Up to 900 staff working for US multinational Pfizer will take part in a ballot for industrial action after having rejected a Labour Court recommendation concerning changes to their non-contributory defined benefit pension scheme.
In 2014, Pfizer proposed the introduction of a defined contribution pension arrangement to replace a legacy scheme which applied to just under 40 per cent of the company’s workforce. This would have applied only to future accrual and the company pledged to continue funding the existing defined benefit scheme.
The Labour court recommendation did not object to Pfizer’s move away from the defined benefit arrangement but included enhanced terms and transitional arrangement for workers.
However, workers in Pfizer's Ringaskiddy and Little Island plants in Co Cork, as well as a "handful" of staff in shared services and commercial operations employed in Dublin, have rejected the proposal "overwhelmingly", Siptu said, adding the vote was not far off unanimity although the union did not provide numbers.
Pfizer said on Wednesday that it was “disappointed that the unions have balloted and rejected the Labour Court recommendation”.
“The cost to the company of funding the defined benefit schemes has risen 1000 per cent since 2009 and these costs are affecting the competitiveness of Irish operations,” a spokeswoman said.
The majority of the company’s staff here are now on a defined contribution pension scheme, and the it is understood that no new employees are being admitted to the non-contributory defined benefit scheme.
Integral part
Siptu, the largest union involved, said at the Labour Court that the scheme was an integral part of the company’s union agreement and that staff were not agreeable to changes to the scheme.
Pfizer said the decision to move from the defined benefit scheme was made at a global level to address the “unsustainable cost and exposure to highly-volatile discount rates associated with defined benefit plans”.
The Labour Court recommended that workers over the age of 50 could remain in the scheme until they retire. Those aged between 35 and 39 also had the option of remaining in the scheme for three years, those aged between 40 and 44 for five years, and those aged 45 to 50 for seven years.
In addition, it advised that an initial lump sum of €10,000 be paid to the existing scheme members to “reflect that future pension arrangement will be contributory for members”.
It is expected that a result from the ballot will be made available by January 30th at which time workers will have decided whether or not to proceed with industrial action.
