UK - Up to 1000 members of the Co-operative group (Co-op) may strike against the companies plans to create a career earnings related pensions scheme, according to the T & G, transport and general workers union.
The Co-op, with reportedly around 70,000 employees and £4.7 billion in pensions assets, today confirmed plans to end the three existing final salary schemes - the Co-op Group Pension Fund, the CIS Employees’ Pension Scheme and the Co-operative Bank Pension Scheme to create a new DB scheme based on career average earnings. The scheme will launch in April pending Trustees’ final approval.
A strike could cause problems for the company, severely affecting its distribution line to all retail department stores and funeral services in the UK.
A spokesman at the T & G said the transport workers are taking a “robust line in not ruling out calls for an industrial action ballet.” However, the T & G added that its members in the insurance sector did not share the same level of appetite.
Ron Webb, T & G national secretary for transport said: “The T & G has around a thousand members in the transport and distribution operation who will be directly affected by the news. The Co-op can be assured that we do not accept the closure of the final salary scheme as a forgone conclusion.”
Usdaw, the retail union, expressed “extreme disappointment” over the ditching of the final salary scheme. According to Usdaw the change will leave higher paid staff in sector such as insurance around a fifth worse off and the lower paid members in the retail stores having to face increased contributions.
Employees in the new scheme will be expected to contribute 6% of their pensionable salary but existing scheme members will not be affected by the changes the Co-op said.
The news co-incides with retail group Arcadia’s plans to hike employees contribution rates by 50% and raise the retirement age from 60 to 65 in order to receive the similar levels of benefits.
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