AA launches consultation on changes to final salary pension

The AA has launched a consultation over proposed changes to its final salary pension scheme.†

The consultation, which sets out proposals for a final salary pension cap of 1.5% and a 2.5% cap on career average earnings, will be open for 60 days.

AA president Edmund†King said: “All employees received a pack that outlines the proposed changes. The intention is for the final salary section and career average earnings to remain open, which is good news since other companies are closing them altogether.”

The scheme has a current deficit of £190 million while the company has put in £172 million over the last two years, five times more than AA employees have contributed.

King added: “If we do not address the issue now, it will just get worse. The proposed changes are very reasonable and have to be done.”

However, a strike ballot that yielded a 76% return from 5,000 AA employees found that 99% have rejected the proposed changes.

The results of the strike ballot came back on 19 February, the same day the Independent Democratic Union (IDU) met with AA to discuss the changes. IDU’s national secretary Alistair MacLean, said that since the AA is not prepared to alter its position, a strike is a definite possibility.

He added: “Prior to these changes, AA patrols retired at 60 with a full pension. These changes threaten to stop all that. AA has no empathy for their workforce. [It] wants to steal the pensions of employees who have helped build the company.”

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