Element Six pension closure slammed

SIPTU, the union that represents the majority of Element Six workers, has slammed the company’s decision to close its defined benefit pension scheme.

In a statement on Tuesday, Element Six, which shed in the region of 200 jobs in 2009, said it was responding to a large deficit and that it felt it had no choice. “Element Six has confirmed that in light of market conditions and requirements from legislative change (both enacted and pending) the company has regrettably been left with no alternative but to close its defined benefit pension scheme.
“The decision to close the defined benefit pension scheme was not taken lightly and follows a number of attempts in good faith by the company and trustees to resolve the significant pension deficit.
However, as the deficit was untenable, action needed to be taken to resolve the issue once and for all.”
It claimed it is not abandoning its workers. “Upon closure of the defined benefit scheme, the scheme’s existing assets, together with a substantial unsolicited upfront payment by the company, will be used to fund competitive pension alternatives that will improve certainty and stability for Element Six pensioners and pension fund members.
In addition, the company is making a further substantial payment to fund new pension arrangements. The company has contacted all members to make sure they are fully aware of what the change will mean to their particular situation. Independent financial advice is also being provided for all members. Element Six remains committed to the long-term viability of the Shannon site.”
In a statement, SIPTU claimed Element Six is rowing back on an earlier agreement. “Six years ago, the company sought to deprive the employees, many of whom had contributed to the pension scheme for up to 30 years, of their entitlements, by unilaterally closing the scheme.
“Although the employees had contributed their full amounts under their contracts, de Beers had failed to live up to their obligations by doing likewise and the pension scheme was thus underfunded. Only when the employees, the majority members of SIPTU, voted overwhelmingly to take on one of the wealthiest companies in the world did de Beers accede to demands for negotiations.
“Negotiations to settle the dispute were protracted and an agreement was signed where the multi-billion dollar company agreed to discharge some of its responsibility to employees. An agreement to fund what the company owed in back service was made under the chairmanship of the Head of Conciliation of the Labour Relations Commission (LRC) and arrangements to pay back that money over a period of 10 years was endorsed by the Irish Pensions Board. Now the company has written to all pension members to tell them, in effect, that they will now tear up that agreement.”
SIPTU also claimed that the company has ignored some of its obligations under the 2009 Shannon Sustainability Plan. “In late 2009, they misrepresented their intention to close the plant with the purpose of gaining major cuts in pay and conditions from employees.
!An agreement, the Shannon Sustainability Plan, was reached under the recommendation of the Labour Court, which saw cuts to pay and conditions and over 207 redundancies, 130 of them from production.
“Within days in some cases and at most within weeks, the company had re-employed most of the 130 production workers made redundant. They were employed through an agency on lesser terms and conditions.
“The company refused to implement a number of items, which the court recommended and both sides agreed would be addressed. Despite the best efforts of the LRC, management have refused to meet with the union or the LRC to discuss their breach of this agreement.”
A union spokesperson said, “The politicians, including the minister, pressured us to trust this company but we have not seen hide nor hair of them since, while the company walk all over the workers.
“No wonder, they now think they can just take our pension from us like everything else. The union is the only thing trying to put a break on them. We are very disappointed in the politicians and the Labour Courts.”
SIPTU say it has sought a meeting with management but that hasn’t received a response to date.