The Communication Workers Union (CWU) has said it will urge its members to reject BT's proposals for its pension funds, which includes closing the defined benefit (DB) scheme.
From today the telecoms company is consulting on two alternative options for the BT Pension Scheme (BTPS), one of which is closing it to future accrual from April 2018 for 11,000 managerial staff.
The other option is to allow non-managerial staff, including engineers represented by the CWU to remain members of the DB scheme, but pay higher contributions.
These planned changes are set out in a consultation paper which launches today and will run for a 60-day period while negotiations are still underway with trade unions.
The CWU branded BT's proposals to change pension provision across the company a "slap in the face to loyal employees."
A spokesperson from the CWU said: "The CWU has not been able to reach an agreement with BT on future pension provision for our members in both the DB and defined contribution (DC) scheme."
"We would like to reach an agreement with BT but the current proposals for both schemes are unacceptable.
"We are absolutely opposed to the closure of the DB pension and any changes to it need to take into account members' retirement expectations."
The spokesperson added BT's proposal for the DC scheme - the BT Retirement Saving Scheme (BTRS) - which would see it paying more in contributions, falls short of where it needs to be for the union's members to have a reasonable income in retirement, and needs to be significantly improved.
The changes proposed are to take place from next April, and managers who joined the company before 2001 and are represented by the Prospect union will be asked to switch to BT's defined contribution scheme from April 2018, according to The Financial Times (FT).
Ending accrual in the BTPS, which has 32,100 active members in total, was initially reported as a possibility in May when the company approached trade unions with the idea.
It was seen to be in response to an expected doubling of the BTPS' actuarial deficit in its ongoing triennial valuation, which is expected later this year.
This is predicted to show a £14bn deficit, compared to £7bn as of 30 June 2014, as PP reported in May.
A BT spokesperson said the company's planned changes are to make pension schemes fair and flexible for all employees, while making sure they remain affordable to the company.
"We're improving contributions for those in the BT Retirement Saving Scheme, the pension arrangement for the majority of BT's UK employees. But, at the same time, we need to take action to address the risks and costs of the defined benefit BT Pension Scheme.
"If we do nothing, BT will be facing hundreds of millions in extra contributions to the scheme, on top of our current costs.
It was added this would damage its ability to invest in the UK's communications networks, customer experience and jobs.
"The changes we're proposing will help tackle this problem and we have worked hard to make sure members of all BT pension schemes receive appropriate contributions from BT towards their retirement savings."
13 LGPS funds seek shared actuarial, admin and governance provider; Maps looks for independent evaluator
Norfolk County Council has issued a tender notice for a multi-provide framework agreement for the provision of actuarial services, governance, and administration support and consultancy services.
In this latest Pensions Buzz we want to know what will be the biggest pension issues in 2021.
New Pension Schemes Bill powers given to The Pensions Regulator (TPR) to issue contribution notices will not be backdated, pensions and financial inclusion minister Guy Opperman has confirmed in a written parliamentary statement.
Every month, several firms issue trackers of the aggregate defined benefit (DB) scheme funding position. See here for the December 2020 estimates on the various measures…
Jake Churchill and Grant Suckling set out their five aims for pensions in 2021.