UK - British Aerospace has agreed to take on a greater share of its pension schemes' deficit and increase contributions over the next three years.
The company’s proposals are outlined in an internal memo sent to employees which was passed on by a source.
The memo said: “The company’s final position aims to offer both the business and members an affordable solution to retain final salary benefits, and the approval of the trustees will now be sought.”
The move follows an in-depth consultation with employees and unions on the health of the £9bn fund.
Proposed changes will see BAe taking on a greater proportion (60%) of the cost needed to save its seven schemes, which have a combined FRS17 deficit of £2.16bn. The increased cost was previously going to be split between the company and employees.
BAe has agreed to increase contributions for three years with further consultation at the end of that period.
The memo added: “Members will be the first to benefit if future improvements in the funding position result in reduced contributions.”
But union leaders say there is some way to go to keep workers’ contributions to an “absolute minimum” and refused to rule out further industrial action.
T&G national organiser Jack Dromey said: “The message from the members is unmistakable – if the company demands too much, they will take industrial action.”
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