BoI transferring management of workers’ pension schemes with a €477m deficit
Increasingly complex regulations believed to have led bank to hire Willis Towers Watson
News of the move prompted the Financial Services Union, which represents many Bank of Ireland staff, to warn that the lender cannot transfer workers to Willis Towers Watson against their will. Photograph: Peter Muhly/AFP/Getty Images
The bank is known to have been looking for some time at different options for administering pension schemes, that are now handled in-house, including contracting the work to a specialist.
Bank of Ireland confirmed yesterday it will outsource this work to Willis Towers Watson from November 2019.
It is understood 28 Bank of Ireland workers currently do this work, although the bank’s statement did not confirm this figure.
Bank of Ireland is transferring the day-to-day administration of the schemes to Willis Towers Watson rather than responsibility for managing the money that the lender and workers have invested in them.
The schemes involved are defined benefit plans, which pledge to pay workers a set proportion of their salaries on retirement, but do not include a defined contribution pension operated by the bank.
According to the Bank of Ireland annual report the schemes had a total deficit of €477 million at the end of last year.
News of the move prompted the Financial Services Union (FSU), which represents many Bank of Ireland staff, to warn that the lender cannot transfer workers to Willis Towers Watson against their will.
Maeve Brehony, senior industrial relations officer, said the union would prefer if the bank kept key activities, including administering staff pensions, in-house.
“Our immediate priority is to ensure employees, whose roles are impacted by this decision, are protected in accordance with the FSU change management agreement and redeployment policy,” she said.
The union’s agreements with Bank of Ireland include tough protections against involuntary redeployment and redundancy.
Bank of Ireland confirmed any changes would be voluntary. “Over the next 12 months staff administering the schemes can consider the various options available including redeployment within the bank or transfer to Willis Towers Watson,” it said.
The company did not say how much it would pay Willis Towers Watson for the work.
Increasingly complex regulations governing pensions are understood to have led Bank of Ireland to hire the advisers to administer the retirement schemes involved.
Since the beginning of the decade, large numbers of employers have wound up or restructured defined benefit pension plans as the liabilities involved could ultimately have threatened their solvency.