Aer Lingus and Dublin Airport Authority face lump-sum pension bill
Two companies face the prospect of making payments running into the hundreds of millions of euro into new pension schemes under the latest proposals to resolve the long-running dispute
The Labour Court told Aer Lingus it has to make a ¤110 million lump-sum payment to cover all active members of the IASS, except pilots
Both Aer Lingus and Dublin Airport Authority (DAA) face the prospect of making lump-sum payments running into the hundreds of millions of euro into new pension schemes under the latest proposals to resolve the long-running dispute.
Late last year, the pair brought disputes relating to the Irish Airlines Superannuation Scheme (IASS), a joint pension plan involving them and SR Technics, that has run up a near €780 million deficit, to the Labour Court.
The court yesterday issued separate recommendations that involve both companies making large once-off payments into new schemes to replace the old polan.
The court told Aer Lingus that it has to make a €110 million lump-sum payment to cover all active members of the IASS, except pilots, for whom it has to make separate arrangements.
This is designed to underpin benefits recommended in January that ranged from 84 per cent to 89 per cent of final pay for workers earning less than €30,000 a year and 66 per cent to 70 per cent of final pay for those making €60,000 a year and above.
Along with this, the court is recommending that, in September, the airline’s staff receive a long-service pay increase that would otherwise have been paid last month.
It also wants accummulated long-service increases that would have been paid over the past three years, when pay was frozen, to be paid.
In addition, the court says that specialist staff, whose conditions do not include these standard increments, receive a 2.5 per cent increase.
The recommendation also proposes that each full-time worker receive a “stabilisation payment” of €5,850 in the period up to December 31st, 2016.
However, after that, the court recommends that pay should effectively be frozen, with no annual increases paid for the next three years and no inflationary payrises.
The court called on DAA to pay a once-off lump sum sufficient to secure 65 per cent of benefits due to workers as well as the actual transfer value of the accrued pensions from the IASS.
This should include an offer that amounted to a payment of €250 for each year of service for each of the 1,900 active members of the IASS, and the payment should be made over a five-year period.