Aer Lingus faces strike threat

Thu, Oct 25, 2012, 01:00

Siptu has warned industrial action at Aer Lingus is the only option left after negotiations between airline management and unions on tackling the near-€750 million deficit in the pension scheme broke down.

The carrier said it had been told by the Labour Relations Commission it was adjourning indefinitely the talks on the Aer Lingus/Dublin Airport Authority pension scheme.

In a statement, Aer Lingus said it was disappointed at the lack of progress in the LRC today.

"Aer Lingus believes that today’s discussions have been overshadowed and hampered by an interpretation by Union groups that a proposal targeting '85% of final incomes' has been agreed with the DAA.

"It has been confirmed to Aer Lingus directly by the DAA that the proposal under discussion with Union groups does not target any such pension coverage level. We encourage the Union groups and the DAA to resume their discussions to clarify their positions," the statement added.

The carrier said it remained available to resume talks and expressed its belief the LRC "is the appropriate forum in which to achieve this solution".

The issue involves the Irish Airlines Superannuation Scheme (IASS), operated for many years by the Dublin Airport Authority, Aer Lingus and SR Technics. It has 14,667 members. The scheme had a deficit of €748 million on May 31st, 2012, according to a document circulated in September.

It states that in the event of the IASS being wound up, the trustee had purchased guaranteed annuities to secure pensions in payment but that active and deferred members would receive only 15 per cent of the statutory entitlement.

In May, employers proposed that the IASS scheme be frozen. They wanted the trustees to adjust accrued benefits for active and deferred members while also purchasing sovereign annuities for current and future pensioners.This was recommended by the LRC, with a few amendments.

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