The vast majority of defined benefit pension schemes have now closed to future accrual.
For employers with open schemes who are considering closure the following crucial legal points should considered.

The conventional method of ceasing or reducing benefit accrual under a pension scheme is typically an amendment to the Scheme Rules.
Sometimes this power can be subject to a restriction requiring a "final salary link" to be kept after the scheme had been amended to close or reduce benefits.
Such restrictions would make it necessary for post-amendment benefits to be calculated by reference to pensionable service accrued up to the date of the change, but based on the member's ultimate pensionable salary not their current pensionable salary.

One alternative option in relation to accrual closure is to potentially terminate the scheme using a termination power rather than the power of amendment.
If such a notice is served the scheme would then be wound up unless the Trustees exercise their discretion to continue the Scheme as a closed scheme.
This is usually a last resort as it carries the risk that if the Trustees to wind up the Scheme rather than continue it as a closed fund this would (under section 75 of the Pensions Act 1995) trigger an obligation for the immediate payment to the scheme of a debt equal to the scheme s insurance buyout deficit.

Another approach to implementing a closure can be to seek to reach contractual agreement with active members of the Scheme.
Any employee consent would need to be given voluntarily and free from duress.
In theory companies could with additional employment law advice consider the possibility of dismissal and re-engagement in order to overcome this point.

The Pensions Act 2004 (Act) requires consultation with affected employees for at least 60 days before an employer can decide to make certain "listed changes" affecting an occupational pension scheme such as an accrual closure.
The obligation under the Act is only a "consultation" obligation and it should not be possible for members to veto or reject the Proposal.
However, the consultation must be genuine and, according to the Pension Regulator's Guidance, both employer and employee are expected to work in a spirit of cooperation taking into account the interests of both sides.

While it would be unusual there can be restrictions in employees’ contracts of employment or even scheme booklets giving members contractual entitlements that could impact upon a closure.
Ideally a review of these documents should be conducted to establish that no such rights exist.

Any employer making significant changes to benefits should consider the employer’s implied duty of good faith / mutual trust and confidence which is implied into all contracts of employment.
There is potential for this duty to be breached in course of an accrual closure exercise.
However, in practice, there is likely to be limited scope for breaching the duty in the context of most scheme closures provided suitable care is taken.

This legislation restricts the ability to amend pension schemes in a way that would or might adversely affect the subsisting rights of any member of the Scheme.
This effectively protects benefits already built up under the Scheme.
Section 67 must always be considered when considering an accrual closure or other benefit changes.
However, section 67 would not generally impact on changes to future benefits under the scheme such as a closure to accrual unless the Scheme Rules were very unusual.