The John Lewis Partnership, which includes both John Lewis and Waitrose, has scrapped its final-salary pension, which members did not have to pay into.
In its place, the group has introduced a defined benefit scheme for new employees, which it calls partners, from April this year and for existing partners from April 2016.
It will extend the period that partners must wait before they can join the scheme from three years to five.
After joining, they will receive payments of 120th of their final salary for every year worked without having to make a contribution, from April 2016.
The group will pay 3% of employees’ basic pay on a non-contributory basis and will match up to 4.5% for the full length of service.
Nat Wakely, director of the pensions benefit review for John Lewis Partnership, said: “The John Lewis Partnership pension is a defining element of our business and this decision will ensure that it remains so in a way that is fair and affordable.
“The council’s unanimous vote in favour of the final proposal was the culmination of a very thorough process, involving every area of the partnership and concluding in a decision that we took together in an open and democratic way.”
John Lewis launched a review of its pension scheme in March 2013 after a valuation found it had a deficit of £840m.