Mandatory Trade Union recognition: How likely is leglislation?

That's a very interesting link Sunny.

It seems to be a very unusual scheme - defined benefit but with defined contributions... So people retire on defined benefits and if their lifetime contributions (including the employers' contributions) aren't enough, they get topped up by current contributions (which should be accruing for current employees). In hindsight, you can see that it's a pretty poor deal for newer and newer employees - almost like a ponzi scheme. It was fine as long as life expectancy was low, investment returns were high and there was an increasing workforce. What a mess. On the face of it, it looks like the ESB is contractually correct - if the scheme never obligated them to pay more than their agreed contribution level, how can the employees demand that now? It would be very interesting to see the wording of the employees' contracts.
 
orka said:
That's a very interesting link Sunny.

It seems to be a very unusual scheme - defined benefit but with defined contributions... So people retire on defined benefits and if their lifetime contributions (including the employers' contributions) aren't enough, they get topped up by current contributions (which should be accruing for current employees). In hindsight, you can see that it's a pretty poor deal for newer and newer employees - almost like a ponzi scheme. It was fine as long as life expectancy was low, investment returns were high and there was an increasing workforce. What a mess. On the face of it, it looks like the ESB is contractually correct - if the scheme never obligated them to pay more than their agreed contribution level, how can the employees demand that now? It would be very interesting to see the wording of the employees' contracts.
Click to expand...
What exactly are the Unions complaining about?
 
I may be way off, but I understood the Union complaint was that the switch to the DC scheme wasn't to the agreement and that the shortfall in the scheme, which is being used to justify the switch, isn't as great as reported.

I think that the shortfall is based on an old evaluation of share prices which is not the case today and so this move isn't as urgent.

Whether strike action is a justifiable action in these circumstances is another question.
 
Purple said:
What exactly are the Unions complaining about?
Click to expand...

They are complaining because prior to 2010, the ESB always carried the pension defecit on their balance sheet as a liability. When in 2010, the ESB decided they wantd to raise money, they figured that the balance sheet would look better without that nasty looking figure and so changed the scheme to a defined contribution and removed the liability from the balance sheet.

My understanding is that nothing has changed apart from the accounting treatment. The ESB always claimed that they were not liabile for any shortfall. They put in €500m and workers accepted changes that should make the scheme solvent in about five years. I think the Unions just felt more comfortable when the ESB had the liability laid out in their annual accounts.

From what I see both sides have questions to answer. And so does the auditors who signed off on the removal of a huge liability from the balance sheet when it seems the issue was in dispute.
 
So the Unions are threatening a strike over something that happened 3 years ago because now the money is running out. Is that it?
Has anyone from the Union side commented on whether they were aware of the change in 2010? If they were what's the aggrieved posturing for and if they weren't why on earth not, it was on the balance sheet and in the annual report.
 
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