O2 pension changes ‘more gain than pain’, says CWU
24th September 2012
A major new deal on pensions for members across O2 is
being presented to staff today (Monday). CWU is supporting
acceptance of a negotiators agreement that, for the first time,
would see all employees benefitting from decent pension provision.
The draft deal being put to members is the culmination of virtually a year of intensive negotiations between the CWU, Prospect and O2 as to how the company can best manage the dual challenge of auto-enrolment and ongoing affordability problems surrounding the O2 defined benefit or 'final salary' scheme, which will close. The vast majority of employees are set to benefit from employer contributions while the union has sought to minimise the negative impact on final salary scheme members by securing compensation.
CWU members will have the opportunity to vote on the changes in
an online ballot during the 60 day consultation period.
Andy Kerr, CWU deputy general secretary,
said: "These pension changes will touch every O2 worker one
way or another. There's more gain than pain here and while
it's been a difficult set of negotiations, we believe the
result is a fair approach to pension provision for our members.
"The CWU negotiating team has focussed its efforts over the
last nine months on securing a fair and reasonable outcome for
employees. We believe this package achieves that and are
recommending our members accept these changes."
Sally Bridge, CWU lead negotiator
with O2, said: "Pensions are often seen as complicated so
it's our job now to get out and explain to our members why
we're recommending this deal. It means different things to
people, depending on whether they're currently in the pension
scheme and which part of it they belong to, but it's an
overwhelmingly positive package.
"We've protected the accrued benefits of people in the
final salary scheme and have won permanent compensation for these
members in the form of a supplement from Telefonica O2. The changes
will also bring new company money and pension provision to a large
number of workers who are not currently saving for their
retirement. Paying even a small amount into pensions is tough for
some people, but we're strongly encouraging everyone to take
advantage of the benefits on offer here."
A 60 day consultation period runs from 24th September
to 25th November 2012. The changes are due to come into
effect from March 2013. Details of the CWU ballot and members'
meetings will follow shortly.
Details of the pension changes include:
- Members of O2's money purchase pension plan will benefit from increased company contribution levels from March 1, 2013 - up to a maximum of 11.5% of salary.
- Thousands of employees aged 22 or over, and earning over £8,000 who are not currently in a pension scheme, will be automatically enrolled in the defined contributions pension scheme from March 2013, unless they specifically request otherwise.
- Closure of the final salary scheme, but with additional company
contributions worth 21% of salary lasting up until 2016 and 16%
For more information please visit: www.cwu.org/o2-pensions.html