Agent69

Would BA employees who are not in NAPS be allowed to take part in industrial action if the proposed changes don't affect them?

ahmetdouas

deleted

Hubbabridge

Well everyone who flies BA is funding the pension scheme because that is where BA gets its income, selling seats to the public. Most people are actually sympathetic but injecting a sense of realism. The pension scheme has become unsustainable in its current form in the future. No one is losing accrued rights they just are not going to accrue the same rights in future. Every time employees go on strike the company loses income, the income that pays for the pension scheme. This really is a battle that staff are not going to win. Better to put your energy into a sustainable new pension scheme.

Scott Pilgrim

BA has taken significant pension contribution holidays in the past in so called good times, now trying to absolve their responsibilities in not so good times.

But as long as the shareholders eat cake.

Waterhorse

And even a minuscule amount of knowledge about how pilots are ensnared by companies by the concept of seniority will lead you to the inevitable conclusion that your last statement is largely irrelevant.

simons1

And I just don't see why you are getting your knickers in a twist.

It's of relevance and interest to many people - former staff, existing shareholders in BA considering whether to remain invested, potential shareholders considering whether to invest, customers who are paying your wages and so on.

A friend of mine is a financial adviser and has just helped a former BA employee shift her pension into a self invested scheme. Let's just say the transfer values being offered to members to shift out of the scheme are quite eye watering.

Ancient Observer

Can we cut out the crude generalisations about contractural or not?

Until a Court has looked at the wording in Individual contracts, there is no "right" answer.

The pre-2003 contract wording will be interesting. I strongly suspect the wording will vary between groups, and maybe individuals, as that was the way of BA pre-2003. There are probably approx 5 groups, 1. Officers/Gentlemen. 2. Pilots. 3 Office folk. 4.CC 5. Maintenance/engineers. Maybe more.

simons1

I love a post that tells us to cut out "generalisations" and then immediately starts speculating on the wording.

My 1980s employment contract with a large corporate has 2 lines saying on becoming employed I will become a member of xxx pension scheme and refers me to a separate booklet with the scheme rules and details.

DYKWIA

Indeed, I have a few friends who are on final salary pensions from when they worked at an insurance company a few years back. A mid-level sales guy who was there for 16 years was offered over £1m to buy him out.

LiviLion

If you are able to say was it less than or greater than 40x value?

simons1

Not that high, but it was almost 35x....

Blueboys999

Not for a moment questioning the truth of that but it represents £62.5k for each year of contributions. What sort of salary must he have been on?

CrazyJ82

This is the way workers think about their pensions, but it's a bad way to understand the pension and unions (in a lot of industries, not only airlines) have done their members an enormous disservice over the years by encouraging this. DB schemes are not cash in the bank. Legally the company needs to make cash provisions for those commitments by funding the scheme, but the accounting leaves sufficient wiggle room that companies can chronically underfund DB schemes. In the extreme, workers then discover that the pension promise is meaningless if the company goes under and the liabilities transfer to a government-run insurance fund that pays out less than expected. Ask people who worked for BHS.

Unions compound this when they encourage their members to accept more generous DB pension promises in lieu of higher salaries and benefits. It looks like the union gains more "benefits" for workers, but workers benefit more from cash in hand either in the form of higher current salary or generous DC pension contributions that vest as the employee's personal pension money quickly and also allow the worker to leave the company more easily if conditions deteriorate in other ways.

This topic is also of interest to the many members of this discussion board who are UK taxpayers. I'd assume BA's DB schemes are insured by the Pension Protection Fund. That's supposed to operate as an insurer funded by premiums from covered schemes, but it's a sure bet that politicians would face considerable pressure to pour in tax money should it face shortfalls from the weight of too many failed plans (such as BA's, if they don't eventually reform it). So aside from the implications for customer experience of BA adopting a pension program that frees up more money for investment - and allows older employees who no longer like their jobs or do them well to leave rather than hanging on to the bitter end solely for the DB pension - there's a valid reason for members of the public to care about how companies manage these things.

phoneticduck

Absolve? Would that apply to letting the thing fail?

In the "good times" the investments made by the fund would have been deemed to be performing sufficiently to cover the liabilities and hence, acting in the interests of both shareholders and scheme members, payment holidays were feasible.

the Trustees of such pension schemes make the decisions about payment holidays, but they act on the advice of (very well paid) actuaries...who it could be argued are the real culprits here...

The reality for most large corporations is that instead of being an airline/telco/retail company with a pension fund, they are more like pension funds with an airline/telco/retail company attached to them.

TravellingSalesman

That's a fun thing to say, isn't it?

Of course it makes it sound like this happened by accident, and not by design...