Aviation strike unjustified before pension proposals - Varadkar

Minister for Transport Leo Varadkar has said there is no justification for strike action in the aviation sector over pensions until these new proposals for dealing with the long-running issue are considered.

The Minister was commenting after members of Siptu in Aer Lingus and in the Shannon Airport Authority voted overwhelmingly in favour of strike action.

Siptu members at the Dublin Airport Authority, who are also covered by the same Irish aviation workers pension scheme, voted for industrial action on Monday.

The joint pension scheme has an estimated deficit of around €780 million and employees are fearful that their anticipated benefits will be curtailed significantly.

Informed sources said that Siptu could serve notice of industrial action later this week but that there could be a longer-than-normal lead-in period of 3 - 4 weeks before any industrial action commenced.

In the Aer Lingus ballot 91 per cent of staff backed industrial action, with 80 per cent prepared to support a full strike.

A total of 78 per cent voted to withhold pension contributions from the current pension scheme.

Siptu represents ground staff grades at the airline as well as some cabin crew.

The bulk of cabin crew as well as pilots are members of Impact.

Other unions at Aer Lingus have not balloted for industrial action over the pension issue, which has been the subject of negotiations for around four years at this stage.

Siptu said that at Shannon Airport Authority a total of 98 per cent and 96 per cent of the membership in two ballots voted in favour of taking industrial and strike action respectively.

Aer Lingus said the renewed prospect of industrial action was unhelpful to making progress towards reaching a solution which is in the interests of all parties.

The airline said it wanted to inform customers that “we have not received notice of industrial action and as such our schedule is planned to operate as normal.”

Mr Varadkar said tonight: “The staff and companies are paying into a pension that is no longer viable and both sides are frustrated that no solution has been found to date. I understand that the trustees will issue their proposals to address the deficit in the next week or so. There is no justification for strike action that would inconvenience the public until these new proposals are considered.”

Aer Lingus and the Dublin Airport Authority urged the pension scheme trustees to set out their new funding proposal as quickly as possible.

It is understood that the trustees have been in discussions with the Pensions Board and are expected to have a revised funding proposal for the scheme within the next few days.

There is increasing speculation that any new proposal could involve introducing cuts to benefits of retired staff by invoking new legislation.

There are around 5,000 retired members in the scheme.

Under the legislation the first €12,000 in pensions are protected. The legislation allows for earnings between €12,000 and €60,000 to be cut by 10 per cent and above €60,000 by 20 per cent.

Some informed sources suggested that the alternative to a pensioner bail-in was to extend the retirement age and to force workers to take a certain size of lump sum on retirement so that the fund can control the outflows.

Siptu said that staff at the airline had been unsuccessfully seeking to have their employer deal with the significant deficit in the Irish Airlines Superannuation Scheme (IASS) for several years.

Dermot O’Loughlin, SIPTU’s pension policy advisor, said:”“A total of 91 per cent and 80 per cent of the membership in two ballots voted in favour of taking industrial and strike action respectively. Separately, by way of a plebiscite, over 76 per cent members indicated that they would prefer that their on-going pension contributions to the scheme to be withheld pending resolution of the dispute on the pension issue. This demonstrates that staff at the airline are angry, disillusioned and frustrated that an acceptable resolution has not been found to the pensions crisis.”

“Before proceeding further, we will now be moving to consult with those of our members who are not in the IASS scheme and indeed who have no proper pension provision at all. We will be seeking to ascertain their views as to how to best further their interests in relation to pensions. We will also be consulting with the other trade unions in Aer Lingus before proceeding with any type of action.

"It is the view of the Pensions Committee that this situation has come about as a consequence of the intransigence and procrastination of the trustees of the scheme, the regulatory authority and the company which has forced the membership into this very serious position."

Aer Lingus said the renewed prospect of industrial action was unhelpful to making progress towards reaching a solution which is in the interests of all parties.

The airline said it was the responsibility of the IASS trustee to submit an appropriate funding proposal to the Irish Pensions Board.

It said that this was “ the next crucial step in this process”.

“We continue to urge the IASS Trustee to submit its proposal urgently and similarly urge the Irish Pensions Board to prioritise and expedite its issuance of a response to the proposal.”

“We wish to inform all Aer Lingus customers that we have not received notice of industrial action and as such our schedule is planned to operate as normal.”