THE Irish Bank Officials Association has welcomed proposals for a ‘hybrid’ pension scheme in National Irish Bank for new employees joining the company after August 1.
The proposals were formulated under the auspices of independent mediator Kevin Foley. NIB would become the third Irish bank to adopt such a policy.
Under the terms all new staff will pay 5% of salary into the direct contribution element of the scheme, which also contains elements of the defined benefit pension scheme.
According to the bank, the new scheme would provide an employee who joins at 20, stays to the age of 65 and contributes in full, with a pension worth 64% of final salary.
The 622 staff represented by the bank officials union will also receive one additional day’s leave in 2009.
Current staff will remain in the direct benefit pension scheme.
IBOA general secretary Larry Broderick described the proposals as a “significant development — especially since the Bank’s opening position was to seek the transfer of all staff, current and future, to a new direct contribution scheme.”
He said it provided further evidence that the trend of replacing defined benefit with defined contribution schemes was not the only way to deal with the issue.
“It is possible to address the legitimate funding concerns of employers without depriving their employees of the prospect of a reasonable income in retirement.”
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