Bite Size HR: Changes to AIB Pension Scheme Following Labour Court Recommendation
Bite Size HR: Changes to AIB Pension Scheme Following Labour Court Recommendation
Peninsula Team
July 09 2013
As reported on RTE the Labour Court has said that AIB should implement significant changes to pensions, pay and working hours in order to ensure the bank’s viability and the protection of jobs. Labour Court Chairman Kevin Duffy recommends that AIB should close its defined benefit pension scheme by the end of the year and replace it with a defined contribution scheme, which carries greater risk for employees. He has also recommended that staff should work longer hours, while under the recommendation the closing date for a voluntary redundancy scheme would be extended from 31 March 2014 to 28 February 2015. However, workers below manager grade would receive a one-off lump sum worth 4% of current salary.AIB and unions have been in negotiations for some time at the Labour Court on a restructuring and cost reduction programme involving changes in areas including pay, pensions, working hours and jobs security. Pay will be reviewed annually from January 2014, with management and union discussions factoring in issues including the cost of living, the bank's financial performance and performance management. Under the recommendation working hours will increase to 36 hours per week from October, and to 37 hours from 1 April 2014. AIB said it was considering the Labour Court recommendation and will engage with staff over the coming period. In a statement, it said the these negotiations and changes were in addition to AIB's severance programme, benefit changes for staff and pay cuts for senior management which were announced last year.
As reported on RTE the Labour Court has said that AIB should implement significant changes to pensions, pay and working hours in order to ensure the bank’s viability and the protection of jobs. Labour Court Chairman Kevin Duffy recommends that AIB should close its defined benefit pension scheme by the end of the year and replace it with a defined contribution scheme, which carries greater risk for employees. He has also recommended that staff should work longer hours, while under the recommendation the closing date for a voluntary redundancy scheme would be extended from 31 March 2014 to 28 February 2015. However, workers below manager grade would receive a one-off lump sum worth 4% of current salary.
