BA unions agree pension cuts
18.03.10
Unions representing British Airways employees have agreed to a plan to help the airline cut the £3.7bn deficit in its two final-salary pension schemes. Pilots union Balpa, ground crew union the GMB and cabin crew union Unite have agreed that future pension entitlement in the bigger of the two schemes will build up at a reduced rate. Alternatively, staff can pay in an extra 4.5% of salary to maintain their current benefits. The deal is separate to the dispute over staffing involving cabin crew.
It is the second time in three years that members of the larger New Airways Pension Scheme (NAPS), which has 30,000 members, have been asked to agree a cut in the value of their scheme or to make contributions to help cut its funding costs. The latest plan will be presented to the pension scheme's trustees for their formal agreement, which has to signed by 30 June 2010, and will be the equivalent of the members paying in an extra £37m a year.
A spokesman for the airline said: ‘The proposals are intended to avoid the closure of the pension schemes and maintain British Airways' contributions at the current level of £330m per annum. There will be a mechanism to help offset the impact of contribution increases on lower paid employees.'
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