Irish Life facing industrial action over pension changes
State’s largest life insurance and pensions group to close defined-benefit pension plan
Irish Life closed its defined-benefit pension plan to new employees at the end of 2006.
Irish Life is facing industrial action and possible strikes after a sizeable majority of its staff voted in favour of taking action in response to the company’s decision to close two defined-benefit pension scheme later this year.
The State’s largest life insurance and pensions group signalled last year that it intended to stop making contributions to the plans where retirement payments are linked to the final salary of employees.
It planned to transfer affected staff to a defined-contribution plan, where benefits are tied to the performance of employer and staff investments in individuals’ pension plans.
The plans affected are the Irish Life Staff Benefits Scheme and Canada Life Irish Pension Scheme.
Irish Life had shut off its defined-benefit plan to new employees at the end of 2006, in line with many other companies in Ireland.
Trade union Unite, which represents 1,000 of the company’s 2,500 staff, said that almost 70 per cent of its members voted for industrial action in response to the planned closures.
Overall, the schemes have more than 3,300 members including 700 of Unite’s members in Irish Life. Unite said the pension schemes had never been in deficit, and currently had a surplus well in excess of €200 million, with assets of about €1.1 billion.
Unite regional co-ordinating officer Richie Browne said it was “noteworthy” that staff not involved in the scheme had voted in favour of industrial action.
“In the run-up to the ballot, Unite held consultative meetings in Dublin and Dundalk to discuss the company’s unilateral decision to close the defined-benefit scheme and our members’ response to this decision,” he said.
“The fact that nearly 70 per cent of members voted to take industrial action reflects their anger at the unilateral decision to close a healthy pension scheme with assets of well over a billion euro and a surplus of approximately €200 million.
“It is noteworthy that members who are not in the scheme also voted to support their colleagues who are in the scheme, in the knowledge that, if this assault on the scheme is allowed to go through, no terms and conditions are safe.
“During the coming weeks Unite members will decide on the timing and nature of the industrial action to be taken.”
In a statement, Irish Life said it had made the decision to end future accrual on the two defined-benefit schemes following a “detailed review of the liabilities and costs of the schemes”.
“The company believes that this is the right thing to do to ensure that accrued pension benefits are properly protected and the interests of all scheme members – active, deferred and pensioners – are taken into account,” it said.
Irish Life said it was “considering its response” to Unite’s communication and “remains committed to the industrial relations process and to working with members of the defined-benefit schemes to agree the details of future defined-contribution arrangements”.