pension…

Your surviving Qualifying Spouse will be entitled to 60% of your pension before the reduction for early payment and before any adjustment for taking a cash lump sum and allowing for increases to the pension up to the date of death.

Your Qualifying Spouse’s/dependant’s pension is in payment…

The pension increases by the movement in the RPI up to 7% each year. If RPI exceeds 7% then the Founding Companies can ask the Trustee to approve an increase over 7%.

Your pension is already being paid and is not an incapacity pension…

A bereavement grant equal to two months of your pension (within certain limits) may be paid to your Qualifying Spouse on your death. The discretion as to whether this is paid and the amount payable lies with the Employing Company. If the relevant Company directs the Trustee, the Trustee may exercise its power to pay this amount after consultation with the Founding Companies.


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Pensions for dependantsThe SOCPF also provides benefits for your dependants. For example, if you do not have a Qualifying Spouse, an Adult Dependant’s pension may be payable, at the discretion of the Founding Companies, to someone who is financially dependent on or interdependent with you.

Pensions for ChildrenChildren’s pensions are payable on the death of a member. Legitimate, legitimated and lawfully adopted Children who are unmarried and under 18 are entitled to a pension on your death, payable up to age 18 or marriage, whichever comes first. Other unmarried Children may be granted a pension on your death in certain circumstances:

nn Illegitimate Children and stepchildren under 18 may be paid a pension if, in the opinion of the Founding Companies, they are dependent on you when you die. This would be payable up to age 18.

nn Children over 18 who are in full-time education or vocational training may be granted a pension at the discretion of the Founding Companies, payable up to age 23.

nn Children over 18 who have a disability that existed at the age of 18 may be granted a pension at the discretion of the Founding Companies.

The table below gives details of Children’s pensions payable:

If you die and a pension is being paid to a Qualifying Spouse

One Child will receive 20% of the member’s pension.

Two or more Children will share 40% of the member’s pension.

If you die and there is no Qualifying Spouse


Two Children will receive 40% of the member’s pension each.

Three or more Children will share 100% of the member’s pension.


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Lump sum benefitIf you were to die within five years of taking your pension from the SOCPF, your estate would be paid a lump sum equal to the pension you would have received from the SOCPF during the remainder of the five-year period. This would be payable at the discretion of the Trustee to your personal representative(s) to be dealt with as if it were part of your estate. This cannot exceed a maximum of three times your Final Pensionable Salary (adjusted for inflation by up to 7% a year or such higher amount as the Trustee and Founding Companies may have agreed).


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Leaving

There are a number of reasons why you may leave the SOCPF. You may resign from or be dismissed by your Employing Company, or you may choose to opt out of the SOCPF at any time.

If you leave the SOCPF (regardless of whether you leave the service of your Employing Company at the same time), your benefits depend on how much Pensionable Service you have in the SOCPF.

Pensionable ServiceThe amount of Pensionable Service you have may include additional service which has been transferred in from another pension scheme. Additional service may be less than the actual pensionable service in the previous scheme.

If you leave with two or more years’ Pensionable Service If you have at least two years’ Pensionable Service when you leave the SOCPF, you become entitled to a deferred pension payable from your Pension Age.

There are other instances when you will be entitled to a deferred pension on leaving the SOCPF, even if you do not have two years’ Pensionable Service:

nn If your actual Pensionable Service with the SOCPF plus your actual pensionable service with a previous company (from whose pension scheme you transferred in benefits) come to a total of at least two years when you leave, you will be entitled to a deferred pension.

nn If you have a transfer into the SOCPF from a personal pension then you automatically become entitled to a deferred pension.

Your deferred pension will be calculated using the same formula as for normal retirement (see page 14) using your Final Pensionable Salary and your Pensionable Service at your date of leaving. Your pension will be paid at Pension Age, unless you decide to take it earlier (from age 55 onwards).

The deferred pension is revalued from the date of leaving. The pension increases by the movement in the RPI up to 7% each year. If RPI exceeds 7% then the Founding Companies can ask the Trustee to approve an increase over 7%.


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If you are leaving service with your Employing Company and have an entitlement to an SOCPF deferred pension, as an alternative to your deferred pension entitlement you can opt to receive a return of your contributions (but not those made by Member Companies). You must advise the Trustee, via your Employing Company, on or before leaving your Employing Company’s service, if you wish to take this option. Please note that if you exercise the option to receive a refund of your contributions in lieu of your deferred pension, then no dependant(s’) benefits would be paid in the event of your death.

It is strongly recommended that you take independent financial advice before making your decision.

Early access to pension Whatever your Pension Age, you can receive your pension from age 55 if you leave, or have left, service. Your pension will be calculated in the same way as at Pension Age (see the example on page 14). As your pension will be paid for a longer period of time, it will be reduced (by an early retirement factor) and paid at a lower rate than you would have received if you had retired at Pension Age, for the full term of your pension. This will affect any Qualifying Spouse’s or dependant’s benefits arising from your death after early retirement because these pensions are calculated as a percentage of your pension. The early retirement factor is set by the Founding Companies (after consulting the Actuary) at 4% a year with effect from 1 January 2009, but this can be reviewed and may change in future.

Once your pension becomes payable, it will be treated in the same way as normal retirement. For example, you will be able to take a cash lump sum (see page 15).

EXAMPLE

Paul is a member of the Pre-2009 Section of the SOCPF and his Pension Age is 60. He resigns from service at age 49 and his SOCPF pension when he leaves service is £39,000. The pension increases each year and by the time he has reached age 55 it amounts to £46,000. He decides to take his pension early from age 55, i.e. five years before his Pension Age. The current early retirement factor is 4% a year at the time Paul wishes to draw his pension, and so a reduction of 20% (£9,200) is made to Paul’s pension and he receives £36,800 a year from age 55.

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What happens if I become ill or die before my pension is paid?

Ill Health Pension

If you are a Deferred Member you may be entitled to a deferred ill health pension, at the discretion of your last Employing Company in the Shell Group of companies. Contact the Pensions Administration team for further information.

Serious ill-health commutation

If you are diagnosed with a medical condition that means that you are expected to die within one year, it may be possible for you to commute 100% of your future pension for a cash lump sum before Pension Age. This applies to both Deferred and Employed Members of the SOCPF, but certain conditions must be satisfied, and Employing Company and Trustee approval must be obtained. The commutation factor used will be as decided by your Employing Company after consulting the Actuary. Pensions will be provided for your Qualifying Spouse/dependants in the event of your death based on your reduced early retirement pension.

If you think this may apply to you please contact the Pensions Administration Team (see page 62 for contact details).

If you die as a Deferred Member

In the event of your death, your Qualifying Spouse and Child(ren) will be entitled to SOCPF pensions from the first day of the month following your death.

Pension for your Qualifying Spouse

If you die before your pension has started being paid, your surviving Qualifying Spouse will be entitled to a SOCPF pension from the first day of the month following your death. The pension will be based on 60% of your deferred pension at the date you left service, allowing for increases to the pension between the date you left service and your death.

The SOCPF also provides benefits for any dependants. For example, if you do not have a Qualifying Spouse, an Adult Dependant’s pension may be payable, at the discretion of the Founding Companies, to someone who is financially dependent on or interdependent with you.

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Pensions for Children

Children’s pensions are payable on the death of a member. Legitimate, legitimated and lawfully adopted Children who are unmarried and under 18 are entitled to a pension on your death, payable up to age 18 or marriage, whichever comes first. Other unmarried Children may be granted a pension on your death in certain circumstances:












If you have no dependants

If you die before your pension is paid and have no dependants, a refund of the contributions you have made to the SOCPF will be paid to the personal representative(s) dealing with your estate. Interest of 3% a year will be added to this refund.

Can I transfer my deferred benefits?Transferring benefits out of the SOCPF is complicated. Unlike the SCPF, the SOCPF is not a Her Majesty’s Revenue and Customs (HMRC) Registered Pension Scheme. This means that there are restrictions on transfers out of the SOCPF and some pension providers may not accept benefits from the SOCPF.

For further details, please refer to the factsheet ‘Transfers out of the SOCPF’.


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If you leave with more than three months and less than two years’ Pensionable Service You have a choice:

nn You may be able to transfer the monetary value of your SOCPF benefits to another pension scheme; or

nn You can take a refund of your member contributions (but not contributions made by Member Companies), plus interest at 3% a year.


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Death in Service

In the event of your death in Pensionable Service, your Qualifying Spouse and Child(ren) will be entitled to SOCPF pensions from the first day of the month following your death. In addition, a lump sum may be payable.

Lump sum benefitA lump sum, equal to three times your Pensionable Salary at your death, may be payable to your beneficiaries if you die in Pensionable Service. This is paid at the discretion of the Founding Companies, which, under current legislation, ensures that the lump sum does not carry any liability to UK Inheritance Tax.

You should complete a nomination form to tell the Founding Companies your wishes in respect of your lump sum benefit. However, the Founding Companies are not bound by your wishes. For example, if your personal circumstances have changed since you completed the nomination form, the Founding Companies may decide not to follow the wishes stated on your form.

It is important to keep your nomination form up to date. You can get these forms from the Pensions Advisory Unit (see page 62 for contact details), or from the Pensions website – www.shell.co.uk/pensions, if you have access.

PensionIf you die in Pensionable Service before Pension Age, pensions for your dependants are based on a percentage of the pension you would have received at Pension Age. For example, your Qualifying Spouse would receive 60% of the pension you would have received at Pension Age. This pension is based on your Final Pensionable Salary at the date of your death and your Pensionable Service including Prospective Pensionable Service to your Pension Age.

If you die in Pensionable Service after your Pension Age, pensions for your dependants are based on a percentage of the pension calculated at the date of your death, based on your Final Pensionable Salary at the date of your death.


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EXAMPLE

Pedro dies in Pensionable Service, aged 45 with Pensionable Service of five years and a Final Pensionable Salary of £54,000.

Pedro’s notional pension would be:

Accrual Rate x Pensionable Service (to death + prospective) x Final Pensionable Salary

1/54th x (5 + 15 = 20) x £54,000 = £20,000

Pedro’s wife, Eve, will be entitled to 60% of Pedro’s notional pension, so she will receive £12,000 a year from the month after Pedro’s death. The pension increases by the movement in the RPI up to 7% each year. If RPI exceeds 7% then the Founding Companies can ask the Trustee to approve an increase over 7%.








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If you die before your pension is paid and have no dependants, a refund of the contributions you have made to the SOCPF will be paid to the personal representative(s) dealing with your estate. Interest of 3% a year will be added to this refund. Any discretionary lump sum paid (see page 26) is in addition to this refund of contributions.


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Serious Illness (Incapacity)

If you are unable to continue working because of a serious medical condition or disability, you may be granted an immediate pension on medical grounds. These pensions are granted at the discretion of your Employing Company after taking medical advice on the level of your incapacity.

Total IncapacityA physical or mental impairment and deterioration which, in the opinion of your Employing Company (acting on medical advice), makes it unlikely that you will ever again obtain employment.

If your Employing Company decides to grant you a Total Incapacity Pension, it will be based on your Pensionable Salary and your Prospective Pensionable Service to Pension Age. The pension will not be less than two thirds of your Pensionable Salary at your date of leaving. A Total Incapacity Pension can be reviewed periodically and may be adjusted if there is a change to your medical condition.

If you die before Pension Age in receipt of a Total Incapacity PensionA lump sum will be payable to your dependants at the discretion of your last Employing Company. This will be equal to three times your Pensionable Salary at the date your employment ceased, adjusted for inflation (up to 7% a year or such higher amount as the Trustee and the Founding Companies may have agreed from the date you took your pension), less any lump sum paid when you took your Total Incapacity Pension. Your dependants will also receive pensions. For example, your Qualifying Spouse will be entitled to a pension based on 60% of your pension as if you had remained in employment until Pension Age and as though you had died in service. The percentage payable to your dependants will be applied to the pension to which you would have been entitled at Pension Age based on your final pensionable salary at the time you ceased employment. The pension will also be inclusive of the same percentage of cost of living increases made to your Total Incapacity Pension between the date of leaving and the date of death.

If you die on or after Pension Age in receipt of a Total Incapacity PensionIf you die within five years of the pension commencing, a lump sum equal to the pension you would have received from the SOCPF during the remainder of the five-year period will be payable, at the Trustee’s discretion, to your personal representative(s) (to be dealt with as if it were part of your estate). This is up to a maximum of three times your Pensionable Salary at the date your employment ceased adjusted for inflation (up to 7% a year or such higher amount as the Trustee and Founding Companies may have agreed, from the date you took your pension). Your dependants will also receive pensions. For example, your Qualifying Spouse will be entitled to 60% of your pension before any reduction in respect of any cash lump sum paid to you.


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Partial IncapacityA physical or mental impairment and deterioration which, in the opinion of your Employing Company (acting on medical advice), prevents you from following your current occupation (and will continue to do so) and which seriously impairs your earning capacity.

If your Employing Company decides to grant you a Partial Incapacity Pension, it will be based on your Pensionable Salary and the Pensionable Service you have completed up to the date your employment ceases. The pension will not be less than one third of your Pensionable Salary at your date of leaving. A Partial Incapacity Pension can be reviewed periodically and may be adjusted if there is a change to your medical condition.

If you die before Pension Age in receipt of a Partial Incapacity PensionIf you die within five years of the pension commencing, a lump sum equal to the pension you would have received from the SOCPF during the remainder of the five-year period would be payable, at the Trustee’s discretion, to your personal representative(s) (to be dealt with as if it were part of your estate). This is up to a maximum of three times your Pensionable Salary at the date your employment ceased (adjusted by inflation up to 7% a year or such higher amount as the Trustee and Founding Companies may have agreed), from the date you took your pension. Pensions will also be paid to your dependants. For example, your Qualifying Spouse will be entitled to a pension which is the lesser of:

a) 60% of the Partial Incapacity Pension you were receiving at the date of your death, ignoring any reductions made for any commutation you elected to take; and

b) 60% of the pension you would have received if you had remained in service until Pension Age based on your Final Pensionable Salary when you left employment and adjusted by the same percentage of cost of living increases made to your Partial Incapacity Pension between the date of leaving and date of death.

If you die on or after Pension Age in receipt of a Partial Incapacity PensionIf you die within five years of the pension commencing, a lump sum equal to the pension you would have received from the SOCPF during the remainder of the five-year period would be payable, at the Trustee’s discretion, to your personal representative(s) (to be dealt with as if it were part of your estate). This is up to a maximum of three times your Pensionable Salary at the date your employment ceased (adjusted by inflation up to 7% a year or such higher amount as the Trustee and Founding Companies may have agreed), from the date you took your pension. Pensions will also be paid to your dependants. For example, your Qualifying Spouse will be entitled to a pension of 60% of your Partial Incapacity Pension before any reduction for any cash lump sum paid to you.


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Ill Health PensionThis is a third category of benefit. If you fail to meet the criteria for Total Incapacity or Partial Incapacity, you might be granted an Ill Health Pension. This may be payable if you have a physical or mental condition preventing you from remaining in service with your Employing Company.

If you fall into this category and you are aged 55 or over, with at least two years’ Pensionable Service, your Employing Company may grant you an Ill Health Pension. This will be based on your Pensionable Salary and your Pensionable Service at the date your employment ceased, but will be reduced by a factor set by the Founding Companies after consulting the Actuary. This factor is currently 4% for each year the pension is taken before your Pension Age, but can be reviewed and may be changed in the future.

If you die after Pension Age in receipt of an Ill Health PensionIf you die within five years of reaching pension age, a lump sum equal to the pension you would have received from the SOCPF during the remainder of the five-year period would be payable, at the Trustee’s discretion, to your personal representative(s) (to be dealt with as if it were part of your estate). This is up to a maximum of three times your Pensionable Salary at the date your employment ceased, adjusted for inflation (up to 7% a year or such higher amount as the Trustee and Employing Company may have agreed), from the date you took your pension. Pensions will also be paid to your dependants. For example, your Qualifying Spouse will be entitled to 60% of your pension before any reduction for early payment and any cash lump sum paid when you took your Ill Health Pension.

Serious ill-health commutationIf you are diagnosed with a medical condition that means that you are expected to die within one year, it may be possible for you to commute 100% of your future pension for a lump sum before Pension Age. This applies to both Deferred and Employed Members of the SOCPF but there are certain conditions which must be satisfied, and Employing Company and Trustee approval must be obtained. The commutation factor used will be as decided by your Employing Company after consulting the Actuary. Pensions will be provided for your Qualifying Spouse/dependants in the event of your death based on your reduced early retirement pension. If this applies to you, please contact the Pensions Administration Team (see page 62).


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3 THE POST-2009 SECTION OF THE SOCPF3


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3 THE POST-2009 SECTION OF THE SOCPF

The Post-2009 Section applies to new members who joined the SOCPF between 1 January 2009 and 28 February 2013. Benefits of this Section – at a glance and in detail – are shown in this chapter.

Your benefits in the Post-2009 Section at a glance

Who can be a member?

Any employee employed by a Member Company on a regular contract, who:

Joined the SOCPF between 1 January 2009 and 28 February 2013; or

Is a Linked Fund Member who has had continuous membership in the SOCPF or SCPF which commenced between 1 January 2009 and 28 February 2013.

What does it cost me? Currently, your contributions are 2% of your Pensionable Salary up to £30,000 and 6% of your Pensionable Salary over £30,000.

Can I transfer pension benefits from another pension provider into the SOCPF?

From 1 July 2018, the SOCPF will no longer accept transfers of benefits from other pension schemes into the fund.

How is my pension calculated?

Your pension is based on a formula: 1/60th Accrual Rate x Pensionable Service x Final Pensionable Salary

You can find an example of this calculation on page 40.

What is my Pensionable Salary?

Your Pensionable Salary is the annual figure on which your contributions to the SOCPF are based. It is a sterling amount based on the equivalent Pensionable Salary for your job group in the UK, and is set by your Employing Company.

How is my Final Pensionable Salary calculated?

The highest average annual Pensionable Salary during any 36 consecutive months in the last five years’ Pensionable Service immediately before you leave service or die, whichever is the earliest. If you have not completed three years’ Pensionable Service, it will be the average annual Pensionable Salary over that shorter period. If you have been in receipt of pensionable shift allowance at any time, please contact the Pension Administration Team to find out how your Final Pensionable Salary is calculated.


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At what age can I take my pension unreduced and without Employing Company consent?

From age 65.

What if I’m too ill to work and leave my Employing Company’s service as a result?

There are two levels of pension that can be paid at the discretion of your Employing Company, based on its opinion of your medical condition:

Total Incapacity – a pension based on your Final Pensionable Salary and Prospective Pensionable Service to Pension Age (or Pensionable Service to date of leaving your Employing Company’s service after Pension Age).

Partial Incapacity – a pension based on your Final Pensionable Salary and completed Pensionable Service to date of leaving your Employing Company’s service.

If you have a serious illness it may be possible for you to exchange 100% of your pension for a lump sum.

What if I die? If you die in service, the benefits for your dependants are:

A lump sum of three times your Pensionable Salary, paid at the discretion of the Founding Companies; and

Pensions to a Qualifying Spouse (or to a dependant if there is no spouse at the discretion of the Founding Companies) and Children based on a percentage of the pension you would have been entitled to at your Pension Age (based on your Pensionable Salary when you died).

Benefits are also payable to dependants if you die in retirement or before you take your pension. More information can be found on pages 44 and 45.

What about pension increases?

Your SOCPF pension increases by the movement in the UK Retail Prices Index (RPI) up to 5% each year. The Founding Companies can ask the Trustee to approve RPI increases over 5%.


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YOUR BENEFITS IN THE POST-2009 SECTION IN DETAIL

Membership

If you joined the SOCPF between 1 January 2009 and 28 February 2013 and have had continuous Pensionable Service since that date, you are a member of the Post-2009 Section. This chapter aims to give you information about the SOCPF to use as a reference throughout your membership.

Please note that no new members will be admitted to the post 2009 section of the SOCPF on or after 1 March 2013.

JoiningMembership of the SOCPF is voluntary. If you are eligible, you will be invited to join. You have 30 days from when you first become eligible in which to make up your mind to accept or reject the offer to join. Your contributions will be set up automatically, but you must still complete and return an application form.

Joining at a later dateIt will not be possible to join at a later date because the SOCPF will be closed.

Terminating your membershipYou may opt out of membership of the SOCPF at any time by giving notice in writing to the Trustee through your Employing Company. Membership will terminate on the last day of the month following that in which your Employing Company receives the notice.


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Working in the UKIf you return to work for a Shell Group company in the UK, you will normally cease accruing benefits in the SOCPF, and will be invited instead to join the Shell Contributory Pension Fund (SCPF). The SCPF is a UK Registered Pension Scheme. The SOCPF is designed so far as possible to be complementary to the SCPF. This enables UK base country employees to participate in a pension fund whilst on overseas assignments for Shell companies. If you are a member of the Post-2009 Section of the SOCPF and then work in the UK, joining the SCPF, you will join the Post-2009 Section of the SCPF provided your Pensionable Service in the two Funds is continuous.


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Contributions

Contributions made to the SOCPF by you and your Employing Company are invested to pay for benefits.

Company contributionsThe Member Companies pay the balance of the cost of providing SOCPF benefits after taking into account member contributions and investment returns.

Your contributionsAs an SOCPF member, you are required to contribute a proportion of your Pensionable Salary to the SOCPF.

Member contributions are currently:

Pensionable Salary up to £30,000 a year 2%

Pensionable Salary over £30,000 a year 6%

The Founding Companies can amend the contribution rates in future with the approval of the Trustee.

For details of the tax treatment of contributions, please refer to the factsheet ‘SOCPF Tax Status’ (see page 6).

Whilst a member of the SOCPF, you cannot make contributions to the SCPF Additional Voluntary Contributions Arrangement. If you are a Linked Fund Member and were making AVC contributions whilst a member of the SCPF, you must stop making AVC contributions whilst a member of the SOCPF.


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Retirement Benefits

The main aim of the SOCPF is to provide you with a pension. These pages look at the pension you can expect to receive from the SOCPF as a member of the Post-2009 Section.

Your Pension Age is 65, and this is the age at which you can take your pension from the SOCPF unreduced and without your Employing Company’s consent.

How is my pension calculated at my Pension Age?The pension you receive at your Pension Age is calculated using a formula that is based on your Pensionable Service and your Final Pensionable Salary. The formula is:


As a member of the Post-2009 Section, your Accrual Rate is 1/60th.

Please refer to the factsheet ‘Linked Fund Membership and the Inter Fund Linking Rules (IFLR)’ if you are a Linked Fund Member (see page 6).

How is my Final Pensionable Salary calculated?Your Final Pensionable Salary is your highest average annual Pensionable Salary in any 36 consecutive months in your last five years’ Pensionable Service immediately before you leave service or die, whichever is the earlier. If, when you leave, you have not completed three years’ Pensionable Service, your Final Pensionable Salary will be your average annual Pensionable Salary over that shorter period. If you have been in receipt of pensionable shift allowance at any time please contact the Pension Administration Team to find out how your Final Pensionable Salary is calculated.

EXAMPLE

Michael is a member of the Post-2009 Section of the SOCPF and retires at age 65 with 35 years’ Pensionable Service and a Final Pensionable Salary of £65,000.

Michael’s pension at retirement is calculated as follows:


1/60th x 35 x £65,000 = £37,917

Michael’s pension is £37,917 a year and is paid (with annual increases when granted) for the rest of his life.


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Cash lump sumAt retirement, you are able to commute some of your pension for a cash lump sum. You will be given details of the maximum amount of cash lump sum available as you approach retirement.

If you take a cash lump sum, your pension will be reduced.

The cash lump sum is calculated as follows: 25% x annual pension x commutation factor = Maximum cash lump sum

The commutation factor is based on age and gender. For example, at age 65, the commutation factors are currently:

Male 16.468 Female 17.488

The reduction in the annual pension is calculated as follows:

Cash lump sum = Reduction to annual pension (commutation)

Commutation factor

EXAMPLE

Michael is able to take a pension of £37,917 a year when his pension becomes payable at age 65. His maximum cash lump sum and the reduction to his annual pension will be calculated as follows:

25% x (£37,917 x 16.468) = Michael’s maximum cash lump sum = £156,104

The reduction in his annual pension for the commutation is:

Cash lump sum = Reduction to annual pension

Commutation factor

£156,104

16.468 = £9,479

This means that Michael can choose to take a cash lump sum of up to £156,104 and a reduced pension of £28,438 (£37,917 – £9,479).

Michael can also choose to take a lower cash lump sum, which will result in a lesser reduction to his annual pension, or no cash lump sum at all.


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Early retirementIf you decide to leave service, you can take your pension, without Employing Company consent, after the age of 55. Your pension will be calculated in the same way as at Pension Age (see page 40), based on your Pensionable Service to the date of your early retirement.

However, as your pension will be paid for a longer period of time, it will be reduced (by an early retirement factor) and paid at a lower rate for the full term of your pension. This will affect any Qualifying Spouse’s or dependant’s benefits arising from your death after early retirement because these pensions are calculated as a percentage of your pension. The early retirement factor is set by the Founding Companies (after consulting the Actuary) at 4% a year with effect from 1 January 2009, but this can be reviewed and may change in future.

Retirement at or after Pension AgeFor Post-2009 Section members, Pension Age is age 65. The Pensions Advisory Unit will contact you before you reach your Pension Age to remind you of your pension options.

If your Employing Company agrees that you may continue your employment after you are 65, and the laws of your host country allow, you may choose to:

nn Continue to work in pensionable employment but not draw your pension from the SOCPF and accrue further SOCPF pension after age 65; or

nn Continue to work but leave the SOCPF and draw your pension.

If you continue to work and accrue further SOCPF pension, you will remain a member of the SOCPF at the same accrual and contribution rate as before and you will be entitled to the same benefits such as death in service and incapacity pensions.

If you continue to work and draw your SOCPF pension, and if you die while employed, you will be treated as a Retired Member for death benefits. For more details see page 44.

You may want to take independent financial advice before making a decision.

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What if I work part-time? If you work part-time, or have worked part-time for some of your Pensionable Service, your pension will be adjusted to take this into account. If you die in Pensionable Service any lump sum that is paid would be based on your Pensionable Salary at the date of your death. A factsheet on ‘Part-time Working’ is available from the Pensions Advisory Unit, the Pensions Administration Team or the Pensions website – www.shell.co.uk/pensions.

What if I am absent from work? Absence from work, including maternity, paternity and adoption leave, may have an effect on your pension. For more information, in the first instance, please contact your HR adviser.


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Death in Retirement

If you die in retirement having left service, the SOCPF provides benefits for your dependants.

Pension for Qualifying SpouseYour surviving Qualifying Spouse will be entitled to a SOCPF pension from the first day of the month following your death. The pension varies depending on the terms of your retirement. See the table below for details:

If... Then...

Your pension was paid from Pension Age and you died after Pension Age...

Your surviving Qualifying Spouse will be entitled to 60% of the pension you received when you took your pension, but before any adjustment for taking a cash lump sum and allowing for increases to the pension between the member’s retirement and death.

Your pension was paid early with reduction under the early access arrangements introduced from 1 January 2009...

Your surviving Qualifying Spouse will be entitled to 60% of your pension after the adjustment for early payment, but before adjustment for taking a cash lump sum and allowing for increases to the pension between the member’s retirement and death.

Your Qualifying Spouse’s/dependant’s pension is in payment...

The pension increases by the movement in the RPI up to 5% each year. If RPI exceeds 5% then the Founding Companies can ask the Trustee to approve an increase over 5%.

Pensions for dependantsThe SOCPF also provides benefits for your dependants. For example, if you do not have a Qualifying Spouse, an Adult Dependant’s pension may be payable, at the discretion of the Founding Companies, to someone who is financially dependent on or interdependent with you.


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Three or more Children will share 100% of the member’s pension

Lump sum benefitIf you were to die within five years of taking your pension from the SOCPF, your estate would be paid a lump sum equal to the pension you would have received from the SOCPF during the remainder of the five-year period. This would be payable at the discretion of the Trustee to your personal representative(s) to be dealt with as if it were part of your estate. This cannot exceed a maximum of three times your Final Pensionable Salary (adjusted for inflation by up to 5% a year or such higher amount as the Trustee and Founding Companies may have agreed).


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Leaving

There are a number of reasons why you may leave the SOCPF. You may resign from or be dismissed by your Employing Company, or you may choose to opt out of the SOCPF at any time.

If you leave the SOCPF (regardless of whether you leave the service of your Employing Company at the same time), your options depend on how much Pensionable Service you have in the SOCPF.

Pensionable ServiceThe amount of Pensionable Service you have may include additional service which has been transferred in from another pension scheme. Additional service may be less than the actual pensionable service in the previous scheme.

If you leave with two or more years’ Pensionable ServiceIf you have at least two years’ Pensionable Service when you leave the SOCPF, you become entitled to a deferred pension payable from your Pension Age.

There are other instances when you will be entitled to a deferred pension on leaving the SOCPF, even if you do not have two years’ Pensionable Service:

nn If your actual Pensionable Service with the SOCPF plus your actual pensionable service with a previous company (from whose pension scheme you transferred in benefits) come to a total of at least two years when you leave, you will be entitled to a deferred pension.

nn If you have a transfer into the SOCPF from a personal pension then you automatically become entitled to a deferred pension.

Your pension will be calculated using the same formula as for normal retirement (see page 25) using your Final Pensionable Salary and your Pensionable Service at your date of leaving. Your pension will be paid at Pension Age, unless you decide to take it earlier (from age 55 onwards).

The deferred pension is revalued from the date of leaving. It increases by the movement in the RPI up to 5% each year. If RPI exceeds 5% then the Founding Companies can ask the Trustee to approve an increase over 5%.

If you are leaving service with your Employing Company and have an entitlement to an SOCPF deferred pension, as an alternative to your deferred pension entitlement, you can opt to receive a return of your contributions (but not those made by Member Companies). You must advise the Trustee, via your Employing Company, on or before leaving your Employing Company’s service, if you wish to take this option. Please note that if you exercise the option to receive a refund of your contributions in lieu of your deferred pension, then no dependant’s benefit would be paid in the event of your death.

It is strongly recommended that you take independent financial advice before making your decision.


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Early access to pensionWhatever your Pension Age, you can receive your pension from age 55 if you leave, or have left, service. Your pension will be calculated in the same way as at Pension Age (see the example on page 40). As your pension will be paid for a longer period of time, it will be reduced (by an early retirement factor) and paid at a lower rate than you would have received if you had retired at Pension Age for the full term of your pension. This will affect any Qualifying Spouse’s or dependant’s benefits arising from your death after early retirement because these pensions are calculated as a percentage of your pension. The early retirement factor has been set by the Founding Companies (after consulting the Actuary) at 4% a year with effect from 1 January 2009, but this can be reviewed and may change in future.

Once your pension becomes payable, it will be treated in the same way as on normal retirement (see page 40). For example, you will be able to commute some of your pension for a cash lump sum.

EXAMPLE

Simon is a member of the Post-2009 Section of the SOCPF and his Pension Age is 65. He resigns from service at age 49 and his SOCPF pension when he leaves service is £52,000. The pension increases each year and by the time he has reached age 55 it amounts to £62,000. He decides to take his pension early from age 55, i.e. 10 years before his Pension Age. The current early retirement factor is 4% a year at the time Simon wishes to draw his pension and so a reduction of 40% (£24,800) is made to Simon’s pension and he receives £37,200 a year from age 55.

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What happens if I become ill or die before my pension is paid?

Ill Health Pension

If you are a Deferred Member you may be entitled to a deferred ill health pension, at the discretion of your last Employing Company in the Shell Group of companies. Contact the Pensions Administration team for further information.

Serious ill-health commutation

If you are diagnosed with a medical condition that means that you are expected to die within one year, it may be possible for you to commute 100% of your future pension for a lump sum before Pension Age. This applies to both Deferred and Employed Members of the SOCPF, but certain conditions must be satisfied, and Employing Company and Trustee approval must be obtained.

The commutation factor used will be as decided by your Employing Company after consulting the Actuary. Pensions will be provided for your Qualifying Spouse/dependants in the event of your death based on your reduced early retirement pension.

If you think this may apply to you please contact the Pensions Administration Team (see page 62 for contact details).

If you die as a Deferred Member

In the event of your death, your Qualifying Spouse and Child(ren) will be entitled to SOCPF pensions from the first day of the month following your death.

Pension for your Qualifying Spouse

If you die before your pension has started being paid, your surviving Qualifying Spouse will be entitled to a pension from the first day of the month following your death. The pension will be based on 60% of your deferred pension at the date you left service, allowing for increases to the pension between the date you left service and the date of your death.


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Pensions for Children

Children’s pensions are payable on the death of a member. Legitimate, legitimated and lawfully adopted Children who are unmarried and under 18 are entitled to a pension on your death, payable up to age 18 or marriage, whichever comes first. Other unmarried Children may be granted a pension on your death in certain circumstances:












If you have no dependants

If you die before your pension is paid and have no dependants, a refund of the contributions you have made to the SOCPF will be paid to the personal representative(s) dealing with your estate. Interest of 3% a year will be added to this refund.

Can I transfer my deferred benefits?Transferring benefits out of the SOCPF is complicated. Unlike the SCPF, the SOCPF is not a Her Majesty’s Revenue and Customs (HMRC) Registered Pension Scheme. This means that there are restrictions on transfers out of the SOCPF and some pension providers may not accept benefits from the SOCPF.

For further details, please refer to the factsheet ‘Transfers out of the SOCPF’.


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If you leave with more than three months and less than two years’ Pensionable ServiceYou have a choice:

nn You may be able to transfer the monetary value of your SOCPF benefits to another pension scheme; or

nn You can take a refund of your member contributions (but not contributions made by Member Companies), plus interest at 3% a year.

If you leave with less than three months’ Pensionable ServiceYou are entitled to a refund of your contributions (but not contributions made by Member Companies), plus interest at 3% a year.


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Death in Service

In the event of your death in Pensionable Service, your Qualifying Spouse and Child(ren) will be entitled to SOCPF pensions from the first day of the month following your death. In addition, a lump sum may be payable.

Lump sum benefitA lump sum, equal to three times your Pensionable Salary at your death, may be payable to your beneficiaries if you die in Pensionable Service. This is paid at the discretion of the Founding Companies, which, under current legislation, ensures that the lump sum does not carry any liability to UK Inheritance Tax.

You should complete a nomination form to tell the Founding Companies your wishes in respect of your lump sum benefit. However, the Founding Companies are not bound by your wishes. For example, if your personal circumstances have changed since you completed the nomination form, the Founding Companies may decide not to follow the wishes stated on your form.

It is important to keep your nomination form up to date. You can get these forms from the Pensions Advisory Unit, or from the Pensions website – www.shell.co.uk/pensions, if you have access.

PensionIf you die in Pensionable Service before Pension Age, pensions for your dependants are based on a percentage of the pension you would have received at Pension Age. For example, your Qualifying Spouse will receive 60% of the pension you would have received at Pension Age. This pension is based on your Final Pensionable Salary at the date of your death and your Pensionable Service including Prospective Pensionable Service to your Pension Age.

If you die in Pensionable Service on or after your Pension Age, pensions for your dependants are based on a percentage of the pension calculated at the date of your death, based on your Final Pensionable Salary at the date of your death.


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EXAMPLE

Elena is a member of the Post-2009 Section and dies in Pensionable Service, aged 45, with Pensionable Service of five years and a Final Pensionable Salary of £54,000.

Elena’s notional pension would be:

Accrual Rate x Pensionable Service (to death + prospective) x Final Pensionable Salary

1/60th x (5 + 20 = 25) x £54,000 = £22,500

Elena’s husband, James, will be entitled to 60% of Elena’s notional pension, so he will receive £13,500 a year from the month after Elena’s death. His pension increases by the movement in the RPI up to 5% each year. If RPI exceeds 5% then the Founding Companies can ask the Trustee to approve an increase over 5%.


Pensions for ChildrenIf a member dies, Children’s pensions are payable. Legitimate, legitimated and lawfully adopted Children who are unmarried and under 18 are entitled to a pension on your death, payable up to age 18 or marriage, whichever happens first. Other unmarried Children may be granted a pension on your death in certain circumstances:





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If you die before your pension is paid and have no dependants, a refund of the contributions you have made to the SOCPF will be paid to the personal representative(s) dealing with your estate. Interest of 3% a year will be added to this refund. Any discretionary lump sum paid (see page 51) is in addition to this refund of contributions.


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Serious Illness (Incapacity)

If you are unable to continue working because of a serious medical condition or disability, you may be granted an immediate pension on medical grounds. These pensions are granted at the discretion of your Employing Company after taking medical advice on the level of your incapacity.

Total IncapacityA physical or mental impairment and deterioration which, in the opinion of your Employing Company (acting on medical advice), makes it unlikely that you will ever again obtain employment.

If your Employing Company decides to grant you a Total Incapacity Pension, it will be based on your Pensionable Salary and your Prospective Pensionable Service to Pension Age. A Total Incapacity Pension can be reviewed periodically and may be adjusted if there is a change to your medical condition.

If you die before Pension Age in receipt of a Total Incapacity PensionA lump sum will be payable to your dependants at the discretion of your last Employing Company. This will be equal to three times your Pensionable Salary at the date your employment ceased, adjusted by inflation (up to 5% a year or such higher amount as the Trustee and Founding Companies may have agreed, from the date you took your pension), less any lump sum paid when you took your Total Incapacity Pension. Your dependants will also receive pensions. For example your Qualifying Spouse will be entitled to a pension based on 60% of your pension as if you had remained in employment until Pension Age and as though you had died in service. The percentage payable to your dependants will be applied to the pension which you would have been entitled at Pension Age based on your Final Pensionable Salary at the time you ceased employment. The pension will also be inclusive of the same percentage of cost of living increases made to your Total Incapacity Pension between the date of leaving and the date of death.

If you die on or after Pension Age in receipt of a Total Incapacity PensionIf you die within five years of the pension commencing, a lump sum equal to the pension you would have received from the SOCPF during the remainder of the five-year period will be payable, at the Trustee’s discretion, to your personal representative(s) (to be dealt with as if it were part of your estate). This is up to a maximum of three times your Pensionable Salary at the date your employment ceased, adjusted for inflation (up to 5% a year or such higher amount as the Trustee and the Founding Companies may have agreed, from the date you took your pension). Your dependants will also receive pensions. For example, your Qualifying Spouse will be entitled to 60% of your pension before any reduction in respect of any cash lump sum paid to you.


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Partial IncapacityA physical or mental impairment and deterioration which, in the opinion of your Employing Company (acting on medical advice), prevents you from following your current occupation (and will continue to do so) and which seriously impairs your earning capacity.

If your Employing Company decides to grant you a Partial Incapacity Pension, the pension will be the greater of:

a) a pension based on Final Pensionable Salary and Pensionable Service at date of leaving; or

b) a pension based on whichever is the lower of:

i) one-third of your Final Pensionable Salary; and

ii) a pension based on your Final Pensionable Salary and Pensionable Service to Pension Age.

A Partial Incapacity Pension can be reviewed periodically and may be adjusted if there is a change to your medical condition.

If you die before Pension Age in receipt of a Partial Incapacity PensionIf you die within five years of the pension commencing, a lump sum equal to the pension you would have received from the SOCPF during the remainder of the five-year period would be payable, at the Trustee’s discretion, to your personal representative(s) (to be dealt with as if it were part of your estate). This is up to a maximum of three times your Pensionable Salary at the date your employment ceased (adjusted for inflation up to 5% a year or such higher amount as the Trustee and the Founding Companies may have agreed, from the date you took your pension). Pensions will also be paid to your dependants. For example, your Qualifying Spouse will be entitled to a pension which is the lesser of:

a) 60% of the Partial Incapacity Pension you were receiving at the date of your death, ignoring any reductions made for any commutation you elected to take; and

b) 60% of the pension you would have received if you had remained in service until Pension Age based on your Final Pensionable Salary when you left employment and adjusted by the same percentage of cost of living increases made to your Partial Incapacity Pension between the date of leaving and date of death.

If you die after Pension Age in receipt of a Partial Incapacity PensionIf you die within five years of the pension commencing, a lump sum equal to the pension you would have received from the SOCPF during the remainder of the five-year period would be payable, at the Trustee’s discretion, to your personal representative(s) (to be dealt with as if it were part of your estate). This is up to a maximum of three times your Pensionable Salary at the date your employment ceased (adjusted for inflation up to 5% a year or such higher amount as the Trustee and the Founding Companies may have agreed, from the date you took your pension). Pensions will also be paid to your dependants. For example, your Qualifying Spouse will be entitled to a pension of 60% of your Partial Incapacity Pension before any reduction in respect of any cash lump sum paid to you.


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Serious ill-health commutationIf you are diagnosed with a medical condition that means that you are expected to die within one year, it may be possible for you to commute 100% of your future pension for a lump sum before Pension Age. This applies to both Deferred and Employed Members of the SOCPF but there are certain conditions which must be satisfied, and Employing Company and Trustee approval must be obtained. The commutation factor used will be as decided by your Employing Company after consulting the Actuary. Pensions will be provided for your Qualifying Spouse/dependants in the event of your death based on your reduced early retirement pension. If this applies to you, please contact the Pensions Administration Team.

OTHER INFORMATION4


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Trust Deed and Regulations

The SOCPF has been a Bermudian registered scheme since 2014. The SOCPF is a Bermudian trust subject to the law of Bermuda. The SOCPF is governed by the SOCPF Trust Deed and Regulations.

This booklet is only a summary of the benefits provided by the SOCPF and does not override the terms and conditions in the SOCPF Trust Deed and Regulations.

The benefits under the SOCPF are also subject to the requirements of overriding legislation.

You should be aware that the members’ benefits are periodically subject to review. Changes to members’ benefits through changes to the Regulations can only be made by the Trustee with the consent of the Founding Companies. No change can be made which alters the main purpose of the SOCPF or reduces the value of benefits already earned or of pensions in payment.

Tax status of the SOCPF

The SOCPF is not a UK Registered Pension Scheme, a Qualifying Recognised Overseas Pensions Scheme or a Recognised Overseas Pensions Scheme.

The tax treatment of members’ contributions, pensions and any lump sum payments will be governed by the tax laws that apply in your country of residence. It is important therefore that you take appropriate independent financial/tax advice.

Please refer to the factsheet ‘SOCPF Tax Status’ for further information (see page 6).

Communication with members

Each year the Trustee produces a report that summarises the SOCPF’s formal Report and Accounts and gives members an update of the funding position of the SOCPF. This is provided, together with other information on the SOCPF, in an annual publication sent to members.

A copy of the full Report and Accounts is available on request from the Pensions Administration Team (see page 62 for contact details).

An annual pension benefit statement is available to all Employed and Deferred Members.

Assignment of benefits

You may not assign or charge your benefits under the SOCPF.

OTHER INFORMATION4


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Divorce

It is extremely important if you are starting divorce proceedings that you contact the Pensions Advisory Unit or Pensions Administration Team and obtain the factsheet ‘SOCPF Pensions on Divorce’. The factsheet is also available on the Pensions website – www.shell.co.uk/pensions, if you have access.

Courts will take account of pension rights when deciding divorce settlements, and you should consult a solicitor experienced in dealing with pension matters.

Evidence of age

Before any benefits are paid, evidence of age (normally a birth certificate) will be required by the Trustee.

Making an enquiry or complaint

If you have any enquiries about your individual benefits, in the first instance, please refer to the Pensions Advisory Unit (Employed Members) or the Pensions Administration Team (Deferred and Retired Members).

If you wish to make a formal complaint about a matter for which the Trustee is directly responsible, you can do so by completing a ‘Notice of Complaint’ form. Employees may obtain a form from the Pensions Advisory Unit ([email protected]). Other complainants may obtain a form from the Pensions Manager, Trustee Services Unit, Shell International Limited, Shell Centre, London SE1 7NA.

Once completed the ‘Notice of Complaint’ form should be returned to The Secretary, Shell Trust (Bermuda) Limited, 3rd Floor, Continental Building, 25 Church Street, Hamilton HM 12, Bermuda.

A copy of the form should also be sent to the Pensions Manager, Trustee Services Unit, Shell International Limited, Shell Centre, London SE1 7NA.

The Secretary has been nominated by the Trustee to investigate any complaints and will respond within two months with either a decision referring to the appropriate regulations of the SOCPF or legislative requirements, or reasons for any delay and an estimated date for a decision.

If you remain dissatisfied with the decision, you can then opt to write to the Chairman of Shell Trust (Bermuda) Limited, 3rd Floor, Continental Building, 25 Church Street, Hamilton HM 12, Bermuda, within six months, including details of your original complaint and an explanation of why you disagree with the decision made.

The Board of Directors of the Trustee will reconsider the matter and respond with a decision within two months of receipt.

All formal complaints and the decisions of the Secretary are reported to the full Trustee Board.


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This procedure relates only to matters for which the Trustee is responsible, so matters which depend on the Employing Company’s discretion must be referred to your Employing Company. Examples of the types of benefit which depend on your Employing Company’s discretion are the granting of incapacity pensions or death in service lump sums.

The SOCPF complaints procedure does not cover complaints in respect of former members who have transferred their benefits from the SOCPF more than six months before, or where proceedings have begun in a Court or a tribunal.

All contact details can be found on the following page.

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Useful contacts

FOR BENEFIT INFORMATION FOR EMPLOYED MEMBERS:

Write to: Pensions Advisory Unit, Trustee Services Unit, Shell Centre, York Road, London SE1 7NA

Email: [email protected]

FOR BENEFIT INFORMATION FOR DEFERRED AND RETIRED MEMBERS:

Write to: Pensions Administration Team, Trustee Services Unit, Shell Centre, York Road, London SE1 7NA


FOR FACTSHEETS:

Write to: Pensions Administration Team or Pensions Advisory Unit, Trustee Services Unit, Shell Centre, York Road, London SE1 7NA


FOR GENERAL ENQUIRIES:

Write to: Peter Borland, Secretary to the Trustee Board, Shell Trust (Bermuda) Limited, 3rd Floor, Continental Building, 25 Church Street, Hamilton HM 12, Bermuda.


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Jargon buster

Accrual Rate is the fraction of Final Pensionable Salary that you will receive for each year of Pensionable Service in a Defined Benefit Scheme.

Adult Dependant is a person who, in the opinion of the Founding Companies, is financially dependent on or interdependent with you.

Child is any one of your unmarried children (legitimate, legitimated, illegitimate, lawfully adopted, or step) who has not yet reached 18 years, or is under 23 years and in full-time education, or has a disability that means they are dependent on you. Children is used throughout this booklet accordingly.

Commutation is exchanging some of your pension for a cash lump sum.

Deferred Member is someone who has left the service of companies in the Shell Group or opted out of the SOCPF, not started to receive a pension and retains benefits in the SOCPF.

Defined Benefit Scheme is sometimes called a ‘final salary pension scheme’ and is a pension scheme, like the SOCPF, where the value or amount of pension a member will receive at retirement is defined at the start.

Employed Member is a member of the SOCPF, currently employed by one of the Employing Companies.

Employing Company is the participating Member Company that currently employs a member, or in the case of a Deferred Member or a Linked Fund Member, was the last participating Member Company to employ the member.

Final Pensionable Salary is the pensionable salary (expressed in sterling) on which your pension is calculated at the date you leave service or die, whichever is the earlier (see pages 14 & 40).

Founding Companies are The Shell Petroleum Company Limited and Shell Petroleum N.V. Some discretionary powers under the SOCPF are vested in these companies.

Inter Fund Linking Rules (IFLR) set out the position for members who accrue Pensionable Service in the SOCPF and the SCPF. These rules deal with the calculation of such members’ benefits, the apportionment of those benefits between the SOCPF and SCPF and the funding of those benefits.

Linked Fund Member means a member of a Fund who is not accruing Pensionable Service in that Fund but has past Pensionable Service in that Fund, and who is an active member of the other Fund and whose periods of Pensionable Service in the two Funds are continuous or are continuous as a result of linked Pensionable Service.

Member Companies are companies admitted to membership of the SOCPF by the Trustee with the consent of the Founding Companies.

Normal Minimum Pension Age (NMPA) is the earliest age that your pension can be paid other than for medical reasons.

Pension Age is the age you can take your pension without Employing Company consent and without having your pension reduced. For the Post-2009 Section of the SOCPF, this is age 65. For the Pre-2009 Section of the SOCPF, this is normally age 60, although some members of this Section may have a different Pension Age for historic reasons.

Pensionable Salary is the annual figure on which your contributions to the SOCPF are based. It is a sterling amount based on the equivalent Pensionable Salary for your job group in the UK, and is set by your Employing Company.


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Pensionable Service is the total of your years and months of SCPF membership whilst in the service of Member Companies, plus any years and months of additional service granted as a result of a transfer in from another pension scheme. Any part month of service will be rounded up or down to the nearest month.

Prospective Pensionable Service is the amount of Pensionable Service you can build up until Pension Age.

Qualifying Spouse is someone you are legally married to or in a civil partnership with at the time of your death.

Retail Prices Index (RPI) is the official UK Government index, which is the basis for annual increases to pensions.

Retired Member is someone who is receiving a pension from the SOCPF.

Registered Pension Scheme is a pension scheme which has either been registered by Her Majesty’s Revenue and Customs or has acquired registered status automatically by being an approved pension scheme on 5 April 2006.

SCPF is the Shell Contributory Pension Fund.

SOCPF is the Shell Overseas Contributory Pension Fund.

Trustee is Shell Trust (Bermuda) Limited.

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Documents

SHELL OVERSEAS CONTRIBUTORY PENSION FUND · in a pension fund whilst on overseas assignments for Shell companies. If you are a member of the Pre-2009 Section of the SOCPF and then