Did you log a complaint and ask for it to be investigated?
AIB Aib ex staff - getting €1,650 compensation
- Thread starter Rarrrrrr
- Start date
Is it justifiable that they managed our accounts & then passed the onus back on us?should your account only be managed by the people who signed the contract?
Can someone clarify was this the first time a switch like this happened ?
They Just went in and switched all of us off the staff pref fixed rate, Is this allowed? Nowadays they need your signature to change a rate.
I know we were notified but I still don’t think it is correct
Was the staff rate ever previously this close to the variable rate in the past? I would think it was,how come they didn’t do this switch previously?
What is the reason for this switch in 09 all of a sudden & how come this never happened before?
I hope someone can answer these questions, might help to see why these switches never happened previously.1960-2009 is a long time to be 3%.......
Can someone clarify was this the first time a switch like this happened ?
They Just went in and switched all of us off the staff pref fixed rate, Is this allowed? Nowadays they need your signature to change a rate.
I know we were notified but I still don’t think it is correct
Was the staff rate ever previously this close to the variable rate in the past? I would think it was,how come they didn’t do this switch previously?
What is the reason for this switch in 09 all of a sudden & how come this never happened before?
I hope someone can answer these questions, might help to see why these switches never happened previously.1960-2009 is a long time to be 3%.......
I might be wrong but my recollection is staff were advised that if the ECB rate dropped below a certain level (maybe 3.25?), the BIK owed on a preferential rate made it more expensive for staff.
I think I remember a message coming out advising this and if you didnt want to move to the variable you had to say so..... long time ago so cant be 100% sure of that
I think I remember a message coming out advising this and if you didnt want to move to the variable you had to say so..... long time ago so cant be 100% sure of that
Surely If they are saying staff had the right to switch to tracker at any stage before the product was pulled then that in itself is an issue. Our contract with clause 3.2 is for the duration of the mortgage and not just until the bank decides to ‘pull’ the various options as they see fit. Nowhere in the terms & conditions does it say that we are only entitled to the various rates ‘if’ the bank decides to still offer them? Are we not entitled to the terms in our contract for the full duration of our mortgage and therefore if they say we ‘could’ have switched to tracker pre the rate being withdrawn that we should still be able to switch to it or be compensated for not being able to switch to it like every other customer in other cohorts? I strongly believe that if the customers here were not staff then there would be no question but things would be put right for the customer. Any contract ambiguity should always fall in the favour of the customer not the author. Why is this principle not being applied to staff?
Brendan Burgess
Founder
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A non-staff customer on a variable rate was entitled to switch to a tracker while trackers were on offer. This was not a contractual entitlement. It was what AIB offered.
After October 2008, non-staff customers were not entitled to switch to trackers.
It is the exact same for staff. If you were on the preferential staff rate you could have switched to a tracker up to October 2008.
There is nothing in your contract which allows a borrower, whether a staff member or not, to switch to a tracker from a variable rate.
It has been established that AIB was wrong not to offer trackers to customers whose fixed rates ended.
However, AIB is denying that the Staff Preferential Rate was a fixed rate. They say it was a variable rate which remained static. It will be up to the Ombudsman to decide.
Brendan
After October 2008, non-staff customers were not entitled to switch to trackers.
It is the exact same for staff. If you were on the preferential staff rate you could have switched to a tracker up to October 2008.
There is nothing in your contract which allows a borrower, whether a staff member or not, to switch to a tracker from a variable rate.
It has been established that AIB was wrong not to offer trackers to customers whose fixed rates ended.
However, AIB is denying that the Staff Preferential Rate was a fixed rate. They say it was a variable rate which remained static. It will be up to the Ombudsman to decide.
Brendan
Thanks Brendan. I understand what you are saying about the position they are taking. Just wondering as the clause states ‘at the end of any fixed rate period’ - was this clause put in every single contract i.e Fixed and Variable rates, or only Fixed and Staff contracts? It seems odd to me to include this clause in our tcs&cs and then say well actually this didn’t apply as these terms were actually in relation to a different product I.e Fixed.
Should they not then have included the terms or options that actually applied to the product at hand i.e. changing rate options from a ‘static annuity’ as opposed to a Fixed rate if their position is that it is not fixed?
It’s just hard to believe anyone credibly denying the staff fixed rate of 3% was not a fixed rate. It was even marketed to staff as Homeflex preferential fixed rate of 3% and remained at 3% for the full lifetime of it as far as I remember from my time there.
Should they not then have included the terms or options that actually applied to the product at hand i.e. changing rate options from a ‘static annuity’ as opposed to a Fixed rate if their position is that it is not fixed?
It’s just hard to believe anyone credibly denying the staff fixed rate of 3% was not a fixed rate. It was even marketed to staff as Homeflex preferential fixed rate of 3% and remained at 3% for the full lifetime of it as far as I remember from my time there.
Brendan Burgess
Founder
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AIB based the staff preferential rate contract on their standard contract.
All customers - fixed, variable and tracker got the same contract.
But those on the Staff Preferential Rate had a few special conditions in Part 2 of the mortgage offer.
All customers - fixed, variable and tracker got the same contract.
But those on the Staff Preferential Rate had a few special conditions in Part 2 of the mortgage offer.
Thanks Brendan. It is clearly outlined here that it is a ‘Staff Preferential Fixed Home Loan’. How can this be denied when it is in black and white clearly.
Brendan Burgess
Founder
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I am only reporting what their defence is.
A few people have taken this to the Ombudsman who will rule on it at some stage.
Brendan
Not all staff had the 3.2 clause in their contract. There was 2 contracts in Staff Business,
1. Letter of Sanction ( pre 2007) no clause
2. Letter of Offer ( post 2007) it has the 3.2 clause.
Also from June 2003 to December 2005 the variable rate was 3.30%, how come there wasn’t a switch of all staff from the preferential fixed rate at that point to the variable rate like 2009?
The switch was done for a reason in 2009, They are saying it was to benefit us and when you consider paying BIK the variable rate 3.25% was more beneficial to staff.
These days they say we don’t know a persons personal tax circumstances so can’t advise it is more beneficial .... how did they know in 2009?
How can they get away with saying the staff rate was not fixed? All the edits from the contracts above show that it was clearly considered a fixed rate.... in my view up until 2009 is when it all changed.
1. Letter of Sanction ( pre 2007) no clause
2. Letter of Offer ( post 2007) it has the 3.2 clause.
Also from June 2003 to December 2005 the variable rate was 3.30%, how come there wasn’t a switch of all staff from the preferential fixed rate at that point to the variable rate like 2009?
The switch was done for a reason in 2009, They are saying it was to benefit us and when you consider paying BIK the variable rate 3.25% was more beneficial to staff.
These days they say we don’t know a persons personal tax circumstances so can’t advise it is more beneficial .... how did they know in 2009?
How can they get away with saying the staff rate was not fixed? All the edits from the contracts above show that it was clearly considered a fixed rate.... in my view up until 2009 is when it all changed.
The latest response from Staff Business states the following; (One wonders why Static is not mentioned anywhere in our letters of offer but Fixed clearly is!!)
We did have a defined term, it was the term of our mortgage unless we left AIB !
Just because we paid BIK does not mean it was not a fixed rate ,it was a Preferential Fixed Rate which is why we paid BIK and as per Revenue Rules is a fixed rate !
We did have a defined term, it was the term of our mortgage unless we left AIB !
Just because we paid BIK does not mean it was not a fixed rate ,it was a Preferential Fixed Rate which is why we paid BIK and as per Revenue Rules is a fixed rate !
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Brendan Burgess
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It will be up to the Ombudsman or the High Court to decide.
Clause 3.2 is very clear:
At the end of any fixed interest rate period, the Customer may choose between:
AIB is arguing that this means "At the end of any fixed term period during which the interest rate was fixed..."
My argument in these cases is "If that is what they meant, then they should have said that in the contract".
They also had a special condition saying
Why did they not say "Clause 3.2 does not apply either as this is not a fixed rate, but a variable rate where the rate will be static at 3%" ?
Brendan
Clause 3.2 is very clear:
At the end of any fixed interest rate period, the Customer may choose between:
AIB is arguing that this means "At the end of any fixed term period during which the interest rate was fixed..."
My argument in these cases is "If that is what they meant, then they should have said that in the contract".
They also had a special condition saying
Why did they not say "Clause 3.2 does not apply either as this is not a fixed rate, but a variable rate where the rate will be static at 3%" ?
Brendan
To appeal, Staff need to address the wording on the contract.
Fixed Vs Static
The replies are just all roundabout ways of avoiding the wording, they need to say there was an error with the wording in the contract.
Point 3 above..... about it been a variable rate and saying “You” could switch in/out, not Staff Business could switch us in/out. They took control of our rate in 2009, in the contract they only say they will control it if we leave/resign.
Fixed Vs Static
The replies are just all roundabout ways of avoiding the wording, they need to say there was an error with the wording in the contract.
Point 3 above..... about it been a variable rate and saying “You” could switch in/out, not Staff Business could switch us in/out. They took control of our rate in 2009, in the contract they only say they will control it if we leave/resign.
Brendan Burgess
Founder
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Be very careful if you are making a complaint to the Ombudsman, that you don't get distracted by conspiracy theories.
1) AIB was right in 2009 to switch people en masse to the SVR. With the new BIK rules, this worked out cheaper for people on the higher rate of tax which I am guessing most were.
2) There was nothing underhand in this.
3) Employees were given a clear choice of opting out or choosing one of the fixed rates if they did not want the SVR
4) Employees could switch back to the "static" rate of 3% at any time and pay the BIK - many did so after the SVR rose
1) AIB was right in 2009 to switch people en masse to the SVR. With the new BIK rules, this worked out cheaper for people on the higher rate of tax which I am guessing most were.
2) There was nothing underhand in this.
3) Employees were given a clear choice of opting out or choosing one of the fixed rates if they did not want the SVR
4) Employees could switch back to the "static" rate of 3% at any time and pay the BIK - many did so after the SVR rose
Brendan Burgess
Founder
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Here is the AIB SVR history at the time. The SVR rate was always ECB +1.25%
Staff Preferential Rate: 3%
SVR: 5.5%
Tracker 5.75%
It would have been a very prescient staff member to choose a tracker at 5.75%.
The letter of mass transfer gave staff the following options:
So there was no conspiracy.
While trackers were available, it would have made no sense for anyone paying a fixed rate of 3% to opt for one.
I believe that AIB staff have a good case in that Clause 3.2 applies to it.
Don't dilute that good case by distracting the Ombudsman or the High Court with a Conspiracy Theory. It will damage your credibility.
Brendan
- 16th January 2008 – 5.25% - ECB rate: 4%
- 16th July 2008 – 5.5% ECB rate: 4.25%
- 22nd October 2008 – 5% - ECB rate 3.75%
- 19th November 2008 – 4.5% ECB rate 3.25%
- 17th December 2008 - 3.75% ECB rate 2.5%
- 28th January 2009 - 3.25% ECB rate : 2%
- 19th March 2009 - 2.75% ECB rate: 1.5%
Staff Preferential Rate: 3%
SVR: 5.5%
Tracker 5.75%
It would have been a very prescient staff member to choose a tracker at 5.75%.
The letter of mass transfer gave staff the following options:
So there was no conspiracy.
While trackers were available, it would have made no sense for anyone paying a fixed rate of 3% to opt for one.
I believe that AIB staff have a good case in that Clause 3.2 applies to it.
Don't dilute that good case by distracting the Ombudsman or the High Court with a Conspiracy Theory. It will damage your credibility.
Brendan
Brendan Burgess
Founder
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Yes, it was there between 2006 and 2009
Brendan, how come they did not do an “en masse” switch In 2003 when the SVR was 3.30%, was the BIK criteria different then?
I see your point to focus on facts, staff pref fixed rate being a fixed product as stated in the contract and including the clause for a fixed rate is the strongest & most clear argument.
Just for me... I didn’t know I was to manage my rates myself & plenty of more staff with me missed the opportunity of availing of a lower fixed rate as we thought that staff rate was the best rate. It is very frustrating to think that they never moved the rate and after 50 years decided to do this and never did it again. Hard to comprehend.
I see your point to focus on facts, staff pref fixed rate being a fixed product as stated in the contract and including the clause for a fixed rate is the strongest & most clear argument.
Just for me... I didn’t know I was to manage my rates myself & plenty of more staff with me missed the opportunity of availing of a lower fixed rate as we thought that staff rate was the best rate. It is very frustrating to think that they never moved the rate and after 50 years decided to do this and never did it again. Hard to comprehend.