Royal Maill have confirmed that theie current Defined Benefit pension scheme, will close to future accrual on the 31st of March 2018, subject to Trustee approval. This has, as expected, caused a bit of a reaction from the Unions.

As part of their 2018 Pension Review, Royal Mail have been working with the CWU and Unite/CMA on a sustainable and affordable solution for some time. A couple of weeks ago the CWU said that a “defined benefit Wage in Retirement Scheme” would offer Royal Mail “a credible, cost efficient and lasting pension solution for all its employees”. Royal Mail have considered the CWU proposal and are looking at options including a Defined Benefit cash balance scheme that ‘builds on a proposal put forward by the CWU’.

Royal Mail say “The proposed Defined Benefit cash balance scheme includes elements of a CWU proposal, without some of the inherent risks to the Company that, in our view, the CWU scheme would have created. We very much appreciate the care that the CWU applied to its proposal and we have agreed to meet them to discuss it further. However, at the moment we do not believe the CWU proposal, in its current form, meets the fundamental principles underpinning our 2018 Pension Review. These are: sustainability, affordability and security“.

Unfortunately Royal Mail’s tweaks haven’t pleased the CWU who responded saying “Royal Mail’s approach to pensions in intellectually boring, morally sickening and in insult to its employees“. Calling Royal Mail’s press release “premature and arrogant” and referring to Royal Mail’s tweaked scheme as a “mutant Defined Contribution proposal”, it is pretty clear that the two sides have a way to go before a pension scheme that Royal Mail can afford and the Unions will accept is in place.

Full Content: Tamebay

Remember to subscribe to our free weekly newsletter for more news or subscribe to our service to get unlimited access