Good take-up of AIB retirement schemes

 

AIB HAS said it has had a “very strong” response to its early retirement and voluntary severance scheme.

However, a spokeswoman for the bank would not comment on whether the bank had received more than 2,500 applications for the two schemes on offer to employees. The closing date for the early retirement scheme was last Wednesday.

The bank aims to reduce staff by 2,500 by 2014 through the two schemes. It expects to announce which applicants have been chosen for the first phase of the schemes by mid-July.

Its announcement last week that it is to switch staff who are entitled to defined benefit pensions to a defined contribution scheme by the end of the year encouraged some wavering members of staff to apply for early retirement, according to staff who spoke to The Irish Times.

The bank does not automatically accept all applications for the two schemes.

Staff are being offered severance pay of three weeks’ salary for each year of service plus the statutory two-week redundancy, or four weeks inclusive of statutory entitlements, whichever is the better.

The early retirement scheme is being offered to staff who are more than 50 years of age.

The bank has said the redundancies will be split proportionately across its 12,500 staff in the Republic of Ireland and 2,500 staff at First Trust Bank in Northern Ireland and AIB’s British business.

AIB was effectively nationalised after the Government injected more than €20 billion into the bank and its subsidiary, EBS, which it acquired last year.

Last week the bank’s chief executive, David Duffy, told staff AIB needed to ensure the cost base of the bank was more properly aligned to its operating performance.