UK - Computing giant EDS has closed its final salary scheme to new members in a bid to remain competitive in a battle for a major contract.
And unions fear workers at the firm could also be laid off to quell ongoing pension costs at the firm.
Public and Civil Service Union senior national officer Colin Sambrook said EDS members were “outraged” that the firm had closed its DB scheme to new members.
The revelation comes after EDS outgoing chief executive Dick Brown was awarded a severance package worth £22m.
Sambrook said: “Brown has left with a massive payoff and we’ve got EDS members who have not had a pay rise for three years, and have now seen their final salary scheme closed.
“Against that background, Brown’s severance package is obscene. Who’s going to pay for this if the company can’t afford to have a decent scheme for its employees?”
He added that it was a valid fear that EDS might be looking to reduce overheads by getting rid of “comparatively expensive employees” – releasing former civil service staff and replace them with cheaper workers who will go into its DC plan.
EDS is competing against BT and Cap Gemini Ernst & Young for the contract to run the Inland Revenue’s computer systems.
EDS declined to comment.
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