FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : CROSSCARE TEEN COUNSELLING (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - IRISH MUNICIPAL, PUBLIC AND CIVIL TRADE UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Doherty Worker Member: Ms Ni Mhurchu |
1. Staff seeking inclusion into the Company's old Pension Scheme.
BACKGROUND:
2. Crosscare is the social care agency of the Archdiocese of Dublin and employs 170 staff. The issue in dispute relates to a claim by four staff for inclusion in the old pension scheme. The pension provisions for the Company are provided through the Archdiocese of Dublin pension plan. The pension plan was altered with effect from 1st July, 2004. The new scheme gives lesser benefits on retirement than the old scheme both in terms of lump sum and weekly payments.
Both the old and the new schemes are non-contributory. In January, 2006 one of the Claimants wrote to the Trustees of the pension plan on behalf of her colleagues and herself concerning the administration of the plan and in the expectation that all four employees would be included in the old pre-July, 2004 defined benefit plan. The Company responded that none of the four would be permitted to enter the old pre-July, 2004, pension plan as they had not become eligible to do so before the scheme closed on the 30th June, 2004. Local discussions were not successful and the dispute was referred to the Labour Relations Commission. A Conciliation Conference was held but agreement was not reached. The dispute was referred to the Labour Court on the 13th September, 2006, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Court hearing was held on the 13th December, 2006.
UNION'S ARGUMENTS:
3. 1. The four Claimants were employed prior to the introduction of the new Pension Scheme. Consultation did not take place with either the staff or the Union until after the new scheme was introduced.
2. The changes will significantly reduce the benefits to the staff involved.
3. The Claimants' contracts clearly state that they will be eligible for the pension scheme upon completion of a probationary period.
4. There have been a number of agreements to change the conditions of a pension scheme between Unions and Employers but these changes normally affect new entrants to the employments and not existing staff.
5. In a previous recommendation the Court recommended that new Pension Schemes should not impact on existing employees (LCR 18413 refers). The Union is not aware of any similar changes to a Pension Scheme that would affect existing members of staff.
COMPANY'S ARGUMENTS:
4. 1. The Employer had no alternative but to amend the benefit structure with effect from 1st July, 2004, due to the significant financial pressures on the pension plan. The change in the benefit provided was critical to ensure the long-term viability of the excellent defined benefit scheme provided to members. The post July, 2004 pension plan provided is still without comparison in the charitable sector and most other sectors.
2. The Claimants are not entitled to join the old pre 1st July, 2004, defined benefit pension scheme as they did not meet the required criteria, specifically in relation to the completion of twelve months service after the probationary period ended. In relation to the rule requiring the completion of one year in service, this is a very reasonable rule and not uncommon in the vast majority of defined benefit pension schemes. Furthermore, having a specific entry date into a pension scheme is typical.
RECOMMENDATION:
The Court notes that the four Claimants in this case were employed before the inception of the new scheme. The Court is satisfied that on taking up employment they had a legitimate expectation of becoming entitled to pension benefits in line with those provided by the Organisation at that time.
In these circumstances the Court if of the view that the four members of staff concerned should be admitted to membership of the old scheme.
Signed on behalf of the Labour Court
Kevin Duffy
15th December, 2006______________________
todChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.